Treasury work on nuclear energy hidden

ONE evening at the height of the global financial crisis, actress Barbra Streisand confronted then US treasury secretary Timothy Geithner at a White House dinner and said: “When I see you on TV, I get the feeling you’re not telling us everything.”

Well, a bit like Streisand, I get the feeling that Finance Minister Nhlanhla Nene is not telling us everything, especially when it comes to President Jacob Zuma’s favourite legacy project: the proposed nuclear build programme, which has major financial implications for SA.

Until now, Nene has claimed that the Treasury had only recently been invited into the decision making on the financing of the programme and that, although work was being done on the programme, it had not been completed.

However, a careful reading of the Treasury’s 2014-15 annual report tells a very different story:

The Treasury completed extensive work on nuclear energy in the 2014-15 financial year;

Some of the work was included in the decision-making process and submitted to the Department of Energy during the 2014-15 financial year; and

An official, or officials, from the Treasury received training, at a cost of about R500,000, in nuclear finance, which was sponsored by South Korea.

The Treasury’s Urban Development and Infrastructure Unit, according to the annual report, “completed the update of the liquid fuels sector investment study and several studies on the feasibility of gas, nuclear and regional hydro for electricity generation”.

The unit evidently completed a study, or several studies, on the feasibility of, among other things, nuclear energy for electricity generation. Moreover, the study, or studies, were completed before the end of the financial year.

According to the annual report, the Treasury’s Oversight and Governance of State-Owned Enterprises Unit “finalised the report on financing nuclear options, models and solutions, and presented to the Nuclear Sub-Work Group on corporate finance and procurement (and) compiled a memorandum and letter formally submitting the report to the Department of Energy”.

The Treasury’s National Capital Projects Unit also completed “several in-depth studies on short- and longterm energy generation options for SA”, according to the annual report. Although there is no explicit mention of nuclear energy, the unit’s studies almost certainly include nuclear energy as a possible option for SA. In the end, the Treasury: Has clearly done more work on the feasibility, financing and assessment of alternative energy options, including nuclear energy, than Nene has been prepared to disclose; and

Much of the work was completed before the end of the 2014-15 financial year.

Nene is walking a political tightrope because the Treasury has more than likely raised serious questions about the feasibility of the nuclear build programme. If this is the case, Nene is on a potential collision course with Zuma, who wants the nuclear build programme procurement concluded before the end of the 2015-16 financial year.

It is not in the public interest for the work done by the Treasury on the nuclear build programme to be hidden from the public or Parliament.

I will, therefore, request the chairman of the standing committee on finance, Yunus Carrim, to schedule a briefing by the Treasury on:

The work conducted and completed on the nuclear build programme by the Treasury; and

The economic and financial implications of the proposed nuclear build programme for SA.

We cannot sit on our hands and allow the nuclear build programme to go ahead in secret given the huge financial implications for SA. We must act and ensure that Nene tells us everything before we are hit by a “financial tsunami”.

Maynier is a Democratic Alliance MP and the party’s finance spokesman.