The Section 194 Committee met on a hybrid platform on Day 66 of the Impeachment Inquiry to hear a continuation of the testimony of the Public Protector, Adv Busisiwe Mkhwebane. The day’s proceedings began with a request from the evidence leader that she be permitted to question Adv Mkhwebane on the completion of each of the five or six issues that she and her legal team intended to present to the Committee. They were identified by her legal team as: CR17, SARS so-called rogue unit, CIEX, Vrede, HR issues, and another category called Miscellaneous. She reasoned that there was a mountain of evidence running into thousands of pages and that it would be more manageable for the Members if each issue could be dealt with in its entirety before moving on to the next one. The Public Protector's legal team objected, declaring that such a procedure was unheard of in a court of law and that it would delay matters further as they would need to landscape each issue. The evidence leader's request was denied.
The Public Protector’s legal team resumed leading evidence on the CR17 matter. The Public Protector stated that the funds possibly totalled R1.2 billion but that was merely an estimation as there were accounts with various banks and monies were moved frequently from one account to another. The PP legal team pointed out that any one of those amounts would have triggered the R350 threshold above which gifts should be declared to Parliament. She pointed to an email in which the President himself requested a movement of funds from one account to another, showing that he was aware of the funds. The Public Protector corrected an earlier statement on the identity of the members of the Ria Tenda Trust, stating that the members of the Trust were the CR17 campaign managers and not the individuals previously mentioned. The legal team referred to a Mail & Guardian article which showed how the CR17 money was moved from account to account. The Public Protector stated that evidence proved that there had been a breach of the Executive Members Ethics Act (EMEA). The Public Protector stated that the beneficiaries of donations were ANC senior members and were functionaries or officials of the CR17 campaign. It was also common cause that the President provided an untrue answer to Parliament as he admitted his response to Mr Maimane was incorrect.
The legal team moved on to the eight pillars of the Public Protector’s Vision 2023 which would form a connection to the following topic. A lengthy discussion of the pillars concluded with the Public Protector's assertion that she had achieved a lot in pursuing those goals. The discussion moved on to how the Public Protector was obliged to present the 2015/16 Annual Report which covered the period before her appointment and how she had felt maligned by the Portfolio Committee that had expected her to answer to issues that were the concern of her predecessor. The Committee impugned her dignity and she had felt victimised. The situation was aggravated by wrong reporting by the media. Her legal team asserted that within three or four days of assumption of office, she was already in the firing line. The Public Protector presented a pie chart of cases successfully handled versus the 17 that had been set aside on review. She also spoke of her clean audit reports and other achievements. Her advocate praised the Public Protector’s work and that of her team.
On the second issue: the report on an Investigation into Allegations of Violations of the Executive Members’ Ethics Code by Mr Pravin Gordhan MP, as well as allegations of maladministration, corruption and improper conduct by the South African Revenue Service, which was referred to as the so-called Rogue Unit report. Of all the Public Protector’s reports, that and the Pillay (SARS pension) matter were the most litigated and contested reports during her tenure. Evidence was led that the accusation that certain people were not given an opportunity to put their case to Public Protector was because only persons who were implicated parties in the first phase were provided with an audi opportunity. Evidence led pertained to documentation that the Public Protector said proved that the "rogue" unit had been set up to undertake covert actions against taxpayers but had been illegal under section 209 of the Constitution. She alleged that ultimately approval had been requested from the relevant authorities but that was because SARS recognised that it did not have the authority to engage in covert activities.
The "mountain of evidence" was evident. The Public Protector stressed her interpretation of the documentation acquired through the use of section 7(9) requests for information. She was at pains to state that she never concealed the fact that she received a copy of the classified IGI document but stressed that, being a responsible citizen, she knew the need to obtain an unclassified copy and yet her request was denied or ignored by everyone until she approached the President. She declared that Parliament should have assisted her to obtain that and other evidence because the Speaker should have been a "mother" to her as she reported to Parliament. The other SARS cases, including Mr Gordhan not telling Parliament that he had been at a meeting attended by one of the Gupta brothers, were examined in detail. Having concluded the item, the legal team returned to a memorandum signed by former Minister Trevor Manuel, declaring that he was the smoking gun in the SARS “rogue” unit matter.
Finally, the legal team turned to section 181 of the Constitution to prove that the Public Protector had the right and responsibility to both assist the country to implement the Constitution and to ensure that the Constitution was a living document. The Public Protector referred to the Nkandla judgment, which stated that the Public Protector could access any information, go deep into raw state power, and acquire whatever information she required, which was why no one could refuse her access to the IGI report. She concluded, stating that instead of the National Assembly protecting her as the incumbent in the Public Protector’s Office, it joined in to victimise her or to "deal with" her. Parliament was instilling Chapter Nine institutions with fear, which would mean the citizens would be on their own and not protected.
The Chairperson delayed the start of the day’s proceedings as at the official time of commencement, he was awaiting a quorum of Members. Commencement of proceedings was delayed by 20 minutes.
Chairperson: Day Number 4 of the testimony of Adv Mkhwebane. Just start the proceedings.
Adv Mpofu: Good morning, everyone. Adv Bawa will make one or two announcements; the first one is just an omission of something we wanted to do yesterday, but she also wants to raise another issue.
Chairperson: Maybe in case both of you forgot, I will allow it if it has something to do with this witness in front of us. I am allergic to anything that takes us away from interacting with a witness.
Adv Bawa: Everything is relevant in a sense and I shall explain in a moment but let me just get the technical thing out of the way. Yesterday, a clip was produced interposing a verbal utterance of Justice Mlambo in two separate cases before this Committee, and I was under the misapprehension that what Adv Mpofu was putting before the Committee was him reading out the respective judgements I said that it is in the judgment; we can read all this. But as things progressed, I realised that what was being given was not the orders and I discussed it with Adv Mpofu. I want it to be clear to Members and everybody that those were sound bites out of the judgment that he was adding on behalf of in both cases; but it was a full bench from which Justice Mlambo was being recorded. So all that was effectively a few lines out of the bigger judgment. In doing that, I think the Members must understand it in that context; that was not an order of the judgment. So that is the first clarification to be made.
Chairperson: My understanding was that that would have been done deliberately. I suppose they wanted us to hear those parts.
Adv Mpofu: One hundred percent correct. And to make it easier to remember, on the 16th (March) when we were last here, we took the Committee to the actual parts of the judgment. All that happened yesterday was that I played that same thing. So the references were, as they were on the 16th, to parts of the judgment, but I think we just wanted to clarify because I said it was the body of the judgment and it was not.
Chairperson: Thank you for that.
Adv Bawa: And the second issue, which Adv Mpofu does not agree with as he is allergic to what I am about to say. There seems to be a plethora of allergies. Adv Mpofu has reached what we all understand to be the end of the Public Protector's evidence in respect of CR17. I would like to do my questioning on CR17 at this juncture before we proceed on to the next topic, which I understand is the South African Revenue Service (SARS) related matter. I understand that what I am asking for is a different approach but I do this for two reasons. Essentially, there is a lot of matter before this Committee but the Committee currently has fresh in their mind that which has been put to them over the last few days in respect of CR17 and so it would dovetail with me putting the questions to the witness now, while it is fresh in our minds, rather than in three weeks or four weeks or two months, depending on where things go in this inquiry when we would have forgotten what was being said. So that is the basis but the second advantage to this is that the respective teams would have finished off on a particular section and we could then simultaneously as we work, work on our report writing. It is incredibly difficult to start working on heads of argument. We've got frameworks etc. but the essence of it is incomplete. If we finish the CR17 section, we can get to it by the time all the evidence is finished. Now, I know that this is an inquisitorial process and the Committee or the Chairperson had discretion in respect of how the questioning is to be done. I have looked at it in various ways and I do not see any prejudice to the Public Protector in that regard. It is for Adv Mpofu to deal with that. I can see you are disinclined to entertain me.
Chairperson: I asked yesterday that people should not read my body language; it would be the most confusing thing you could do. So please go ahead.
Adv Bawa: I do not want what is almost an innocuous request on my part to take two hours. Hear Adv Mpofu on it and rule, because, at the end of the day, we do not want this request to hold us up. Consider that this next section is about the SARS matter. And you may want to say to me, I am not going to let you do it on CR17 alone, but when you finish the SARS matter, then you take those two issues together before you start on CIEX. But at the end of the day, we are going to have a lump of information. And that is my only point.
Chairperson: All right, thank you.
Adv Mpofu: No. It is just completely impractical. I am quite sympathetic to the fact that this witness is not like other witnesses and the evidence is quite bulky. We are talking about the witness statement which, in total, is 250 pages. So that alone is unusual. So I acknowledge that. But what has been proposed is completely unworkable for various reasons. The directives are very clear that witnesses give evidence and then they get cross-examined or in this case, questions are put by the evidence leaders and then the Members ask questions, and then I re-examine the witness. Now, imagine if we are going to do that for every item: we have about five or six broad topics that we have identified broadly. It is CR17, the SARS so-called rogue unit, CIEX, Vrede, the HR issues, which is a whole cluster on its own, and then we created another category called miscellaneous. Now, imagine this with those five or six units. That would mean we do the CR17, then there are questions put by evidence leaders and questions put by Members and then re-examination. We had the so-called landscaping because that section is cross-cutting through all the other things and it was to avoid repeating it every time we have a new section. We would now have to have another long day landscaping while that day was intended for the entire evidence. So, quite apart from the practicalities, it is the first time I have heard of such a thing. When I was trying to explain it and sell it to my team, one said it would be as if there was a case and there were charges of murder and robbery and possession of firearms, and they say: “Let us just do the murder, and then cross-examine and come back and say let us do the robbery…”
Chairperson: You are exaggerating a bit.
Adv Mpofu: But the point I think is made. We are totally against that proposal. It will make the process cumbersome, unwieldy and unworkable.
Chairperson: May I ask you to pause so that we do not go on? I am able to quickly make a ruling. In this regard. I think I hear Adv Bawa's reasoning and I think you also agree with that reasoning in terms of the almost acres of information, and the bulkiness of what we have to go through. So in that regard, it is persuasive but you have raised a number of issues. The practicality is key because we would not have featured that in our planning. I would want to err on the side of us not disturbing the flow and continuing as planned. If the two of you can think of how we deal with that, I will be wide open to that. But I make the ruling that we proceed as planned. It was quite a smart thing and has relevance to the witness. But it is not on the agenda, which I am consistent in adhering to. Adv Bawa.
Adv Bawa: I just want to make three points. Firstly, this is a novel process; the timetable has changed along the way all the time; this is not the witness. This is the Public Protector, who is the subject matter of this inquiry, coming to give her version. So the rules that apply to witnesses do not necessarily apply to the Public Protector. I know you have made your ruling but I may ask again after the second section.
Chairperson: I hear that too. Thank you for that. I know it is a novel process. It is convincing, but I make the ruling because I have an allergy to introducing rules in the middle of a process, but I will remain open to discussions thereafter. Adv Mkhwebane, we have taken altogether 38 minutes of your time from the start to now. That is noted. May I now hand over to you?
Adv Mpofu: Let me go straight into it. I just wanted to agree with you that for that proposal to work it would have to be by agreement between the parties. I am going to sweep up on a few issues and I promise I won't make it unnecessarily long, two or three issues just to round up the CR17 issue. The first issue comes from a section of the Bosasa Report 5. 2.17.
Chairperson: Page 56.
Adv Mpofu: Right, I shall ask questions building up to it. Now, I just wanted to clarify something regarding this matter, because again, we will always have to situate these things in the context of this inquiry. So this is this inquiry is not a Public Protectors investigation, neither is it court proceedings; it has a life of its own. So now and again, as the independent panel said, we have to understand that the judgments were made in a particular context of a review application and so on. So, we established that the CR17 managers, for example, had given a fee of R200 million as the total of the donations on the one hand, the President, when at the Zondo Commission, gave another figure of R300 million. We added up some of the figures and it came to about R1.2 billion. Remember the PP struggled to do the arithmetic. What I want to zoom into is a minor issue, where it does not matter whether it was R1 billion, R100 billion or whatever because I am going to refer you to the actual requirement for declarations. People will be surprised that the threshold is R350. So let us not be so much concerned by the billions; the actual requirement is very mundane and ordinary. That is why I wanted to ask you Public Protector to take the Committee through that paragraph at 5.17. And maybe read it out first and then explain its significance in your investigation. Maybe just before you do that.
Adv Bawa: I may not have been paying as much attention as I should have yesterday, but I am not sure that I heard the Public Protector confirm that it was R1.2 billion.
Adv Mpofu: Okay. PP, the figures, we spoke about R400 million here, R300 million, R500 million there and so on. And I remember putting a question to you and you said it was around about whatever. I can't even remember the figure but you made the disclaimer that you are not good at making these additions. And at least now, you have had 10 days to do the arithmetic. Do you have a rounded figure of those amounts so that we do not have to go back and just waste time?
Adv Mkhwebane: Last week, when I testified we calculated and I said I could not calculate how much it was. It was amounts of around R400 million, R300 million. And I said that was not the total. I didn't calculate all of them. Today, I am saying it is an estimation of that. Possibly R1.2 billion, but I am still saying that is an estimation. I remember there were various accounts: EFG2, the Standard Bank account, and the First National Bank (FNB) account. So monies were moving from here to here. So it is R1.2 billion. You will find that sometimes maybe the same money was moved twice. So it is just an estimation. The three campaign managers were interviewed and they estimated the amount to be around R200 million.
Adv Mpofu: I do not want this to be fixated on the amount. The whole point of this question is not to get too fixated on the numbers. So I am trying to get out of that mode. But be that as it may, now that you have given that explanation about the movement of monies from this account to that account, what role did that very fact play in your referral to the NPA (National Prosecuting Authority) regarding the question of so-called “round-tripping” of the money?
Adv Mkhwebane: Remember, in my testimony last week, I indicated that there was a movement of money from this EFG2, the attorneys who created the trust - and I must correct my previous indication that there were various people who benefited or the money was transferred into their accounts because we were showing the articles that were published the information - so it is EFG2, the Ria Tenda Trust - the members of the Trust are the Campaign Managers, not Khumbudzo (Ntshaveni), then Khumbudzo as a beneficiary (and Busiwe and, I think, Thembi Siweya) - she is the sole director of Phore Farms, so I am correcting that. And remember, there was the article in IOL and I insisted that there was the Mail & Guardian article which showed how the money is moved. We were supposed to upload that article, but we were still trying to find it. So that article has been found, we can just share it so that Members, when they go through this, can see what evidence was before me that made me come to this conclusion. So it is just proving that point that I had evidence before me, which I relied on.
Chairperson: So maybe you should walk slowly with us because I am aware that in that week, you certainly did say Mrs Ntshaveni was the sole director of Ria Tenda. It is essential to place what the situation is today on record. Just repeat and summarise that so that we have it correctly because you are now indicating that there are additional members of Ria Tenda. I just want to clear my mind that I follow the correction properly.
Adv Mkhwebane: So Ms Ntshaveni is not the sole director for the Ria Tenda Trust. The people who were the Campaign Managers, for instance, James Motlatsi and Donné were members of that Trust.
Adv Mpofu: I am sorry to interrupt again, but for the same reason, let us give full names, so when you say the name, Donné, is that Donné Nicol?
Adv Mkhwebane: Yes. So James Motlatsi and Donné Nicol were directors of Ria Tenda and then there were two other Members. I won't mention them; I shall only mention these two because I interviewed them. And then Ms Ntshaveni was the sole director of Phore Farms.
Chairperson: Not Ria Tenda. Thank you.
Adv Mpofu: Thank you, and Phore Farms was one of the entities that the monies went through.
Adv Mkhwebane: Yes, in paragraph 263 of my affidavit, I said some of the beneficiaries of donations were senior members of the ANC and were functionaries or officials of the CR17 campaign. Ms Marion Sparg, Mr Mxolisi Duma, Ms Thembi Siweya, and Ms Khumbudzo Ntshaveni were the people who were moving the monies from the Linkd Environmental Services account or from Ria Tenda directly into various accounts.
Adv Mpofu: Again, just for clarification purposes, can you maybe explain to the Committee the relationship between what you have just said and EFG2? So in other words, was EFG2 the vehicle through which those monies were distributed or it was one of the entities that you have mentioned?
Adv Mkhwebane: I explained that during the interview of Donné – it is in the Report - is the one who approached the attorneys EFG2 – Edelstein, Farber, Grobler Incorporated. And then the attorney's firm created a trust account. So all donors were deposited into that trust account, and then they would then move the monies to Ria Tenda and Linkd Environmental Services and then it was paid to various beneficiaries and various service providers. So that was how the money is moved. But then, as I said that our focus was following the R500 000 And then we uncovered all of this.
Adv Mpofu: Thank you. I think it is clear. We are done with the clarification. We will go to 31.7.17. This is the article that last week she mentioned when we showed the other one with Piet Rampedi and there were snide remarks about it. She said that there was a clearer picture. So, again, without going into the matter at least some of the entities that have already been identified in evidence are in that diagram. Number six, for example, is Phore Farms is what you are referring to. The sole member of the entity was the current Minister Khumbudzo Ntshaveni. According to this diagram, that entity received R8 484 000.
Adv Mkhwebane: According to our estimation, it was around R5 million, hence the calculations and estimations. And then there is Linkd Environmental Services, where I said some of the campaigns managers were directors, at R8 million. Then there is Ria Tenda and there is Edelstein, Farber and Grobler. Those are the three entities and that is the most relevant information which I have in the report.
Adv Mpofu: Just to remind people, Edelstein, Farber and Grobler are EFG.
