Ezulweni debt: ActionSA takes legal action against IEC for investigation ‘flip-flop’ [VIDEO]

ActionSA has announced it has taken legal action against the Electoral Commission of South Africa (IEC) for its ‘flip-flop’ on a commitment to investigate the Ezulweni debt settlement of over R150 million.

The political party also announced it has lodged formal complaints against the Economic Freedom Fighters (EFF) and uMkhonto weSizwe (MK) party.

This comes the day after several political analysts agreed that ActionSA leader Herman Mashaba’s own backtracking on an African National Congress (ANC) partnership has left voters feeling betrayed.

ANC’s debt to Ezulweni

Ezulweni Investments supplied election posters and banners to the ANC ahead of the 2019 elections, but was never paid.

The ANC strove to recover funding to pay for this, including targeting former financial manager Nhlanhla Mabaso’s pension.

This led to years-long litigation between the two, which nearly reached the Constitutional Court.

It even led to the sheriff of the court arriving at the ANC’s headquarters Luthuli House in December 2023 to seize assets.

The debt dispute was eventually settled out of court shortly afterwards.

ActionSA slams IEC inaction

ActionSA’s national spokesperson Lerato Ngobeni and national chairperson Michael Beaumont held a media briefing on Tuesday outlining why the party is taking the IEC to court for not investigating the settlement.

“ActionSA has, today, announced legal action against the IEC for its flip-flop on its initial commitment to investigate the over R150 million Ezulweni debt settlement agreement as well as announcing new complaints to the IEC against the EFF and MK,” said the party in a statement on Tuesday.

They said the Party Funding Act is being rendered meaningless by non-adherence.

The legislation places the onus upon a party to self-declare where its funds were received.

They pointed out that the ANC, African Transformation Movement, Congress of the People, National Freedom Party, African Independent Congress and  Pan Africanist Congress of Azania were recently ordered by the Electoral Court to pay fines of R40 000 for failing to provide audited financial statements.

“Following the two-line statement issued by the ANC in December 2023 that the party had settled the debt with Ezulweni Investments, ActionSA has been in a protracted battle with the IEC to investigate this matter purely on the basis that there is no way the settlement can be lawful in terms of the Act,” Beaumont said.

He said the settlement could not be legally discounted by more than R15 million and yet the ANC only had R10 million in disclosures in the quarter the settlement was concluded.

“It is necessary to observe that ActionSA has discovered that Ezulweni Investments is a registered vendor to at least one municipality in KwaZulu-Natal where it has been awarded tenders,” ActionSA’s chairperson added.

“A real concern exists that the real terms of this debt settlement may well involve South Africans footing the bill for this settlement.”

Watch ActionSA’s briefing below:

ActionSA told IEC will no longer investigate Ezulweni settlement

He said the IEC told ActionSA in March 2024 it was handling the matter.

“Yesterday the IEC’s legal team responded to a letter of demand reversing their earlier position and claiming now that there is no prima facie case to investigate.”

He called the decision a “flip-flop”, saying ActionSA’s legal team will initiate a two-part legal action:

• Firstly, to obtain the record of decision from the IEC to assess the rationality of their decision.

• Secondly, if necessary, to challenge the rationality of the decision to decline the investigation.

Ngobeni said President Cyril Ramaphosa had promised the government of national unity (GNU) would be a more transparent and accountable government.

However, he said this was not the case.

“We are going to hold those who have said they are going to constitute a government for us, we are going to hold them accountable.”

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Complaints against EFF and MK

ActionSA initiated a set of complaints that were issued to the IEC in relation to the EFF and the MK party on the basis of the “self-evident fact that their disclosures do not substantiate their campaigns”.

Beaumont said in the case of the EFF, R3.5 million was disclosed since the start of the 2022/2023 financial year despite spending an estimated R100 million on stadium events alone.

“Perhaps even more absurd is the disclosures by the MK party which, since its registration, managed disclosures of less than R400 000 in the context of an election in which it emerged as one of the most well-funded political parties and speculation of foreign funding.

“ActionSA contends that the IEC is not only the only institution in government empowered to investigate these matters, but that the IEC cannot wait for a party to self-incriminate before its legal obligations in terms of the Act kick in.”

READ MORE: Funding Act: It will be ‘easier to grab money with less transparency’ – researcher