Thulas Nxesi denies allegations in R500-million UIF bribery scandal

Employment and Labour Minister Thulas Nxesi has denied allegations by CEO of Thuja Holdings, Mthunzi Mdwaba, that he was one of the ministers implicated in the R500-million scandal involving Thuja and the UIF’s 750,000 jobs deal.

Mdwaba made headlines over the weekend when he alleged in a Sunday World report that three ministers demanded 10% of the R5 billion in the deal.

ANC secretary-general Fikile Mbalula was one of those implicated.

The deal hit a snag last December after Nxesi announced his department would put on hold the project by the Thuja Capital Fund Project, a subsidiary of Thuja Holdings, which was under the Labour Activation Programme (LAP), run by Unemployment Insurance Fund (UIF) and other partners.

WATCH: ANC calls on Youth League to respect members after Nxesi ‘insults’

“I have instructed the Director General (DG) of the Department of Employment and Labour (DEL) and UIF Commissioner to suspend this project pending a full report on all the matters that are raised about it in media reports and related matters,” said Nxesi at the time.

Nxesi: ‘Defamatory accusations’

Nxesi on Wednesday denied the allegations, saying it was not his first run-in with Mdwaba.

“The attacks on myself by Mdwaba began two years ago when we were obliged to withdraw our support for his candidacy for a position in the International Labour Organisation (ILO). Mdwaba blamed me for this, even though it was a government decision, emanating from the emergence of information on his past,” said Nxesi.

“Our paths crossed again late last year when media exposed a plan to pay over R5 billion of UIF funds to Mdwaba’s private company, Thuja. I acted immediately to stop any payment even in the face of Mdwaba’s threats of legal action, thus safeguarding public funds.

ALSO READ: Thulas Nxesi says Ramaphosa’s leadership is committed to fighting state capture

“I then called for a forensic investigation, which pointed to irregularities. We therefore instructed lawyers to prepare an application to set aside the Thuja agreement, and Mdwaba was removed as chairperson of Productivity SA.”

Nxesi said he would “address” the “false” and “defamatory” accusations against him, assuring South Africans the R5 billion deal would never see the light of day under Mdwaba.

“This is false and without foundation; not one iota of evidence is provided, in what is clearly a self-seeking attempt to divert attention from the issues around the R5 billion Thuja scheme. The allegation is also defamatory.”

Tomorrow morning I will be at the Sandton Police Station at 07h00 to Lay Charges of Crimen injuria against Mthunzi Mdwaba. pic.twitter.com/ongfAzueIq

— ANC SECRETARY GENERAL | Fikile Mbalula (@MbalulaFikile) November 8, 2023

Mbalula said he would open a case against Mdwaba.

“The secretary general of the ANC, Fikile Mbalula, will open a crimen injuria case against Mthunzi Mdwaba at the Sandton police station. The secretary general will read out a short statement after laying the charges,” said the ANC in a statement.

‘Deal has not failed’

Mdwaba, who introduced himself as chairperson of Productivity SA, claiming his removal was illegal, said he would fight tooth and nail to ensure the deal goes on.

He said that, although it may appear unusual for his companies to be considered for the project, what qualified Thuja Capital, registered in 2019, and Thuja Holdings, registered in December, just about a week before the deal, was that they were designed specifically and exclusively for the UIF.

ALSO READ: Labour market reform ‘too slow’ – Nxesi

“We formed this thing to make sure the UIF does not lose money, and saves money,” he told Newzroom Afrika on Tuesday.

“The deal has not failed at all. I will not stop, I will be relentless until it is implemented upon because it is a valid signed agreement having followed very robust and rigorous processes of the department of employment and labour and the UIF.”

State capture

The allegations against Nxesi come just over a month after Parliament’s Joint Committee on Ethics and Members’ Interests cleared him of any wrongdoing in the complaints arising from the commission of inquiry into state capture reports

A complaint was laid by the Democratic Alliance (DA) in 2020 following controversial businessman Edwin Sodi’s testimony at the Zondo commission, in which he revealed he had paid R45,000 to underprivileged schoolchildren following Nxesi’s request.

ALSO READ: ‘Complaint unfounded’ – Ethics committee clears Nxesi and Zwane of state capture allegations

Sodi, who was awarded a R255m asbestos tender in the Free State, was testifying about payments made to “perceived politically connected people”.

However, according to the committee, Nxesi provided an affidavit to the commission that the payment was not for his personal use.