6 December 2018

South Africa: Denel Cleans Up State Capture Financial and Governance Mess, Mkhwebane Dodges Inquiry

analysis

Denel has posted a R1.75-billion net loss for the 2017/18 financial year, incurred some R500-million irregular expenditure and, at a 10% brokerage fee, is paying four times the European rate for technical assistants - effectively arms dealers.

On Wednesday Denel told MPs a number of internal investigations are dealing with irregular expenditure, invalid contracts and how, as recently as last week, a Saudi delegation had to be told that contrary to rumours, Denel was not for sale. The weapons manufacturer might soon be looking for a R2-billion bailout. But actually, the numbers may just turn out to be the easy part.

Denel board chairperson Monhla Hlahla spoke brutally frankly before Parliament's public enterprises committee on Wednesday. The culture at State-owned Entity (SoEs) was one where people seemed to think the state, and thus the taxpayer, owed them a salary for doing nothing, or very little - even as the money crunch is on. And paying salaries against the odds in a financial crunch was also what politicians wanted.

"What do employees...

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