Media allegations about conflicts of interest involving the winning bidder of the lottery licence will be investigated, trade industry and competition minister Parks Tau told MPs on Tuesday.
Tau also said he would not discount the possibility of going to the next bidder but insisted that he was satisfied that the process of selecting Sizekhaya as the preferred bidder for the eight-year lottery licence was fair and had ticked all the right boxes.
The minister and representatives from the National Lotteries Commission (NLC) were grilled during an engagement with members of parliament’s trade, industry and competition committee about the conflict of interest allegations and the delayed process of awarding the lottery licence and the temporary licence.
Allegations have been made about the political connections of Sizekhaya and about potential conflicts of interest of members of the tender’s bid adjudication committee, who are said to have links to Sizekhaya and/or its part-owner, the JSE-listed Goldrush.
Sizekhaya is led by businessperson and ANC member Sandile Zungu and its chair, Moses Tembe.
“We will look at the allegations. It would be irresponsible of us to ignore what has been raised in the public domain by investigative journalists and the media. But we must pass a test and that test cannot be subjective. We must get appropriate advice as to whether this constitutes conflict of interest, political affiliation and other considerations,” the minister said.
“To the extent that these matters have been raised we will follow up on them and make a determination about the veracity of the allegations and their impact on the adjudication process.
“We have not discounted the possibility of getting to the next bidder if for any reason there are significant question marks about the first bidder. The process allows us to go to the next bidder,” Tau said. The process would have to be meticulous and assessed against the provisions of the law.
Tau was adamant that Deputy President Paul Mashatile was not involved in the adjudication and decision-making process either formally or informally.
The AmaBhungane Centre for Investigative Journalism reported this week that Mashatile’s sister-in-law had links to Sizekhaya via her directorship in Tembe’s company, Bellamont Gaming. It also exposed the close ties between Mashatile and Tembe.
Tembe and Zungu were part of Mashatile’s entourage to France in May that sought to deepen economic ties between the two countries.
DA spokesperson on trade, industry and competition Toby Chance expressed concern that the link to Bellamont only came to light through media reports.
He said it was “extraordinary” that Tau was unaware of the connection between Bellamont and Mashatile, which raised questions about whether the bid evaluation, bid adjudication and quality assurance team did proper due diligence.
Tau said that to expect the team involved in assessing the bids to know every individual’s relationships would be more than what was required by the process.
NLC commissioner Jodi Scholtz said the allegations suggesting that Zungu and Tembe had close ties to the ANC and MK were investigated and legal advice sought. It was determined that they do not qualify as political office-bearers under the Lotteries Act.
“There is no evidence that the ANC or MK possess a “direct financial interest” in Sizekhaya or any of its shareholders,” she said so there was no violation of the act.
Accusations that two evaluation committee members were conflicted vis-à-vis Sizekhaya and one of the bidders Wina Njalo were also investigated and legal advice sought and the NLC concluded that there were no conflicts of interest.
Business Day has reported that Sizekhaya’s nonexecutive director Fundi Sithebe served alongside bid adjudication member Mahlubi Mazwi on the interim SAA board. A bid evaluation member, Thiran Marimuthu, is believed to have attended Goldrush’s anniversary golf day in early November 2023, when the tender process was under way.
Business Day has previously reported that Anne-Marie Pooley, who also sits on the bid adjudication committee, invested in an establishment in Pretoria, Route 515 Pub and Grill, which houses slots and gaming machines of Goldrush. The transaction involving Pooley was concluded in March last year.
Tau did not think that merely knowing another person represented a conflict of interest. NLC chair Barney Pityana stressed that great care had been taken to ensure the bid evaluation and adjudication process was not contaminated while Scholtz said all participants in the bidding process were vetted by an independent vetting agency.
Tau said he was constrained in what he said during the meeting in view of pending legislation. Lekalinga, a Serbian group that has local partners, has asked Tau to produce records of his decision. It is preparing to challenge the decision to award the contract to Sizekhaya and wants to check if Tau made sure no political party had direct or indirect interest in Sizekhaya,
Tau noted that the Lotteries Act needed to be reviewed to ensure the appropriate separation of powers and responsibilities in a case where the minister has the power to decide. Pityana added that there was a review committee in the department that was undertaking this work to make the act a more viable instrument to operate the national lottery.
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