Adv Mkhwebane: That is correct.
Adv Mpofu: I was at the point of asking you to read the 18.104.22.168
Adv Mkhwebane: I think just to clarify, let us start from 5.2 (252 in Adv Mkhwebane's affidavit) because that is the response of the President and I can show that we've incorporated it in the report. He is addressing exactly that R500 000 that is in dispute, because we structure our reports so that when a complaint is lodged, and we have an issue at the beginning of our investigation, then all the evidence we correlate will have to be evidence relating to that issue. In 5.2 the issue was whether he, the President, improperly and in violation of the provisions of the Executive Ethics Code and Disclosure of Members’ Interest for the National Assembly and Permanent Council Members exposed himself to any situation involving the risk of a conflict. So this is the issue we were investigating. And when we investigate an issue, then we go to common cause issues, i.e. issues which are not in dispute. So that is the issue of the R500 000 which was paid by African Global into EFG Attorney’s account for the campaign of the Presidential election campaign.
Adv Mpofu: Remember, using this as a tool to educate ourselves as to how these reports work. So the reason that you say it is common cause is obvious that that is the information coming from the President himself when he was correcting his answer to Mr Maimane. He says, “No, no, no, I made a mistake. I said that was my son and I looked him in the eyes, what have you… But now I've realized that it is EFG. So, therefore, it is common cause as nobody disputed that.
Adv Mkhwebane: Definitely. And as for common cause, even if there is a correction, as I told the Chairperson yesterday, we asked a range of questions because it was about the son, hence, as is common cause, the son was doing business (with African Global), but we were not investigating the son. That is why in the next paragraph, I say the issue was the President and his involvement. So now we go to the issue in dispute. So it shows here that we've incorporated the President in the report and we have involved him in the investigation and he responded. The President submitted a supplementary statement to my office, where he clarified the issue of conflict and his obligation to the National Assembly to disclose his financial interests received in his private capacity as a member of a political party - that is what I am being accused of in the matter, i.e. that I didn't have jurisdiction in the matter. So this is the response directly from the report. This was part of the rule 53 papers presented before all the judges. So he is then acknowledging that: “In light of your questions regarding the issue of disclosure of interest, I thought it appropriate to address you in this in this regard. During our discussion regarding the R500 000 donation that was paid by a law firm to the Absa trust account towards my presidential campaign for the presidency of the ANC, you seem to suggest that the donation amounted to a benefit and that it ought to have been disclosed.” So that is where the President is addressing that issue. And then he went further to indicate that he was a Member of Parliament and a Deputy President, acknowledging that and then went on: “In my capacity, I disclosed my financial interests as required by the Executive Ethics Code every year. I continued to do so until I was elected President in February 2018. So in this paragraph, the President acknowledges that he was supposed to do so. “…and based on the provision, I disclosed shares, financial interest in companies, other cooperative sponsorships, gifts, other hospitality and hospitality benefits of a material nature, foreign travel, land, and immovable property and pensions. I am also aware of my duty to disclose such information in relation to my spouse and my dependent children.” So the President shows that he understood what as the Deputy President and a Member of Parliament, he was supposed to disclose. So then he went further and said, “Since becoming a Member of Parliament and a Member of the Executive, I have taken care to be guided by section two of the Executive Members Ethics Act.” Again, the President acknowledges that he knows what section 2.1 says, which requires the President to publish a code of ethics, and which Members must comply with when performing their official duties.
Adv Mpofu: And now to point 22.214.171.124.
Adv Mkhwebane: That is still part of the President’s response. “The Executive Members Ethics Act states that the disclosure of benefits is required. Firstly, if it is a material benefit, and secondly, if it is received by the Member, although that donation may be regarded as a material in nature, on the basis that even the donations above R350 are subject to disclosure.” I think that is what I said. “The donation was not received by me. Instead, it was received by the CR17 campaign in strict confidence; in essence, the donation was not made to a Member.” So that was the argument that the President raised. Perfect. And then he went further, stating that, “I had no knowledge of a donation and therefore cannot reasonably be expected to have disclosed it when it was made, even if there was an obligation to do so, which there was not.” Okay, yes, fine.
Adv Mpofu: I think that the reason we bring this to the attention is that again is that we get buried in all this paper. But the essence is 126.96.36.199 and five-point 188.8.131.52 is the essence of this entire thing. Remember, yesterday, we said there were two defences: I did not benefit; I did not know. So that is where you find those two defences. The benefit was received by the CR17 campaign. I do not even know if that is a legal entity. It is just a thing. But apparently, that is the thing that received the benefit, not him. So that is his defence and that the thing called the CR17 campaign is not a Member of Parliament. And so that is the purported difference. And then the next one is okay: “I had no knowledge of the donation and therefore cannot reasonably be expected to disclose it.” That is the thing about “it was kept away from me, I didn't know who the people were, even though I addressed them at dinners.’ Now, the only point that you wanted to make is that despite the big amounts and so on, as far as you are concerned, the threshold for declaration is R350. Whether it was R200 million, R300 million, or R1.2 billion, as far as the law is concerned, all you would have been interested in is whether the duty to declare had been triggered.
Adv Mkhwebane: It's as simple as that. Remember, again, still repeating to Members of the Committee, and members of the public, going forward, know that the Public Protector will check what happened, what should have happened, where's the gap, what is the law saying, and how to remedy that? So here, he acknowledged that R500 000 was from Bosasa and he was a Member who was the Deputy President. He says he declared his declaration, but when we checked the declaration, he never declared and he acknowledged that he participated in the dinners. We had a person who attended who donated, Gavin Watson, but also before me, I had this evidence which we've shown - the bank statements, the emails, including one where he even personally said, “Move R75 million or whatever, to Ria Tenda” and all those. So that is why when the judges say, and even the panel says, I second-guessed, and I didn't take the President (sic). So for me, the decision was taken and when the drafter, the evidence and the analysis of the evidence by the chief investigator is brought to me, I also say that we cannot just make an accusation. What is the source? Where is the evidence? And that is what we did. So we were following this R500 000 donation and that is it. He never declared it, according to the record in Parliament.
Chairperson: I think you have traversed that mopping-up exercise.
Adv Mpofu: I do want to emphasise this as this is a highly controversial and political matter. It gets politicised and I do not want to be waylaid by that. So, the Chairperson said that you stumbled into all these other millions. Assume that you had not stumbled into anything - the bank statements, the emails and all the other things or even just the bank statements and the other big amounts and whatever, purely based on the R500 000 which the President himself brought to the attention of Parliament as having been received on by the CR17 campaign, and which is more than R350. Just based on that, forgetting the big amounts, was your conclusion that there had been a breach of the Executive Members Ethics Act sustained?
Adv Mkhwebane: It was because that was the focus, actually, the R500 000. Even if it were more than R1 000 or R10 000 and if he had not acknowledged that and the complaint was lodged, we wouldn't have known about that and we wouldn't have investigated. If the complaint were not lodged by the DA, we would not have followed up on our initiative. I mean, the investigation was done in terms of the Executive Members Ethics Act: a Member of Parliament complained and the investigation was conducted. That is why it is critical that I place this on record and still repeat it. It means then that my version that I am presenting because certain information is also sealed and the President acknowledged to the Zondo Commission that it was around R300 million. It would have helped for the Committee to directly engage the President on the matter, but you have taken a decision that you are not going to call him as a witness. So I think then, the information which I am presenting will assist the Committee to decide on this charge, although it means my version will be the only version which is before you. And the evidence I am presenting currently just to make sure that I showed the Committee that this was done honestly and without any ulterior motives as I was just doing my work the best I know how, according to the Constitution, the law, and the relevant prescripts in the Executive Members Ethics Act. And the President was a Member of Parliament as a Deputy President when the money was paid and he was obligated to declare it. When we checked the records in Parliament, the declaration of that amount was not made.
Adv Mpofu: Thank you helped me out. I won't ask you about the implications of not calling the President. So the last point then is to round this all up. We know that we do not have any we are not at liberty to share the CIEX documents and you referred to this movement of money, bank statements, emails, and what have you. But what we do have access to is paragraph 261 of your statement, and that just gives us a glimpse of a window and I shall just ask you to comment on the implications of that. So you stumbled on all sorts of information, and one of the emails says, “Hi, Donald, thank you for assisting with the internet banking the other day. Could you kindly transfer an amount of R20 million from the Money Market investment that was left after we shifted ('we', the persons included himself) R75 million from the Money Market Select to the Ria Tenda Trust Standard Bank account number blank, blank. I shall call you to confirm all this, signed, Cyril.”
Adv Mkhwebane: Yes. And that shows that he knew he was involved in the running. As I said even the monies which were transferred to the Cyril Ramaphosa Foundation clearly show that he was involved, but he also confirmed he went to the dinners, and he addressed those people who participated.
Adv Mpofu: So that is to say you did not disbelieve him them or mistrust his bone fides or whatever it is, without any reason, which was the conclusion of the court. In light of this, is that sustainable?
Adv Mkhwebane: It is not sustainable.
Adv Mpofu: Thank you, Chairperson. That is, that is what I wanted to do. If you allow me just to deal again with this small section on division now, you will see the connection. I am just building up to our next section. If you go to paragraph 154 of your statement. So you had what you call Vision 2023?
Adv Mkhwebane: Correct.
Adv Mpofu: It is now 2023. Okay, just the highlights, please - we'll see the connection when we get to the next big section. So, you come into the office in October 2016, you see what you see, find what you find and then at some stage, you build your vision for the non-renewable, seven-year term ahead.
Adv Mkhwebane: Correct.
Adv Mpofu: I am doing this because of something that we raised in the second statement, but we'll deal with it when we get there. I’d like Members to keep this in the back of their minds, that, you know, all these cases that we are dealing with here, I've got to call them high profile cases: CR17, Rogue unit, CIEX, Vrede and so on. These are four or five cases and we lose sight of the 50 000 cases of so-called Gogo Dlamini type of customer. So can you just broadly, just take us through the headlines of the vision - they are set out in paragraph 157: Access Vernacular, Footprint, Agreements, Safe Haven, Rights, Complaints Resolution, and Self-Protection. Just capture the vision, without going into the minute details, of what you had in mind for your seven years.
Adv Mkhwebane: Since he sits in the Portfolio Committee on Justice and Correctional Service, the Chairperson has heard me explain this, but it will help the other Members of the Committee, and even the public out there to understand that. I need to acknowledge Mr Themba Dlamini who was the CEO then of the Public Protector South Africa. After we had addressed various stakeholders, he said, “PP, we need to come up with your vision for the next seven years so that we know what you would want to achieve.” So this is the Vision 2023. It was drafted in such a way that we expanded the access. This is a constitutional obligation - section 182 (4) of the Constitution requires the Public Protector to be accessible. During my interview, I was asked 'how am I going to make sure to enrich the communities'. So the issue of access was to make sure that, because our institution is free, we addressed the issue of access. The main focus here is on the so-called “Untouchables.” So the focus of my mandate was purely on the issue of access. That is what we intended to do and access is achieved through the roadshows every year. There are community outreach programmes, and I have been accused of taking monies there, but we'll deal with that and explain what transpired. But outreach is continuing, and consideration is given to how we can have a bigger reach into the communities.
Adv Mpofu: Okay, just to assist the Members listening to this, and members of the public - you have just dealt with access. Now, access is the first pillar of your eight-pillar Vision 2023. Good. We are doing this against the background of what you said two weeks ago, that when you go to the office, nobody said, “Here is your job description, here's what is expected of you,” and so you had to also design your roadmap. And of course, you had to get the buy-in of Parliament, as you say, so you presented this vision to Parliament, correct?
Adv Mkhwebane: It is correct. Because every year when I present the Annual Report, we take them through this vision, and how far we are in implementing the vision.
Adv Mpofu: So, the second pillar?
Adv Mkhwebane: Vernacular, meaning the 11 official languages, because access I always say is not about the building, or the offices, which we have, it is impossible for us to have buildings in every corner of the country. So it is the issue of languages because Nelson Mandela said, “If you speak to a person when you speak in their language, you speak to their heart.” So we considered using indigenous languages, and using community radio stations, as well as SABC broadcasters because they are accessible, so people can understand and access this very important institution.
Adv Mpofu: The third one?
Adv Mkhwebane: It is its footprint. So since we can't have the resources to have an office in each corner, then we had this footprint to expand our footprint. We only had 19 offices of the Public Protector but then the Kuruman one was closed, because of the challenge that we didn't have enough people, but then we needed to consider other options. Then we identified traditional offices and various municipal offices and engaged with them to expand our footprint. Hence, it links to Agreements, meaning memoranda of understanding what we have with the Department of Justice, COGTA (the Department of Cooperative Governance and Traditional Affairs) and various traditional councils. We've established several service points because, before my suspension, we were also developing a way of having drop boxes in various traditional councils, so that members of the community or inkosi at imbizos, etc. can say: “My people have a challenge of ideas, Home Affairs is not doing this or the issues of road infrastructure mean children cannot go through.” So this was mostly then dealing with that. And my achievement is that we've signed a number of those agreements, and we are maintaining them. The office will then collect all the complaints and then we process them or we refer them to make sure that we are a safe haven to the members of the public, the poor, and the marginalised people who cannot exercise their own rights to engage and be assisted by public servants. So that is the other pillar, and then for us was to make sure to uproot the issues of the maladministration, which are occurring in state affairs.
Adv Mpofu: Okay, thank you. In that answer, you have covered the fourth pillar, as well as the fifth one, which is Safe Haven. Yes, let us move to the sixth one.
Adv Mkhwebane: The sixth one is Rights. You know, in several instances, it is only the empowered or those who are educated, who will exercise their rights and hold the public servants to account. It is very rare that you'll find rural communities exercising their right and making sure that they hold the officials to account. So when we conduct roadshows, we engage with them, and we involve amaKhosi, and everyone, using them as our ambassadors to engage their communities. So in this instance, we are also then empowering members of the public to exercise their rights. So this is where we also deal with a lot of systemic challenges. In other words, we are saying to the people, deal with that public servant yourself, expect and demand service, instead of complaining, but then you must be on your own and stand for your own right, deal with that so that as an institution, we can focus on systemic challenges and propose policy changes. So the next one is Complaints Resolution. This one is also very, very critical. Well, the Chairperson would know because the Justice and Correctional Services Portfolio Committee is where I ask them to make sure that there is a sector ombudsman. The tax ombudsman will tell you that, in a year, we process more than 2 000 complaints from members of the public about delays in dealing with their tax issues. And if we didn't have the tax ombudsman, more than 2000 people would be approaching us because of the delay in paying refunds. So we encouraged the establishment of a Health Ombudsman as well, the Military Ombudsman is helping the issue of military men, members of the SANDF. So this helps a lot. And what we've done as well is to engage with departments like Home Affairs. We have an MOU with them to deal with all complaints related to Home Affairs, instead of us investigating them. It has always been like that but now we formalised that structure and refer to Home Affairs for updates. It is the same with the Master's Offices in processing the issues of deceased estates. So there's an arrangement to quickly process thongs so that we remove a lot of the burden on the institution as, due to financial constraints, we do not have enough capacity. So that has been achieved and several bodies have those internal complaints mechanisms, including various municipalities such as Tshwane which we advised. Johannesburg has a Municipality Ombudsman, where members of the public can go and complain about service billing, so we, as the Public Protector's Office, are not doing the work of the public servants. This is very critical so that when members of the public can't get assistance from these institutions, then it is escalated to the Public Protector. We only deal with systemic challenges.
Adv Mkhwebane: Then the last one is Self-Protection, meaning people must be their own liberators. I always say I want each member of the public to be a public protector. So after we've empowered them, and I would say before my suspension, we were testing the Public Protector App because each and every family, including children, have smart phones. A child could advise gogo that if she has a challenge with her pension, it could be logged on the App. This Public Protector App would be promoted and it will indicate which institution can help one. And this app also not only helps with the issue of our mandate for those that have challenges with the public service, but it will also give support for challenges with short-term insurance, or any other private company. People also come to us thinking that we investigate private companies, which we do not. So this app will tell you, if you do not receive service from your insurance, then contact the Banking Ombudsman. I must indicate that we've achieved a lot in this particular issue. So those are the visions of Vision 2023.
Adv Mpofu: Unless there's any suggestion that any of those pillars were not being significantly achieved, as at the time of your suspension, and hopefully, by the time of the end of your contract in October, when you go back to the office, then we will assume then that will vindicate that statement of having achieved what you set out to achieve and which you shared with this Parliament. To direct the Members, there's a section that deals with your Annual Reports, since your assumption of office and I think you did say ironically that even the first report you presented to Parliament was not in your report; it was Adv Madonsela’s Report for 2015/2016.
Adv Mpofu: So from 2016/17 up to now, you are presenting your own reports, as it were.
Adv Mkhwebane: It is a fairly busy record. It is just that we need to be sure of 2015/16 or 2016/17. But then remember a financial year in government is from April. So it was the year-end April 2016 or March 2016. It was that report that, unfortunately, I had to present. Unfortunately, it caused a lot of uproar. It was blown out of proportion that I was criticising my predecessor. That report was showing that there were donor funds which I agree with my predecessor was done properly through the process, but then the question was the comments by Members of the Committee and me being a learned person saying I wouldn't be using donor funds because there are implications if you do that. Then I was criticized for that. And that is where the issue of Malunga was raised by the Members of Parliament as if I appointed Malunga, but then I was expected to deal with that matter and they wanted to know what I was doing. So that is where some of my problems started.
Adv Mpofu: Was that the issue about Malunga not having security clearance?
Adv Mkhwebane: Yes.
