The Democratic Alliance (DA) has questioned\u00a0a decision by “parastatal”\u00a0Telkom to fund a party-political event over the past weekend, given its current debt levels.<\/p>\n
In an article on the DA website,\u00a0Marian Shinn<\/a>, the shadow minister of communications said: “It has emerged that parastatal Telkom was one of the main sponsors of the South African Communist Party\u2019s 91st Celebratory Gala Dinner this weekend.”<\/p>\n The DA notes that the government owns 38.9% of Telkom, and if the stake by the Public Investment Corporation is included, the South African public has a 51% investment in Telkom. “This means that South African citizens paid, at least in part, for the lavish dinner enjoyed by SACP comrades,” Shinn said.<\/p>\n “The Department of Communications receives the dividends from the government\u00a0 investment in Telkom and is, as such, the custodian of the public investment in the company. Communications Minister Dina Pule should therefore ensure that our investment in Telkom is protected,” the shadow minister said.<\/p>\n The DA points out that in June, Telkom reported gross consolidated financial debt of about R7.2 billion, which the company will likely struggle to service as analysts are predicting pressure on its profitability \u2013 partly as a result of its failure to establish itself in the mobile telecoms market.<\/p>\n “Telkom is also expected to spearhead national broadband roll-out and has recently rejected the injection of significant funds from the South Korean company KT Corp to support this process,” the party said.<\/p>\n “One therefore has to question the decision to fund a party-political event,” Shinn said adding that she would\u00a0be asking Parliamentary questions to find out how much was spent on the SACP sponsorship and how Telkom justified this sponsorship. “One struggles to imagine how this expenditure would contribute to the strategic objectives of the telecoms operator.<\/p>\n “Minister Pule has some explaining to do,” Shinn concluded.<\/p>\n Telkom denies that it sponsored the event. \u201cTelkom did not sponsor the SACP Congress. However, Telkom bought a table at the dinner in order to entertain its stakeholders,” the group said in a statement.<\/p>\n Related article<\/strong><\/p>\n Telkom denies KT bribe allegations<\/a><\/strong><\/p>\n Friday 13th hits Telkom<\/a><\/strong><\/p>\n Telkom shares tank on KT Corp deal block<\/a><\/strong><\/p>\n Telkom agrees KT Corp deal at cut price<\/a><\/strong><\/p>\n Telkom shares slump below R20<\/a><\/strong><\/p>\n \u00a0KT Corp still an option: Telkom CFO<\/a><\/strong><\/p>\n