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Eskom denies allegations of a cover-up

Releases controversial Dentons report in blacklined format through PAIA process.

JOHANNESBURG – Eskom chairperson Baldwin Ngubane (pictured) denies he unnecessarily withheld information from the public by not releasing the contents of the controversial Dentons report.

The report, commissioned in an effort to get to the bottom of the power utility’s load shedding problems and compiled by polycentric law firm Dentons, was completed in July 2015, but its contents have not been made public. Eskom paid R20 million (excluding VAT) and disbursements of R1.425 million in relation to the report.

Following significant public pressure, Eskom announced on Tuesday that a “blacklined” version of the Dentons draft preliminary report would be released to a handful of individuals who applied for access in terms of the Promotion of Access to Information Act (PAIA).

Speaking at a media briefing, Ngubane rejected allegations that the contents of the report were being hidden from the public in an effort to cover up corruption.

He said the board accepted a tradeoff and decided to fix the organisation as quickly as possible instead of dragging out the Dentons investigation.

The tradeoff has paid off, he said, and it has used the recommendations to implement Eskom’s turnaround strategy. Thirteen of the 18 recommendations in the report have been implemented.

Noor Kapdi, managing director of Dentons in South Africa, said the firm provided the board with a draft preliminary report that represented the state of its investigation up to the date of the report.

When the last version of the report was presented to the board they realised that the findings were not dissimilar to the board’s initial suspicions of problem areas and they decided to stop the investigation to save resources, Ngubane said.

Kapdi said they advised the board that much of the information in the draft report required further investigation and corroboration for it to be credibly relied upon and that uncorroborated information and material would be removed.

Ngubane said the board didn’t curtail the investigation for nefarious reasons.

“We didn’t want to spend further money on a matter that seemed to tally up with own thoughts. Suggesting that the board tinkered with the findings isn’t only a gratuitous insult to the individual members of the board but to Dentons too.”

In light of Eskom’s obligation to third parties and the board’s fiduciary obligations it has consulted senior counsel on the matter. The recommendation was that it should release the report within the framework of the PAIA, Suzanne Daniels, group company secretary and acting head of Eskom’s legal and compliance department, said.

“The final report as accepted by the audit and risk committee and the board of Eskom will be the report that we will be using in the release process.”

Daniels said the report contained names of individuals and third parties other than Eskom employees and officials who needed to first consider the report.

“You will see that the report that is provided will have those names blacklined so that we can issue the necessary notices to the individuals. They do have the right to give us their view and it is Eskom’s obligation to consider that,” she added.

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This situation describes the main difference between a government-run institution and a private business. Entrepreneurs know at all times exactly what is going on in their business. Managers at SOE’s need to wait for a report from a law firm, then they first ignore the findings, then study it for years, then query it, then discuss it, and then, try to hide the damning facts.

In the mean time the taxpayer foots the bill while all this incompetence is going on.

From what I gather Dentons is a lawyers firm. How are they in a position evaluate ESKOM as a business unless the brief relates to legal matters in particular? If ESKOM needs advice from a business point of view it should come from Engineering/Business competent people not lawyers? I would like to see the details of this report and what the R20M was paid for. Something sounds fishy

Absolutely – this was not a ‘legal’ issue or one relating to negotiations or regulation – surely it was primarily operational in nature. What on earth do lawyers know about electrical generation and supply, they’d probably battle to change a light bulb. And 20 million!!! Plus the report was finalised in 2015 and Eskom still want to blackline it because they have not yet consulted interested parties. What utter BS!

Inge – next time rather just say multinational and not polycentric.

I would love to see the original scope of the brief and also whether the report actually talked to the scope, and/or, was the scope changed during the investigative process

Dentons is a legal firm but they work on a lot of power projects around the world (think they are London based) and likely had engineering support. Having said that, I have no idea what the scope of the report was.

Yeah – on the regulation, litigation, negotiation, investment type issues. But operationally and from an engineering perspective – very, very doubtful.

Oh! And don’t forget the 1.425 million paid on top for disbursements, whatever those amounted to! Some detail here would be handy.

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