Adv Mpofu: All right. To make it even more graphic, the Members of Parliament were, rightly so, raising with you the issue of the absence of security clearance for the Deputy Public Protector but that was against the security policy that Prof Madonsela had introduced.
Adv Mkhwebane: Definitely. But again, it is just that Members of the Committee were concerned during the interviews because that is what transpired. They are representing members of the public and that is where they raised those issues. There was this issue and they said: “Public Protector deal with it.” I do not know whether they knew there was a security policy, but it was me who discovered what was happening, especially having worked in State Security for three months. Besides, when I was working at Home Affairs and was deployed to China, it was a requirement to have security clearance at that level. I discovered a lot of things when I was in Office and promised things to Members of the Portfolio Committee because that is where I accounted for the operations of the institution. So I think that is where some of the unnecessary attacks and wrong reporting by the media started.
Adv Bawa: Clarification, please. I am not clear if that was raised during Mr Malunga’s interview or whether the Portfolio Committee raised it.
Adv Mpofu: I understood it was in the interviews for the Public Protector, but let the Public Protector explain. Where was this matter raised?
Adv Mkhwebane: Okay, but during my first encounter with the Portfolio Committee when I presented my predecessor’s Annual Report. And it was I was appointed on 15 October, which was a Saturday. So I started on the 17th of April. And I was supposed to appear before the Portfolio Committee, I think on 9 October or 28th, that same week. But I was accused as if I was the one who did all those things but the very same person was appointed by the Members. They told me I needed to deal with it. “What policies do you have? We cannot afford to do this.” But I am saying that it was because it was widely reported during our interviews, where he (Mr Malunga) was asked questions about his security, clearance, citizenship and how he came into the country. So those were the issues which were deliberated. It was not me.
Adv Mpofu: That puts it into perspective but, even then, the issue was magnified.
Chairperson: Time to take a 10-minute break.
Chairperson: Adv Mpofu to proceed.
Adv Mpofu: I want to round off that issue we were dealing with, paragraph 91. I ask you to read it out because it covers some of the points you made. This would have been the occasion where, within three or four days of assumption of office, you were already in the firing line.
Adv Mkhwebane: “As indicated above, Adv Madonsela left the institution without having presented the 2015/16 annual report to the Portfolio Committee for Justice and Correctional Services. As a result, I had to be the one who presented the aforesaid report, and I was blamed for using external donor funding. I was informed by Dr Motshekga that "there is nothing such as free lunch.” The issue of the then Deputy Public Protector Mr Kevin Malunga’s security clearance was also sharply raised, which cautioned me about his involvement in dealing with classified information in any manner, which could be in breach of the applicable regulations.” So that was the origin. And I have indicated that there was the criticism which I received, especially from the mainstream media, because there was the article saying “Busisiwe hates Thuli.” I think it came from some organisations, NGOs or AfriForum, including the donors as if it were me who stopped everything. Not having received any expectations of any kind from my employer, I thought that in terms of the Public Protector Act, I was accountable to Parliament, and especially the Portfolio Committee and the expectations that they had of me. So I took it that I needed to act and deal with those, but then again, being security conscious myself and understanding how we should, as a country, protect our sovereignty, being aware of the weaknesses in the system, I had to make sure that I was compliant. Surely even when the Auditor-General audits, the auditors will check what policies government has and whether we, as an institution, were also compliant.
Adv Mpofu: So that is the end of that. I was saying that apart from that special presentation, you were presenting your own work in the following years to the Portfolio Committee, your own annual achievement goals for the next year, and so on, against Vision 2023. Correct?
Adv Mkhwebane: That is correct. That is what I did. And we tried with the office - there is something called that we need to reflect on which summarises my achievements.
Adv Mpofu: So if you go to paragraph 231 of your statement. You have told us about the vision, the pillars of the vision, and the road towards the achievement of that vision. And then here you call it “Main achievements in summary.” And you can read it out.
Adv Mkhwebane: ‘As at the time of my illegal suspension, the institution had released a pie chart attached as annexure BM13 which reflected, among others, the following key achievement areas:”. So it deals with the audits where I was the first Public Protector to receive three clean audits since the establishment of the institution; the investigation reports which we have managed to issue – can we just show that pie chart - Public education activities we've conducted, reports successfully defended in courts versus reports set aside and reviewed; finalised cases; the caseload. So that is where the achievements are reflected.
Adv Mpofu: We go to BM13 just to give perspective because, as I said, we sometimes will get bamboozled by the so-called “high profile cases” and lose the bigger picture.
Adv Mpofu: The pie chart is for the period October 2016, to February 2022, which would be two or three months before the suspension. Please take us through.
Adv Mkhwebane: We were still awaiting the audit of that financial year. It was two (clean audits), so it should be three after we've updated so.
Adv Mkhwebane: At the time 412 investigation reports had been issued, but it would be more because I had already adopted a situation where every month we issued reports and the intention was for it to be a public education process because when we issue reports, we inform the media so that people can know continuously know what we are doing. It's part of the outreach process but I understand that has been stopped. We had 2372 total public education activities. That was the outreach but, as I indicated, we had to restructure the outreach process because in the past, you'd find that an Outreach Officer would see five to ten people and we had to restructure that into the district model on the advice of Ms Motsitsi because she was from Department of Home Affairs, and she was using that model as the provincial representative of Home Affairs in Limpopo. So that was a good way of reaching bigger communities, especially using the district model that in each region. In KwaZulu-Natal, there are 11 districts so if we visit each district, at least we cover several local municipalities, and the agreements which are mentioned in the MOU, we can collaborate with them. So we also had public education work with the provincial speakers in their public participation process. So that is what it entails.
Adv Mpofu: You might have mentioned this before, but before your time, to knowledge were there ever these innovations of suggestion boxes in communities, places where they could drop complaints or whatever at the traditional leaders' premises, as well as the app that you spoke about?
Adv Mkhwebane: No, it was not there. Hence, I am saying that before it was community outreach officials in each province, organising themselves as the Public Protector officials and the number reached was limited. So we had to then re-arrange this process for a bigger reach. And I think this is very critical for me to take the public through this because it also goes directly to the issue of incompetence. It deals with what I have done for the greater community. Repeating the issue of the App - and I also have to acknowledge the Professor from the Northern Cape, who said: “PP now, for the Fourth Industrial Revolution, there are many ways for you to be accessible, which is a brilliant idea.” It was just dropped, and we ran with it. This is huge if it's taken seriously because it means in each house in South Africa, where they have at least a smart phone, and how many people are on Facebook or Twitter, and if you have this app, which is free, you download it, and you have a Public Protector with you on your gadget. So this is something about which I was so excited. I was even preparing to launch the app before my suspension because I was saying that you go out there, download the app and it will be helpful irrespective of whether you are educated or not educated. This app will help you because you have this gadget or advice in your house.
Adv Mpofu: So it's called an ad break and we should have had the number to dial at this point.
Adv Mkhwebane: I hope is there on the Public Protector website or they can even go to our Twitter page or Facebook page. It was uploaded and if not, we will also find a way of sharing it. So reports successfully defended in court were nine at that stage. So the story that the Public Protector was losing each and every case is not true. There are reports that we've successfully defended. And the courts have found in our favour and regarding the issues of costs, institutions were expected to pay back the cost to the Public Protector South Africa. Then reports which were reviewed and set aside by the courts were 17 compared to the 412 reports that we've issued. So ask yourself the percentage of lost cases, and yet I am labelled as this person who is incompetent and who does not know the law. I am only mentioning the reports which reached my desk and I signed them, having gone through the section 7(9) process. So by then, we had a total caseload of 60 962.
Adv Mpofu: For the record, 17 reports out of 412 amount to 0.04%. So less than 1%.
Chairperson: That is quite correct, statistically, but they are in different categories.
Adv Mpofu: Yes. So are the 17 (in different categories).
Adv Mkhwebane: Yes, that is correct but I am trying to educate the media that this institution does not only investigate the President and the Ministers. In February 2022, the total caseload was 58,964. And this is very critical for members of the public out there. Because when they say Public Protector, they think of Busisiwe Mkhwebane but it is humanely impossible for me to have done this great work. This is to the credit of each and every staff member of the Public Protector. We've got 19, it's now 18 officers. Now, each and every investigator is assisted by the support staff, because if it were not for them, the investigators wouldn't have managed to do this. This great work was also done by our communication section, which compiled this with the assistance of the strategy staff and everyone. So this is the impact of this office on the communities out there, but then there could be more that we could do. Government can capitalize on this institution and reach out to the communities or use us to support and strengthen government because that is all that we are there for.
Adv Mpofu: Just so that I can beat the Chairperson in the statistics game: your achievement of 58 964 complete investigations out of 60 962 is 97%, which I think deserves a round of applause. I am sure people at home are applauding. Well done.
Adv Mkhwebane: Thank you.
Adv Mpofu: So overall, on the achievements, and basically, how you would like South Africa to assess you as a Public Protector? I think that Mr van der Merwe, if I am not mistaken, is an analyst who has been there from the very beginning and has been with all the other public protectors and he says he has never seen the backlog at such low levels as at the time you were suspended. We do not know what it is like now.
Adv Mkhwebane: That is true because the Public Protector is there to investigate improper conduct in state affairs and one of the key issues is maladministration. Therefore as an institution, we cannot be guilty of maladministration where members of the public come to us they complain but we are the ones subjecting them to the very same issue. So it goes back to the issue with the team and putting a lot of pressure on them and an emphasis on them that we cannot be seen to be subjecting the public to the very same thing which public servants are subjecting them to. Hence, the pressured environment to deal with the backlog and not be accused of subjecting the people to the same maladministration.
Adv Mpofu: I think that is important. We'll touch on that later when we deal with the so-called HR issues and the audi letters and backlog deadlines and so on.
Chairperson: As you move to the next big topic, one Member has consistently been raising what you have just covered. Unfortunately, Mr Holomisa is not here to hear this, but we will brief him.
Adv Mpofu: Yes, from day one he asked whether the Public Protector had not won any cases. Unfortunately, coming back from the grassroots, where we have just been, we go back to the world of the high and mighty. So we are going to go to the next big report that features in your inquiry, which is known by various names, but more appropriately on this side of the table, we call it the so-called rogue unit. But you know what I am talking about. I think the proper name is the report on An Investigation into Allegations of Violations of the Executive Members’ Ethics Code by Mr Pravin Gordhan MP, as well as allegations of maladministration, corruption and improper conduct by the South African Revenue Services. That is the long name of the report but we will call it the so-called rogue unit report. Of all your reports, this and the Pillay matter were the most litigated and contested reports in your tenure. Agreed?
Adv Mkhwebane: That is correct. Yes.
Adv Mpofu: Just from my own experience, this report, which has gone in various guises to the lower courts, some aspects went to the full court, which went to the Constitutional Court and back and then, of course, the full court matters, including the Jafta J bench, and then the Kubushi bench in the Pillay matter. But all these matters involved essentially the same players: Minister Gordhan, Mr Pillay, Mr Magashula and a few others, correct?
Adv Mkhwebane: That is correct.
Adv Mpofu: Now, let us look at that web of litigation and some of those thousands of pages that we had around these issues. According to the independent panel, it ran into something like 5000 or 6000 pages. In fact, there were 11 000 pages. That is the general background. So let us go through it, step by step. I just want to confirm that you are aware of evidence from Ms Mvuyana in particular, that even before your time in 2014 or so, there had been a related complaint confined to the HR issues around this so-called rogue unit, correct?
Adv Mkhwebane: That is correct. It's covered in the report.
Adv Mpofu: It's also covered as part of the background in there. And also, just to get one issue out of the way, this is relevant to one of the accusations where the Public Protector is accused of calling this unit a rogue unit even before you issued a report, in other words, suggesting that you were pre-empting the outcome. But we will show later that. I think it's Mr von Loggerenberg ironically. One of his affidavits actually tells us where that term came from, which was from the Sunday Times when the story erupted in 2014. Are you also aware of that?
Adv Mkhwebane: Yes.
Adv Mpofu: I think I said to one of the witnesses at that time that you were in China minding your own business, not even dreaming that you would be a Public Protector.
Adv Mkhwebane: Correct.
Adv Mpofu: Then you do become the Public Protector, two years later. Please take us then to the beginning, which is one day sitting in your office on 12 October 2018 and then there's a complaint by Mr Floyd Shivambu of the Economic Freedom Fighters, also their Deputy President and chief whip. Then there was also an anonymous complaint. What, in a nutshell, were the issues? Page 4219 of the so-called Rogue Unit Report.
Adv Bawa: For record numbering purposes, the report is in three different places.
Adv Mpofu: I am happy to go along with whichever.
Adv Bawa: I suggest we use the one in the full report: Bundle E, No 7, Page 216. It's the one that would be attached to Minister Gordon's founding affidavit in the record that you have.
Adv Mpofu: The Public Protector says: “The first complaint was lodged my office and turf October 2018 by an anonymous whistle blower. The second complaint was lodged on nine November 2018, with my office, and Mr Floyd bamboo of the EFF, deputy president and chief whip. And the complaints were that …” Then you list 14 different complaints. It's a long list. Fortunately, they were cut at some stage, but just to give the landscape. Can you go through them?
Adv Mkhwebane: The complaint, which was lodged by Mr Shivambu and the follow-up by the whistleblowers is in the executive summary: 1) that the former commissioner of SARS, Mr Ivan Pillay failed to follow proper recruitment procedures in the appointment of Mr Yolise Pikie and Mr Johann van Loggerenberg; 2) back to Mr van Loggerenberg unlawfully received cash deposits paid directly into his personal First National Bank (FNB) bank account from taxpayers and/ or representatives under investigation by SARS during 90 November 2012, and 28 May 2014; 3) Mr Jonas Makwakwa unlawfully received cash deposits into his personal bank account from taxpayers and/representatives under investigation by SARS’ 4) during the tenure of the former Commissioner of SARS, Mr Pravin Gordhan MP (Mr Gordhan), SARS established an intelligence unit in violation of the South African Intelligence prescripts. The intelligence unit was confirmed by a SARS investigation report compiled by Adv Sikhakhane; 5) SARS violated section 41(1)(e) of the Constitution by not respecting the constitutional status, power and functions of the National Intelligence Agency. (So I think they mean the SSA currently.) 6) SARS irregularly procured intelligence equipment, which the intelligence unit utilised for gathering intelligence; 7) SARS failed to follow proper recruitment processes in appointing employees who worked for the intelligence unit; 8) the SARS Intelligence Unit irregularly bugged the offices of the National Prosecuting Authority (NPA) and the Directorate of Special Operations (DSO); 9) SARS, based on an instruction from Mr Gordhan, as the former Minister of Finance, in 2012, pursued the tax affairs of the current Economic Freedom Fighters President, Mr Julius Malema MP, without a legal basis; 10) Mr Pillay was appointed to the position of the Deputy SARS Commissioner and subsequently as SARS Commissioner whilst he did not possess the necessary qualifications for the positions; 11) SARS failed to follow correct procurement processes in the appointment of Accenture; 12) SARS irregularly extended the SARS IT tender for 12 years, resulting in fruitless and wasteful expenditure that has escalated to R8 billion to date (that is what they said.); 13) that SARS purchased an IT company by the name of Interfront for an amount of R72 million while the company was worth R2 million at the time of purchase; 14) that Mr Gordhan violated the Executive Members Ethics Code by deliberately misleading the National Assembly in failing to disclose that he had met with a member of the Gupta family since taking office.
Adv Mpofu: So those were the 14 complaints combined. And we are all familiar now with some of the landscape and the EMEA complaint, which is almost similar to the CR17 complaint about allegations of misleading. That confusion about the 2007 code does not feature here because the complaint already states “deliberately misleading” the National Assembly. You decided to slash these 14 items into two chunks, the so-called Part One investigation, and Part Two. This is quite important. So the issues that were then isolated and the Public Protector will tell us why but I am just using them to avoid giving the long description every time we talk about them. The first one is the EMEA issue, which we'll call the Gupta issue or misleading of Parliament or the EMEA issue, as I've just said. The next one will be what we call the establishment issue. It's important to isolate these issues. In other words, this deal strictly with the establishment of the unit, apart from its activities or whatever. Then number three, we'll call that the procurement issue and that is to do with the procurement procedures. It's the allegations that say SARS failed to follow correct procurement procedures when procuring intelligence equipment. Anyone who is ever worked in the PFMA (Public Finance Management Act) environment like me, will tell you that is a bread-and-butter issue. How did you procure this? When did you procure it? And then the fourth issue, we call it the recruitment issue and that deals with whether the people who were working for the unit were properly employed as SARS employees. And then the fifth issue, we call the operations issue as it deals with the actual core activities of the unit, as to whether they were rogue or not. And really, I think the “Rogue Unit” really relates only to that issue. And then the last issue is what we call the qualifications issue and that is the whole thing about the Matric Certificate and Mr Pillay being employed as the Deputy SARS Commissioner. Now, you then separated it into two issues. Let me ask you two things about the separation: a) what motivated the separation? In other words, what was the logic of the separation? And what was the relationship between those six issues that made up part one?
