/ 3 November 2016

Zwane and his new appointment go way back

New Mineral Resources Minister Mosebenzi Zwane.
Mosebenzi Zwane, The chairperson of parliament's portfolio committee for transport, will be indicted for the dairy farm scandal this week

A senior Free State official who facilitated the payment of tens of millions of rands to a controversial dairy project in the Free State linked to the Gupta family has landed a top position in the department of mineral resources – thanks to mining minister Mosebenzi Zwane.

Zwane is a former Free State MEC with close ties to the Gupta family.

He was fingered by former Public Protector Thuli Madonsela in her report on “State Capture” over his trip to Switzerland with the Guptas on a mission to persuade Glencore to sell the Optimum colliery to their company, Tegeta Exploration and Resources.

The report, released on Wednesday after Zwane tried to interdict it, recommends that he should be interviewed about the trip and that “his conduct with regards to his flight itinerary to Switzerland appears to be irregular and may not be in line with Public Finance Management Act”.

He has denied accompanying the Guptas.

According to Mineweb, the minister has appointed Seipati Dlamini to the position of deputy director general: mineral regulation in the national department of mineral resources (DMR), where she will be responsible for granting and rescinding mining licences.

The website reports that the position was not advertised or ratified by Cabinet, as required by public service legislation.
Dlamini was chief financial officer in the Free State department of agriculture when Zwane was MEC.


“rushed to approve the project without a budget”


After he was elevated to the national cabinet as minster of mineral resources in September last year, she was appointed chief of staff at the DMR.

Both came under the spotlight when amaBhungane exposed the department’s payment of king’s ransom – estimated at between R40-million and R144-million – to a dairy project run by a Gupta-linked company, Estina, allegedly without following due process.
The dairy is in Vrede, Zwane’s home town.

There were allegations that the provincial government’s deal with Estina – a company without agricultural experience, led by a computer sales manager – flouted treasury rules.

Estina’s sole director, Kamal Vasram, is a former employee of the Guptas’ IT company, Sahara Computers.

AmaBungane also reported on a treasury investigation in mid-2013 which suggested that she bent over backwards to approve the project.

In a transcript of an interview between Treasury official Suad Jacobs and Dlamini, obtained by amaBhungane, she admitted that the Free State agriculture department rushed to approve the project without a budget, feasibility study or conditions of urgency.

Pressed by Jacobs, she also admitted that no due diligence was done on Estina, and that she paid grants to Estina’s bank account and had no real evidence of how the money was spent.


“beneficiaries were supposed to have been there before”


The investigator asked why the small farmers who were supposed to benefit from the project had not been identified before the project was implemented. 

She replied: “Under normal circumstances the beneficiaries were supposed to have been there before, that so I (won’t) say.”

The transcript reveals that Dlamini was unable to provide the name of the dairy project manager she had dealt with, saying it was difficult to remember.

DMR spokesperson Ayanda Shezi defended Dlamini’s appointment to a powerful and sensitive post.

Shezi said the department “has, in an attempt to ensure effective service delivery, exercised its rights to effect certain temporary lateral transfers in terms of the Public Service Act”.

She added that there was no legal requirement for the posts to have been advertised and all “lateral moves” had taken into account the required qualifications.

The department unequivocally follows due process in respect of all its appointments, Shezi said.

The treasury did not answer emailed questions about what progress has been made in its investigation of the project.


The amaBhungane Centre for Investigative Journalism produced this story. Like it? Be an amaB supporter and help us do more. Know more? Send us
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