The National Prosecuting Authority's R5 million agreement with fraudster Schabir Shaik was "normal", it said on Thursday.

"... The settlement between the NPA and Shaik is a normal one in civil litigation where disputes are often settled between the parties rather than litigated," NPA spokesman Tlali Tlali said in a statement.

"The (Asset Forfeiture Unit) settles disputes regularly after weighing up its prospects of success in court, the costs involved in the litigation and the extent to which it can devote its limited resources to litigating other matters," he said.

Quoting from papers filed in the Durban High Court, the Star reported on Thursday that Shaik had received R5m from the state in a secret agreement on interest earned on R34 million which the state seized from him in January 2006.

Shaik had unsuccessfully tried to overturn the forfeiture order.

In terms of the agreement, the state agreed to pay Shaik half the R14m in interest -- R5m in cash with the balance being used to offset his legal fees. The remaining R14m would join the rest of the money in the criminal asset recovery account.

The newspaper reported that the deal was signed late last year and was conditional on being kept secret with "no public announcements", without written approval from either party.

Said Tlali: "All such settlements have to be submitted to the head of the AFU for authorisation and to ensure that they are justified, in accordance with procedures required by the Auditor-General."

He added that the A-G audited such statements every year.

"In this matter, there was a relatively complex legal dispute about whether the AFU could claim interest on the amount of the confiscation order, the applicable interest rate and the date from which interest accrues.

"The AFU considered the fact that issues have not been litigated before, and would therefore have resulted in further litigation, which would have delayed the process for as much as another two years.

"In the event, it was agreed to settle the matter on the basis that the disputed interest would be shared between the parties," he said.

Confirming the amounts involved, Tlali emphasised that the details of the agreement "were always intended to be made public".

The agreement provided that the parties would agree on statements to be issued, he said.

"Although settlements in civil matters are often kept confidential, the AFU has a policy of not doing so," he added.

The Star further reported that Shaik has applied to President Kgalema Motlanthe for a "reprieve and remission of the confiscated amounts", in an attempt to get back the R34m confiscated.

Shaik was convicted in 2005 on two counts of corruption and one of fraud and was sentenced to 15 years imprisonment. He started serving his sentence in November 2006 after numerous appeals failed.

However, he has spent lengthy periods in the Inkosi Albert Luthuli hospital since then with health problems related to his blood pressure.

The Democratic Alliance on Thursday called on the NPA to explain the thinking behind the deal. It found the agreement outrageous and a mockery of the justice system.

"It seems patently obvious that if an initial sum is forfeited, then any subsequent earnings on that amount ought to be forfeited too," read a statement from the party.

The NPA had to make it clear why the deal was concluded, how it served the interests of justice, why it was conducted in secrecy and why the NPA concluded the settlement, rather than the courts.