Shedding some light on Molefe
ESKOM is tasked with the responsibility of leading South Africa from darkness to light.
In the past decade, there were two spells when Eskom plunged the country into the dark depths of despair.
Brian Molefe has been credited – some say unduly – for bringing stability to Eskom since April 2015, when he was seconded from Transnet.
Molefe’s executive managerial capacities have been exaggerated.
During his reign at Transnet, for example, R50 billion was awarded to four Chinese companies to manufacture 1 064 new locomotives. The first two that arrived in South Africa had serious faults and could not be used. Molefe was apparently aware that Namibia had encountered similar problems with the same companies.
The Centre for Investigative Journalism, AmaBhungane, revealed that during Molefe’s reign, Transnet had also given contracts to telecommunications company Neotel without going to tender. Neotel allegedly paid R66 million to Homix, a shadowy, unknown company which “appears to be a letterbox – a front for persons undeclared… for no apparent work”. The “known Neotel payments to Homix were to clinch Transnet’s purchase of R300m in telecommunication network equipment from Neotel and a fiveyear, R1.8bn agreement for Neotel to provide Transnet with network services”.
Subsequent investigations revealed that Ashok Narayan, a former director of the Guptaowned Sahara company (from which he had resigned in 2012) was the chief executive of Homix.
Molefe’s nemesis was the “State of Capture” report by former public protector Thuli Madonsela, which suggested he had an unusually close relationship with the controversial Gupta family.
(In his defence, he argued that he had visited the Saxonwold shebeen and not the curry-house in that vicinity.)
According to Madonsela’s report, there was “a distinct line of communication between Mr Molefe of Eskom, the Gupta family and directors of their companies in the form of Ms Ragavan and Mr Howa. These links cannot be ignored as Mr Molefe did not declare his relationship with the Guptas”.
To his credit, Molefe tearfully resigned from Eskom “in the interests of good corporate governance”. He was then parachuted in as an ANC MP, and widely tipped to replace Pravin Gordhan as finance minister.
Next was the implausible R30 million Eskom pension payment to Molefe for working at Eskom for less than two years. Eskom is yet to explain how this figure was calculated, and some public-spirited actuaries need to assist. This was followed by the bombshell that Molefe would be returning as chief executive to Eskom – no questions about any alleged impropriety. Public Enterprises Minister Lynne Brown’s defence that this was better value than the R30m pension payout was trite.
Disturbingly, Brown only learnt about the payment, which she considered “very irregular”, after reading about it in the press. She conceded that the argument presented by the board on why the pension arrangement was conceived lacked “legal rationale”.
The ANC condemned Molefe’s reinstatement at Eskom. According to the ANC: “The decision therefore to reinstate him in his former position without these matters being resolved is tone deaf to the South African public’s absolute exasperation and anger at what seems to be government’s lacklustre and lackadaisical approach to dealing decisively with corruption – perceived or real”. It would appear the ANC government is no longer in charge, given its outrage at the shenanigans at Eskom.
SACP deputy general secretary Solly Mapaila contended Molefe’s reinstatement was not surprising “because we understand the decadence that is at Eskom, in terms of the board leadership”. He argued Molefe was part of a “disruptive agenda”: “When he went to Parliament, the intention was to make him minister of finance and when that didn’t work, he had to come back to fulfil his mission to continue to make sure the Guptas continue to gain from coal supplies at Eskom through coal mining company Tegeta”.
A draft PriceWaterhouseCoopers (PwC) report revealed “Eskom’s contract with Tegeta Exploration and Resources for the supply of coal contained discrepancies, was poorly drafted and was in contravention of supply chain management procedures”.
Business Unity South Africa stated that the “return of Mr Molefe as CEO of Eskom is inopportune, indefensible and undermines government’s messages around promoting good governance at state-owned companies” and was “not in line with the expected levels of accountability and ethical leadership”.
State-owned enterprises like Transnet, Prasa, Eskom, SAA, and other institutions like the SABC are all facing goodgovernance challenges because of weak boards and mediocre, politically compliant chairpersons, who often make reckless decisions with impunity. Dudu Myeni of SAA comes to mind. Then there is 76-year-old Dr Ben Ngubane, current Eskom chair, and former chairperson of the SABC board, who had presided over the demise of a credible public broadcaster, as it lurched from one crisis to another under his leadership.
According to Madonsela, Ngubane had “acted irregularly” when he altered the qualifications for appointment of a chief operations officer “to suit Mr (Hlaudi) Motsoeneng’s circumstances, and this constitutes improper conduct maladministration and abuse or unjustifiable exercise of power”.
Ngubane presided over Molefe’s R30m pension payout decision, and was “absolutely delighted” to welcome him back to Eskom.
Ngubane also defended Molefe in the State of Capture report‚ arguing Madonsela had “struck a deadly blow against Eskom and against the people of South Africa”.
Birds of a feather…