Sunday Times

Gord­han gives ex-min­is­ters cause to quake

Zuma, Brown and Martins in spot­light at Zondo hear­ings

- By RANJENI MUNUSAMY Pravin Gordhan · Belarus · Jacob Zuma · Belgium · Austria · Gupta family · Petronas Gas · South African government · Duduzane Zuma · Vanuatu · Iceland · South African Airways · Lynne Brown · Ben Martins · Nhlanhla Nene · Barbara Hogan · Mcebisi Jonas · Isabel dos Santos · Denel · David van Rooyen · The New Age · Dudu Myeni

● Pub­lic en­ter­prises min­is­ter Pravin Gord­han will draw for­mer cabi­net col­leagues Lynne Brown and Ben Martins into the state­cap­ture ma­trix when he tells the Zondo com­mis­sion on Fri­day how they tried to push the gov­ern­ment into mega-deals that were ul­ti­mately blocked by the Na­tional Trea­sury.

Gord­han will also tes­tify that in 2013, dur­ing his first term as fi­nance min­is­ter, for­mer pres­i­dent Ja­cob Zuma made it clear to him that the nu­clear deal had to go ahead.

Gord­han will be the sec­ond serv­ing cabi­net min­is­ter to give ev­i­dence at the in­quiry af­ter fi­nance min­is­ter Nh­lanhla Nene’s dra­matic tes­ti­mony on Wed­nes­day when he ad­mit­ted meet­ing the Gup­tas seven times. Gord­han’s ev­i­dence will be pre­ceded on Wed­nes­day by that of for­mer pub­lic en­ter­prises min­is­ter Bar­bara Ho­gan.

Gord­han has been asked by the com­mis­sion to give ev­i­dence about his dis­missal in March 2017, when he and his deputy Mce­bisi Jonas were re­moved from the fi­nance min­istry in a mid­night reshuf­fle.

Gord­han will in­form judge Ray­mond Zondo about the is­sues that caused a break­down in his re­la­tion­ship with Zuma and hos­til­ity to­wards the Trea­sury, ac­cord­ing to mem­bers of his team.

These in­clude an ap­pli­ca­tion by Martins, when he was en­ergy min­is­ter, for Trea­sury to is­sue a guar­an­tee of be­tween R18bn and R20bn to PetroSA for the pur­chase of a ma­jor­ity stake in En­gen from Malaysian com­pany Petronas. PetroSA would have part­nered with An­golan paras­tatal So­nan­gol.

The Trea­sury was con­cerned that the price was in­flated to al­most dou­ble the value of the com­pany and was re­luc­tant to is­sue the guar­an­tee.

There was also con­cern that the risk would be borne by the South African gov­ern­ment though So­nan­gol would ac­quire a 49% stake in the petroleum com­pany. The An­golan state-owned com­pany was chaired by Is­abel dos San­tos, the daugh­ter of then pres­i­dent José Ed­uardo dos San­tos.

Gord­han will tes­tify that when Martins could not se­cure the guar­an­tee from the Trea­sury, Zuma in­ter­vened and at­tempted to force him to fa­cil­i­tate the deal.

Gord­han met Martins to ex­plain why due dili­gence had to be con­ducted be­fore the par­tic­i­pa­tion with So­nan­gol could be ap­proved and the guar­an­tee is­sued.

Gord­han will also tes­tify how Brown, his pre­de­ces­sor, tried to push through the joint ven­ture be­tween state-owned arms com­pany Denel and Gupta-linked VR Laser Asia.

VR Laser Asia was owned by Gupta busi­ness part­ner Salim Essa and its only share­holder was VR Laser RSA, whose di­rec­tors were Duduzane Zuma and Ra­jesh Gupta.

The joint ven­ture, which was to be known as “Denel Asia”, would have seen a takeover of Denel’s in­tel­lec­tual prop­erty. Denel Asia could then have made bil­lions of rands by sell­ing on the pro­pri­etor­ship of mil­i­tary weapons sys­tems.

Brown is­sued a pre-ap­proval for the deal in Oc­to­ber 2015, while Nene was still fi­nance min­is­ter. Nene would not is­sue an ap­proval and guar­an­tees for the deal.

Dur­ing Des van Rooyen’s brief spell as fi­nance min­is­ter, the ap­pli­ca­tion was again sub­mit­ted to the Trea­sury. Van Rooyen did not have time to ap­prove it be­fore he was re­moved and Gord­han reap­pointed to the fi­nance min­istry within four days.

Gord­han re­fused to sign off on the deal, lead­ing to a court bat­tle and pub­lic ex­changes with the then chair of Denel’s board, Daniel Mantsha.

Mantsha is now rep­re­sent­ing Zuma at the state cap­ture in­quiry, and will prob­a­bly have to re­spond to Gord­han’s tes­ti­mony about his rocky re­la­tion­ship with the for­mer pres­i­dent.

This in­cludes a claim Gord­han is ex­pected to make that one of the rea­sons for his ax­ing was that he snubbed the Gup­tas by can­celling a post-bud­get busi­ness break­fast in 2016.

Gord­han re­fused to speak at The New Age Busi­ness Break­fast sched­uled for the morn­ing af­ter his bud­get speech and with­drew the spon­sor­ship for the event. The New Age break­fasts were broad­cast on SABC and drew mil­lions of rands in fund­ing from sta­te­owned com­pa­nies. Zuma as well as his cabi­net min­is­ters head­lined the events.

Gord­han will tes­tify how Brown tried to push through the joint ven­ture be­tween Denel and Gupta-linked VR Laser Asia

Gord­han caused a stir when he spoke at an al­ter­na­tive break­fast brief­ing and gave the broad­cast rights to eNCA and the SABC.

Gord­han’s tes­ti­mony, like Nene’s, will also run through the events sur­round­ing the nu­clear-build pro­gramme and the Trea­sury’s clashes with for­mer SAA chair Dudu Myeni.

The nu­clear deal re­mained a hot potato for Gord­han when he re­turned to the fi­nance min­istry af­ter Nene’s dis­missal.

Nene told the com­mis­sion last week that the cabi­net had ap­proved the deal based on an in­ac­cu­rate cal­cu­la­tion of the costs by the depart­ment of en­ergy, to un­der­play the real fi­nan­cial bur­den on the coun­try. Nene was fired on the same day.

Gord­han will tell Zondo how he was forced to re­tain Myeni as the SAA chair despite his ef­forts to dis­miss her and the en­tire board in Septem­ber 2016 be­fore is­su­ing a bail-out for the trou­bled air­line.

Gord­han will also give de­tails of the in­ves­ti­ga­tion by the Hawks against him and at­tempts by the Na­tional Prose­cut­ing Au­thor­ity to charge him with fraud.

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