In search of truths
Contradictions and clarities revealed in public servants’
unhappiness with R5bn loan from PIC to Eskom.
Yet another confrontation has befallen the beleaguered Public Investment Corporation. This time it’s been to explain the inner workings of its relationship with the Government Employees Pension Fund, the PIC’s major client, specifically over the grant of a R5bn bridging loan from the PIC to Eskom.
The purpose of the loan was to allow Eskom time, through a short-term operational liquidity crunch, to arrange longer-term borrowings from financial institutions. Fundamentally at issue were whether or not:
- The loan, granted in February 2018, was guaranteed by government. (If it wasn’t, which is denied, there are at least explanations of how government considers the guarantees take effect.).
- The GEPF was consulted. (The PIC, represented by thenchief executive Dan Matjila, said that it was consulted. The GEPF, represented by principal executive officer Abel Sithole, said that it wasn’t.)
- The GEPF board ever discussed the loan either prior or subsequent to it having been granted. (Because the investment mandate of the GEPF to the PIC is kept confidential, respective obligations aren’t in the public domain.)
This latest dispute came about because the Public Servants Association, a 230 000-member strong trade union with a seat on the GEPF board, has applied to the North Gauteng High Court under the Promotion of Access to Information Act for disclosures that relate not only to the loan but also to the ministerial appointment of PIC directors.
What happens next? Will witnesses be called, either to the PIC commission of inquiry or to give evidence in court? Both options are debatable.
No date for the PSA hearing has been scheduled. It could be that a hearing is unnecessary because much of the requested information is already revealed in a series of voluminous affidavits. So it would be over to the commission, should it want, for a deeper dig into how the PIC operates.
The affidavits have been deposed by PSA general manager Ivan Fredericks in launching the notice of motion, then by the various respondents: Stadi Mngomezulu of National Treasury for the Minister of Finance, Matjila for the PIC and Sithole for the GEPF. (Incidentally, Mngomezulu is also a GEPF trustee and Sithole is also acting commissioner of the Financial Sector Conduct Authority.)