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Eskom R43m New Age deal stirs controversy

Oct 24 2014 09:20

Johannesburg - Eskom interim CEO Collin Matjila has stirred controversy at the power utility over a R43m contract to sponsor The New Age's (TNA's) breakfast briefings, the Mail and Guardian reported on Friday.

The new contract commits the cash-strapped power utility to sponsor around one TNA breakfast briefing per month for three years, the newspaper's AmaBhungane investigative unit reported.

Public Enterprises Minister Lynne Brown reportedly confirmed that she had been approached with concerns about Matjila's approval of the contract.

"I don't take the decisions, and I wouldn't tell anyone you must not charge or suspend someone," Brown was quoted as saying.

The Eskom board's probe into the matter was ongoing, she said.

Eskom board chairperson Zola Tsotsi said the situation should not be "prejudged".

"It's a little premature to comment until I get feedback... to tell me what they [the subcommittee] uncovered."

The contract apparently overshot Eskom's sponsorship budget and allegedly did not contain an exit clause, which the parastatal's lawyers allegedly raised concerns about prior to Matjila's approval of the contract.

Acting group commercial executive Matshela Koko said the TNA contract was part of Eskom's "continuing relationship" with the company, which predated Matjila's tenure as interim CEO.

Spokesperson for the Gupta family - the owners of TNA - Gary Naidoo said: "This contract was negotiated not with the then acting chief executive, but with the functional executives at Eskom and Nazeem Howa, TNA chief executive".

He would not provide details "of a hard-won deal with a competitor", ie the Mail and Guardian, and declined to comment on the Gupta's relationship with Matjila.

Matjila could not be reached for comment.

In his mid-term budget on Wednesday, Finance Minister Nhlanhla Nene announced plans to raise at least R20bn to help Eskom deal with its R225bn cash flow gap.

READ: Moody's welcomes Eskom equity injection
Nene: Eskom won't need to convert R60bn loan
No new govt guarantees for Eskom

the new age  |  eskom


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