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Zondo Commission hears no progress made in Transnet’s R647 million scandal

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Roberto Gonsalves

The Zondo Commission of inquiry into State Capture heard that no progress has been made into investigating the R647 million Transnet locomotives deal.  

On Friday, 24 May 2019, the Zondo Commission of inquiry into State Capture learned that there has been no progress on the Hawks’ side to investigate Transnet’s possible payment of R647 million to a locomotive manufacturer. Roberto Gonsalves is a minority shareholder into a consortium that was appointed to supply Transnet with locomotives, while China North Rail (CNR) was the majority shareholder. He appeared before the commission and revealed that, although a case was opened with Hawks in 2017, it has yet to bear fruit.

Gonsalves told the court that his company entered into an agreement with Transnet as part of the CNR Consortium on 17 March 2019. The consortium was mandated with supplying 232 of the 265 diesel locomotives to Transnet, each locomotive contracted at R42 million each. The total cost was R9.7 billion. He also told the court that ten days before the consortium submitted its final tender documentation to Transnet, the company requested that the project be moved from Pretoria to Durban. Since the manufacturing was initially supposed to happen in Pretoria, Transnet offered to pay for the relocation.

“We changed our prices accordingly, which added up to R9.7 billion, in our final documents,” he stated.

“There was nothing to relocate when we were told that the delivery point must be changed from Pretoria to Durban,”

“In my opinion, I don’t think we were entitled to the relocation costs. It’s not like there was this big crane that needed to be moved [to Durban],” he said.

Upon learning of the Hawks’ lack of action on the matter, deputy chief justice Zondo expressed shock at the inaction and instructed the commission’s legal team to contact the Hawks on the matter.

“Transnet does not take any action to recover the money and they do not tell you that there is a lawful cause for the payment. You go to the Hawks and you explained the matter that this is the money that was paid to our company and there was no reason for it to be paid, it is taxpayers’ money. There is one meeting (with the Hawks) and a year and a half later you have not been told of anything and there have been no arrests.

“It is very strange. How does it take a year and a half to conclude that kind of investigation when someone from within says there is no need for such a payment. It is a matter of great concern I think the legal team should take steps to get in touch with the head of the Hawks. I want to know what is being done about this. Why should it take so long for the matter to be concluded,” Zondo said.

Abenathi Gqomo

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