Adv Mkhwebane: We had to split the issues based on the fact that there was an EMEA complaint, which needed to be investigated within 30 days, which is very difficult to do, but once try striving to come up with various strategies to deal with these matters expediently. So that was the main intention but I would want to go to the ones we didn't investigate because they deal directly with Mr van Loggerenberg who is also one of the witnesses and who is also accusing me of not consulting him. So I think that will be critical. But the intention of doing that was because it was an EMEA complaint and I indicated yesterday that was also done by my predecessor, while it was not involved in EMEA, but then she had her own intentions that “Derailed” report plus the Prasa investigation. Normally I would say to the team leadership that one day the Auditor-General will be very strict and want us to even account for the issue of performance. Now, they are focusing more on the issues of procurement, irregular, unauthorised and wasteful expenditure, but even then, they do check performance, but not that much. But if they were going to be very strict and also check the compliance to various legislations you are obligated to comply with chapter 12 of the Constitution. You need to have a security policy. You need to comply with the government policy of NIS and therefore comply. When they come to us one day and say: “ Public Protector, there's the law. You are the sole agency that was investigating within 30 days, you do not do that.” So hence the motivation for splitting these issues into six, and then the remaining (ones) were dealt with as part of the second investigation. So that is what motivated me to do that. And I think, in any investigation, I said yesterday that there is a delay in investigating because sometimes you will find yourself having to look into all issues. When we issue a letter of document request, we include each and everything. You saw yesterday when I was dealing with the Phala Phala matter that will include tax evasion and other matters because when we receive the information, that is where you decide whether the matter still needs a lot of follow-up. If so, it will take longer. That is for the Public Protector to decide. In this one, I would have decided to separate the two matters which needed follow-up and other information. I would decide to deal with this as part one and that as part two. For the sake of the person who is being accused, because you do not want something to be hanging over their head, you want to dispense with the matter as quickly as possible. So that was the main intention.
Adv Mpofu: In all the reports that we are going to deal with, which are the so-called high-profile matters, there will always be public pressure. I think Mr Tshiwalule or even Mr Kekana, Mr Samuel and all the people who were involved in all those high-profile matters would say that the public, understandably, wants to get quick answers. And you have just mentioned the Phala Phala matter and Cr 17 just because they are topical matters. And even if the 39 days is not achievable, it's incumbent upon you as a leader to find ways to minimise the period. Correct?
Adv Mkhwebane: Yes, correct.
Adv Mpofu: And, without going back to yesterday's evidence, the Chairperson said I was giving a compliment about the speed with which you acted in from the complaint from Mr Zungula. So that was generally the motivation. Now, maybe take that example. Why did you not split this matter like that?
Adv Mkhwebane: I sent those 31 questions and the question was do we delay, do we wait for all the forensic evidence, do we go to SARS, do we go to any other institution to collect the evidence? So that was not done because it was going to be quicker to dispense with a violation, possibly of section 96 of the Constitution or a violation of the Executive Members Ethics Act, especially after the acknowledgement or the statements that the President made about trading in this and dealing with that. So those are the considerations. We would then say, “Let us deal with it and be over and done with it.” Then we would deal with possibly the forensic investigation later. It was purely based on the fact of compliance and dealing with matters speedily
Adv Mpofu: So the split is done and I've given the Chairperson the shorthand for about six matters that you did isolate. I think what you wanted to highlight of the matters that you did not do was an issue which I have raised with Ms Mvuyana and, to some extent, Mr van Loggerenberg because you remember his big gripe is that he was not given section 179, he was not given a right to be heard and all that. Did Mr van Loggerenberg feature anywhere in the six issues that formed part one of the investigation as an implicated person?
Adv Mkhwebane: That is where we are going back to the issue of the six items. Firstly, Mr Gordhan, the fast-tracking of the EMEA; secondly, Mr Gordhan as the SARS Commissioner as the accounting officer establishing the unit; thirdly, the recruitment processes, the issue of the operations and the appointment of Mr Pillay as the issue of qualifications. The Committee must see how we structured the issue - we were not investigating the matric certificate; we were investigating the qualification. Hence the issue of serving Mr Gordhan and Mr Pillay because they were implicated parties at some stage; they were accounting officers at some stage and they were at the executive management level. Mr van Loggerenberg was not at that stage - Part A - implicated because we were going to deal with him and serve him with a section 179 if there was any way he was implicated when we did the second volume of the investigation where you find him being mentioned as having benefited directly.
Adv Mpofu: He was featured in the issues which were separated. And you can see his name in two parts A and B. And I think for perspective, we should also include C. The first time his name appears is an allegation that issues relating to the Commissioner of SARS, Mr Ivan Pillay, for failing to follow proper recruitment procedures in the appointment of Mr Yolise Pikie, and Mr Johann van Loggerenberg. In that issue, did Mr van Loggerenberg feature as an implicated party?
Adv Mkhwebane: In this instance, remember, we were investigating the former SARS Commissioner, Mr Ivan Pillay, for the appointment and relating to him as the decision maker and the processes he was supposed to follow when he appointed those two. Maybe to simplify this matter, the person or the employer who appoints a public servant can be punished if he didn't follow the process, not the public servant. As an institution, we investigate the decision maker. So here, the person who was supposed to account - the example I gave yesterday of a municipal manager who appointed somebody who did not qualify. We have to deal with the accounting officer, the municipal manager, etc. We cannot serve a section 179 on the particular person who applied and didn't follow the processes and was appointed. So normally, when we investigate, we deal with the improper conduct of the decision maker. So in this instance, that is what transpired. We were expecting answers from Mr Ivan Pillay because that is where we will say, “Did you advertise the position when you were appointing Mr Pikie and Mr van Loggerenberg? Where are their CVs? Where is the panel which sat to determine their appointment? What does your policy say about that because you have you should have done a job evaluation (JE)? You should have indicated that for this position, you should have a degree or qualification or so much experience. So that is what was expected in this particular instance. And even in point 1(a), a lot of engagement was going to be with Mr Pillay on this one.
Adv Mpofu: Yes. But was Mr van Loggerenberg an implicated party?
Adv Mkhwebane: He was an affected party, he was implicated. Okay, but he never appointed himself. Oh, yes.
Adv Mpofu: Now, let us go to B so the Chairperson’s question of yesterday is answered. There is an allegation against Mr van Loggerenberg. It says he unlawfully received cash deposits paid directly into his personal FNB account from taxpayers' representatives, and then the investigation by SARS during November 2022 and May 2014. As far as this allocation is concerned, was Mr van Loggerenberg implicated?
Adv Mkhwebane: We were supposed to deal directly with him, issue him with that letter, the document request. Ask questions, everything, because then that is the first Audi.
Adv Mpofu: And I said we'll read C, just for perspective, you will see that almost word for word, the allegation is now pitted against a Mr Makwakwa that Mr Makwakwa unlawfully received cash deposits into his personal account from taxpayers and representatives and was under investigation by SARS. So he was the implicated party?
Adv Mkhwebane: Mr Makwakwa? Yes, the same as Mr van Loggerenberg, so he was supposed to be contacted to be served with section 179, interviewed and everything. So he was going to be an implicated party if we found any improper conduct.
Adv Mpofu: Yes, the question is both Mr Makwakwa and Mr van Loggerenberg would be contacted and so on as implicated parties concerning B and C? Yes, but would that be in part A of article one, volume one, or in the second volume of the investigation?
Adv Mkhwebane: Volume two.
Adv Mpofu: I think that goes 80% to answering the Chairperson. It's close enough. Now let us then go back to volume one or part one or whatever of the investigation. So now, we know who the complainants are, we know what the issues are, and we know the implicated people and who the implicated people are not. So then what then happens next, and I am doing this just to see how these things flow into being. That is why I started from day one when she receives the complaint and where she then separates them. So notionally, then, we are on day three. What happens next? You have received the complaint, you have separated, and you have told us the logic of the separation. And now what did you do next?
Adv Mkhwebane: Then the critical issue for the public to know is that in any institution, the complaint is lodged, and a file has been opened. I am in no way analysing, assessing and doing all this but the issue is when an EMEA is lodged, that is where automatically they know I must be informed if the complaint has not been sent directly to my office. So after that, the file is allocated to the investigators. We've had Mr Mataboge, who was the chief investigator, and Bianca (Mvuyana) the investigator dealing with this particular matter. So they are the ones who conduct the investigation. Firstly, they will issue a document request letter, then because it involves the Minister and he falls under Executive Members Ethics Act, it is sent directly to me, and they prepare a submission that Mr Mataboge signs, it goes to the executive manager, to the Chief Operating Officer, if he's there, then it lands on my desk, and then I go through it. If I pick up maybe somewhere they need to change and improve or split issues. Then I signed the letter and then it was sent to the implicated party.
Adv Mpofu: And I think Ms Mvuyana then told us that one of the first things that they do is to contact the complainant to streamline the complaint. And so, again, I want to know, do you get involved in that process? Is it now done by the rest of the members of the team who are in charge of this?
Adv Mkhwebane: Generally, it is done by the investigator, and that is compulsory as well, trying to instil the issue of dealing with matters more quickly while avoiding the Vrede issue. We call it in the ombudsmanship, the issue creeping. When a complaint like this is lodged, we'll have to sit down with the complainant. It helps to even call the complainant and discuss the issues raised. We clarify our mandate and what they want us to investigate – A, B, C and D. And then we'll log the issues. So I advise them to do that. And there is a service standard document which we've developed that says when you receive a complaint, within so many days contact the complainant to understand the issues you are going to investigate. When you prepare that letter to the implicated party, already you know what the issues are and also we normally ask the complainant to give us any documentation which is in his possession, so that we understand exactly what the complaint is. That helps the issue creep. Let us put it at the back of our minds for the Vrede investigation routine. It complicates issues when you have moved to such an extent that the investigation is almost at the end and then another issue is raised, and after you have spent so many years on it, you must start afresh. So when a complaint is lodged, they meet the complainant. After that, they will then assess it with the supervisor, considering how complicated the matter is. Sometimes a complaint can be launched and they will say Home Affairs is delaying giving me an ID. A simple call to Home Affairs saying the Department is violating his rights with an undue delay. Home Affairs may say the application was made but they are still conducting an investigation. Sometimes they take up to six months to do that or even a year. So they meet with the complainant directly to make sure that we log the issues. That will also help the investigator, not me, I am nowhere near the preparation of an investigation plan. And the investigation plan is guided by the fact that they know per our strategic document, that when it is an easily resolved matter, a simple matter, such as the Home Affairs easy resolution, we give ourselves six months to incorporate the delays and maybe complications. Then we've got the service delivery-related complaints where we deal with a service failure. And then we've got the conduct failure complaints which are under good governance and integrity. That is where Mataboge and Mvuyana are. So they will decide, not me because as leadership, accounting officer and executive authority I have designed a strategy and they need to feed into that particular strategy. Now they draft an investigation plan after they have assessed the matter, and this one does not fall under service failures which can take up to six months. This one is a good governance and integrity issue; it takes up to 24 months. And EMEA should take 30 days. So that investigation plan then should incorporate all those timeframes for us to be accountable to Parliament. We say to Parliament that we are committed to our strategy, we will be doing service-related matters within 12 months, etc.
Adv Mkhwebane: So they draft their own investigation plan, and they will then count back because if it's a two year-matter, they should then block the dates to meet with the complainant, send the document request letter to the Department or Mr Gordhan, give him 14 to 20 days, or 30 days according to the service standards, which will have to comply with the rules of the Public Protector. Then if he does not respond - I am just trying to cover all those nitty-gritty issues so that when I mention them in all these reports we've already done that – firstly, we then can issue the first reminder, then the second reminder, that is when we come to the three strike rule. If they fail to respond, then we issue a subpoena. But then to clarify for Members of the Committee, I as the Public Protector can issue a subpoena based on the mode of investigation for dealing with the matter quickly. So that is what transpired. So, I am not there with them. They do that on their own. They bring the letter. Because it's going to the Minister, I sign the documents, send the documents back to them and they send it. When they prepare for the subpoena, they prepare the subpoena for me, they bring it to my office and then I sign it. So, that is what transpired even in this particular matter.
Adv Mpofu: Yes, I think that should clarify it for everyone. And just as a former CEO, what you are talking about is now high-level management. So the so-called dashboards, the meeting is called dashboard but actually should be dashboards because there are different dashboards for the six months matters, for the 30-day matters, for the 12 months matters. And, as you say, the managers themselves then populate the deadlines for each matter.
Adv Mkhwebane: You as an individual because when you draft that investigation plan, you are the one who is committing that your project and your action plan demands of you to finalise the matter within 24 months, etc.
Adv Mpofu: But that was done and the plan was drawn up and Ms Mvuyana took us through that. You are not involved at that level. Then once all that is done, what then happens at your level? At what point does the matter come back to you? And by that, I mean, when are you going to meet with this matter once all those emails are done? I am talking about the next interaction with a matter like this.
Adv Mkhwebane: As the Public Protector, sometimes when you just explain to people, or when we were engaging with the remuneration committee when they were asking, at what level I work: “As a Public Protector, what is expected of you as an executive authority?” And we were giving an example of whether the Minister is involved in preparing rule 53. The Constitution says the Public Protector investigates and the Act says I delegate those powers, but then when it comes to the issue of EMEA, for instance, I would then insist that the task register, which is a weekly process, which I had to say,” COO, CEO. COO is Chief Operating Officer for those who do not know, and CEO is Chief Executive Officer.” My late chief of staff used to say CE, instead of saying CEO like in a State-Owned Enterprise, so when the person was acting, then we say ACE as we adopted his way of doing the thing. So that is where I engage with matters. That is where I will ask the questions: “Okay, we've received this complaint, because I've signed the letter, I've seen that we have this matter and what we call (which I adopted from my predecessor) special attention matters. So I didn't stop that process. I would say I want to know about all these key issues because those are the matters that will be in the media. I receive media inquiries and also am criticised or attacked for delaying matters or political parties threatening to take us to court. So I need to be aware of these matters and this was one of those. So it was on the agenda of the task register.
Adv Mpofu: Good. So then, we'll okay we'll come back to the process issues.
Chairperson: We will take a lunch break.
Chairperson: We resume the hearing and back to the unit issues. I am going to ask Adv Mpofu to get into that. I think you have landscaped it already, so let us just go past it.
Adv Mpofu: Section 4.3 (of the Public Protector Report, July 2019) then says: “On analysis of the complaint the following were the issues considered and investigated:” And basically, we do not have to go through that. You then list the issues again. And I take it – I think from Ms Mvuyana – that is when you lock the issues to avoid issue creep.
Adv Mkhwebane: That is correct.
Adv Mpofu: And 4.4 is a list of so many things now for which the key sources of information are included. And I think one of the witnesses emphasised the word “key” sources, so it's not intended to be all the documents. But what do you normally include there?
Adv Mkhwebane: We include the documents we have relied on: their correspondence with the various institutions, their responses, and their recordings if they have provided any recordings. We also then deal with the section 7(9) notices which were issued to the implicated parties. So the sources of information were what were before us when we were conducting the investigation and what we relied on when we conducted the investigation. For instance, if you deal with recruitment, you have to have recruitment policies. If we deal with procurement, we'll have to have their procurement policies, the reports or any documentation which will receive from all the institutions which we had approached.
Adv Mpofu: And this is a question I should ask you later on when we deal with the so-called IGI Report. But I think everyone knows that issue by now, so we can raise it. Now just to flag it. You'll remember that one of the accusations or issues that was raised as a basis for criticism is this suggestion that you articulated explicitly that you had not seen the IGI Report. By now everyone knows that there's nowhere in the report where it says that. But I think a sub-theme of that, is that you did not articulate it explicitly. But somehow you conceal that fact, which is not the accusation in the judgment, but it's now a new variation, but let us meet even that variation. If just go to 184.108.40.206. No, let us start, first, with 220.127.116.11.
Adv Mkhwebane: I think it starts at 18.104.22.168.
Adv Mpofu: There is a cluster of letters. I was just going to the last one, but you want to go to the first one.
Adv Mkhwebane: 22.214.171.124 is the letter to the IGI or OIGI.
Adv Mpofu: Yes, point seven is another letter.
Adv Mkhwebane: The subpoena to the Minister (of State Security).
Adv Mpofu: And point 9?
Adv Mkhwebane: This is the letter from IGI.
Adv Mpofu: Point 10?
Adv Mkhwebane: This is the letter from the Acting DG of the South African State Security Agency (SSA).
Adv Mpofu: Point 11?
Adv Mkhwebane: This is the letter to the Minister of SSA.
Adv Mpofu: And then point 12?
Adv Mkhwebane: That is the letter, the response of the Minister. Now all of these letters are dealing with the issue of the report.
Adv Mpofu: Okay, now, anybody reading those letters, given the content of those letters or who has read those documents ever think that you are concealing that you had a report anonymously dropped at your offices, given what is retained in those letters?
Adv Mkhwebane: A reasonable person would not think like that and any person who assesses and adjudicates this matter with an open mind, would never think that.
Adv Mpofu: But if anyone after reading those letters, referring to them, or even understanding what they are, whether that person is a judge or a Member of Parliament and they have letters in which say, I have a report, you have a report, please give it to us and there's a whole fight about it, could ever justifiably say you are concealing the fact that you had such a report?
Adv Mkhwebane: I do not understand why they came to that conclusion, but we are still going to deal with the judgment. Because at the end of the day, being the Public Protector, receiving all kinds of information, being the Public Protector, with a safe haven for whistleblowers, who receives documents from all and sundry, people who are following up on such investigations, who are interested, sending information, therefore, my responsibility as the Public Protector was to get the document from the state institution, which is very clear. I even indicate that I have this report anonymously dropped. Can you avail the report? Can you confirm you have the report, you know about the report, which was confirmed in the responses.
Adv Mpofu: Yes. And specifically, can I take you to 126.96.36.199 just to emphasise that point? 4.4 1.29 is where you disclose that. “Further documents fair blurred or not listed due to their nature.” What documents were you referring to?
