Enoch Godongwana has gone to ground over claims that he was paid a R100,000/month retainer by a government-funded tyre recycling company, itself mired in scandal.
The ANC’s head of economic policy failed to give his input into an explosive draft report prepared by forensic specialists Accountants @ Law. Drafted for the liquidators of the Recycling & Economic Development Initiative of SA (Redisa) and its external management company, Kusaga Taka, the report identified payments made by Redisa to Godongwana and his wife, Thandiwe, as well as former ANC MP Pule Mabe.
Godongwana failed to respond to repeated requests for comment from the Financial Mail.
Faced with the looming death of Redisa, its executives appear to have hit on a plan to pay off the prominent politicians to extend its life.
Redisa made monthly payments of R100,000 from February 2015 to February 2017 — totalling R3.1m — to Isivuno Consulting. Isivuno’s registered directors are Enoch and Thandiwe Godongwana.
The invoices Redisa provided to the accountants in support of these payments show Isivuno facilitated Redisa’s relationship with government and explored new waste streams.
If Godongwana successfully lobbied his colleagues in government to introduce legislation covering other waste streams, he would have been paid a collective R13m in success fees. Simply influencing them to amend Redisa’s mandate to include solid tyres, inner tubes and flats would have earned him a R3m success fee.
The ... transactions raise numerous, concerns regarding the lack of proper procurement procedures
Accountants @ Law was unable to reach Godongwana for comment on the payments, but it recommended that these be investigated by the Hawks to see if they breached anti-corruption laws as they might have amounted to inducements.
Damning payments of more than R30m were also made to Mabe, just as national treasury was preparing to move collections of the tyre levy from Redisa to the SA Revenue Service. The shift had been in the works since then-finance minister Pravin Gordhan’s 2016 budget presentation. This timeline is consistent with Mabe’s time as the ANC’s whip on the standing committee on finance.
In September 2016, the committee heard representations from Redisa on the Taxation Laws Amendment Bill, which Redisa argued would cut off its funding and was unconstitutional.
Had Mabe been able to whip the nine (out of 16) votes necessary to block the amendment to the bill, tyre manufacturers would not be paying the tyre levy to Sars now.
Accountants @ Law found Mabe was paid handsomely for transactions that made no sense. Between June and September 2016, Mabe’s companies Enviro Mobi and Kariki Media invoiced Redisa R30.1m for items such as tuk-tuks and placing inserts about Redisa on television.
The fact that Redisa paid for the tuk-tuks and then "donated" them back to Mabe, coupled with public relations firm FleishmanHillard being paid to place the same inserts on television, raised red flags with the forensic accountants.
"The ... transactions raise numerous, serious concerns regarding the lack of proper procurement procedures and authority, corporate governance, questions of lack of value, [and] breaches of the plan," the accountants say.
But Mabe, who is also a former Kusaga Taka employee, maintains he did nothing wrong.
"I have always understood Redisa to be a non-state-owned entity, and that all supply chain decisions vested with the owners of the business," he says.
"Because of our public standing our names often attract attention, since many out in the public domain have developed a very unfortunate narrative that politicians, and especially those attached to the ANC, are corrupt. This is very unfortunate as it intends to divorce ANC activists from the overall definition of any other South African whose rights are spelled out in the supreme law of the republic."
Asked to explain the payments nonetheless, Mabe says he cannot be expected to respond to the contents of a draft report.
"[This] has since been clarified with the relevant authorities, and a proper understanding established on the activities in question."
Redisa CEO Hermann Erdmann failed to comment.
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