{"id":671905,"date":"2023-03-10T16:29:56","date_gmt":"2023-03-10T14:29:56","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=671905"},"modified":"2023-03-10T16:33:24","modified_gmt":"2023-03-10T14:33:24","slug":"eskom-assures-south-africa-that-corruption-is-being-dealt-with","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business-opinion\/671905\/eskom-assures-south-africa-that-corruption-is-being-dealt-with\/","title":{"rendered":"Eskom assures South Africa that corruption is being dealt with"},"content":{"rendered":"<p>Eskom chair Mpho Makwana says that the power utility is tackling fraud and corruption within its ranks and supply chain.<\/p>\n<p>In an op-ed distributed on Friday (10 march), Makwana moved to detail the many &#8216;wins&#8217; being seen at the embattled power utility in its fight against corruption &#8211; this, against a backdrop of a growing narrative that corruption and malfeasance are entrenched at the group.<\/p>\n<p>This narrative has been underpinned by recent claims made by former CEO, Andre de Ruyter, who said that the company is losing R1 billion a month to graft and theft.<\/p>\n<p>De Ruyter said that this theft was being orchestrated by unnamed government officials who were embedded and leading vast criminal networks.<\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"f6ByppECBF\"><p><a href=\"https:\/\/businesstech.co.za\/news\/energy\/666921\/de-ruyter-strikes-back-blows-the-lid-on-anc-corruption-political-interference-and-worse-load-shedding-this-winter\/\">De Ruyter strikes back &#8211; blows the lid on ANC corruption, political interference and worse load shedding this winter<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;De Ruyter strikes back &#8211; blows the lid on ANC corruption, political interference and worse load shedding this winter&#8221; &#8212; BusinessTech\" src=\"https:\/\/businesstech.co.za\/news\/energy\/666921\/de-ruyter-strikes-back-blows-the-lid-on-anc-corruption-political-interference-and-worse-load-shedding-this-winter\/embed\/#?secret=Sd00xSHBgz#?secret=f6ByppECBF\" data-secret=\"f6ByppECBF\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p>Without addressing De Ruyter&#8217;s allegations, Makwana said that Eskom and its board were working with the National Prosecuting Authority (NPA) and the Special Investigative Unit (SIU) to tackle various forms of graft and criminality, including fallout from state capture.<\/p>\n<p>This, he said, is regularly communicated to the Standing Committee on Public Accounts to keep the government in the loop.<\/p>\n<p>&#8220;Our close collaboration with the law enforcement agencies is instrumental in addressing the Zondo Commission\u2019s recommendations,&#8221; he said.<\/p>\n<p>&#8220;Key among the recommendations (of the Zondo Commission) is that the NPA undertake the criminal prosecution of former Eskom board members and executives involved in decision-making that resulted in inter alia the breach of the Public Finance Management Act.<\/p>\n<p>&#8220;The Zondo Report was unequivocal in singling out former Eskom executives among those who must be pursued for their alleged involvement in nefarious activities at the company.<\/p>\n<p>&#8220;Amongst the several findings of malfeasance by the executives includes the irregular supply of coal to Eskom from Tegeta&#8217;s Brakfontein Colliery whereby the Commission recommended that the NPA consider criminal action against the executives and a range of other implicated individuals from both within and outside the organisation,&#8221; he said.<\/p>\n<p>The chair said that Eskom has a dedicated State Capture Task Team executing its Implementation Plan to address the findings in the Zondo Report. Steps already taken include:<\/p>\n<ul>\n<li>Disciplinary action against delinquent employees;<\/li>\n<li>Flagging of delinquent employees for future employment;<\/li>\n<li>Disciplinary action against delinquent suppliers;<\/li>\n<li>Deregistration of delinquent suppliers from Eskom\u2019s supplier database;<\/li>\n<li>Blacklisting of delinquent suppliers by the National Treasury;<\/li>\n<li>Taking action against delinquent directors;<\/li>\n<li>Instituting civil recovery processes and criminal proceedings;<\/li>\n<li>Reporting of delinquent employees to professional bodies; and<\/li>\n<li>Reviewing of Eskom-specific policies, procedures, and governance requirements.<\/li>\n<\/ul>\n<p><strong>Successes<\/strong><\/p>\n<p>The chair outlined the progress being made in tackling allegations of corruption.<\/p>\n<p>&#8220;One of the success stories to date includes the matter relating to the unlawful payment of R1.6 billion to McKinsey, Trillian and Regiments. Eskom has since recovered R1.1 billion from McKinsey and has a judgement against Trillian.<\/p>\n<p>&#8220;Trillian has been placed in liquidation after the firm failed to abide by the court judgement, and this has resulted in the sequestration of Trillian\u2019s key shareholder and director.&#8221;<\/p>\n<p>Through a collaborative partnership with the SIU, Eskom has recouped over R2 billion in funds unlawfully paid out to service providers, Makwana said.<\/p>\n<p>&#8220;Together, a recovery of approximately R1 billion from SAP is underway.