The ANC is facing renewed pressure over its finances after ActionSA and the DA reignited their bid to have the party’s R102m debt deal with Ezulweni Investments investigated by the Electoral Commission of SA (IEC) for potential breaches of funding legislation.
ActionSA said a confidential debt settlement agreement, now part of court records, shows the ANC breached the provisions of the Political Party Funding Act by disguising a donation as a commercial transaction.
The DA said disclosures linked to the Ezulweni contract suggested that ANC-aligned partners may have received resources indirectly through campaign procurement. It has threatened to submit information requests under the Promotion of Access to Information Act if the ANC failed to reveal full details.
If found guilty by the IEC, the commission may issue directives to correct the issues. If persistent, the IEC will seek administrative fines through the electoral court. While the IEC oversees enforcement, it lacks the power to impose fines, a function reserved for the courts under the legislation.
“The IEC must determine whether supplying materials to these ‘strategic partners’ and ‘strategic alliances’ amounts to undeclared funding in terms of the Political Party Funding Act. Any in-kind donations to other parties must be transparent, so voters can make informed choices,” the DA said.
According to ActionSA national chairperson Michael Beaumont, the ANC’s R150m debt to Ezulweni, which supplied campaign banners and other materials in 2019, was effectively written off through an inflated order of election materials for the 2024 campaign.
“The ANC placed an order valued at R190m to write off a historic debt, for goods independently valued at only R125m,” Beaumont said. “This means the ANC settled a R150m debt with only R65m in actual value. In terms of the law, that is a donation-in-kind of about R85m, well above the R15m annual limit for any single donor.”
The debt agreement was signed before amendments to the Political Party Act, which amended the disclosure threshold for the upper limit, doubling it to R200,000 and increasing the annual cap from a single entity from R15m to R30m.
ActionSA argues that the deal amounted to an “unlawful political donation”, and has written to the IEC asking it to reopen its investigation.
“The IEC failed to obtain or review the agreement before hastily dismissing the need for an investigation,” Beaumont said. “As long as the IEC continues to wash its hands of its responsibilities, the Political Party Funding Act will remain laughable.”
ActionSA’s claims follow a counterclaim by the ANC against Ezulwini in October in which the party sought payment from the company for all payments made to date after the marketing company obtained a court order to seize the ANC’s assets for monies owed.
The order to seize the ANC’s assets of R85m included its headquarters in Johannesburg. The company says the ANC has breached an earlier debt payment agreement and still owes the funds for marketing material provided to it for the 2019 elections campaign.
The ANC claims that Ezulweni Investments was not registered for VAT at the time of the transaction and that it was irregularly charged by the company.
The IEC and the ANC were still to comment on the allegations by the time of publication.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.