Eskom takes Deloitte to court alleging improper contracts

Utility is going after consulting firm for R207m linked to contracts it was awarded by previous Eskom executives in 2016.
Jabu Mabuza says Eskom is asking the court to declare the activities relating to a batch of tenders 'unlawful and unconstitutional, to set aside the awards'. Image: Moneyweb

South Africa’s cash-strapped state power firm Eskom said on Monday it had filed court papers in a bid to recover R207 million in connection with contracts it alleged were improperly awarded to Deloitte Consulting in 2016.

Deloitte was not immediately available for comment.

Eskom, drowning in debt of over R450 billion and reliant on government bailouts to keep the lights on, is at the centre of a judicial inquiry into corruption at state entities, in addition to several other probes into mismanagement at the company.

On Monday, the power firm’s chief executive and chairman Jabu Mabuza said in a statement it was going after Deloitte for R207 million linked to contracts it was awarded by previous Eskom executives in 2016.

“Information before us shows that Deloitte engaged in activities that were unfair, inequitable, non-transparent and uncompetitive using off-the-record briefings with Eskom officials to submit proposals, and were granted contracts even though their pricing was way above their competitors,” said Mabuza.

Mabuza said Eskom was asking the court to declare the activities relating to a batch of tenders “unlawful and unconstitutional, to set aside the awards, and for Deloitte to pay back the amounts paid to them”.

The investigations and inquiries were triggered by the 2016 leaking of a trove of documents detailing relations between the wealthy Gupta family, former President Jacob Zuma, and deals struck with state firms like Eskom, as well a number of big companies including multinationals like McKinsey and Germany’s SAP.

Read: SAP opens probe into SA unit kickback reports

McKinsey overhauls SA office after graft scandal

The Gupta family and Zuma have denied the allegations.

Earlier in October the United States sanctioned the three Gupta brothers over the corruption allegations.

The probes have led to resignations and the firing of numerous executives in state firms, a broad presidential inquiry into graft, as well as the eventually axing of Zuma by his party in 2018 just months before the end of his second term.

At Eskom, which supplies 90% of the country’s electricity, the clean-out has seen the chief executive and chief financial officers pushed out in quick succession. 

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You have an incapacitated NPA and a nonfunctional justice system when it comes to the elite.

Just a waste of time and money in the hope ratings agencies will think they are doing something.

They have not even started dealing with Zuma’z stuff from decades ago.

What about going after “The previous executives”. I guess the answer is no capacity.

Not no capacity more a matter of is there just a little more to take before we jump ship.

Ten years later and still NO ONE’S IN JAIL.
Fraud and corruption really pay in S.A., as long as its big time.
Enough has been written about the Corrupt Eskom….I’ll say no more.

what do they actually want to prove with this “dramatic” step side ways – that there is some life / brains in eskom ???????????

what is happening to the guptas, the bee messed up deals and eskom’s own useless employees who could not even keep control over the quality of coal bought by eskom never mind anything more complicated???????????????????

On top of it all: who signed the eskom’s hush hush contracts if at all?? – where are these people now?? – surely they must also get very good legal hiding

Who in Eskom signed off on the contracts – if not in their authority to sign on behalf of Eskom jail them, if signed by the appropriate signatories and they knew the contracts were fraudulent jail them

End of comments.

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