Magashule and Manyoni then took their leave and drove back to Bloemfontein.
About a month later, however, the pair was back in Saxonwold.
Magashule had again driven Manyoni up the N1 in his black BMW X5
to the family’s compound, where Atul Gupta tried to ‘court’ the mayor for a second time.
Magashule once again laid out the plan for Manyoni to succeed him as premier. ‘Ace said he looked forward to me taking over as premier, because then he wouldn’t have to deal with the province’s problems any more,’ Manyoni told me.
But Manyoni once again disappointed them with his lack of enthusiasm for the plan. After this second visit, no further attempts were made to try to lure him into the Guptas’ state-capture network, Manyoni said.
The former mayor now believes that his unwillingness to work with the Guptas led to his political demise. The events that followed certainly suggest this may be true.
After the elections in 2014, Zuma did install a new minister of
communications. However, it was Faith Muthambi and not Magashule who replaced Yunus Carrim in the portfolio.
Manyoni thinks he may have ‘ruined’ the grand plan to include Magashule in Zuma’s cabinet with his negative responses at Saxonwold. Having no one they could trust to take over as premier in the Free State meant that Magashule had to stay where he was.
Despite the failure of what appeared to have been plan A, Muthambi proved to be a most helpful communications minister as far as the Guptas were concerned. The so-called #GuptaLeaks, a series of leaked emails and documents from servers of Gupta-owned companies, later revealed that she had emailed important documents relating to the broadcasting industry to one of the family’s known lieutenants.5
Manyoni’s relationship with Magashule, meanwhile, started to deteriorate in 2014 and throughout the following year.
In June 2016, as the ANC was preparing for that year’s local government elections, the party gave Manyoni the boot as Mangaung’s mayor. After a meeting of its NEC, it announced the names of several
‘mayoral candidates’ for the upcoming elections. 6 It was the first time ever that the ANC released such a list.
The would-be mayor for Mangaung was Olly Mlamleli, a staunch Magashule ally. According to Manyoni, he was led to believe that he would simply swop places with Mlamleli, who at that point served as the Free State’s MEC for cooperative governance, traditional affairs and human settlements. Manyoni was told that the NEC, the party’s highest authority between elective conferences, had sanctioned the decision. Given his background as chairperson of the South African Local Government Association, the intended move made sense to him.
But it was not to be. Instead, Manyoni was sent to Parliament in Cape
Town and social development MEC Sisi Ntombela was moved into Mlamleli’s former position in October 2016. Ntombela, who is also considered a close ally of Magashule, succeeded the latter as premier in 2018.
Manyoni saw this as a plan devised by Zuma to move him into a far less visible and influential political position. If indeed the case, it did not go unnoticed by Zuma’s fellow NEC members.
When Manyoni later attended an NEC meeting in his capacity as SALGA’s chairperson, ANC secretary-general Gwede Mantashe asked him why he had not become the MEC for cooperative governance. It had been an NEC decision, after all. Manyoni said an irate Mantashe confronted Magashule over the matter. The latter, of course, simply defended himself by saying that Zuma wanted Manyoni in Parliament.
The former mayor’s stint as an MP in Cape Town officially started in September 2016. 7 But it would be a temporary arrangement.
According to Manyoni, the distance between the Mother City and Bloemfontein did not stop Magashule from making his life difficult.
At that stage, Manyoni was still the Free State ANC’s deputy chairperson, and as such was required to attend meetings of the party’s PEC. These were usually scheduled for Mondays to allow PEC
members who were also MPs to attend committee meetings in Parliament, which usually took place between Tuesday and Friday. But Magashule started to call PEC meetings on Tuesdays, Manyoni said.
This obviously put him in a bind, seeing as he was torn between his duties as an MP and his position as a senior party leader in his home province.
By May 2017, Manyoni had had enough. He resigned as an MP after just eight months in the National Assembly. To this day, he believes
that his political fate was sealed after those two awkward meetings with Atul Gupta. His account of this saga is one of the most compelling indications that Magashule participated in and actively abetted the shadowy parallel state that the Gupta family ran from their fortified seat in Saxonwold.
It seems Manyoni was not the only Free State official who was dragged to the Gupta compound by Magashule. In October 2018, news broke that Magashule and Mxolisi Dukwana, the former MEC for economic development, had allegedly visited Saxonwold in 2011. 8 In a so-called Anton Piller application submitted to the Bloemfontein High Court, Dukwana claimed that the Guptas had tried to strong-arm him into approving a R140-million property development project backed by the Free State government. He also claimed that the Guptas had offered to pay him R2 million a month for ten years if he signed off on the deal, and that all of this occurred in Magashule’s presence. 9 Magashule said Dukwana’s claims were ‘not only baseless and malicious, but
[were] also based on fabrications’. 10 Dukwana was due to testify about his alleged trip to Saxonwold at the Zondo Commission of Inquiry into allegations of state capture. At the time of writing, he had not yet appeared at the inquiry.
