Pages

Saturday 8 December 2012

Nelson Mandela Bailed Out Debt-Mired Jacob Zuma, Audit Reveals

Jacob Zuma, Nelson Mandela and Thabo Mbeki have dominated South Africa’s political landscape since the end of racial apartheid in 1994. Photograph: Themba Hadebe/AFP/Getty Images
Jacob Zuma, Nelson Mandela and Thabo Mbeki have dominated South Africa’s political landscape since the end of racial apartheid in 1994. Photograph: Themba Hadebe/AFP/Getty Images
Jacob Zuma looked down and out. He had just been fired as deputy president of South Africa, his financial adviser had been convicted of fraud and corruption and now Zuma himself was facing charges. In a month from hell, he was also mired in debt.

Rescue came in the shape of Nelson Mandela, who bailed out Zuma with a cheque for 1m rand (then worth about £80,000). It was June 2005. Two years later Zuma came back from the political dead to beat Thabo Mbeki for the presidency of the governing African National Congress (ANC).
Mandela's surprise intervention was revealed in an audit published by South Africa's Mail & Guardian newspaper on Friday. The 500-page report by KPMG (pdf) offered a glimpse of the dynamics between the three men who have dominated the country's political landscape since the end of racial apartheid in 1994.
It also added to the pressure on Zuma's beleaguered presidency, with the opposition calling on him to step down after the report painted him as a reckless big spender dependent on benefactors who funded him to the tune of R7m.
Chief among them was Zuma's former financial adviser Schabir Shaik, who made 783 payments totalling R4m. Shaik was convicted of corruption and fraud in June 2005, prompting Zuma's dismissal two weeks later. The payments continued during Shaik's trial and even for a short time after his conviction until he resigned as Zuma's adviser, the audit shows.
It was such shady associations, observers say, that persuaded Mandela to step in for the sake of both Zuma – a struggle comrade and fellow former Robben Island prisoner – and the reputation of the ANC. The KPMG report quotes from an internal bank memo from 1998 that apparently refers to Zuma having been disciplined by Mandela and the ANC treasurer over his financial affairs.
Mandela gave R2m to Zuma in 2000; half went to an educational charity, while the intention behind the other half remains ambiguous. Then came the R1m cheque on 23 June 2005, nine days after Zuma was sacked as deputy president and three days after prosecutors announced he would be charged with corruption. At the time Zuma was more than R400,000 overdrawn on his various bank accounts, the Mail & Guardian said.
"Nelson Mandela gave him the money to pay off all his debts as a personal favour," said William Gumede, author of Thabo Mbeki and the Battle for the Soul of the ANC. "It was in the hope that he would walk away from all those dubious benefactors. The idea was to say: 'You know what, I'm seeing and hearing all this stuff and it doesn't look good. There are no strings attached but I want you to clean up your act.'"
Mandela, who left the presidency in 1999 after serving one term, was concerned about the movement he had served all his life succumbing to the cancer of graft. "Mandela said he was very worried about corruption and money being taken from dodgy people," Gumede said. "The ANC was meant to be a morally upstanding party. I think Zuma is one of the people he was thinking of."
Ralph Mathekga, a political analyst, said the incident showed Mandela to be both pragmatist and philanthropist. "I think there was a realisation that Jacob Zuma was indebted to the wrong people who could have compromised him," he said. "There was a sense of permanently rescuing him from Durban businessmen whose motives are extremely opportunistic.
"Nelson Mandela is a reconciliatory figure in the ANC; he doesn't give up on you. Jacob Zuma went to him as an elder. You could say this money from Mandela was coming from a guilt feeling that we have this person in the ANC, we cannot disown him, we have to rescue him from further indebtedness. It came as a way to save him from himself."
Mandela, now 94 and retired, is said to have admired Mbeki's grasp of economics and foreign policy, though their relationship cooled considerably once Mbeki succeeded him as president. "But Mandela liked Jacob Zuma, he always said so," said Zuma's biographer, Jeremy Gordon.
Mbeki's sacking of Zuma in 2005 and the split that followed threatened to tear the party apart. Since the traumatic transfer of power in 2007, Zuma has allegedly purged the party leadership of Mbeki loyalists, and acrimony persists to this day. Zuma is almost certain to retain the presidency at an ANC conference this month.
Justice Malala, a political columnist, said: "I think Nelson Mandela felt sorry for Zuma. Many people felt that Mbeki handled the firing of Zuma badly. They would much rather that it had been done in the family way."
The KPMG audit was compiled as police prepared for Zuma's corruption trial in 2006, but the case collapsed and it was never admitted into evidence. Zuma was recharged in 2007 but the charges were eventually dropped because of political interference, a decision that remains hotly contested in courts to this day.
The audit "lays bare in excruciating detail the ongoing recklessness of Zuma's financial relationships", the Mail & Guardian said. "Zuma blithely incurred large debts – for cars, property, loans, building his Nkandla homestead – without bothering to consider where the money would come from."
The audit states: "The financial position of Zuma deteriorated over time, mainly as a result of the fact of the shortage in daily funding required to fund his lifestyle … Zuma's cash requirements by far exceeded his ability to fund such requirements from his salary."
The opposition Democratic Alliance (DA) seized on the revelations. James Selfe, chair of its federal executive, said: "The DA calls on President Zuma to do the honourable thing and take a leave of absence from his office until all allegations against him have been dealt with. The report highlights both dodgy payments to Mr Zuma as well as his inability to manage his own finances."
Zuma's office and the Nelson Mandela Foundation did not respond to requests for comment.

No comments:

Post a Comment