Gordhan: Over R2.1bn recovered in overcoming the 'rot' of state capture | Fin24
  • Molefe Pension Money

    Eskom's pension fund wants a court to enforce an order against the utility's former CEO.

  • Eskom

    The power utility has brought back a former manager to head up its Kusile construction.

  • Zimbabwe

    The country has turned to UAE in hopes of selling a stake in its national oil company.


Gordhan: Over R2.1bn recovered in overcoming the 'rot' of state capture

Aug 21 2019 10:29
Lameez Omarjee, Fin24

So far the state has recovered more than R2.1bn lost through contracts awarded irregularly to entities doing business with state-owned enterprises, says Public Enterprises Minister Pravin Gordhan.

This is according to a written reply from Gordhan to IFP member of Parliament Elphas Buthelezi. The IFP's deputy president had asked about the interventions in place to recover the monies lost at state owned companies (SOCs) within the public enterprises portfolio through state capture.

In the reply, Gordhan details that over R4.8bn has been lost through state capture.

"The rot within SOCs is deep but can be overcome," Gordhan said.

So far Eskom has recovered R902m from McKinsey and a Gauteng High Court has ruled that another company Trillian repay the power utility R600m to be used for the benefit of the country's citizens, Gordhan said. Further the Special Investigating Unit has filed a court application on behalf of Eskom to set aside the Tegeta Brakfontein coal supply agreement to the value of R2.7bn.

At Transnet, China South Rail repaid R618m, relating to irregular prepayments made for locomotive maintenance. "Civil claims have been lodged against former executives to recover losses that were incurred as a result of their irregular conduct," Gordhan said.

Gordhan further explained that current leaders at SOCs have a plan to root out corruption. "Each board, supported by other officials is heavily seized with executing the plan." The plans are beginning to yield "tangible results," he added.

"However, to be frank, overcoming the full impact of state capture and corruption requires vigorous effort and courage from boards and management," Gordhan said.

Financial difficulties

Gordhan acknowledged that SOCs within his department's portfolio are facing financial difficulties and that the process to turnaround SOCs is ongoing. "This will culminate in the review of the operating models of the SOCs," he said.

Some SOCs will partner with Strategic Equity Partners to improve some operations. "In that vein, SOCs will provide the minister with proposals on areas where private partnership are required," Gordhan said.



Company Snapshot

Voting Booth

How concerned are you about ransomware attacks?

Previous results · Suggest a vote