There is growing disquiet in political circles about the role of Public Investment Corporation (PIC) CE Dan Matjila: not that he is corrupt, but certainly that he is too powerful.
There are signs that the rock-solid support he has enjoyed from the PIC board is wavering and it appears his political cover is evaporating. In September 2017, during Malusi Gigaba’s brief reign as finance minister, there was a crude attempt to finger Matjila for corruption on the grounds of an e-mail from a "whistle-blower", who claimed he had given PIC funds to "a girlfriend". Matjila went public to say he was under attack, raising the spectre of the Gupta looting machine, which wanted to get "the keys to the big safe".
— CURIOUSLY … SEVERAL OF THOSE SUSPENDED ARE IN SOME WAY CONNECTED TO THE AFTERMATH OF THE ‘WHISTLE-BLOWER REPORT’.
The PIC board, which received a written explanation from Matjila and a report from the head of the internal audit, Lufuno Nemagovhani, cleared him of wrongdoing. Political parties and the public all rallied behind him.
However, recent events indicate that the board is not quite so filled with hubris as it was then. The first sign is a request from some in the board for a review of the decision on the PIC’s funding of Ayo, the company linked to Independent Newspapers’ Iqbal Surve, for which the PIC stumped up R4.3bn at the listing in December. The valuation has since been questioned for being unusually high. The PIC’s private placement came at R43 a share and it forked out R4.3bn for the full initial public offer. The share now trades at R36.
The management of the R2-trillion-strong fund has large delegated authorities. Management committees may invest R2bn in an unlisted company without board approval and can go up to R10bn in the listed space.
The Ayo transaction fell within the delegated authorities and Matjila was not required to bring it to the board’s investment committee for a decision. But the board has since decided it is not leaving it there. Its investment committee is to conduct a review of the transaction, with particular attention to the valuation.
It has also decided to re-examine the rules about the management’s delegated authority to make sure transactions that may be politically sensitive or controversial also come to the board, even when they are below the delegated authority of the management.
There are also suggestions that the board is considering appointing a chief investment officer, but the board has not discussed this. Before Matjila’s appointment as CE in 2014 the PIC had a CE and a chief investment officer. When Matjila, who had been the investment boss, was appointed CE, the two positions were merged.
There is much anxiety among staff about the rash of suspensions and departures from the organisation. These include the dismissal of the head of risk, Paul Magula, and the suspensions of the head of information technology, Vuyokazi Menye, the head of IT security, Simphiwe Mayisela, and the company secretary, Bongani Mathebula.
Curiously, although the details are hard to come by and the PIC will not comment on staff disciplinary procedures, several of those suspended are in some way connected to the aftermath of the "whistle-blower report".
After the September incident Matjila, with the support of the board, commissioned a probe into breaches of IT security and instructed staff to report the breaches he believed had occurred to the police.
From here it gets murky and the motives of no one involved can be said to be pure. What is certain, however, is that subsequent to the complaint being lodged, the police began to investigate. It is this probe that led three weeks ago to subpoenas being issued to the new PIC chairman, Mondli Gungubele, as well as Nemagovhani.
The two have been asked by the police to provide more detail on Matjila’s response to the board on the dealings with the so-called girlfriend and on the findings of the internal audit. Unlike the board, which accepted that Matjila had a plausible explanation, the police are less convinced.
How exactly the complaint over interference in the IT system morphed into a corruption investigation of Matjila is not easy to understand. Whether it was just incredibly good police work or there were other motives is not possible to discern now.
The subpoenas jolted Finance Minister Nhlanhla Nene into action, and he has requested an account of what took place in September 2017 and details of how the board arrived at all its decisions.
Since Nene’s request the board has again reiterated its support for Matjila. But the political mood has clearly shifted and this time explanations will find a far more sceptical audience.
• Paton is deputy editor
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