Documents in the #GuptaLeaks show that Magashule became increasingly prominent within the Guptas’ social circles after he became premier. In November 2010, the family sent an invitation to
‘Ace Magashule and partner’ to attend their annual Diwali celebrations at the Saxonwold residence. It is not clear whether Magashule attended that year’s event, but sources confirm that they saw him at at least one such Gupta Diwali celebration.
There are further indications of contact between Magashule and the Guptas early in his first term as premier. In January 2011, Gupta staffer Joleen Roux negotiated with a car rental company for a chauffeur-driven sedan. Apparently someone from the Gupta family or their clique was set to visit their powerful friend in the Free State.
‘Can you see if there is anything available for us on Friday. We are actually waiting to get confirmation from the premier of free state office to confirm appointment,’ Roux wrote in her email to the rental company.
By 2015, at the pinnacle of their capture of the state, the Guptas viewed Magashule as one of their most important allies in government.
This is seen in those #GuptaLeaks related to the 2015 edition of Gupta-owned news channel ANN7’s South African of the Year Awards. One document shows that Magashule was to be seated at the event with Hlaudi Motsoeneng, Faith Muthambi and Mosebenzi Zwane. The document refers to the group as the ‘A team’.
We know that the Guptas did not cosy up to political leaders like Magashule for the purpose of making friends. To them, every new connection in government represented a fresh business opportunity.
The Free State premier was no exception.
This is best illustrated by another document from the #GuptaLeaks. In June 2011, Santosh Choubey, a Gupta associate best known for his involvement with Sahara Computers, created an Excel spreadsheet titled ‘Copy of Free State Schools’. It is a record of hundreds of government schools, Further Education and Training (FET) colleges, libraries and provincial departments that ‘subscribed’ to some or other Gupta-provided product or service around that time.
The document does not explicitly state the nature of the subscriptions,
but I had a hunch. So I phoned a few of the schools and libraries listed.
They all confirmed my suspicions: that they received copies of the now defunct The New Age newspaper. ‘We received a small heap of The New A
ge newspapers every morning, but nobody really read them,’
said one employee at a municipal library somewhere in the Fezile Dabi district municipality. ‘They were mostly just left on a heap.’
The document, it would seem, is a blueprint for one of the Guptas’
early coups. The New Age first hit the shelves in December 2010. By June the following year, it was distributing over 4 000 subscriber copies a day to those government entities listed in the spreadsheet.
The document shows that more than 1 300 copies of The New Age were delivered to hundreds of primary schools, high schools and FET
colleges all over the province each morning. Just over 1 000 copies a day were sent to provincial government departments and municipalities, of which the Office of the Premier was the single largest subscriber. A further 1 770 copies a day were delivered to 177 libraries that fell under the custodianship of the Free State Department of Sport, Arts, Culture and Recreation.
The New Age never subjected itself to an audit of its circulation figures by the Audit Bureau of Circulations (ABC), so in order to put these subscription figures into perspective, one has to dig a little deeper and do a bit of educated guesswork.
Each year, a non-profit organisation called the South African Audience Research Foundation releases the All Media and Products Survey (AMPS), which includes detailed information on the public’s consumption of newspapers. According to the AMPS data for 2011, each issue of The New Age had an average readership figure of 39 000
in the paper’s first year in existence. 11
Readership figures do not equate to actual physical copies. It is generally accepted that more than one person reads each copy of any given edition or issue. In South Africa, on average, one newspaper is shared by roughly seven people. 12
Based on the AMPS readership figure of 39 000, and considering the reader-to-newspaper ratio of 7:1, The New Age distributed about 5 600
copies per issue in 2011. According to the average readership figure, this would suggest that the 4 200 subscriber copies sent to schools, colleges, libraries and government departments in the Free State constituted about 75 per cent of all copies sold.
Under Magashule, the Free State government appears to have been the first major tax-funded dumping ground for The New Age. It must have been a considerable source of stability for a new publication entering an industry that faced serious financial constraints. It leaves one wondering whether the Guptas would have been able to launch the newspaper at all had it not been for their close ties to the premier.
