The Gauteng provincial government has officially launched its controversial private equity fund without approval from national treasury.
The Mail & Guardian revealed the existence of the Gauteng Fund in the provincial fiscus two weeks ago. Gauteng has already spent R28-million on consultants, travel and salaries for the fund and a further R500-million will be contributed as seed capital.
Despite criticism from the Institute for Democracy in South Africa (Idasa) that the fund was anti-competitive and open to corruption, the Gauteng Fund was officially launched two weeks ago by Premier Paul Mashatile and finance minister Mandla Nkomfe.
According to national treasury spokesperson Thoraya Pandy, approval has still not been sought for the establishment of a private equity fund in government ”as stipulated by the Public Finance Management Act”.
National treasury will now engage with Gauteng ”to try and address the matter going forward”.
The media was initially invited to the fund’s launch where a press conference with Mashatile and Nkomfe was scheduled to happen.
But on the morning of the launch, the PR company employed by the fund informed the M&G that the press briefing was cancelled and that one-on-one interviews with Nkomfe would be set up.
The fund was launched at a cocktail function on Thursday evening, to which the media was not invited.
According to Nkomfe’s spokesperson, Percy Mthimkhulu, the media was not banned from the launch, but that the minister couldn’t attend the press conference because of executive committee meetings.
He did not respond to the M&G‘s questions on why treasury approval was not sought before launching the fund.