Issued by: Gauteng Provincial Government
RESPONSE TO THE STATEMENT BY THE NATIONAL PARTY ON ALLEGED "COVERING UP OF GPG DEBT" BY MEC JABU MOLEKETI.
The press release of the National Party of 27 July 1998 on the issue of the bank, overdraft of Gauteng as at the end of March 1998 requires a response.
To set the record straight without stating any new facts that are not public domain information:
In introducing the Adjustment Appropriation Bill for 1997/98 in the Legislature on 3 March 1998, I covered the issue of the overdraft thus:
Gauteng's bank account will go into overdraft later this month. Our estimates are that we will have an overdraft of approximately R200 million during the last week or so of March. This matter has been discussed at the Budget Council and has received the blessings of the Minister of Finance. We have taken this into account in drafting the proposed budget for the 1998/9 financial year and we have planned for the full repayment of the overdraft in the first week of April.
We have discussed this with our bankers and are hoping to have reached agreement with them on the interest rate to be paid, which should be below the prime rate.
In my speech to the legislature on the adoption of the Adjustment Appropriation Bill for 1997/9 on 12 March 1998 I gave an indication of the interest rate:
It might be prudent for me to report that our negotiations with our bankers have been very successful. I can report that the rate on any bridging finance raised will be charged at the prevailing overnight call loan rate.
Finally, in my budget speech on my department's Vote 3 to the Legislature on 25 May 1998, I covered the extent of the overdraft:
Our projections regarding our need for an overdraft at the end of March 1998 were accurate: the province was in overdraft by approximately R267 million as at 31 March 1998. That overdraft has since been liquidated.
The above excepts from my speeches to the legislature clearly reflects that the Gauteng has been open and transparent in reporting issues on the bank overdraft of the province. I find it difficult to understand why the National Party chose to ignore these publicly stated facts in asserting that there has been a cover-up and "wheeling and dealing" and can only assume that they seek to sensationalize misinformation.
For further enquiries contact Pradeep Maharaj at (011) 355 8705