Adv Mkhwebane: I was referring to the very same IGI report, I was referring to the equipment, which to me, I felt, being security conscious, and not wanting to expose the country to unnecessary allegations or the discussions with IGI where even the Minister was saying, I would be exposing individuals or sources, and even security in the intelligence trade, and all that. And it was very clear because the Constitution demands of me when I issue any report unless there is something which I need to ensure is not published, I cannot publish that report because it demands of me to issue a report, but then I need to take into consideration the security of the country or the protection of the information.
Adv Mpofu: And to be fair, there's a reference to this in the Public Protector Act, and I shall refer the Committee to the specific section.
Adv Mkhwebane: Section eight. And then in the Constitution, it is section 182.1 is the publication of reports.
Adv Mpofu: 182.1 in the Public Protector Act is the specific reference to security concerns, such as the one that you mentioned. I wanted the actual wording, but it's fine, we'll get to it. Then under 4.4. 2.1, you disclose something there.
Adv Mkhwebane: The recordings relating to the operations of the intelligence unit.
Adv Mpofu: Yes, again, for someone who was concealing or hiding this issue of the possession of the leaked report, what were you talking about?
Adv Mkhwebane: There it refers to the information or the evidence that we had received from members of the unit who were interviewed by the former Commissioner of SARS and who confirmed the operations of the unit and what it was expected to do.
Adv Mpofu: A question that will address the Chairperson’s issue. Go to 4.4.4. There you list the people who did receive section 7(9) notices. You explained why Mr van Loggerenberg didn't get it. But we've got Mr Pillay that was an implicated party, Mr Magashula, and Mr Gordhan. But at 4.4.4, you have the Minister of Finance Minister, Mr Trevor Manuel, on whom you served a 7(9) to which the chairperson might say, “Why did you do that if you say section 7(9) is only for implicated parties?” To what extent was he an implicated party?
Adv Mkhwebane: Maybe starting from 4.4.3 - those were the people whom we had served with the Audi, which is a notice. And then they responded, and Mr Manuel approved the memo, which was written by Mr Gordhan when he was the accounting officer who requested approval from the Minister of Finance. So we were giving Mr Manuel an opportunity to … because he was implicated as he approved the establishment of this unit.
Adv Mpofu: So, at that stage, Mr Gordhan, as far as that particular allegation is concerned, was not a Minister. He was a Commissioner of SARS.
Adv Mkhwebane: All right. All right.
Adv Mpofu: Okay. Then the legislation, again. I think this will tell us a story, before we read the report, as to what was what we lawyers call the regulatory framework, against which the factual findings would be measured. And it's the Constitution, the Public Protector Act, the South African Revenue Service Act, the PFMA, National Treasury Regulations, the National Strategic Intelligence Act, Interception of Communications and Provisions of Communication Related Information Act - that is the one that says you can only intercept people's communication if you have a court order. And then the SARS Recruitment and Selection Policy. Can you explain why, firstly, it's necessary to put those in and what role that section plays?
Adv Mkhwebane: The role of this section - when you are somebody who is adjudicating or putting the matter before the court, you will see that this is the legislative framework, which we checked against the investigation process to determine what happened, what should have happened and the facts. And then whether there are any gaps in whatever should have happened. And remember, the complaint also said they violated section 209 of the Constitution, which addresses the issue of the intelligence and if it's done by another institution, the President should give a go-ahead on that particular issue. Also, we were showing in terms of the procurement, the violations of the Public Finance Management Act, because we were dealing with Accounting Officers, the issue of the Public Service Act, we had to check it because we needed to understand their operations, the powers of the Accounting Officer, the role of the Minister as far as that is concerned, the National Strategic Intelligence Act. So this is what the Public Protector is all about. Like the Auditor General, we just check whether there was any improper conduct or whether it was compliant with the provisions of the laws governing that particular institution. So this was purely that. And then we referred to the case law because we relied on the cases, especially concerning the responses of the implicated parties, or when we investigate, then we need to highlight these cases so that we can rely on them and maybe why we needed to inform them? Our investigations are not subjected to PAJA (Promotion of Administrative Justice Act). Our investigations are subject to legality. Hence, we mentioned the Home Affairs versus the Public Protector in the SCA judgment.
Adv Mpofu: Okay, just for the sake of flow we are not going to go through all those various Acts of Parliament and so on until they become relevant in the evidence. But I think it's important, maybe just for the Members to anchor the rest of this report against the Constitution and the constitutional provision which figured here. Right. If you can do that, section 209(1) of the Constitution, what it says and explain why it was important for this particular part.
Adv Mkhwebane: Yes, so in terms of section 209(1), of the Constitution, any intelligence service, other than any intelligence division of the Defence Force, or Police Service, may be established only by the President, as head of the National Executive, and only in terms of national legislation. So this is what it means. And this section is very relevant to our investigation.
Adv Mkhwebane: So that is, if you like, the canvas for the entire investigation: that an intelligence service in South Africa other than the Intelligence Division of the Defence Force might be established only by the President. Then it becomes a simple exercise about whether whatever you are investigating, is an intelligence service or not. If it is, then obviously, it falls under this section. So then the next section is obvious. Mail & Guardian, Home Affairs, that is just relevant case law. Now, let us get to the meat of the report. So the first issue which you dealt with was - you have already explained the EMEA issue - regarding whether Mr Gordhan violated the Executive Members Ethics Code by deliberately misleading the National Assembly, in failing to disclose that he had met with a member of the Gupta family since taking office. All right, take us through that, assuming this was the only issue for now that you are investigating. What we already know is that it's an EMEA issue. It's important, it's urgent and all that. But how do you tackle that issue? So that we do not have to do that for the other six issues. So let us use this as the pilot.
Adv Mkhwebane: For this matter, the investigator will be the starting point. This has no common issues which mean there were disputes only; Mr Gordhan was not agreeing to anything which we indicated. Hence, they had to put the issues in dispute as he denied the allegation that he lied or misled Parliament. So this would be the first letter which was written to him, which then requested him to give us his side of the story. And if that is not the case, sometimes we will then inform the President we are investigating but we failed to finalise this matter within 30 working days. EMEA should be the quickest but sometimes, then you will have to acquire all the evidence and your investigation should be evidence-based. So we had to get the question from Parliament and his response and there was an allegation that when he responded to the Zondo Commission about this, then he remembered that actually, he met with Mr Ambani who is linked to the Gupta family. So, then all this evidence is analysed by the investigator, then they have to check: what was the question? What was the response? And how he responded? And then was there a gap or any concern that, indeed, he didn't do what was expected of him? What does the Executive Members Ethics Act and Code say about that? So, in this particular instance, that is what transpired. So, if you go through the report, we are showing the question in 5.1.6.
Adv Mpofu: Where did the question come from?
Adv Mkhwebane: The question was asked in Parliament by a member of the DA, Mr Bagraim, who asked the Minister of Finance, “Has he ever met with any member, employee and or close associate of the Gupta family and/or attended any meeting with a specified person at the Gupta’s Saxonwold Estate in Johannesburg or anywhere else since taking office? If not, what is the position in this regard? If so, in each specified case, what are the names of the persons who were present at each meeting? When and where did each such meeting take place? And what was the purpose of each specified meeting?” Then we got the reply from the records of Parliament where he said, “I have not attended any meeting with the Gupta family or anyone else at the Saxonwold Estate. I have encountered one or more members of his family at public events on a few occasions, e.g. cricket matches. I met one of the Gupta brothers at Mahlamba Ndlopfu around 2009/10, during which a brief discussion on Small Business Finance took place.” So then we go to the extract from the Zondo Commission.
Adv Mpofu: Before we go to the Zondo Commission because it looks like something that might have happened the next day and I think it's important to show the difference. So that question, which came from Mr Bagraim, was on 11 April 2016. So the answer must have been … we do not have the data, but it would have been somewhere around.
Adv Mkhwebane: They are given dates to reply.
Chairperson: It depends - if it's a written question, it is 10 days thereafter but if it's an oral question, it's on the same day.
Adv Mpofu: The question was 11 April, so we can say May. Even given all the holidays and whatever. It is now two years two and a half years later, in October 2018. What then happened?
Adv Mkhwebane: There was a proceeding before the Commission of Inquiry on state capture
Adv Mpofu: Otherwise known as the Zondo Commission, right?
Adv Mkhwebane: Correct. Where he said 'I had forgotten of another instance where one of the Gupta brothers may have been present at the meeting I had with billionaire and Indian businessman Anil Ambani of the Reliance Group of companies in or about June 2010'. So, I stress that I do not recall the details set out below since it proved to be a meeting of little significance at the time, but I've been assisted in this regard by my former chief of staff, Mr Dondo Mogajane.
Adv Mpofu: Okay. All right. I think we get the gist. Two and a half years later, he says at the Zondo commission that the answer that I gave in April, or May 2016, two and a half years ago was wrong. I've been “reminded’ I did. To your knowledge, was this correction made to Parliament itself?
Adv Mkhwebane: According to the information we had during this investigation, it was never made to Parliament; it was only made during the Zondo Commission hearings.
Adv Mpofu: And unlike the President who, at least, made his “correction” two weeks later, this one was made two and a half years later. And the President made his correction to Parliament, which is where he had made the mistake. According to you, then this one was made somewhere in Braamfontein.
Adv Mkhwebane: That is correct. Hence, the main issue for us in such instances is the Executive Members Ethics Act and the Code which says they must be truthful to Parliament since they've taken an oath of office. So this is raised at the inquiry of the Commission. We do not have any record which shows corrections have been made. And I think this shows that Parliament should be considering the amendment of EMEA very seriously to address and compel people to go back to Parliament and maintain the decorum of Parliament and the respect.
Adv Mpofu: Yes. Possibly within a particular period, surely not two or three years later. And in the CR17 report, you are criticised for even making suggestions about looking at the rules to make sure that this does not happen again.
Adv Mkhwebane: Correct.
Adv Mpofu: So his story is summarised on the following page, effectively that he had a meeting with an Indian businessman, Mr Ambani, and there was one of the Gupta brothers, but his DG reminded him and he says he does not recall this Gupta person being there, but he may or may not have attended. Section 3.5.6: Mr Mogajane has advised me that Mr Ajay Gupta was present at the meeting. I do not recall him being present. I wish to refer the Commission to annexure (or whatever) which is my response to the question in Parliament from the DA. It is apparent in my written response that I do not make mention of the 2010 meeting with Mr Ambani of the Reliance Group, which a Gupta brother may or may not have attended. This is simply because, at the time of submitting the return response, I had no recollection of the 2010 meeting with Mr Ambani. That was the answer. I do not know which part he recalls, or which part he does not recall, but the Gupta brother may or may not have been present-. Now, what must this committee make of this? And how do we know what Mr Gordhan was intending to say?
Adv Mkhwebane: Maybe let me start by saying, Go back to the question. I think again, it's for future lessons when they respond to questions of Parliament because the question is: “Has he ever met with any member, employee or close associate of the Gupta family, and/or attended any meeting with the specified persons at the Gupta’s Saxonwold Estate, or anywhere else?” And then the other part is: “What are the names of those people?” The response was only addressing the Gupta family, and anywhere else. Well, he mentioned somewhere else, a cricket match and at Mahlamba Ndlopfu. And so the issue here was, then he recalled that there was a meeting where he met specifically this associate, and it was not at Saxonwold, it was somewhere else where he met him. So the main thing here was that he should have, although the rules do not provide for it, corrected that answer to Parliament. But he just remembered outside of Parliament that he made this particular individual. So I think he explains that, but we were trying to say to him, that he either intentionally, or inadvertently, misled the President, or, in this case, the legislature because that is what the 2007 EMEA Code says.
Adv Mpofu: Well, okay, the way you framed the issue before was just whether he misled or not; there was no inadvertently. Given that Mr Gordhan did not come here, will we ever know what he was trying to say?
Adv Mkhwebane: Yes, because he's explaining himself. If he were here, he would have clarified further. You would say Roman figure one says this, what is your answer? Because normally, I think that is what they would expect. But he just lumped everything together; he was supposed to say on this date, there was no member of the family, no meeting with the associate, no meeting at Saxonwold or only met at Mahlamba Ndlopfu and the cricket match, and this is the particular person. So this was going to help if he were also here to explain to the Committee what he meant specifically about that and then later clarify to the Zondo Commission. So I do not know whether this Committee will be able to make any conclusion based on this if he is also not present.
Chairperson: Before you proceed, just on that question, the Public Protector identified the Member and did the investigation find out from Parliament if that Member rose to ask for assistance if there were gaps, and asked for a follow-up on those questions that had not been fully answered? So I am checking if, having identified the Member and having looked at that answer from your side, there had been a conversation with the Member to ask if the Member had taken up the issue thereafter. In terms of the rules, unless the member was not happy and was ignored, the matter is closed.
Adv Mpofu: Now, that is a fair question, Chairperson. But I think, maybe you can frame it like this. The Chairperson is right. It's all very well to say now Mr Gordhan maybe did not come back to Parliament and we can speculate. But I think the question from the Chairperson is, specifically from the Public Protector’s point of view, in your interactions through section 7(9) or whatever, was that question sharply raised with the Member? As to a) did you correct the thing in Parliament? And if not, why not? Was there such an interaction about the processes?
Adv Mkhwebane: In section 7(9) we raise all these inconsistencies and gaps. So it was the members all's responsibility as well to say, well, the DA person was happy, Parliament was happy, therefore, I never went back to clarify the issue. But hence, the issue I raised yesterday about the section 7(9) letter. Most of the time, people think, I've responded or I do not agree with this instead of also helping because it's just helping us with our investigation. And if that was done, possibly it was going to be a different response.
Adv Mpofu: All right. Now, the rest of it is what we went through yesterday with the Bosasa Report - you apply the directive ethics, you refer to Section 96(1), 96(2) 2(3)(a) of the Executive Act, its Code and so on. And once you have then applied those prescripts to the material that you have, then you reach a conclusion. So just take us through that. I know it's not as simple as all that as in between those are all the things we've just spoken about the section 7(9) letter, to-ing, and fro-ing, and so on. But just take us through how you arrived at the conclusion and what the conclusion was.
Adv Mkhwebane: So in all our investigations, we have issues, common cause issues, we've got issues in dispute, then we apply the prescripts. Then you have just gone through the legal framework. And from there, we then come to the conclusion on applying the prescripts: Did the implicated party comply with the prescripts which have been mentioned? So, after giving them an opportunity and an audi in terms of section 7(9), they would bring additional information to the assessment and response. So we analyse all that information and this is done by the investigator for instance, when Bianca and Rodney, had deliberated on the matter, they come to me. I will ask about progress. How far are you? And then comment where they need clarity and then they finalise the matter. So the conclusion was then that he had not disclosed that he had met a member of the Gupta family and an associate in 2010. So he conceded to that. And then he argued that, at the time, of his response. He could not recall or he had forgotten about the meeting in which Mr Ajay Gupta was present on such an occasion and they should have gone further because the question was: was there any other associate and/or. But then in this instance, he conceded that he forgot about the fact that Ajay Gupta was there. And then it was apparent that he deliberately misled Parliament in responding to the Parliamentary question. His responses accordingly misled Parliament and it does not seem to be a bona fide mistake, because he should have done that and clarified the matter. And again, it goes back to the issue of responding to Parliament, the issue or the intention of an Executive Member Ethics Code - ethically, when you respond, do not just rush to respond. Why was he not reminded by the chief of staff when you are supposed to respond to Parliament, normally those questions are sent to the Minister, the Minister has to sit with the ministerial staff, and if it has an impact on the department, the DG must also check with the staff to give information to make sure that Ministers, because they are executive Members, account to Parliament. It means you must respect Parliament and you must make sure that you are transparent and honest in your response. So that is what he picked up. And that was the finding on the effects before us, the responses and the documents we received from Parliament on this matter.
Adv Mpofu: Now about this. Let us move to the next issue but I shall come back to this in a different format because what I intend to do to try and save time is, once we've done an issue like this, and then to juxtapose that with whatever the finding was in the judgment, and then move on so we do not have to recover the issue when we do the judgment itself. But for now, can we just move on? The next issue is 5.2 which is page 40, regarding whether during his tenure as SARS Commissioner, Mr Pravin Gordhan established an intelligence unit in violation of the South African Intelligence prescripts and, if so, whether such conduct constitutes maladministration. So now we are getting to the so-called rogue unit issues, having disposed of the EMEA issue in the way that you have described. In shorthand, this is the establishment issue, as opposed to the procurement or recruitment issue and so on. So, what are the parameters of the establishment issue, what was said, what did you find, and what did you take into account? And maybe there were common cause issues so you had to use the normal format. Not necessarily word for word or blow by blow, just take us through the highlights
Adv Mkhwebane: This issue had common cause issues. And you can see in 5.2.1 that the allegations that the unit was unlawfully established were not in dispute as that had been in the public discourse. It was something which had been discussed by various institutions so that was acknowledged, but the issue of my determination was whether the institution, or the unit, violated any legal prescripts.
Adv Mpofu: The part that you jumped might be the most important for what's going to follow later. You say that it was in the public domain and everyone in South Africa knows that. But you also refer to the reports.
Adv Mkhwebane: Yes. When this matter was brought to the attention of SARS, because you see, we are investigating SARS because Mr Gordhan was the Commissioner of SARS, the Accounting Officer. So we also then show that it's common cause what SARS has acknowledged in their responses, where they indicated that there was a unit, which was collecting information in respect of compliance with tax and customs laws. And this was confirmed by Mr Pillay when he responded originally to the Public Protector when they were investigating the human resource-related complaint of 2014. And the name of that particular unit - you will see in the report, we are even showing you step by step how the unit changed, from one name to another name to another name to another name but we will also show that the same individuals, the same modus operandi, the same equipment, was the subject of our investigation,
Adv Mpofu: So, we just call it a unit. It was this the ABC, the XYZ and what have you, but it was the same unit. Now then at 5.2.5, one of the criticisms when you get to the judgment is that you ignored or did not take into account the Nugent Commission. Against that criticism, what is the comment contained in 5.2.5?
