Eskom CE Brian Molefe breaks down over State of Capture report

There was drama at Eskom’s Sunninghill headquarters on Thursday as CE Brian Molefe broke down after speaking at length about former public protector Thuli Madonsela’s State of Capture report.

An emotional Molefe had to go backstage to compose himself before returning to the podium to continue with the results presentation of Eskom’s financial results. For a while he continued wiping tears from his face with a handkerchief.

Molefe slammed Madonsela for not giving him time to respond to allegations of corruption against him and Eskom.
"We gave the public protector 132 files in boxes, of the prepayments to Tegeta and other companies we have done in the past. Then we never heard from her again," said Molefe.
The report says Molefe exchanged 58 cellphone calls with members of the controversial Gupta family during the period in which companies linked to the family were trying to buy a company that supplies Eskom with coal.
According to the State of Capture report, Molefe was also in the Saxonwold area where the Guptas live on 19 occasions in the three months to mid November last year.

 

 

Molefe said this was unfair on him as it painted him as corrupt without affording him the opportunity to respond.
"We will take this report for a judicial review and will submit ourselves to the judicial commission," he said.
Molefe went to town explaining how Eskom ended up having contracts with the Gupta-owned Tegeta company.
He also offered to take the rap. "I do not agree that the board should resign over this matter. I take the responsibility.
"I don’t think the minister should resign," he said, referring to Public Enterprises Minister Lynne Brown. "I also don’t think that the president should resign over this matter. I will resign."

 

This angered Eskom chairman Ben Ngubane‚ who said: "If we lose Brian‚ she [Thuli Madonsela] should take the responsibility."

The word "Eskom" appears 829 times in the State of Capture report.

Cellphone records show Molefe and Ajay Gupta exchanged 58 calls in eight months between 2015 and 2016.

Ajay is one of three brothers — the other two being Atul and Rajesh Gupta — whose business empire and alleged political influence have stirred up a hornet’s nest in SA.

The parastatal was a source of lucrative contracts for the Gupta family and Duduzane Zuma‚ the son of President Jacob Zuma‚ through a company called Tegeta.

Tegeta secured a 10-year supply agreement with Eskom to supply coal to the Majuba power station. Tegeta also secured contracts to supply coal to the Hendrina and Arnot power stations.

Madonsela said in her report that a member of the Gupta family admitted to her during an interview on October 4 2016 that Molefe was his "very good friend" and often visited his home in the upmarket suburb of Saxonwold‚ Johannesburg.

"Eskom’s awarding of the initial contracts to Tegeta to supply coal to the Majuba Power Station will form part of the next phase of the investigation‚" noted the report by Madonsela.

Having considered the evidence uncovered during the investigation‚ Madonsela said that it appeared that the board of Eskom was "improperly appointed"‚ not in line with the spirit of the King 3 report on good corporate governance.

A board appointed to a state-owned-enterprise was expected to act in the best interests of the country at all times but‚ "it appears that the board may have failed to do so".

Molefe was seconded to Eskom from Transnet on April 20 2015 as acting CE. He was appointed to the post in a permanent capacity on September 25 2015.

Cellphone records show he called Ajay Gupta 44 times between August 2 2015 and March 22 2016. Gupta called Molefe 14 times during the same period.

Molefe was also in telephonic contact with Nazeem Howa — a director at Tegeta and until recently the CEO of Gupta-owned company Oakbay Investments — four times in a single day‚ August 24 2015.

The timing of the phone calls is significant as it dovetails with a controversial purchase by the Gupta family of Optimum coal mine.

The Guptas reportedly financed this deal with about R600m of prepayment by Eskom to Tegeta for coal.

The report published a diagram showing a "distinct line of communication between Mr Molefe of Eskom‚ the Gupta family and directors of their companies in the form of Ms (Ronica) Ragavan and Mr Howa. These links cannot be ignored as Mr Molefe did not declare his relationship with the Gupta family‚" the report states.

With Financial Mail and TMG Digital