Popo Molefe, right. Picture: BUSINESS DAY
Popo Molefe, right. Picture: BUSINESS DAY

Transnet needs to cleanse itself of "pervasive corruption" so it can improve efficiencies and win back public and investor confidence, its newly confirmed chairman says.

Transnet and Eskom are at the centre of President Cyril Ramaphosa’s bid to improve the management of public institutions engulfed by corruption scandals during former president Jacob Zuma’s nine-year tenure.

Ramaphosa named former finance minister Pravin Gordhan as public enterprises minister, and Gordhan this month appointed Popo Molefe as Transnet’s interim chairman and overhauled its board.

That appointment, along with the rest of the board, has been confirmed by the Cabinet, Gordhan said on Thursday. He also announced new boards for other embattled SOEs.

Molefe has dedicated his first days on the job to assessing the extent of the graft there.

"We need to find out how deep this problem has gone, because it is a pervasive problem," Molefe said in an interview on Wednesday. "It is in the interest of looters, thieves, corrupt people to compromise as many people as possible."

‘Deep’ claws

Transnet has been caught up in allegations of corruption linked to the Gupta family, who are friends with Zuma and have done business with his son.

The questionable deals allegedly enabled them and their allies to earn massive kickbacks on a locomotives deal.

Everyone involved has denied wrongdoing.

In April Ramaphosa referred claims of mismanagement and graft at state power utility Eskom and Transnet to the Special Investigating Unit.

"The claws run very deep, you can’t set specific targets to say ‘by this time we will be done’," said Molefe.

"As we uncover these things and the evidence is adequate, we will have to act and communicate, because our people want action."

Transnet reduced its seven-year capital-investment plan by 17% last year to R229.2bn in response to lower than anticipated freight demand.

"I am going there to help discharge the mandate of the company — it has to invest in infrastructure to and use that to attract more investment," Molefe said.

During Molefe’s time at the helm of the Passenger Rail Agency of SA (Prasa), the company made losses due to irregular spending.

He then challenged some contracts the company had entered into, alleging bid-rigging and corrupt activities.

Bloomberg

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