Adv Mkhwebane: Yes, so this is the Commission of Inquiry into Tax Administration and Governance Final Report, which is the very same Nugent Report. We have captured the information that we received in a response from SARS where they were saying, the Nugent Commission found that there was only a question of why such a unit was considered to be unlawful. “It was not clear to me,” the Commissioner said, “while the National Intelligence Strategic Intelligence Act prohibits the covert gathering of certain intelligence, that applies to intelligence concerning threats to the safety of the state, which hardly applies to intelligence relevant to collecting tax. While, indeed, we agree that members of the unit might at times, have acted unlawfully, that SARS employment policies might have been breached, and that members might unlawfully have acquired and used equipment, all of which came later to be alleged, I see no reason SARS was and is not entitled to establish such a unit to gather intelligence on the illicit trade, even covertly within limits.” So that “within limits” is very critical and I must say, I agree with this. You'll see later in the observations, where I was very clear because it's as if this person does not want SARS to do their work when they investigate information relating to tax evasion and illicit trade. Then, he says, “Indeed, that was a view expressed to SARS in late 2015, which seems not to have been made public by SARS. An opinion was furnished to the former Commissioner of SARS in 2015 in response to the findings of the panel chaired by Adv Sikhakhane SC, by Adv Trengove SC and Adv Nxumalo who advised SARS that it was said to be unlawful by a panel chaired by Sikhakhane, but I find nothing in his report to persuade me why that was so. That is what he says. Adv Sikhakhane was asked if he could elaborate further but his reply went no further than what was said in the report. Then he goes to Judge Kroon and the Advisory Board which reported to the Minister and issued a media statement saying the unit was unlawful. But in the evidence, he told the Commission that was not a conclusion reached independently by the board but had been adopted from the Sikhakhane panel. And so that is what the Nugent Commission was saying, which I will show now why we had to capture it and indicate why it's different to what we were doing as a Public Protector.
Adv Mpofu: That is exactly what I want to get into but we'll leave it for legal argument whether the statement by Judge Nugent that something was not clear to him, which meant that it was unlawful. But I want to get to the point you are making now about whatever the terms of reference of that Commission were, we know that they were not the same as your complaint, as it were. Now, here's the thing, because the Nugent Commission, when you are criticised, trumpeted, shall we say, absolution of the unit. But if you go to paragraph nine, now wearing the hat of the Public Protector, not of Judge Nugent, can you overlook the things that he says? He says that members of the unit might at times have acted unlawfully, that SARS employment policy might have been breached, and that members might unlawfully have acquired the use of equipment, all of which came later to be alleged. Let us just take those three things. He's now acknowledging that those things might have happened, but he brushes them aside. Now for your investigation, if you found those things - that employment policies were breached, members acquired equipment unlawfully and so on, what finding would you have to come to?
Adv Mkhwebane: You know, it's a concern because he never conducted an investigation. Possibly he was reading some of the affidavits and statements, but from my side, I wouldn't just ignore such, especially being an investigator. If a complaint is lodged, I am there to make sure that every state functionary is compliant with the laws. We'll still go to the judgment, which is criticising me about this and the fact of the matter is, when the Public Protector investigates - and worse it was Judge Parker, who knows our mandate clearly - and finds a violation of any supply chain policy, a violation of the recruitment policies or a violation of the law that this institution was established, and conducted its work contrary to what it was expected to do, I definitely wouldn't just brush it aside. As the Public Protector, I am an investigator; his terms of reference dealt with broad issues of SARS. I was dealing specifically with the violations of this prescription because of a complaint which had been lodged. So I wouldn't just ignore the information and brush it aside and say, because judge Nugent said this … he was a Commissioner who had not investigated. As Public Protector, we were investigating because we had to check what happened, what should have happened, whether there was a violation of the prescripts and whether there were any gaps and how we could remedy this because we intend to remedy, acknowledging that the Public Protector’s remedial actions are binding. Going forward, the Commissioner of SARS and people who are interested in making sure that such things do not repeat themselves will learn from this and they will avoid doing this going forward.
Adv Mpofu: So, I think it should then be clear that you engaged with the Nugent Report at whatever level and it didn’t ignite. Now, the next issue is the important issue of the Trevor Manuel memorandum that you referred to earlier. And, to save time, I want to go to the actual report; we've made references to it with Ms Mvuyana and so on. So we'll just use it as it is quoted in the report and we'll move along. The references are the same as before. That memorandum plays a crucial role in your report. What we know now in this Committee is the fact that it was written to Minister Manual, it was written by Mr Gordhan, and it was requesting certain things. I'd like you to just read 2.1 which I think is the important part of that memorandum. And then comment on what it says to you.
Adv Mkhwebane: (5.2.7.)2.1 says: “Collecting technical intelligence invariably means penetrating and intercepting organised criminal syndicates. This is an activity for which SARS does not presently have the capability (including the legislative mandate to manage clandestine activity).” So this paragraph is very clear that SARS under Commissioner Gordhan knew that they didn't have the legislative mandate to deal with this or to establish such a unit with such capabilities.
Adv Mpofu: Yes, and I'd like to highlight because Ms Mvuyana testified that the key activities, and we’ll deal with those when we deal with the operations of the unit, but the key things or the red flags were: interception and surveillance and using a jamming device. Those are just a few things that would start giving signals as it were, even to someone who is not familiar with the intelligence world. Now, I want to zoom onto the first sentence. I see the point you make about the legislative mandate, but it would seem that even at that early stage, there was an appreciation of the kinds of activities the unit performs and so what do you read into that statement that says, “collecting tactical intelligence invariably means penetrating and intercepting organised criminal syndicates”?
Adv Mkhwebane: This meant the interception of organised crime syndicates, which they should be doing, especially if they violated tax-related matters and customs and illicit trade, but it's very clear how that should be done by the institution responsible for that. I think that is what it was meant to do.
Adv Mpofu: And then in case, there's any doubt, the next sentence in 2.2 says: “Discussions are taking place with the National Intelligence to supplement SARS intelligence capability. Does the word “supplement” mean there was no intelligence activity at SARS?
Adv Mkhwebane: This means there was a SARS intelligence capability because they wanted to supplement it.
Adv Mpofu: All right, so let us assume then that, firstly, contraception activities were taking place or at least envisaged and there was some existing intelligence capability. And in any event, if this had nothing to do with intelligence, why was this memorandum being raised with NIA (National Intelligence Agency), not the Department of Water Affairs and so on? Why, why else would they have been raised with NIA?
Adv Mkhwebane: I think they acknowledged and understood that it did not fall within their mandate and they had to make sure that they approached the institution which was supposed to do that. And I think they had at the back of their minds, section 209 of the Constitution.
Adv Mpofu: Everyone knows that the institution in South Africa that does comply with Section 209 of the Constitution, in other words, which conducts intelligence services and which is governed by national legislation, is NIA and the Defence Force and the police, I think.
Adv Mkhwebane: In terms of section 209, it is Defence, Intelligence, SAPS and Security.
Adv Mpofu: All right. So another important issue. I am raising this just for context in the mode of what I was saying yesterday that the Public Protector reached the same conclusions as the Chief Justice. Let us go to 5.2.8. What is your comment on this? Mr Jabu Moleketi was the Deputy Minister of Finance. The letter was sent to both him and Minister Manuel, and Minister Manuel did approve it, as you already said, and so did Deputy Minister of Finance Moleketi. But interestingly, he inscribed - we all know by now that there were some handwritten inscriptions by Deputy Minister Moleketi on the letter as he approved with comment. And his comment is reflected in 5.2.8 which says: The recommendation was supported by the General Manager of Enforcement and Risk and approved by the Deputy Minister of Finance and the Minister of Finance on 22 February 2007. Deputy Minister of Finance noted and stated: “Supported, however, this is a strange way of executing what I consider to be the mandate of NIA…it seems as though it's an add-on rather than part of NIA’s mandate. Now, this is the Deputy Minister making his own observations. Firstly, what do you read into that? And what do you think he's saying about this whole unit or the project?
Adv Mkhwebane: And this is because when he reads this submission, indeed, it's very clear that it was the mandate and it seems as though it's an add-on rather than part of NIA’s mandate. I want to just stress that it shows that SARS can investigate within its mandate, but here, it's very clear that it was questionable; it was as if they were usurping the responsibility of another institution. So this is also a concern; this is a mandate of the NIA, but it seems as though is an add-on rather than part of the NIA’s mandate. But that add-on meant it was something questionable.
Adv Mpofu: There's a section in your report, that you have referred to twice now in giving context, but I shall find it. Mr Moleketi deals with this. You cross-referenced that this was a matter of public interest and topical issue in South Africa and then you deal with the various reports, you refer to the KPMG report at 5. 2.9. And 5.2.10 is then the gist of your logic as it were. Take us through that.
Adv Mkhwebane: So, 5.2.10 this agreement meant that the two parties recognised that intelligence gathering was not within the powers and legal mandate of SARS. It also meant that there would be instances where SARS would require access to specialised surveillance, so, it was just making sure that they were complemented by state security. So it was not the responsibility of SARS to deal with that particular surveillance or they didn't have that specialised capability, which did not fall within their mandate. As we then go further, we see that this MOU did not materialise as envisaged by SARS, resulting in SARS continuing to develop its own capabilities. And I think 12 goes further to show that SARS approached Minister Ronnie Kasrils requesting approval for the establishment of this deep covert capability which would require both NIA and SARS to collaborate but this was not approved by the then Minister of Intelligence.
Adv Mpofu: I found the place where you were burning to explain part of the context, but which we jumped, and I think this is important. It’s on page 10 of the report.
Adv Mkhwebane: It’s in the executive summary.
Adv Mpofu: This might well be the most important observation, just to put it into perspective for the Committee, but also for South Africans and for anyone who might say that you did not want SARS to be chasing tax dodgers and all sorts of people who might have been legitimately targeted by the unit. You can just read it.
Adv Mkhwebane: So it's under Observations and learning from the State of Capture Judgment of the Pretoria High Court, where they said observations can also be …
Adv Mpofu: used as a basis for remedial action.
Adv Mkhwebane: So my investigation of the establishment and activities of the intelligence unit by SAR should not be viewed as stifling the effectiveness and efficiency of SARS, in their investigations into tax evasions and the curbing of the illicit economy but it's to ensure that they do not encroach upon the territory of the State Security Agency. Perhaps consideration should be made by the two institutions to conclude a memorandum of understanding so as to have collaborations as and when the need arises. So this was putting it out there. And as well, to make sure that I am not against them and that I support the issue of them having to conduct illicit activities, and in the report, it is very clear, in terms of the South African Revenue Services Tax Act, that the investigation unit has powers, so you will see when we deal with it, and the legislative framework, that it's very clear what they are supposed to be doing, and how they should be conducting their investigations.
Adv Mpofu: So your job was a much simpler one than all these dramatic things suggested; you were not passing moral judgment on whether SARS can collect intelligence in whatever way they wanted to, but simply looking to see whether, in so doing, there were any breaches of our laws, Constitution, regulations, and policies – but not necessarily to stop the unit itself.
Adv Mkhwebane: That is what our intention was and to support SARS – do things within the law, and the prescripts of the law, do not perpetuate unlawfulness, and be compliant with the law as it stands. So that is all that we are doing. And that is all that we were intending to do with this report.
Adv Mpofu: And extend this to the issue of the recruitment of personnel. Again you didn't say no to Ms blah, blah, and 'I do not like this one'. It was a simple question of whether those people were employed in terms of the applicable HR policies and so on.
Adv Mkhwebane: That is definitely correct because if you check our investigation, the simple issue was about what your policy was saying. It seems as if these people were seconded, but what is your policy saying about that? Comply with your policy, if you want to second them. If you want to advertise and get skills from outside, what is your policy saying? Follow the normal recruitment in your Recruitment Policy, and if, for instance, their policy does not provide for secondment, amend your policy so that you have a secondment and then you are compliant. That is all that we were intending to do with this process.
Adv Mpofu: All right. And at the risk of stretching the point, if we apply that same logic to the procurement of equipment, what are we looking at? It is for the jammer or whatever device, would that have been your concern as far as procurement is concerned? Or what were you looking for under that heading?
Adv Mkhwebane: And I know we want to move to that, but there's a point I want us to make. It deals with recruitment - page 44 deals with the unit the kind of skills those individuals had is addressed in 188.8.131.52. The unit was staffed by former intelligent agents, etc. Adv Trengove SC and Adv Nxumalo gave a legal opinion on the position and it picked up that the staff ... because we are dealing with the issue, I want us to just continue the issue of recruitment. It was very clear that the people who were recruited to staff that unit were former intelligence agents, law enforcement officials and tax professionals and it conducted investigations, using methods, techniques and equipment normally used by intelligence and law enforcement agencies. So those are the red flags. Now coming to the SARS investigative powers, which I mentioned earlier: What is the Tax Administration Act saying about investigations? What it said - because this is also at the core – SARS has powers to conduct various types of investigations for the administration and enforcement of tax legislation. So those investigations ranged from the least invasive to the most intrusive. This included the request for information from a taxpayer, arriving at the taxpayer’s premises without prior notice, requests for a taxpayer to submit to interviews, and the conduct of audits and investigations on the premises of any person by prior notice. So their investigation powers are limited to what the tax legislation is saying. So they may not do any other investigation that intrudes upon the privacy of others, without the statutory powers to do so. So I am just showing you that when we take it further, this is the legal opinion and the opinion also acknowledges the people who were working there and what kind of people they were but, as Public Protector, we didn't just take that as gospel truth. We wanted the names, and we wanted to know if the posts were advertised. If a post was not advertised and you seconded the person, where was the proof that you were using the proper process? There must be a submission, like that submission requesting funding. Those were the internal documents of SARS.
Adv Mpofu: Thank you for highlighting that. But I want to simplify it. I am a member of the public and want to know where you, the Public Protector, come in all of this. Why are you involved in this as a Public Protector? I think that issue of the privacy of citizens which was highlighted by the two advocates comes through, and section 209 of the Constitution. Remember, this is the Constitution, not legislation. So what it's saying to me is, Mr Citizen, as I walk around, I must be sure that all sorts of institutions do not have the right to establish private armies or private intelligence officers. The Chairperson can't just wake up tomorrow and say he is going to establish an intelligence division of this Committee that can spy on me, my attorneys and whoever. Isn't that the essence of all this? What is the interest of the Public Protector in all this? Because SARS could say, “Why do you care? If we want to have an intelligence unit, that has got nothing to do with you.”
Adv Mkhwebane: Remember, the Public Protector’s mandate in terms of the Constitution, is investigating proper conduct and the Public Protector Act requires the Public Protector to investigate abuse of power. Any institution which performs a public function should perform the public function while being compliant with the Constitution and the various legislative prescripts. So, in a simple and straightforward way, the Public Protector says, “Do your work, be compliant to your own laws, do not encroach on other institutions and their legislative mandate, but even if you do your own investigations, and you do so within your rights to do so, you must still comply with your law.” So basically, that is all we do as the Public Protector because we do not want a situation where we have to investigate maladministration. We should be delayed dealing with it at a very early stage because if we pick up such things and we do not learn from them, then it means it will lead to a situation where the citizens’ rights will be violated, your rights to privacy. You'll find that the unit will then investigate you or access your information or even follow you so we still look at the operations of the unit and the information which was before us when we investigated to protect you, to be sure SARS respects the Constitution, irrespective of who you are. Yes, it was purely to protect the public and nothing more, nothing less.
Adv Mpofu: When we deal with the judgment, we'll deal with all those issues, and whether, in your view, should the judiciary be nit picking on technicalities and all that or is the issue of the protection of the public and the dangers that might arise should a unit like this be left to roam around the country?
Adv Mkhwebane: The justice system focuses on the papers before them, but I think, whatever they do, they should also have that broader perspective to see what impact a judgement will they have on society at large because the issue of justice needs to be seen to be done. There are several points we'll speak about on those issues. But as a judge, adjudicating this kind of matter, you should be worried that if this is left unattended, they just focus on section nine and on seeing the Public Protector as biased. What about section 6(9)? What are we saying about this unit, which is not compliant, and the Public Protector is trying to remedy that, saying put your house in order? What if any other institution which is not mentioned in Section 209, and the President does not know about this and hasn't given your authority for that institution to proceed, decides to establish such a unit? Then it means anyone can do that. What are you doing to the issue of the invasion of the rights and privacy of people?
Chairperson: Adv Mpofu, earlier in the day, you said you had about five or six issues. When we come back from tea, could you summarise the evidence on this issue?
Chairperson: We will get straight into the session.
Adv Mpofu: I shall continue to use the report as our source document until it's not possible to do so. But what I wanted to do in rounding up this second issue was to refer to Mr Gordhan's section 7(9) response where you'll remember that I put it to Ms Mvuyana that his response really almost amounted to what I loosely called a confession that indeed he was involved in the establishment and then he makes certain remarks that we'll get to that when we deal with the section 7(9) so far we were at the point where we were cross-referencing the remarks of Mr Moleketi and that then took us to another cross referencing which was to the Adv Trengove SC opinion and then we will now we then spoke about what we call the public implications of this and section 209. Let us do this 5. 2.15.6 in the Trengove opinion and again I shall just be selective because I think we did this a similar exercise with Ms Mvuyana but just to give a perspective to someone sitting at home and listening to, the type of activities used by the unit at that time and what that included according to the Trengove SC opinion juxtapose that against what you were saying about the interests of citizens. Item A.
