The African National Congress's (ANC's) investment arm, Chancellor House Holdings, will not benefit from a $3,75-billion World Bank loan to, among other things, build Eskom's new Medupi power station.

Public Enterprises Minister Barbara Hogan told journalists ahead of her budget speech in Parliament on Thursday that the loan did not cover a contract to build a boiler for Medupi by Hitachi Power Africa, in which Chancellor House had a 25% share.

"I don't understand what the conflict of interest is, when there is no political party involvement, where there is no beneficiary," Hogan said.

"One of the issues that comes up continually is that the World Bank loan covers the boiler contract, which is what the Hitachi contract is for.

"The World Bank loan does not cover the Hitachi contract. It is completely separate from the boiler.

"So the World Bank is not involved in funding the boiler programme that Hitachi has contracted for."

But, Hogan added that she was fully behind comments made by Finance Minister Pravin Gordhan on Wednesday that the shareholders of Chancellor House "must do the right thing if there is any conflict of interest".

"When this is untangled, the right thing must be done," she said.

Inkatha Freedom Party MP Mario Oriani-Ambrosini on Thursday challenged the ANC "to do the right thing" and subject the World Bank loan to review and approval by the National Assembly's public enterprises committee.

He called for the loan to be cancelled, or for it to be used "merely as a credit line facility" should the need arise.

Oriani-Ambrosini said that the ANC should have Chancellor House liquidate its holdings in Hitachi Power Africa at acquisition cost, "so that its sale price may not discount the financial gains of the Eskom contract which have already been discounted in the present value of the shares".

"If there is an undeclared conflict of interest, the tendering process is usually null and void," he said.

"If the ANC receives an estimated billion rand worth of net profits from this deal, it will be able to fund its election campaigns for years to come.

"No other political party will ever be able to compete with it and democracy may very well be declared dead," he said.

Hogan's remarks come amid reports of a standoff between top ANC officials on whether Chancellor House would sell its 25% stake in Hitachi Power Africa, which has a R16-billion contract to supply boilers for Medupi power station.

ANC treasurer general Mathews Phosa is on record as saying the party's investment arm would dispose of the stake within six weeks.

But he has been contradicted by secretary-general Gwede Mantashe who said the decision did not belong to Luthuli House as Chancellor House had its own board.

He added that Chancellor House's stake in Hitachi did not translate into the ANC having a stake in the consortium.

The link between the ruling party, its investment company and Eskom's expansion programme and allegations about the extent of any conflict of interest have been hotly debated for months.

In February, a Public Protector's report found ANC heavyweight and former Eskom chairman Valli Moosa had failed to manage a conflict of interest that arose when the utility awarded the Medupi contract to the Hitachi consortium.