When Brian Molefe still headed state-owned freight company Transnet’s board, he allegedly asked that the board approve a R16-million increase to a controversial tender for 1 064 locomotives.
The value of the contract shot up R38 billion to R54.5 billion. This inflated contract, according to law firm Werksman’s report, was then divided between four suppliers of locomotives, one of them being the Guptas’ business partners, China South Rail (CSR).
City Press carried the details of the report’s findings on Sunday, which found that Molefe explained to the board that the inflation of the contract’s value took into account the fluctuations in currency value and variation in cost. This is despite the fact that these had already been considered in the initial R38 billion, according to the law firm’s report.
It has been reported that CSR was to set aside a R10 million kickback for the Guptas on every R50 million locomotive they built for Transnet.
After two and a half years into the contract – September 2017 – CSR had delivered only 41% of the 302 locomotives that were expected. The other companies had also underperformed, with only General Electric able to deliver more than 50% of the expected locomotives.
The report by Werksmans comes two weeks after three board members at the parastatal, chairperson Linda Mabaso and nonexecutive directors Vusi Nkonyane and Yasmin Forbes, resigned.
Molefe himself has been in and out of court after he had to leave Eskom, where he was CEO, when then public protector Thuli Mandonsela’s report implicated him in corruption at the energy utility – yet again related to the Gupta brothers.
Regarding the recent report on Transnet, the state entity’s spokesperson, Molatwane Likhethe, was quoted by City Press as saying the report was inconclusive, as all it said was that Molefe had signed the business case, which Likhethe said was standard practice for any procurement process.