Public Enterprises Minister Lynne Brown has announced that she will institute a “broad scope” investigation into allegations of corruption currently hanging over State-owned electricity producer Eskom.

The terms of reference and form of the investigation were still to be finalised, but Brown indicated that it would be overseen by a retired judge, so as to ensure that the credibility of the remedial actions arising were not questioned.

It was possible that the investigative work would be conducted by the Special Investigating Unit (SIU), with which the Department of Public Enterprises (DPE) already had a memorandum of agreement. However, Brown said she still needed to meet with the SIU to assess its capacity.

The terms of reference would likely include a review of seven forensic reports already conducted into allegations of corruption and mismanagement at Eskom since 2007, including reports produced by Dentons, PwC and Deloitte.

Special focus would also be given to Eskom’s coal procurement processes, which featured heavily in the ‘State of Capture’ report released by then Public Protector Thuli Madonsela, last year.

The report recommended that President Jacob Zuma establish a commission of inquiry to further interrogate “observations” of possible corruption at Eskom and several other State-owned companies (SoCs). However, Zuma had since taken the report on review, disputing the Public Protector right to insist that the inquiry be led by a judge selected not be himself, but by Chief Justice Mogoeng Mogoeng.

The report led to the departure of Eskom CEO Brian Molefe, who controversially returned to the post earlier this month after Brown rejected his R30-million early-retirement payment. It has since emerged that the payment was in breach of pension fund rules, but Brown nevertheless endorsed the board’s reinstatement of Molefe’s on the basis that it represented better value than any payout.

PARLIAMENTARY PROBE?
Brown said the “deep dive” probe was not designed to disrupt or delay a proposed Parliamentary Portfolio Committee investigation into Eskom, which she said should proceed. It was also not meant to circumvent the Public Protector’s recommendation for a commission of inquiry.

However, she questioned whether a Parliament-led process would be as effective as one recently held into the South African Broadcasting Corporation (SABC), owing to the fact that she appointed the board in concurrence with Cabinet. By contrast, Parliament appointed the SABC board.

Brown would also not ask either Molefe or Eskom chairperson Ben Ngubane to step aside for the duration of the investigation, despite fears that they might be able to tamper with evidence or intimidate potential witnesses. She said she would not pre-empt the outcome of arguing the legal challenges to Molefe’s reappointment, which would be heard by the courts in early June.

However, the Minister would approach the Democratic Alliance (DA) to request that they share evidence that document shredding was already taking place at Eskom.

DA shadow minister of public enterprises Natasha Mazzone said earlier that she had credible evidence that documents were being destroyed, including correspondence relating to Molefe’s reappointment.

In a related development, Zuma announced that an Inter-Ministerial Committee, comprising the Ministers of Public Enterprises, Energy, Finance and Justice and Correctional Services had been set up to "gather the facts" on Molefe's reappointment "in order to guide Cabinet on how to deal with such matters in future. The convenor is Justice and Correctional Services Minister Michael Masutha.