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Nkandla: Profligate and presidential

Phillip De Wet

The country's most extravagant presidency has overseen millions spent on an estate without a formal lease, writes Phillip de Wet.

Work taking place on the road leading to President Jacob Zuma's compound in KwaZulu-Natal. (Madelene Cronjé, M&G)

President Jacob Zuma pays R8 000 a year to lease the ground on which his Nkandla compound stands, although total spending on the site over the past decade is about R250-million.

This is one of the few known figures and facts in the ongoing saga of the president's private residence; virtually everything else has been denied, disclaimed or obfuscated – or drawn from documents that government departments will not confirm as accurate, or which they simply deny exist.

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The trial of Schabir Shaik, which found that he had had a corrupt relationship with Zuma, and documents presented as evidence in the case showed that Zuma had a bond worth R900 000 by 2002, which partly financed the first stage of construction on the sprawling complex. Some of that may still be outstanding.

But the presidency this week refused to release any details on the loan, even as First National Bank (FNB), speaking in general terms, said it could not have granted a traditional bond on the property, because it is held in trust on behalf of the Zulu people.

The circumstances under which the bank granted the loan are not known, although Zuma confidant and spokesperson Mac Maharaj was, at the time, a director of the holding company of FNB. Neither Maharaj nor the bank have responded to questions on the matter.

Financial trouble
The source of the remainder of the money necessary for the construction is not known. Zuma had no hard cash, little in the way of assets and no major source of income at the time. Family financial trouble would seem to indicate no major improvement in those circumstances. A combination of building estimates based on photographs of the site, Zuma's statement to Parliament that his family was responsible for the entire cost of the core of the compound and documents from the department of public works obtained by City Press leave at least R9-million not accounted for.


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It is not known who signed off on the vast amount of government spending on the site – and how that individual or group managed to do so without making Zuma aware of the amounts involved, even though it was intimately intertwined with building work he was personally overseeing. Zuma has said in statements and in Parliament that he does not know the amounts involved.

It is also not known when the decision was made to declare the entire site a national key point, what triggered that decision or whether it was properly executed. The presidency, police and defence department have refused to disclose this information and others, including the department of public works, have claimed they do not have access to it.

What is known is that Zuma's bill for the use of the land is about R667 a month, according to the land owner. "The cost of the lease is related to tariffs as determined by the board from time to time, taking into account the land use, extent and location," said the Ingonyama Trust, the body that administers tribal land in KwaZulu-Natal, in a written response to questions about the lease. "At the time the maximum tariff was 20c per square metre. We applied the normal sliding scale for undeveloped rural residential land and the rental thus determined is R8 000 per annum."

Millions spent with no lease
Answers from the board of the trust have also revealed that the public works department started work on the construction that would eventually include helipads and a bunker shortly after Zuma became president – but without basic documents relating to the land. By his account Zuma, too, would have spent millions in building and upgrades, some of it funded with a bank loan, without formalising his lease.

"The application date for this site [the Zuma residences, which consist of several buildings] was September 2010 and the department of public works lodged its application for the land abutting the presidential complex [in] January 2011," the Ingonyama board said. "It was under this separate lease that the state has erected facilities."

Plans for the security facilities were already in place when the Mail & Guardian broke the news of the Nkandla upgrades in December 2009.

The Ingonyama statement supports Zuma's explanation to Parliament, which suggested that the security section of the complex (including housing for police and soldiers) could be separated from his family's spending on buildings for their private use.

But it raises additional questions about the conduct of public works, which now appears to have decided to spend what would amount to 2500 times the limit imposed for ministers on the private residence of the president without so much as securing the use of the land in writing first.

Although Ingonyama said that ­formal leases were not required for traditional authorities to assign land-use rights, regulation and laws on government spending do require them.

An expensive president
The willingness of a branch of government to forgo such details and what appears to have been a remarkable lack of questioning of the spending in Nkandla is part of a broader pattern that has emerged under Zuma's administration.

The Zuma presidency is the most expensive South Africa has experienced – and not only in terms of overall expenditure under his watch. Zuma has a big personal footprint in many regards. His large family incurs extra cost for the state in travel, support services and in terms of the Nkandla compound. Zuma's own travel resulted in the use of "shadow aeroplanes" that were  chartered for intercontinental flights without passengers.

Less direct costs have included his creation of six new ministries and the appointment of new deputy ­ministers with their associated administrative and salary expenses.

However, it is in the voluntary spending by government departments in projects to the benefit of, or close to Zuma's heart that the pattern becomes most pronounced: the department of public works on the Nkandla project; the department of rural development in planning the new town of "Zumaville" just 3km from the homestead; and the department of agriculture's support of Masibambisane, Zuma's rural development initiative that has a strong focus on the Nkandla area.

The ministers of all three departments have said they were not acting under orders. Their combined spending – including numbers the agriculture ministry denies – totals more than R2-billion.


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