While she was social development minister of Gauteng, Angie Motshekga helped a trust — in which her husband played a key role — to land a stake in the lucrative provincial contract to pay pensions.
Motshekga, now Gauteng’s education minister, this week denied that her then-department had recommended in 2002 that the trust be given a 6% empowerment shareholding in Allpay Gauteng. Allpay, a division of Absa, is answerable to the social development department in its R170-million a year pensions contract.
However, the Mail & Guardian has seen a March 2002 letter contradicting her claim. In it, Motshekga personally wrote to Allpay that “I’d like to kindly propose that Sediba sa Basadi as a trust be considered” and that “Sediba sa Basadi is being proposed as the most suitable group”.
Motshekga referred Allpay to an “organisational profile” of the trust, which was described alternatively as a women’s empowerment company or as an NGO. The profile touted the Sediba sa Basadi Community Development Trust’s extensive involvement in women’s development work.
In fact, the trust was registered only about eight months later — by her husband, former Gauteng premier Mathole Motshekga, who described himself in the trust deed as Sediba sa Basadi’s “duly authorised director”.
The fact that Angie Motshekga used her influence as responsible minister to benefit a body in which her husband played a role raises serious conflict-of-interest questions.
Allpay this week said it would not have entered the agreement with Sediba had it known the husband of the provincial minister was involved.
And there are further questions over the true nature of the trust. It is likely already to have earned several millions of rands in dividends from Allpay, but it failed to give details to the M&G this week of how the money had been spent.
These revelations also throw new light on an attempt a fortnight ago to interdict the M&G from publishing an article in which it was shown that Joyce Kgoali, the chair of the National Council of Provinces (NCOP), had failed to fully declare her interests to Parliament.
In the parliamentary register, Kgoali declared that she was a trustee of Sediba sa Basadi, but failed to declare that she is a director of Allpay, where she represents Sediba or that she receives a stipend for performing that function.
Kgoali, who is a friend of the Motshekgas and who served in Mathole Motshekga’s provincial cabinet, this week refused to comment, saying she was precluded from doing so as the parliamentary ethics committee was examining the accusations of non-declaration levelled by the M&G.
The interdict attempt was brought by Moroka Matutle, the manager of her office, in the Pretoria High Court. It failed when the court held that Matutle had no right to represent Kgoali or the NCOP.
Understanding the real nature of the trust is further complicated by a filing last month to the Master of the High Court by Mathole Motshekga. The filing contained a new trust deed which omitted his name and described Kgoali as “director” and the person who had registered the trust. Alongside Kgoali, several new trustees were included. Earlier the trustees had all been employees at Sechaba Trust, a liquidation business which Motshekga chairs.
Motshekga this week denied that he had controlled Sediba all along, claiming that his involvement with the trust ended when he registered it.
Speaking through his lawyer Julian Meltz, Motshekga said he was “approached and duly instructed to advise and register Sediba”.
Asked about the appointment of his Sechaba Trust’s employees as trustees, Motshekga said: “Employees of Sechaba Trust in their personal capacities agreed to be such initial trustees without remuneration whatsoever”.
He said the decision to appoint the employees was based on “advice and consultation” with his “clients”. He did not say who those clients were.
Motshekga ackowledged that he had received financial benefit for the “professional” role he had played advising and registering Sediba. Said Meltz on his behalf: “Other than that our client has not benefited.”
Even if Motshekga received only “professional” fees, it may be argued that there was a conflict of interest as his wife had used her office to benefit Sediba in the first place.
Angie Motshekga, in her answers to the M&G this week — also through Meltz — denied a conflict of interest. Asked whether she knew of her husband’s involvement, Meltz answered on her behalf: “Our client is now aware that Dr Motshekga acted professionally in advising and forming the trust for Sediba.”
The coincidence of Angie Motshekga using her office; Mathole providing services; and their friend and colleague Kgoali’s appointment to the trust remains unexplained.
Dirk Kotze, the chief executive of Allpay nationally, this week told the M&G that when Allpay Gauteng tendered for the pension payout contract in 2000, it had a 34% BEE component. The tender board at the time recommended that it increase its BEE shareholding to 40%.
Kotze said Allpay decided at the end of 2001 to do so. “We decided that we should give 6% to an NGO. We went out and started talking to various parties. We then approached the Gauteng department of social services.”
According to him, the department referred Allpay to one Titi Lengosane, whom they said was an independent consultant dealing with NGOs.
It was in their discussions with Lengosane that the name of Sediba sa Basadi Community Development Trust first came up.
Other NGOs were also considered, but they were not suggested by the department, Kotze said.
Angie Motshekga this week firmly denied that she or her then-department had been involved in the selection process for Sediba to become Allpay’s new 6% partner, and she also denied that the department had recommended Sediba. Meltz, on behalf of Motshekga, said that “the relevant department at no stage recommended Sediba. They would have done the required credibility confirmation on Sediba as well as on other applicants.”
Motshekga’s letter to Allpay, seen by the M&G, however states: “In pursuance of our discussion regarding an invitation to a women’s group to participate in the pension payment programme, I’d like to kindly propose that Sediba sa Basadi as a trust be considered … Sediba sa Basadi is being proposed as the most suitable group.”
It is not clear what Mothsekga had based her recommendation on, since Sediba was not registered then and its track record remains unknown.
The M&G this week asked Sediba what work the trust was engaged in before it acquired the Allpay stake. It answered in writing: “We are and always will be committed to broad community support and development.”
Asked what projects Sediba has since invested in, it answered: “We are a non-profit trust … whose beneficiaries are those named in the trust deed.”
The trust deed describes Sediba’s beneficiaries very broadly as “members of Sediba sa Basadi Community Development Trust societies”. Attempts by the M&G to obtain details of specific projects or beneficiaries from both Sediba and Mathole Motshekga this week failed.
Sediba stated: “All monies received from Allpay are accounted for and … are provided for community development.”
Allpay’s Kotze said that if the company had known of the role played by Mathole Motshekga, it would not have given the shareholding to Sediba.