South Africa

Zondo: Ace Magashule and Mosebenzi Zwane helped Guptas milk Vrede dairy project

Ace Magashule and Mosebenzi Zwane were “pursuing the agenda of the Guptas” by failing to do their jobs with respect to the Free State government’s R280-million Vrede dairy project.

This is according to the fifth instalment of the state capture commission’s report, which recommends that law enforcement agencies investigate the two, who served as the Free State premier and Free State member of the executive council (MEC) for agriculture at the time of the dairy project scandal.

After a week-long delay, Chief Justice Raymond Zondo handed his final fifth and sixth reports to President Cyril Ramaphosa on Wednesday night.

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The report, which detailed allegations relating to the Gupta-linked dairy project, further recommends that consideration be given to seeking advice about instituting legal proceedings against Magashule and Zwane to recover money that was lost by the state through the project “as a result of their failure to perform their legal obligations”.

Between 11 June 2012 and 5 May 2016, Estina — a private company that only registered itself as being involved in agriculture months after the project was approved — was paid R280.2-million by the Free State department of agriculture. The office address of Estina’s sole director was at the headquarters of Gupta-owned firm, Sahara Computers.

Gupta-linked Estina was paid this amount on the agreement that it would deliver a dairy farm near the town of Vrede in the Free State, with the aim of uplifting the local residents by creating 150 jobs and benefitting black farmers.

But most of the funds were allegedly transferred from Estina’s bank accounts into accounts controlled by the Gupta family and their associates. The dairy project was “a complete disaster”, according to Zondo.

Zondo notes that one of the central figures in the project was former Free State department of agriculture and rural development head Peter Thabethe.

Thabethe was obliged to do proper due diligence in respect of any entity, such as Estina, appointed by his department as a partner. Estina had R16 in its bank account the day before the department of agriculture and rural development paid the first amount of R30-million to the firm.

The report states that Thabethe must be held both criminally and civilly liable for his role in causing the department to lose so many millions of rands in taxpayers’ money and recommended that the Free State provincial government sue Thabethe for the lost funds.

New Mineral Resources Minister Mosebenzi Zwane.
Mosebenzi Zwane.

In his report, Zondo states that Zwane also “shoulders a lot of blame for the debacle … because he failed to perform a proper oversight function” regarding Thabethe.

Zondo goes on to state that the dairy farm was “a project of the Guptas” and that Zwane has been found to be a “Gupta associate and a Gupta minister”. In 2012, Zwane and his youth choir were allegedly hosted on an all-expenses paid tour of India by the Guptas.

“It can be safely taken that he knew that this was a project of the Guptas and he was advancing the business interests of the Guptas,” the report reads.

Zondo points to evidence of Magashule’s links to the Guptas, including through his son, Tshepiso Magashule.

In 2019, former Free State economic development MEC Mxolisi Dukwana testified before the Zondo commission and said he understood that Magashule had facilitated the hiring of his son by one of the Gupta companies. Dukwana said Magashule told him that he would use Tshepiso to deal with the Guptas, because he was a politician and there was no law against his son doing business with the family.

In a section aimed at Magashule, Zondo later adds: “It is necessary that there be consequences for people who fail to do their job. Otherwise, this corruption and these acts of state capture are going to continue forever to the detriment of the country and all people … Premiers must know that they must supervise MECs and their departments.”

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Artmotion S.Africa

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