Adv Mkhwebane: I want to still insist that this opinion of Trengove was also saying, which we agree with, that SARS may not do anything which is outside of the tax law. So item A was the surveillance of individuals which the Special Projects unit was doing, as analysed by the legal opinion team, that is what the opinion was saying.
Adv Mpofu: Those were some of the red flags that Ms Mvuyana identified, i.e. surveillance, interceptions, etc. And let us go to the item (g) as to what the network was also doing.
Adv Mkhwebane: Listen in to and/or electronically record the party’s conversations by using listening devices.
Adv Mpofu: Item (i)
Adv Mkhwebane: Obtain information from informants on the understanding that the identity of the informant will not be revealed.
Adv Mpofu: item (j)
Adv Mkhwebane: Accept information from a person while knowing that information was acquired, unlawfully, or illegally, by the person.
Adv Mpofu: Now, the question I want to ask is just a cross-section of some of the activities of the unit. But I am just saying if this indeed exhibits signs of being of the intelligence world, what impression do you get if a unit was involved in such activities as the four that we picked up?
Adv Mkhwebane: Well, on the face of it, it's concerning because you cannot just accept information from a person whilst knowing that that information was acquired unlawfully and illegally, I mean, we have laws in the country, which need to be respected. And even (k) -used other abusive practices or threats. Their investigative powers should be within the limits of the tax administration law. But then those are the things which were picked up, even the interception or listening in to private calls to get information should be done within the law, and according to that legislation, it needs the approval of the judge to do that. So even besides the Sikhakhane Report, that is what the legal opinion, on checking all the available information, picked up.
Adv Mpofu: And then the 184.108.40.206 is the one that deals with the permission by the judge. What was the conclusion of the Trengove legal opinion?
Adv Mkhwebane: He says, “However, from the evidence reviewed by the panel, officials were prohibited in terms of the Regulation of the Interception of Communications and Provision of Communications-Related Information Act from interception communication of individuals under tax investigation. So they were prohibited from doing that because it was clear that there was no evidence that they acquired the relevant approval.
Adv Mpofu: From a judge.
Adv Mkhwebane: Right.
Adv Mpofu: The next section deals with the Sikhakhane Report. I am not going to deal with that now because I want to deal with all those reports tomorrow in one section so that we do not hop around among them.
Adv Mpofu: Your team had access just to the Sikhakhane Report, correct?
Adv Mkhwebane: That is correct.
Adv Mpofu: The Sikhakhane Report as we know was provided in 2014. And your work was done in 2018.
Adv Mkhwebane: Correct.
Adv Mpofu: One of the reasons I do not want to go through that is because they refer to some of the material we've already spoken about – the Trevor Manuel memorandum and what have you. 5.2.23: there seems to be then a coincidence of conclusions between you and Sikhakhane.
Adv Mkhwebane: It would seem that at this stage SARS recognises that it had no statutory authority to collect intelligence and the report found that there was prima facie evidence that SARS had engaged in functions that properly belonged to other government agencies and that the SARS Special Unit (SP) had no authority to perform. And there was a real possibility that the SP would undermine the work of government agencies tasked with the investigation of organised crime in the collection of intelligence. So that is the conclusion.
Adv Mpofu: Now 5.2.25 is important because it provides the platform for the transition from the Sikhakhane Report to the well-known IGI report.
Adv Mkhwebane: The report recommended that the activities and functions of the SP be investigated by the Inspector General of intelligence. So can I elaborate on this?
Adv Mpofu: The Sikhakhane Report.
Adv Mkhwebane: Yes, the Sikhakhane Report because picking up information when they have moved out of their mandate, meant they encroached on the mandate of SSA. So I think also that creates a lot of confusion because people say that the unit was not an intelligence unit, but the activities were such that they fell directly within the mandate of SSA, with the approval of Minister Trevor Manuel and all those. So hence in a meeting we had with the Inspector General of Intelligence, Dr Dintwe, on 31 January 2019, he confirmed that the Office of the Inspector General of Intelligence had indeed previously investigated allegations of an intelligence unit within SARS and confirmed the existence thereof.
Adv Mpofu: I am just flagging that issue; we will come back to it. You'll remember that right at the beginning, there was a transcript or audio material that was played by the evidence leaders related to that particular meeting, correct?
Adv Mkhwebane: Yes.
Adv Mpofu: And that meeting goes to this whole issue of whether anybody was under any impression that there was no report in your possession. But we'll go through that recording. What we will do is provide a transcript. And in fact, I think that transcript is already part of the record.
Adv Bawa: There's a transcript in the record.
Chairperson: It is item K (13) page 1466. I just do not want to get into it now. Please show Members. So this is a meeting that is referred to in that paragraph you just read. Who was present?
Adv Mkhwebane: It was me. It was the late Mr [Sibusiso] Nyembe, Ms [Pona] Magaladi, the executive manager, Mr Rodney Mataboge, the chief investigator, Adv [Jay] Govender, the legal advisor from IGI and Mr Ephraim Kabinde, my PA
Adv Mpofu: Okay, and this is the same Mr Govender, who recently submitted an affidavit to this Committee. Correct?
Adv Mkhwebane: That is the same Ms Govender. Yes.
Adv Mpofu: I indicated to the evidence leaders that you would want her to be called at the appropriate time. But for now, we are working on her affidavit. We'll come back to this transcript because I just want to deal with your statement that in that meeting, effectively, they confirmed the existence of the report and they said the custodian was the Minister and so on. Yes, we'll deal with that when we do all the reports themselves. Anyway, then you deal with interviews with the Minister of Security? What was that all about?
Adv Mkhwebane: That was still my effort to assist the team to determine the veracity of the allegations of the existence and the activities of the intelligence unit. I sought more information from the Inspector General of Intelligence. This information was attributed to a report by the former intelligence … so I subpoenaed the Minister and I had a meeting with the Minister and I informed the Minister that I had that report. And I wanted to make sure that I got it legally from the institution which produced it or, in fact, from the custodian of the report because IGI informed me that the Minister was the custodian.
Adv Mpofu: This talks again to the allegation that you were concealing that you had this report. If you go to 5.29 530, and 5.32, you use the word that the Minister undertook to request the Director-General to avail the declassified copy of the report. The emphasis is on “declassified.” And then you said, “I have yet to receive the report. I will be requesting the new Minister to avail the declassified report to my office.” And again, “I have since requested President Ramaphosa to assist in facilitating the availing of the declassified report by the Minister of State Security to no avail.” When you are saying you wanted the declassified copy of the report, what was the emphasis between that and whatever you had?
Adv Mkhwebane: It was because acknowledging that the report is a classified document, and how to treat a classified document, and also understanding, from the meeting I had with the IGI in January, where the key issue was, how to make sure that the resources or the agents are protected? Because remember, this report was not only dealing with the SARS unit, but it was also dealing with other information and other individuals who are not supposed to be exposed, as well as the issue of how the agency operated. Now, my insistence on the declassified report was acknowledging that I would want to use that document and remember in the sources of document which have indicated, I said some documents and equipment which were blinded and documents which I could not disclose. So it was all intending to make sure that I also operate within the provisions of the law and act responsibly in protecting those sources and covert agents and operators and how they operate. So all this indicated my efforts to get the declassified document from State Security to no avail.
Adv Mpofu: You then say in 5.2.33, “In light of the above-mentioned and the terms of powers vested in me by section 181(2) and (3) of the Constitution, I have it on good authority that the findings of the OIGI Report, inter alia, were that” and then you say what the findings are. Firstly, SARS created a covert unit using intrusive methods and so on, in violation of Section 209. Then you say the establishment was illegal and the IGI recommended that criminal charges be investigated against Minster Gordhan, Mr Pillay and Mr van Loggerenberg and Mr Richer for the establishment and involvement in the covert intelligence unit in SARS and SARS to produce a credible inventory of the equipment used and so on. That is an exposition, as it were, of the recommendations on the ICI report. It says explicitly what the IGI report recommends - could you say that if your intention was to conceal the fact that you had seen it?
Adv Mkhwebane: It was not my intention. I do not understand where this comes from. I said I haven't seen the report when the judges and everyone knew I said, in the beginning, the report was dropped at PPSA by somebody. Secondly, the issue of me writing those letters, which we've mentioned, and the letters are so detailed, because we availed them through rule 53, and even in the section 7(9) document, we said that I have the report and can I get the correct document because section 181(3) of the Constitution demands that state institutions, organs of state must all assist the Public Protector. I was requesting to get that from the custodian of the report and I have it on good authority that the findings and recommendations were relevant to the complaint and the violation of Section 201. So you can see here, I showed what the findings of that were all about. Because there was a unit that I was requested to investigate whether its operations are legal, which is the mandate of the Public Protector. Going through this report, I could find what was relevant for me and, instead of being irresponsible, putting all the information out there and exposing intelligence information or sources, I was trying to make sure that I acted responsibly. And this is exactly what is in that report. The recommendations show that I've seen the report and in my opening statement, I recorded my conversation with the IGI Inspector General where I told him the report was dropped. Strangely, I've even seen it in Nose Week and they seemed to comment on whether was there such an investigation.
Adv Mpofu: We'll still go through that recording. What I was avoiding was the blow-by-blow account right now; we can do it in another session. But in a nutshell, I shall just ask you a few questions. In your interactions, whether it was with the Minister, the IGI, Adv Govender, etc., did anybody ever say, “No, there's no such report.”?
Adv Mkhwebane: Definitely not.
Adv Mpofu: Did they go as far as to confirm the date on which the report was finalised?
Adv Mkhwebane: Correct, even in those letters of response.
Adv Mpofu: And did those dates or that information coincide with the report that you ha?
Adv Mkhwebane: Correct.
Adv Mpofu: So, short of giving you the report, this high-ranking official, the Inspector General for Intelligence in South Africa, the Minister, the legal advisors, and so on, did any one of them ever give you the impression that the report that you had was not the report noted? Collectively speaking, were they good authorities on that issue?
Adv Mkhwebane: Correct.
Adv Mpofu: Now, we'll deal with the KPMG report. And Mr Moyane appointed KPMG report in 2014. Okay, so it's now a second report, which we will deal with when we do the reports but Mr Pillay’s evidence was that he was the one who commissioned the Sikhakhane Report.
Adv Mkhwebane: That is correct.
Adv Mpofu: And his successor, Mr Moyane commissioned the next report, which was the KPMG report.
Adv Mkhwebane: That is correct.
Adv Mpofu: We won't go into it now but what did the KPMG report find regarding the lawfulness of the establishment of the unit?
Adv Mkhwebane: The covert unit (intelligence unit) existed (which is 220.127.116.11) and varied its form and shape. Evidence indicated that the unit only started existing in 2007, even though reference is made to a covert unit being operational as far back as 1998.
Adv Mpofu: Jump to 18.104.22.168 & 8.
Adv Mkhwebane: Maybe 22.214.171.124 is very critical because that unit was given various names: special operations, SPU, NRG, and HRIU. So the members of the unit were not employed by SARS as they were recruited outside of their SARS systems and processes.
Adv Mpofu: So, 126.96.36.199.
Adv Mkhwebane: So there was clear evidence that the intelligence unit intercepted private individual communication, which was corroborated by Mr. van Loggerenberg’s laptop, which was found with unexplained emails appearing on his allocated laptop, so that is what the KPMG finding was. So we just kept it as is.
Adv Mpofu: Okay, so we've gone over the three reports now: the Sikhakhane Report confirms that it was unlawfully established; IGI says that there should be criminal charges against Mr Gordhan, Mr Pillay, Mr van Loggerenberg and Mr Richter; and KPMG says that there's clear evidence of interception of private individuals. Then they also talk about recruitment. We have read five points.
Adv Mkhwebane: Yes, I have read that.
Adv Mpofu: I suppose they say he was outside the system processes. Another accusation is therefore that you “ignored” the responses of Mr Gordhan and Mr Pillay and Mr Magashula and forged ahead with your predetermined outcome without taking into account their responses. Now taking into account the sections that follow, what do you have to say about?
Adv Mkhwebane: The affidavit of Mr Gordhan - he was approached and I think we are still going to deal with the challenges facing this investigation, including the recording of meetings, the subpoena and everything but he responded because we've captured and incorporated his response in the report. So here we were requesting him to verify the establishment of this unit and he acknowledged that this unit had different names. He said the unit didn't have a name originally 188.8.131.52 and was called the Special Projects Unit at first, later National Research Group, and the Higher Risk Investigation Unit, respectively. The manager of the unit reported to Mr Pillay in his capacity as General Manager of Enforcement and Risk. Mr Pillay in turn reported to Mr Gordhan as the Commissioner of SARS, the accounting officer. So it's going back to why the section 7(9) document was served to the two of them, including Mr J. Magashula, which was because of their role and their level in the system. He said the unit was lawfully established to perform very important functions for and on behalf of SARS and, as far as he's aware, the unit operated and performed those functions within the law. And then Mr Pillay was given an opportunity. This is part of audi. We told him about the investigation and the report. And he denied the allegations.” He then says he argued that the Sikhakhane Report was entirely flawed in fact and law, which is in 5.2.38. And then he denied that the establishment of the intelligence unit by SARS failed to respect the constitutional status, power and functions of the National Intelligence Act. Then he maintained that the relationship between SARS and NIA was generally sound and managed in accordance with the Constitution in mutual interest and joint subject matters. And then he listed the relationship which existed between SARS and NIA and I mean we are capturing all that. And we are showing that we did indeed take into consideration the response of Mr Gordhan and Mr Pillay and then the affidavit of Mr Magashula. We also had a meeting with him, we asked him to tell us about this unit.
Adv Mpofu: Mr Pillay refers to it says there were various joint investigations between SARS and NIA, joint training and all sorts of things. Does that suggest the unit had nothing to do with intelligence or what?
Adv Mkhwebane: I think here he was just trying to show that SARS has a relationship with NIA and the State Security Agency. And I mean, if you have joint investigations between the two that is good because this is actually what is expected from them, not to usurp the powers of State Security. And it means the officials who are doing all this work needed to be trained in this kind of work and were being trained. Various investigations and audits were conducted by SARS at the request of NIA, which is also in the spirit of Cooperative Governance as per section 41 of the Constitution. Training courses were conducted between the two, and a memorandum of understanding was signed between SARS and NIA, dated 2002. Remember, we are acknowledging where they were doing good but the fact of the matter is that the unit usurped the powers. I think that is what they do not understand. It’s as simple as that. We say that it's fine to respect that NIA or State Security is the only agency with powers under section 209. So indeed, if you have got training and collaborations, it means that you are trained, but then I think the training also should only focus on what you can do within your own mandate. Joint operations are good and joint investigations are good because that is what they were supposed to do, instead of taking responsibility.
Adv Mpofu: Just to save time, I think the same general answer can be applied to Mr Magashula. He also responded to you and you dealt with his response. I do not think we need to go through it.
Adv Mkhwebane: Yes, because he was also the accounting officer and by the end, he was in HR Corporate Services, so we wanted to know if he knew about this, especially the issue of recruitment and the establishment of the unit as he was key in that particular process. We also incorporated his response; we never ignored his responsibility. I think the key issue is the issue of audi, the issue of giving them a hearing and incorporating their information.
Adv Mpofu: Now comes what I think is the core of your first step process. At 5.2.44, we'll deal with the application of the relevant legal prescripts but we won't go deep into them for now as the Members can read that for themselves. But a high level, it was the Constitution, which we've already dealt with and you specifically referred to section 41 which is about cooperative governance, section 209, the one you were talking about earlier, section 195, which is the ethical standards of organs of State and the section 199 which talks about the integration of defence systems and intelligence and police services and so on. And then you go to the relevant legislation, in your view, at least: the National Strategic Intelligence Act and that is at 5.2.4 – 8; you outline the Tax Administration Act 2008 of 2011 … you wanted to come in.
Adv Mkhwebane: This is very critical as well. Yes, it's very critical that I highlight something and that is section 5.2.51. Section 41 of the Tax Administration Act says, “Senior SARS officer may grant a SARS official written authorisation to conduct a field audit or criminal investigation then when they exercise their responsibilities, under the Tax Act in person, the official must produce authorisation. If the official does not produce authorisation, a member of the public is entitled to assume that the official is not a SARS official who is authorised.” So this indicates that when they conduct the investigation, this is what they need to do. In terms of section 44 of that Act: “During a criminal investigation SARS must apply the information gathering powers in terms of the chapter with due recognition of the taxpayer’s constitutional rights as a suspect in a criminal investigation.” So again, whatever they are doing, they should comply with the law. In terms of section 46 again, “SARS may whether identified by name or otherwise objectively identifiable, require the taxpayer or another person to within a reasonable period submit relevant material.” So that is what SARS is expected to do. Paragraph 5.2 point 55 is very critical. “However, when one considers the evidence at my disposal, which points to specific steps taken by SARS to recruit personnel and procure surveillance equipment for the said unit for covert taping of people's telephones, and conducting illegal surveillance on people, it confirms SARS’ violation of the legal prescripts which dictate when such covert activities may be permissible.” So they can do those things but then they should be doing those within the legal prescripts. Now coming to the conclusion, that is where we are applying the law to the facts. So we are saying SARS is not mentioned in terms of the relevant legislation as one of the National Intelligence Structures established in terms of the NSI Act and it can only work with other law enforcement agencies within the principles of cooperative governance. So you see, where Mr Pillay mentioned that they cooperated, that is where they can cooperate with other law enforcement agencies.
