Public enterprises minister Pravin Gordhan was heavily criticised by members of parliament's public enterprises committee on Wednesday, for failing to co-operate with its investigation into the allegations made by former public enterprises director-general Kgathatso Tlhakudi, regarding the integrity of the sale of SAA to the Takatso consortium.
At issue was the failure of the minister to provide the share sale and purchase agreement and the shortlist of companies considered as potential strategic equity partners with the government in SAA, despite repeated requests by the committee.
Gordhan told the committee he could not provide these documents because of confidentiality and nondisclosure provisions in the agreement with Takatso.
The committee was unanimous at a meeting on Wednesday that it could not reach a conclusion on the veracity or otherwise of Tlhakudi’s allegations after a very lengthy process lasting about a year.
Committee chair Khaya Magaxa said at the conclusion of the meeting that the committee should now subpoena the required documents constitution and if necessary consider them in camera. He described the committee's investigation as a “bloodsucking” process in which it had tried to be open and fair to all parties. It was not possible to reach a conclusion because of the lack of evidence which meant it was just one party's word against the other's, Magaxa said.
Tlhakudi, who was dismissed from his position as director-general (according to Gordhan for reasons other than his views on the Takatso transaction), petitioned the committee in October 2022 about his allegations against Gordhan, which the minister rejected outright.
Tlhakudi alleged that the choice of Takatso was irregular and that SAA was undervalued at R51 — a figure that was challenged in the Competition Commission scrutiny of the deal as misleading because it is a nominal sum that does not take into account Takatso’s agreed R3bn capital injection.
He claimed the sale of SAA to Takatso was orchestrated by Gordhan to benefit a few privileged individuals. Takatso, he said, was not part of the shortlist of the initial transaction adviser Rand Merchant Bank, and there was no evidence that Takatso had the financial and technical capacity to consummate the transaction.
Gordhan has since ordered a new going concern and asset valuation of SAA since it resumed operations, and Takatso has agreed to pay what is required on the basis of this valuation.
Gordhan told the committee that Tlhakudi was involved in the process leading up to the transaction with Takatso and did not raise any concerns. He was adamant that the department undertook a fair, equitable and transparent process and that Takatso satisfied the department's requirements of having a combination of financial and operational capabilities for the successful relaunch of SAA.
Senior parliamentary legal adviser Andile Tetyana noted during a meeting of the committee that the transaction with Takatso was “shrouded in secrecy”. He noted that one option available to the committee was to report that it could not give unqualified support to the Takatso transaction for this reason.
Tetyana referred to the unfavourable conclusions of the auditor-general about the transaction including that the department of public enterprises did not follow a formal process of invitation, evaluation and adjudication of proposals from interested parties to identify the preferred partner, and also that there was no evidence that the proposals were fairly evaluated based on predetermined criteria. The Special Investigating Unit is also looking at the transaction.
Tetyana said the committee had not formally summonsed the required documents and had not exhausted all the powers provided to it by the constitution. He noted that it was an offence under the Powers, Privileges and Immunities of Parliament and Provincial Legislatures Act not to provide documents under a subpoena.
Some MPs suggested that the committee recommend to the speaker of the National Assembly, Nosiviwe Mapisa-Nqakula, that an ad hoc committee be established to investigate the matter but Magaxa noted that the committee could not outsource its responsibilities. They also suggested that the transaction with Takatso be put on hold pending the conclusion of the inquiry or that it be renegotiated to get a more favourable deal for government.
ANC MP Carol Phiri said the committee's probe into Tlhakudi's allegations had taken longer than anticipated because of Gordhan's lack of co-operation. This meant that the committee only had a one-sided story.
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