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Brown: I poked my nose into a hornet's nest at Eskom - FULL STATEMENT

May 31 2017 10:43

Cape Town - To say her instruction to the Eskom board to reconsider a R30m pension payout to Brian Molefe unleashed a storm is to grossly understate the effect, Public Enterprises Minister Lynne Brown said on Wednesday.

Updating the National Council of Provinces' select committee on communications and public enterprises regarding Brian Molefe’s future as chief executive, Brown said she poked her nose into a hornet’s nest at Eskom when she gave the instruction five weeks ago.

Her update follows the appointment of an interministerial committee by President Jacob Zuma in May to investigate Molefe's return to Eskom, after Brown agreed to the Eskom board’s decision to reinstate him. The committee consists of Brown, Justice Minister Michael Masutha, Finance Minister Malusi Gigaba and Energy Minister Mmamoloko Kubayi.

READ: Molefe to learn fate soon, as Zuma committee reaches consensus

Brown said the four ministers have “had several engagements” and “reached a consensus” on the matter. She now needs to inform the Eskom board of the decision taken before making it public.

Here is Brown's full statement:

Chairperson Ellen Prins

Members of the Select Committee

Officials of my Department and Parliament

South Africans…

Five weeks ago, I poked my nose into a hornet’s nest at Eskom when I instructed the Board to reconsider its proposed pension payout of R30m to Mr Brian Molefe.

To say that the consequences of this decision unleashed a storm is to grossly understate the effect. Within moments of publication of the announcement by Eskom chairperson Dr Ben Ngubane that Mr Molefe was to return as Eskom’s Group Chief Executive, the issue was thrust to the centre of societal and political contestation.

Old allegations have re-surfaced and new ones have been brought to light. These include serious allegations – that are regularly reported, and widely perceived, as fact.

Do I regret interfering in the proposed Molefe pension payout? Well, I can’t say I enjoy having my integrity questioned. But, in the end, if our State-Owned Companies are to perform to their true potential at the vanguard of the developmental and transformative state, we must clear the fog of allegations of impropriety that envelop them – one way or the other.

I therefore pay tribute to Members of Parliament, the media (of course we’d like them to be more balanced) and members of the public who have invested time in investigating and reporting these matters, and I encourage others to contribute to setting things straight.

Chairperson…

Allow me to give the Select Committee a brief progress report on unfolding issues pertaining to Eskom.

Firstly, I am a deployee of the ruling party therefore I am subject to the decision of the party.

Secondly, the political and government processes: Since Mr Molefe’s return to Eskom I have briefed the top officials, the Deployment Committee and National Executive Committee of the ruling party on the matter. The ruling party requested Government, led by President Zuma, to resolve the matter.

The President established an Inter-Ministerial Committee on Eskom led by the Minister of Justice and Correctional Services, the Honourable Michael Masutha and includes the Ministers of Finance, Malusi Gigaba, Minister of Energy Nkhensani Kubayi and I. The IMC has held several discussions and reached consensus.

I know that members would like me to announce the outcome of these deliberations. But all I can promise is that the announcement will be made soon.

Thirdly, the opposition’s court case: I don’t want to dwell too much on a matter before the court. Let me just say that I have submitted an affidavit, and instructed my legal team to withdraw my opposition to Part A of the relief sought – that I set aside my appointment of Mr Molefe. I will abide by the court’s decision on the legality of Mr Molefe’s return to Eskom. This is consistent with my support for Mr Molefe’s return to Eskom on the proviso that his return is legal.

Fourthly: Let me take the Committee into my confidence on the subject of the Eskom Board. We cannot ignore the fact that the Board is ultimately accountable for the fiduciary duties of the company. To this extent I continue working with the Board to ensure that Eskom’s sustainability is maintained and its developmental contribution to the South African economy is enhanced. Therefore, as the Shareholder Representative, my relationship with the Board is crucial in ensuring that public and investor confidence is restored as we (Eskom and the sovereign) continue engaging with the investor community to improve our investment rating.

Chairperson…

A word or two about Eskom’s performance. It is not all doom and gloom, as some would have it.

The company:

- is an important economic driver;

- is the 4th largest utility company in the world;

- operates the only nuclear power station on the continent;

- employs 46 000 people;

- has recorded a profit for the 2016/17 financial year;

- is ahead of schedule on its revised build-programme; and

- provides more than 90% of the country’s electricity.

These are not green shoots; they are giant trees.

Finally…

Allow me to express our deepest condolences, on behalf of Government, to the family of Thembisile Yende. I have asked my Department to ensure that Eskom provides the appropriate support to the Yende family and the police investigation.

I thank you.

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