Brian Molefe
Photo by: Duane Daws
The Organisation Undoing Tax Abuse (Outa) on Monday welcomed Public Enterprises Minister Lynne Brown’s decision to decline State-owned electricity provider Eskom’s proposal to pay its former CEO Brian Molefe a R30-million pension payout, noting that it was setting a precedent by placing an end to the “incessant and unnecessary golden handshakes” paid to officials.
Brown said she could not support the board’s reasons for the payout. "I found the argument presented by the board on why the pension arrangement was conceived lacking in legal rationale and it cannot be substantiated as a performance reward, as Molefe has already been granted a performance bonus for his contribution to the turnaround of Eskom,” she said.
Further, Brown noted that the proposed pension payout was not justifiable in light of the current financial challenges faced not only by State-owned companies (SOCs) but by the country as a whole.
Outa chairperson Wayne Duvenage said golden handshakes have frustrated the public for far too long and called on Brown to “scrutinise and question” the Eskom board's request for the pension payout and to “hold them accountable for their unacceptable conduct”.
“It is clear to Outa that the Molefe payout scandal, along with many other actions resulting in wasteful expenditure and gross maladministration, points to poor leadership, highly questionable conduct and a board that needs to be replaced,” he noted.
Brown further instructed the Eskom board to “urgently” engage with Molefe and report back on a new pension proposal within a week.