/ 29 June 2016

Zuma will make an 85% profit on his Nkandla home after repaying the state R7.8m

File photo of then-deputy president Jacob Zuma at his homestead in Nkandla on December 13
Former president Jacob Zuma at his Nkandla homestead in 2007. (Gallo)


President Jacob Zuma has until the end of August to repay the state R7.8-million for taxpayer-funded improvements to his Nkandla home. But, ironically, that amount represents – conservatively – an 85% profit for Zuma.

Combining the findings of the treasury with a 2014 report by the Special Investigating Unit (SIU) shows that the Zuma family benefited to the tune of R51.5-million from state spending on their home. The R7.8-million repayment represents only a little more than 15% of that.

And thanks to a recent policy decision by Zulu King Goodwill Zwelithini regarding Ingonyama Trust land, the Zuma family will eventually be able to cash in on that state-sponsored benefit.

The treasury this week told the Constitutional Court it had calculated Zuma’s fair share of the Nkandla work at R7.8-million, and the court accepted that calculation.

That amount represents about 3% of what the state spent at Nkandla, not counting maintenance or legal costs since the upgrades started in 2009.

According to a clear order from the Constitutional Court, the treasury said, its calculation had been “limited to five distinct measures implemented at the president’s residence, namely, the visitors’ centre, amphitheatre, swimming pool, cattle kraal and chicken run”.

That big-five set of items came to be the focus of Nkandla inquiries after public protector Thuli Madonsela identified them as the most egregious examples of the state providing comfort and luxury to the Zuma family two years ago.

But Madonsela also expressed concern about other elements of the upgrades, such as a private medical clinic and extensive landscaping. And Madonsela had intended for the minister of police to add to that big-five list, the court said in March.

Instead, Police Minister Nkosinathi Nhleko limited himself to the big five, then insisted that all five were required as security measures and set Zuma’s bill for them at zero.

By also limiting itself and the treasury to the big five, the court absolved Zuma from payment for five more features identified by the SIU — working on the basis of a proclamation by Zuma himself – as nonsecurity elements that had “enriched” the Zuma family.

The SIU said the state spending on these items, for the benefit of the president’s family, came to:

  • R3.4-million for landscaping;
  • R4-million for air conditioning;
  • R4.5-million for internal roads for the use of the family (as opposed to security roads);
  • R10.6-million to move other households away from the immediate vicinity of the core Zuma family compound; and
  • R21.2-million for lifts in residences and emergency escape tunnels.

Though the Zuma family has the use of those features, built for a combined R43.7-million, the financial benefit is muted.

The Nkandla compound is built on land owned by the Ingonyama Trust and so is under the control of Zwelithini, in effect making it impossible to sell and difficult to get a loan against. (Zuma claims to have a bond registered against the property even though banks say that would be impossible for land under traditional ownership. Zuma has never provided proof of that bond, despite an obligation to do so.)

But in early June, Zwelithini announced his intention to issue title deeds to those who live on Ingonyama Trust land. If that happens, the Zuma family would become the owners of the land – and will be able to cash in on the 85% profit on the R7.8-million investment.