Adv Mpofu: Okay. Well, firstly, quite apart from the content of what you have testified about now, what does all this say about the criticism that you ignored the inputs of the implicated persons?
Adv Mkhwebane: That is why I am saying it's so unfortunate as a reasonable judge and a reasonable person who is reading this report would see that we have incorporated the evidence or the information we received from Mr Pillay, Mr Gordhan and Mr Magashula. At first, we asked them to provide us with their affidavit in the document collection process. Remember when we receive a complaint, we will then after meeting the complainant, lock in issues, then we will write to the individual and say, “Give us an affidavit. These are the allegations against you.” So this is what was done in this particular process and this is the first audi. Then we come to the second audi, giving them the section 7(9) notice saying: “This is the information you provided; this is the evidence we have that you are implicated in this matter. We are giving you an opportunity to give us the second bite now on these issues.” It is all in the report.
Adv Mpofu: Well, I know the Chairperson said I must not dish out compliments liberally but speaking for myself and having read all these things many times, I say that this is one of the best reports from a Public Protector that I have ever read. But be that as it may, I am not a Member of Parliament. But you said that Mr Mataboge, who was the chief investigator, was one of your best drafts people. Would you say the quality of this report was related to that fact?
Adv Mkhwebane: Mr. Mataboge prepared the Bosasa Report. This one was prepared by Bianca (Mvuyana) under the guidance of Mr Mataboge and is also well drafted. She's also one of the best drafters.
Adv Mpofu: And I know she's one of the best witnesses but I did not know she was also one of the best drafters.
Adv Mkhwebane: She's the best and I mean, at this level. She is an investigator, not even a senior investigator. A number of investigators do Service Delivery-related matters, but she was one of those under Good Governance and Integrity who investigates complex matters. So I think she was also one of the best. I must indicate that a number of them are the best investigators.
Chairperson: We will take a brief adjournment.
Chairperson: Over to you Public Protector.
Adv Mpofu: Now, just around us that second issue of the establishment of the unit, having dealt with the prescripts, the history the other reports, the affidavits of Mr Pillay Mr Gordhan and Mr Magashula and all that, you come to your conclusions, which we find from 5.2.56 and without reading directly from the conclusions, just tell us why you say that allegation was sustained.
Adv Mkhwebane: Yes. Our conclusion, taking into consideration the complaint and the responses we received from SARS, Mr Gordhan, Mr Pillay and Mr Magashula, we concluded that the National Intelligence Structure which is established in terms of the NSI Act can only work with law enforcement agencies, so, it means that while it was good that it was there, and they should investigate as we want them to deal with the tax evaders and the unlawful, illicit economic trade which is affecting our country, but it should then operate within the law. We say in 5.2.57 that SARS under the guidance of Mr Pillay established this unit, without the involvement of NIA. 5.2.58 shows in the memorandum that Mr Gordhan, as the Commissioner, wrote to the Minister, saying that SARS had already begun operating a unit that gathered information covertly. However, as the Accounting Officer, Mr Gordhan should have been aware, and I believe was aware, that the unit had already started operating. Mr Pillay reported directly to Mr Gordhan as Commissioner of SARS. That memorandum was crafted in such a way that it showed that this unit had already started operating. So the accounting officer should have been aware of that. So the establishment of the unit with the approval of Mr Gordhan as the then accounting officer was in breach of section 209 of the Constitution, in terms of which only the President may establish such a covert information gathering unit. I think we've read section 209 already. So then Mr Magashula misrepresented himself under oath because he denied the existence of the intelligence unit, even if the unit was never called a rogue unit as such, he was fully aware that such a unit existed which was changing names over and over and over. And he just denied knowledge of any unit which was doing this kind of work. I mean, being the General Manager responsible for Recruitment or Corporate Services, surely he should have been aware of it as everything should be approved through him if it were an organisation complying with the law, your policies., etc. and I think, if they were audited if the Auditor-General found something like this, the Auditor-General would also come up with these findings and then advise them accordingly. So due to the sustained denial, denial and denial of the existing unit’s existence, as well as the failure by the Minister of State Security to provide my office with a copy of the declassified report on the investigation conducted by the Inspector General of Intelligence Adv Faith Radebe on the affairs of the unit. Also requested the President's intervention in the matter. As a Public Protector, I am saying I have this evidence, and I use this evidence accordingly.
Adv Mpofu: So those are your conclusions in a nutshell and based on that, therefore, you concluded that the allegation was sustained.
Adv Mkhwebane: Yes, it was sustained. Because if you check 5.2.62 as well, the evidence obtained during the investigation indicates that State Security Report found amongst other things because we are mentioning that report again, amongst other things, that SARS created a covert unit utilising covert and intrusive methods in contravention of this mandate. So this also shows that I wouldn't say something like this if I didn't have a copy of the report. And SARS had an interception and monitoring of communications capability, which went beyond targeting tax offenders but was also utilised for political purposes, as per the documentary evidence in my possession. So this, also, it's not just a thumb suck about political purposes. I have indicated that there were documents and videos, besides the interviews or the recordings of them, and those recordings of Helgard (Lombard) and (Johan) de Waal, which we are going to play. So they were confirming that indeed, that was what they did; they installed those cameras. Yes, the intention was something different, but unfortunately, it ended up going beyond the mandate of SARS, because it was not relevant related to SARS.
Adv Mpofu: Or to tax. We'll deal with that when we deal with the operations section. Now, I want to say, just to close this question, that you have taken us really through the journey of how you then got to your conclusions on this issue of the lawfulness and/or otherwise of the establishment of the unit. Again, when you get to the judgment, you'll find that one of, or the most prominent criticisms are that you effectively embraced, let me put it that way, “discredited” reports on these questions and put aside whether they were indeed discredited or not. But in your conclusions, is there anywhere where you regurgitate or rely on or adopt anybody else's findings or are these findings from your own investigation?
Adv Mkhwebane: Mentioning these reports, we were showing that in this investigation, which was done by Sikhakhane, by KPMG, a legal opinion was requested, thus showing all the people who have investigated the matter. But then you will see that our focus was on whether there was any violation of the legal prescripts. So if it can just be understood that that was the only focus. Yes, we checked the information, and we couldn't ignore it. And remember, in our investigations as the ombudsman or Public Protector, we use such information as leads, meaning, for instance, on our own investigation, we can hear them, such as the Gupta leaks, for instance, but we deal with it. When you use that information, it is not the gospel truth, it is not evidence. Then after these reports, we will go to the source and interview them. For example, KPMG dealt with this and they are saying the following, these are the laws which they refer to in this IGI report and they're the only institution which investigates intelligence-related issues, because one misunderstanding which a lot of people have and I saw when I interacted with your legal adviser, Govender, the Minister of State Security, Ms Dlodlo, because I had a very close session with her and she was also saying SARS was not an intelligence department. I explained that was the very purpose of the investigation conducted by Sikhakhane who referred that part to you as IGI and IGI oversees State Security. So the main aim was just to check whether they operated within the law, nothing more, nothing less. And in the report, there are several instances where I refer to independently acquired evidence. So we use these reports as leads, and then we approached SARS ourselves to ask if they could provide us with information. We also have our own independently acquired means of acquiring information. So this is why we came to the conclusion based on our own investigation, not just regurgitating, or just taking whatever the reports are saying, but because of their findings and their conclusions, we are saying that the evidence, which we have, and what the law says shows there has been a violation of the law.
Adv Mpofu: Okay, we'll deal with the third leg. And I think it will be the quickest because as I said, probably of all the things you investigated, this is the simplest, as it is a fairly straightforward PFMA case of whether something was procured properly, or not. Anyone would know that in the public sector, you can pick up anything, whether it's a cow or a computer and the people who work there must be able to say, where did it come from? When did it come? And so on and so on. I wanted just to deal with that issue that I had flagged, which I said, does not fit in.
Chairperson: Maybe you can just assist me as a Chairperson and the Committee, by just indicating in summary, what evidence you are placing before this establishment? I am asking you to just summarise.
Adv Mpofu: You have gone to all the elements of whatever you went through and you, therefore, say that allegation that the establishment was unlawful. So the Chairperson now wants you to summarise how you reached that conclusion?
Adv Mkhwebane: I think we dealt with the conclusions on page 58, because that is where I am saying the fact is that the unit was established and we've shown that section 209 of the Constitution is very clear that it's only State Security, Defence Intelligence and SAPS intelligence. SARS approached the Minister of Finance to approve its establishment, but they had already established it. And I am saying that we are not stopping SARS from doing its work. And I think we've shown you the observations which we had to deal with, that they needed to cooperate with state security agents and hence, Mr Pillay’s response, and Mr Gordhan's response, is also incorporated here, where they indicate their view. So we've given them the audi in this particular issue, so it is not true that we didn't allow them to respond, secondly, again, for the Committee, this investigation was conducted with an open mind, as far as the issue was contained. We show the interception of information and what it says about the operations of this particular unit. Also, I am showing here in the establishment part that there was also a report by IGI, which we are still going to deal with in detail, where I tried to acquire it properly and I didn't regurgitate the reports of Sikhakhane, KPMG and everyone, which we are still going to deal with, but I am just showing that in the investigation of the Public Protector, we use that as leads, then we acquire our own evidence. In other words, it helps us to know where to start to investigate.
Adv Mpofu: Well, one question always leads to an error. So I am just going to piggyback on the Chairperson’s question, and maybe zoom it.
Chairperson: I thought you were done, Adv Mpofu.
Adv Mpofu: I just want to ask one specific question and your question has helped me to do that, just so that we do not go back to the so-called establishment issue. And just focus, we haven't read everything we can, but it does seem that the smoking gun in this whole thing is the memorandum to Mr Manuel, can you maybe in answering the Chairperson’s question in a more focused way, just zoom into the importance of that. Given its content, its author, its destination, the comments around it, and so on, what did that mean to you as the Public Protector? What role does that play in the establishment issue? Specifically, thank you.
Adv Mkhwebane: I do not know why we didn't show it and the memorandum is a reliable source document because it comes directly from SARS.
Chairperson: We did go through it in detail in earlier testimony.
Adv Mpofu: Remember, Public Protector, we said, as far as we can, for the sake of progress, we'll use the source document in the report. But maybe tomorrow morning, before we start, we can display it. But for now, just because of the time, if you can answer the question.
Adv Mkhwebane: Yes, yes, it's very critical, because the accounting officer signed this, the accounting officer acknowledged that already the unit was operating and wanted to have an MOU with the NIA because what the unit was doing fell within the mandate of NIA or State Security. So this memorandum acknowledged or agreed that they knew that it was not within their mandate; they needed the security agency to collaborate with SARS. So hence the comment by Deputy Minister Moleketi when he was noting the matter, was not approving, but concerned. It was a mandate of State Security and they wanted to supplement because the Memorandum of Understanding says they want to supplement so it means the unit was already operating. But the key issue is that is the document which we relied on, and which belongs to SARS.
Adv Mpofu: Can we then go to Bundle A page 7842 just so that we do not have to display the memorandum tomorrow? This is a crucial piece of evidence. You can see it's got all various stamps and is dated February 2007 and it is on the SARS letterhead. Right, Dear Minister. I am going to go through - the critical paragraphs 2.1 and 2.2. But just give us the context, Public Protector.
Adv Mkhwebane: So the proposal or the purpose was to request approval to find a special capability within NIA. So they wanted to fund it within NIA, acknowledging that it was not their mandate, but then they fund it within NIA which supplies SARS and the law enforcement unit with the necessary information to address the issues of the illicit economy. So the discussion then is about collecting intelligence and the interception of the organised syndicates, which the country should be doing. So this is also
Adv Mpofu: Okay, word for word.
Adv Mkhwebane: and then collect
Chairperson: Adv Mpofu, you are not the Chair yet. So do be mindful of your time but you are not the Chairperson.
Adv Mkhwebane: Yes. Collecting technical intelligence invariably means no, I am struggling to read.
Adv Mpofu: If you go to page 42 it is clearer.
Adv Mkhwebane: 5.2.7: The memorandum requested approval to find a special capability within NIA to supply SARS and its law enforcement unit with the necessary information to address the illicit economy. The memorandum failed as they stated the following: “2.1 Collecting technical intelligence invariably means penetrating and intercepting organised criminal syndicates. This is an activity for which SARS does not presently have the capability (including the legislative mandate to manage clandestine activity).” So I said earlier that this acknowledges that they do not have the mandate. “2.2 Discussions are taking place with National Intelligence to supplement SARS intelligence capability. NIA is willing to create a ring-fenced capability, provided funds are made available to cover personnel costs. All other costs will be covered by NIA. NIA is willing to formalise the abovementioned arrangement into an MOU. 2.3 We, therefore, request that NIA’s budget be increased to fund the creating of this special capability.”
Adv Mpofu: All right, go back to the actual letter now you have read the important parts. Can you then just go to …
Adv Mkhwebane: The estimated personnel costs?
Adv Mpofu: Yes. All right. Personnel costs
Adv Mkhwebane: 2007/8 was R13 million. 2008/9 was R17 million. 2009/10 was R18.8 million.
Adv Mpofu: Maybe let us pause there to jump a little bit ahead on the equipment issue. Just on that budget - we will deal with the equipment issue tomorrow - one of the issues that you raise in the reports is that with such a unit costing as much money as this, there was no way that it didn't have any equipment. And if it did, then you would have wanted to know how it was procured. I just wanted to flag this so that these amounts can be kept in the back of our minds. Just comment on 2.5.
Adv Mkhwebane: So this document again, Chairperson, is the kind of document which I encourage officials to rely on instead of media articles or just some reports which have been leaked. So here, it shows that this was prepared by the General Manager of Enforcement and Risk - we know that was Mr Pillay - and the Commissioner of SARS who was then Mr Gordhan, the accounting officer. The Deputy Minister had to approve or not approve. So his comments, as we've captured here, were asking if that were the responsibility of NIA: “And I see that you would want to supplement that function or the existing units functioning within SARS.” Then Minister Manuel just approved the submission. So, communications in government work like that. Once a request for approval is signed by the Minister, it means it was approved.
Adv Mpofu: So as far as approval is concerned, this was clearly directed to the Minister, prepared by the relevant official, Mr Pillay, signed by the Accounting Officer, Mr Gordhan, countersigned by the Deputy Minister and signed, and therefore, it was, as you say, a proper legal document or memoranda. Chairperson, I hope that covers your question.
Chairperson: Yes. Thank you.
Adv Mpofu: My issue again, just so that we do not bill it for tomorrow. This is homework, something that I just wanted to highlight, which postulates particularly into CIEX, regarding the role of the Public Protector. There's this debate about whether the Public Protector’s mandate includes saying anything about the Constitution and so on. If you go to section 181(1) of the Constitution, the governing provision, not just for the Public Protector, but for all chapter nine institutions, talks about state institutions supporting constitutional democracy. It says the following: “Establishment and governing principles
181. (1) The following state institutions strengthen constitutional democracy in the Republic: (a) The Public Protector.”
Now addressing the Chairperson of the Committee and the public - what do you understand about the concept, that the role of Chapter Nine institutions is to strengthen the constitutional democracy? Does that mean that there are areas within the Constitution or the constitutional framework, including the Constitution itself, where you are not allowed to go?
Adv Mkhwebane: Definitely, it's very clear for all the Chapter Nine institutions, we should be assisting the country to implement or to make sure that the Constitution is a living document and applies to all citizens. Therefore, Chapter Nine and section 181 are very clear that we are there to support constitutional democracy and we do that via transparency, cooperation, and even assistance for us in the performance of our responsibilities. So, I think that was interpreted in the Nkandla judgment, where we can access any information, go deep into raw state power, whatever information you require, hence, in a number of engagements in this investigation, I was very clear that they could not indicate that they could not give me the IGI report. It was necessary for the performance of my responsibilities. So it was like then stifling us or not cooperating with us. I think we had several issues where there were challenges in the SARS investigation.
Chairperson: So it is also fitting that the National Assembly establish roles for all of these institutions.
Adv Mkhwebane: That is correct, but not only for the Public Protector, for all these institutions
Adv Mpofu: For the sake of competition, let us then link that to 181.3.
Adv Mkhwebane: Correct.
Adv Mpofu: Can you comment on that one?
Adv Mkhwebane: So 181.3 is at the core of what is expected from other organs of the state.
Adv Mpofu: including the National Assembly.
Adv Mkhwebane: “Through legislative and other measures, must assist and protect these institutions to ensure that the independence, impartiality, dignity and effectiveness of these institutions is guaranteed.” So I think we will possibly deal with it when we also deal with evidence of Public Protector Sokoni because it was like, okay, as the National Assembly, you have established this Committee. And I think in my statement, we asked what are the expectations from me and how did they assist me in ensuring that I get any information to ensure that I am independent, impartial, the dignity of this institution and the effectiveness of this institution, especially the dignity I've mentioned several times. There was an instance where I mentioned that in the Portfolio Committee, I felt like I was being attacked from all angles. And the very same mother, being the Speaker of Parliament, as the parent joining in to victimise me or to deal with me instead of the National Assembly protecting me as the incumbent in this institution. So, this is very critical, especially section 181(3), for any Chapter Nine institution when we are performing our work and it was even worse when I had to be clobbered with personal costs in my private capacity. What does it say to this? How do you assist in ensuring that I maintain my independence, impartiality, dignity, and effectiveness, which is very critical, because the minute you disarm or you cause this institution to operate with fear, or all these institutions to operate with fear, then it means the citizens are on their own? They're not protected.
Adv Mpofu: I think that is where we can stop it for today.
Chairperson: Thank you. We are going to adjourn for the day.
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