Gordhan’s moral suasion plea

PARLIAMENT should lead a campaign to shame big firms who colluded in the state capture scandal to pay back money siphoned off parastatals, says Public Enterprises Minister Pravin Gordhan.

“Civil cases take a long time. What about moral suasion?” Gordhan asked during a briefing to National Assembly committee on public enterprises on progress in rehabilitating companies left in financial dire straits by corruption.

He said privately, executives from firms that were complicit in irregular deals or covering these up through unscrupulous auditing, confided to him they were “excruciating” about what had transpired.

“Well, excruciating is one thing, paying back the money lost to South Africa is another,” he said, suggesting that the legislature was well placed to make a call to the entities involved to “get them to pay back the money”.

Gordhan noted that international consultancy firm McKinsey had refunded R902 million paid to it by Eskom without a proper contract, but lamented that at this point there was no progress in recuperating large sums paid by the power utility to its local development partners, the Gupta-related Regiments Capital and Trillian.

He said as the government implemented corrective measures at state-owned entities, more irregular spending was coming to light, that had not been reflected in auditing processes for a number of years.

This raised questions about the conduct of auditors at the time the state capture phenomenon was in full swing.

“Why have they not been reporting some of the things we see today?”

He said Eskom’s irregular expenditure jumped from R3 billion to R19.6bn in the last financial year.

He said it was not the only state-owned company where irregularities came to light since the government rotated boards.

“There is a pattern here that you will see with many entities as audit performances are questioned,” he said.