VBS looting haunts the ANC in Limpopo

The ANC is facing a major pushback from its structures in Limpopo — including alliance partners and civil society — over the controversial decision to reinstate Limpopo treasurer Danny Msiza and deputy chairperson Florence Radzilani, who is also the former mayor of Vhembe municipality.

Under the banner of the Vhembe Fraternal Organisation — which includes the ANC Veterans League, the South African National Civic Organisation, the National African Federated Chamber of Commerce and Industry, trade-union federation Cosatu, the South African Municipal Workers’ Union and Congress of Traditional Leaders of South Africa — the organisations have written to the ANC top six to raise their displeasure at the “insensitive” decision to reinstate the two.

VBS Bank began in the Vhembe district of Limpopo. Most of its investors were poor people and villagers who live in the area.

In a letter to the ANC top six, dated July 13, the organisations accuse the governing party of taking an “insensitive decision” by reinstating the two leaders. The party, they said, had “rushed to take this decision without prior consultation”.

The top six comprises President Cyril Ramaphosa; his deputy, David Mabuza; secretary general Ace Magashule; his deputy, Jessie Duarte; national chairperson Gwede Mantashe; and treasurer general Paul Mashatile.


The letter warned the ANC that the decision could cost the party dearly in next year’s local government elections. 

Read the letter below:

Anc Nec Letter From Vhembe ... by Mail and Guardian on Scribd

“With the 2021 local government elections on the horizon, it will be an impossible task for the ANC and its alliance to campaign within our constituencies. This is because our people will demand answers on this issue since the arguments advanced so far are condescending, offensive and irrational,” reads the letter.

The organisations accuse the party of turning its back on the poor and siding with the two leaders accused of wrongdoing. 

“Our people have no one to turn to because the ANC government has not made any effort to assist the poor VBS victims with the Covid-19 relief funds. Most burial societies within our communities have virtually collapsed when their savings disappeared during the VBS scandal,” said the letter.

The ANC has been at pains to explain the controversial decision, which came a week after the National Prosecuting Authority began to move against those people implicated in the looting of R2-billion from the bank.

But the meeting was postponed after the alliance partners protested about the short notice.

In a letter sent to Magashule on Thursday, Cosatu secretary in Limpopo, Gerald Twala, turned down the invitation, citing the lack of proper consultation.

“We need to ask whether the ANC NEC decision on the reinstatement of the two leaders was consulted with the National Alliance Political Council or not … the matter must be treated with the seriousness it deserves regarding meaningful consulting with the alliance, the MDM structures and the victims of the VBS collapse. We are, therefore, not happy with the 30 minutes allocated in the meeting with the ANC national officials.

“As the federation in Limpopo we reaffirm our resolution that reinstatement of the two leaders should only happen after they have cleared their names in the Adv Terry Motau SC report on VBS. Until our national office bearers have been taken into confidence by the ANC national officials on the NEC decisions, as a province we are not ready to engage,” said Twala.

The internal ANC politics

But the reinstatement of Msiza and Radzilani can be seen in the context of factional political fighting in the province. The two are close to Magashule and are instrumental in the ANC’s upcoming provincial conference. ANC provincial secretary Soviet Lekganyane, who has publicly distanced himself from the decision to reinstate the two, is said to be gearing up to contest the provincial chairmanship. 

An insider at the party’s national headquarters, Luthuli House, told the Mail & Guardian that there were leaders in Limpopo with ambitions to take over from the current ANC leadership. “There are people who want to create the impression that Limpopo ANC is divided and also cause a situation that the current structure is disbanded by the NEC so that they can take over as a PTT [provincial task team]. 

“The NEC is the highest decision-making body in between conferences and it has a right to review its decisions and that is what it has done here [by reinstating Msiza and Radzilani]. We can’t charge people based on SMSes,” said the insider. 

Radzilani hails from the Vhembe region, where traditional leaders took a decision to support Ramaphosa ahead of the Nasrec Conference of December 2017. The Vhavenda King Toni Mphephu-Ramabulana was also implicated in the Motau Report on VBS — as having received R19-million. 

Dyambeu Investment, which was majority owned by the Venda royal family, owned 25% of the bank.

“The feeling by the VBS grouping is that Cyril [Ramaphosa’s] government has thrown them under the bus and has not protected them despite their support for him at Nasrec,” said the insider.

The issue of the bank’s rescue is a sore point for the locals. Despite their anger at the ANC’s decision to reinstate Radzilani and Msiza, there is a strong lobby for the Reserve Bank to revive the bank. The chairman of the Matsila Community Development Trust and traditional leader, Livhuwani Matsila, told the M&G that they had not received any response to the letter to the top six from Luthuli House.

“Our plea is that the ANC reverses its decision [to reinstate Radzilani and Msiza] and invokes its own internal disciplinary processes … for all the leaders that are facing charges. We are calling for consistency in holding its leaders to account,” said Matsila.

VBS in the North West

The issue of VBS has also been a sore point within the ANC in the North West, where four municipalities had unjustifiably deposited R314-million of taxpayers’ money. 

In late 2018 the ANC’s provincial task team, which was appointed after the Provincial Executive Committee was disbanded, had recommended to the ANC NEC that action should also be taken against the mayors of the four municipalities that had deposited money into VBS. 

But to date those recommendations have not been implemented. 

“Unfortunately, the PTT was dissolved after the elections, but the NEC had been engaged that the mayors should be held accountable. There was a clear political pressure that the monies should be invested with VBS. Also, the mayors should have known about the investments because they are supposed to get financial reports from the officials. I think that recommendation by the PTT was ignored because nothing happened to the mayors,” said China Dodovu, a former PTT member who was in charge of governance and legislation.

A forensic report, commissioned by treasury in the province, showed that Madibeng, Mahikeng, Moretele and Dr Ruth Segomotsi Mompati municipalities irregularly invested millions into VBS, contravening the Municipal Finance Management Act and other regulations. 

The report, by consulting and auditing firm SekelaXabiso, also said that there might have been some form of political encouragement for the municipalities to invest in VBS. North West municipalities have been found by the auditor general to lack accountability and transparency in the usage of public funds. It found poor financial management, governance and oversight, as well as a lack of service delivery.

“The root causes outlined in further detail below have resulted in the province’s current state of undesirable audit outcomes. The intervention by the provincial treasury and the provincial department of co-operative governance was riddled with political infighting and caused further instability within the municipalities, delaying improved delivery of services to communities,” reads the auditor general’s municipal report.

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Thanduxolo Jika
Thanduxolo Jika

Thanduxolo Jika is an investigative Journalist and Co-Author of We are going to kill each other today:The Marikana Story. The Messiah of Abantu.

Related stories

Advertising
Advertising

press releases

Loading latest Press Releases…

The best local and international journalism

handpicked and in your inbox every weekday