New finance deputy Buthelezi will need to explain role in Prasa irregularities | Fin24
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New finance deputy Buthelezi will need to explain role in Prasa irregularities

Apr 02 2017 15:13

Cape Town – South Africa’s new Deputy Minister of Finance Sfiso Buthelezi will most likely have some explaining to do when PublicPprotector Busisiwe Mkhwebana concludes her investigation into the Passenger Rail Agency of South Africa (Prasa). 

Buthelezi, former Prasa chairperson until he was replaced by Popo Molefe in 2014, was appointed to his new position after President Jacob Zuma reshuffled his Cabinet in the early hours of Friday March 31, sacking both Finance Minister Pravin Gordhan (who was replaced by former home affairs minister Malusi Gigaba) and his deputy Mcebisi Jonas. 

READ: Former Prasa chairperson Sfiso Buthelezi named new deputy finance minister 

Buthelezi, however, has a cloud over his head dating back to his days as Prasa chairperson. News24 earlier reported that Buthelezi was linked to possible financial irregularities in former public protector Thuli Madonsela’s 2015 report on Prasa. 

Madonsela’s damning report, called Derailed, on the troubled state-owned rail transport entity, contains allegations that a company of which Buthelezi was a shareholder and a director clinched an advisory services contract from Prasa while Buthelezi led Prasa’s board.

In the report, however, Madonsela could not make any conclusive findings on the allegations because former Prasa CEO Lucky Montana failed to provide her with key documents related to the allegations.

His role at Makana 

Buthelezi held shares in Cadiz Holdings and Makana Investment Corporation, according to an “undated” declaration of interests form included in Madonsela’s.

He was also a director of the latter company. Makana is a subsidiary of Cadiz.

According to information provided to Madonsela, Cadiz Holdings secured a contract to provide advisory services to Prasa on the state-owned company’s huge tender for new passenger carriages worth R51bn.

Madonsela set out to determine whether Buthelezi “improperly fail[ed] to disclose and manage a conflict of interest arising from his interest in Makana, a subsidiary of Cadiz, a company allegedly providing advisory services to Prasa on the Rolling Stock Programme”.

READ: 10 of Thuli Madonsela's findings against Prasa 

However, she did not receive the documents she needed to probe the claims.

Destined for higher things

Buthelezi has been touted to take over from Jonas for the past 12 months. 

In March last year, City Press published an interview with Buthelezi in which he dismissed rumours that he was about to become deputy finance minister, replacing Jonas. 

At the time, Jonas was embroiled in a drama surrounding the Gupta family when he claimed in court papers that Ajay Gupta offered him the position of finance minister and R600 million, allegations the Guptas have denied vehemently. 

READ: Mcebisi Jonas takes on Ajay Gupta over Saxonwold meeting

Buthelezi was sworn in as an ANC member of Parliament in March last year and served on the standing committee on finance. 

During the past year, Buthelezi was critical of National Treasury, most recently lambasting Treasury officials the breakdown of trust between them and the South African Revenue Service. 

Rank and file member of the ANC

A staunch supporter of Zuma, Buthelezi has steadily risen through the ranks, joining the ANC at the age of 20 in 1981, according to City Press. He formed part of the Ingwavuma unit that was sent to experiment with setting up the first military bases for the ANC in the country. He was arrested and sent to Robben Island for eight years, until 1991.

Buthelezi obtained his BCom degree while on Robben Island, an honours degree at the University of Cape Town after his release, and later completed a master’s degree.

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