&#8221;<\/p>\n<p>Makwana said that action is being taken on several fronts:<\/p>\n<ul>\n<li><strong>Civil recoveries:<\/strong> jointly with the SIU, Eskom is pursuing R3.8 billion through civil action against 12 defendants who played a central role in State Capture. Seven of the 12 defendants are former Eskom executives and directors.<\/li>\n<\/ul>\n<ul>\n<li><strong>Consequence management:<\/strong> there are currently no Eskom employees implicated in State Capture as key employees involved in State Capture were dismissed or resigned in early 2018.<\/li>\n<\/ul>\n<ul>\n<li><strong>Criminal proceedings:<\/strong> despite the arrest of a former Interim Group Chief Executive and 25 others accused of fraud and corruption at Eskom in relation to the Kusile contract on 27 October 2022, criminal proceedings continue to lag. The group is closely monitoring all outstanding criminal matters and are working with the SIU, NPA and other law enforcement agencies to bring these to court as soon as possible.<\/li>\n<\/ul>\n<ul>\n<li><strong>Director delinquency proceedings:<\/strong> Eskom is a party to the Department of Enterprises\u2019 (DPE\u2019s) coordination of all SOE proceedings under the Companies Act and has such provided detailed evidentiary packs for all directors on the 2014 Eskom Board to its shareholder. Further, Eskom has reported a former delinquent director to the South African Institute of Chartered Accountants, which has resulted in the suspension of their membership.<\/li>\n<\/ul>\n<ul>\n<li><strong>Supplier disciplinary:<\/strong> Eskom has placed a provisional block on new contracts with all implicated suppliers, pending supplier disciplinary processes being initiated in due course. Eskom\u2019s Supplier Disciplinary Process is also under review to enable a more agile approach towards supplier discipline going forward.<\/li>\n<\/ul>\n<p>&#8220;Finally, in line with the Zondo Commission\u2019s recommendation for a review of key internal policies such as anti-bribery and corruption, Eskom is implementing various initiatives,&#8221; Makwana said.<\/p>\n<p>These include:<\/p>\n<ul>\n<li>An automated procurement system to better manage procurement spend and protect against integrity breaches;<\/li>\n<\/ul>\n<ul>\n<li>The use of tools such as PriceCheck in supply chain management;<\/li>\n<\/ul>\n<ul>\n<li>The digitalisation of stock control;<\/li>\n<\/ul>\n<ul>\n<li>The use of an augmented procurement model in certain business areas; and<\/li>\n<\/ul>\n<ul>\n<li>The use of e-auction.<\/li>\n<\/ul>\n<p>&#8220;The organisation will continue to monitor technology developments and will introduce suitable tools as they become available,&#8221; he said.<\/p>\n<p><strong>Going forward<\/strong><\/p>\n<p>Beyond the state capture and Zondo Commission recommendations, Makwana said that the Eskom board is receiving reports from the group&#8217;s Assurance and Forensic department and external auditors, which guide it on where to focus.<\/p>\n<p>&#8220;There are also various existing whistle-blowing channels available to Eskom employees and the public, assisting us in unearthing fraud and corruption,&#8221; he said.<\/p>\n<p>&#8220;Eskom will continue working closely with the DPE, other SOEs and law enforcement agencies to ensure that we either directly address the recommendations or, where recommendations, such as criminal prosecutions, are not within our control, to support law enforcement agencies in bringing delinquent suppliers, former employers, former executives, former board members and associated perpetrators to book.<\/p>\n<p>&#8220;We are also strengthening our whistle-blower support for the Eskom guardians who help us see what is cloaked,&#8221; he said.<\/p>\n<p>&#8220;Eskom is resolute in pursuing those who have enriched themselves at the expense of our organisation and South Africa. We are ensuring that we have a robust framework in place for zero tolerance to fraud and corruption.&#8221;<\/p>\n<p>&#8220;This is a non-negotiable for the Board and executive team to rebuild trust and restore public confidence.&#8221;<\/p>\n<hr \/>\n<p><strong>Read: <a href=\"https:\/\/businesstech.co.za\/news\/business-opinion\/671697\/things-are-looking-very-very-bad-for-load-shedding-in-south-africa\/\" rel=\"bookmark\">Things are looking very, very bad for load shedding in South Africa<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Eskom group chair Mpho Makwana says the group is acting decisively in dealing with fraud and corruption.<\/p>\n","protected":false},"author":10,"featured_media":671911,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[1164,26],"class_list":["post-671905","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-opinion","tag-eskom","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/671905","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=671905"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/671905\/revisions"}],"predecessor-version":[{"id":671917,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/671905\/revisions\/671917"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/671911"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=671905"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=671905"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=671905"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}