News / South Africa / State Capture

Molefe Seeletsa
Digital Journalist
3 minute read
13 May 2021
5:53 pm

Zwane fails to explain R30m prepayment to Gupta-linked Estina

Molefe Seeletsa

The former Free State MEC says that when it came to payments and issues relating to the PFMA, he did not get involved unless there were problems raised.

Continuing with his testimony after lunch hour at the Commission of Inquiry into Allegations of State Capture, former minister of mineral resources Mosebenzi Zwane could not answer why the department of agriculture in the Free State made Gupta-linked company Estina a R30 million prepayment before the company started work on the Vrede farm dairy project.

In 2012, Estina was identified as the company that would partner with the Free State government in the dairy project.

At the time, the plan was for Estina and the department to inject R500 million into the project.

ALSO READ: Paras Dairy’s ‘non-existent contract’ was never under suspicion, Zondo hears

The department then kickstarted the project with R30 million to Estina, but money continued to flow into Estina’s coffers, it was previously reported.

While the contract was cancelled in August 2014, Zwane stands accused of initiating the failed Vrede farming project in the first place.

Earlier during his testimony, the former minister said he only knew of Estina’s contract with the department after he left his position in March.

Zwane, who was MEC of agriculture at the time, told the commission that he was under the impression the department had a contract agreement with Indian-based company Paras Dairy instead of Estina.

Evidence leader Pule Seleka revealed that the department paid R30 million to Estina three days after Exco Services approved the project, despite Paras reportedly committing to invest R228 million.

Responding, Zwane told the commission he was not able to explain why the prepayment was made, adding that he was not privy to the details.

READ MORE: Investigator breaks down how Guptas raked in R229m from Estina project

“The nitty-gritties in terms of how this was arranged should actually be the work of officials like the CFO, which I have indicated earlier on that I have not seen the contract and those details would have been in that contract,” he said.

Zwane said when it came to payments and issues relating to the Public Finance Management Act (PFMA), he did not get involved unless there were problems raised.

“You will not find me as an MEC being involved in issues of payments. Issues regarding the PFMA are not my purview. I was on the ball,” he said.

Seleka then told the former minister that the procurement and appointment of Estina was not non-complaint with the supply chain management processes, as advised by the state law advisors.

The evidence leader said the contract between Estina and the department was already signed when the state law advisor saw the documents, to which Zwane agreed upon.

“I have saw that during this process as I was forwarded with the documentation. Yes I saw it,” Zwane said.

ALSO READ: Zwane rejects claim farmers were promised training in India

Asked if he was aware that Sahara Computer’s former sales manager, who was inexperienced in farming, had been sent to oversee the Vrede farm, Zwane said he was not and again that he did not know Estina was overseeing the project and thought Paras was involved.

The former minister said the process of the Estina contract should have been corrected and those responsible should have been held accountable.

On why the Vrede project failed, Zwane said he believed the reason it did not succeed was because of poor management by people responsible for the project.

Watch the live coverage, courtesy of SABC News, below: