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Request for SIU probe of Eskom submitted to President Zuma

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Request for SIU probe of Eskom submitted to President Zuma

Photo by Duane Daws
Public Enterprises Minister Lynne Brown

18th July 2017

By: Terence Creamer
Creamer Media Editor

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Public Enterprises Minister Lynne Brown confirmed on Tuesday that she had submitted a formal request to President Jacob Zuma for the establishment of a Special Investigations Unit (SIU) investigation into allegations of impropriety at State-owned utility Eskom.

Speaking on the sidelines of the POWER-GEN and DistribuTech Africa Conference in Johannesburg Brown told Engineering News Online that the request had also been handed to Justice and Correctional Services Minister Michael Masutha and that she hoped that the proclamation would be forthcoming “soon”.

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In her earlier address to delegates, the Minister described the SIU probe as a “deep dive” in all allegations that had emerged for several previous investigations at the utility that had arisen since 2007.

However, she told Engineering News Online that the primary focus would be on allegations of maladministration and corruption that had persisted since 2010.

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“There are about ten investigations that have taken place since 2007. So what I really want is to synergise those investigations. There are many of the recommendations that have been followed through, but there are many that have not been followed through since 2007. However, the dominant focus will be on the period from 2010 to 2017.”

She hoped that the SIU would tease out “systemic issues and trends”, which could be followed by a more thorough review of Eskom’s operational model.

In addition, Brown had asked the new interim board to conduct certain short-term investigations of their own, and report to her with recommendations. These related mainly to the Cliffe Dekker Hofmeyr and auditor Nkonki investigations of a possible conflict of interest involving former interim CEO Matshela Koko, who is currenlty on special leave.

Cliffe Dekker Hofmeyr had been instructed to conduct a forensic and legal investigation in respect of a potential conflict of interest relating to Koko’s stepdaughter, Koketso Choma, who, according to media reports, was a shareholder in Impulse International, which received Eskom contracts valued at around R1-billion from a division overseen by Koko.

“There will be more announcements in this regard in due course,” the Minister said, adding that it was “heartening that the ruling party and government have agreed on the necessity for further investigation, too”.

Brown also admitted to having a degree of mistrust of some of the information she had been given by the board. “Let me just say that as the shareholder’s representative, reliant on the company’s board and management for accurate information, I have recently had reason to question the veracity of some of the answers I have been given.”

To address these misgivings “various measures” had been taken. However, Brown provided no further details, other than to point to recent changes to the composition of the board.

On June 23, Brown announced a new interim board, following the resignation of previous chairperson Dr Ben Ngubane. Besides the new interim chairperson, Zethembe Khoza, the other new board members included interim CEO Johnny Dladla, Dr Pulane Molokwane, Simphiwe Dingaan, Dr Banothile Makhubela and Sathiaseelan Gounden.

“We must be very clear that maladministration and corruption are enemies of radical economic transformation and the developmental State. But we must be equally clear on the necessity for transformation . . . if we don’t spread the wealth that State-owned companies such as Eskom generate, more widely than it has been spread up to now, we are doomed to an insecure and unsustainable future.”

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