The bulk of any newspaper’s revenue, however, does not come from its cover price. It comes from selling advertising space. Magashule’s government also contributed generously in this regard. It is rather telling that one of the few full-page advertisements in The New Age’s pre-launch ‘Heritage Day special edition’ in September 2010 promoted
‘the rate of service delivery by the Free State government’. 13
A review of advertisements in The New Age in March 2011 revealed that, after state-owned telecommunications company Telkom, the Free State government was the paper’s most frequent advertiser. 14 In 2016, the provincial government spent just shy of R4 million on advertisements in The New Age, amounting to half of its advertising budget for print media. 15
The #GuptaLeaks offer further insight into the business dealings between the newspaper and Magashule’s government. In January 2015, The New Age boss Nazeem Howa emailed an Excel spreadsheet to Rajesh ‘Tony’ Gupta and Kopung Ralikontsane, the director-general in the premier’s office. It was a list of ‘Free State debtors’, presumably for advertising services. The spreadsheet gives a good idea of which Free State departments spent the most money on advertisements in the Guptas’ newspaper. Of the R5 million owed to The New Age at the time, Magashule’s office owed almost R3 million. The Department of Police, Roads and Transport and the Ngwathe local municipality, which encompasses Magashule’s hometown of Parys, were among the other big spenders listed.
Money also flowed from Free State government departments to the Guptas for other media-related services. The #GuptaLeaks include a statement from Infinity Media Networks for services provided to the
‘Free State provincial government’ in 2014. It lists four separate invoices that add up to R4.4 million. Infinity was the holding company of ANN7, the twenty-four-hour news channel launched by the Guptas in 2013. The statement does not say what services were provided; the only clue is the recipient’s address, Bophelo House in the Bloemfontein CBD, which, I discovered, is occupied by the Free State Department of Health.
I asked the department if it had ever been invoiced by Infinity.
According to one of its finance officials, the Free State Department of Health paid Infinity an amount of R220 000 in 2014 for ‘media services’. When I asked the department to elaborate on the nature of the services provided, a spokesperson said it was for a ‘media breakfast networking session with provincial service delivery partners … held in
Welkom’.
In September 2018, the Zondo Commission of Inquiry heard evidence from a National Treasury official who confirmed that Magashule’s Free State had made a hugely disproportionate contribution to the Guptas’
media empire. Jan Gilliland’s data showed that the province had poured nearly R80 million into The New Age and Infinity Media Networks between 2011 and mid-2018. By comparison, KwaZulu-Natal, Jacob Zuma’s home province and the second-biggest spender, spent just R25 million on media services from the two companies. 16
Magashule’s official diary shows the amount of direct contact he had with The New Age bosses. In May 2013, for instance, he had the following appointment scheduled for two different days: ‘Meeting with NEW AGE (Ms [ sic] Nazeem Howa & Mr Ricky Naidoo)’. Howa, who is definitely not a woman, was the newspaper’s CEO and Naidoo was its politics editor before he later became editor-in-chief. And in early July 2013, Magashule had this engagement in his schedule: ‘Premier meets The New Age’. All three of these meetings took place at the premier’s office in Bloemfontein, according to the diary.
The Guptas seemingly used Magashule’s Free State as a testing laboratory for their state-capture schemes, which involved more than just their media ventures. Mediosa, a Gupta-linked supplier of high-tech mobile medical units, achieved notoriety mostly due to reports of dodgy contracts in Premier Supra Mahumapelo’s North West province.
According to City Press, the North West health department awarded the company a contract worth R180 million in early 2017 for mobile units that were superfluous to the province’s needs. This included an upfront prepayment of R30 million. 17
But Mediosa’s operations were, in fact, first rolled out in the Free
State. Cureva, as Mediosa was known before it changed its name, signed a memorandum of understanding with the Free State Department of Health in 2015. The two parties then signed a contract in early 2016 for the provision of primary healthcare services in rural areas at a cost of R954 per patient, the same rate Mediosa later offered North
West.
Documents
in
the
#GuptaLeaks
reveal
that
Cureva/Mediosa would forward R650 of each per patient payment to what appeared to be Gupta front companies in Dubai. By March 2018, the Free State health department had splurged R25 million on the Gupta-linked firm’s services. 18
A source from the Free State Department of Health provided shocking details on how Mediosa ripped off taxpayers. This government healthcare worker was based in the eastern Free State’s Maluti-a-Phofung local municipality, one of the early pilot sites for the mobile units. ‘Mediosa’s staff would come into our hospital and take pills, other medicines and basic consumables like bandages,’ he told me.
In other words, the company’s mobile clinics were leeching off government facilities in the areas it was servicing. This would partly explain how Mediosa could afford to ship the bulk of its revenues t
o Gupta-linked companies abroad.
More terrifying, the Free State and North West were just the starting points for the scheme. Another document from the #GuptaLeaks shows that Mediosa intended rolling out its services in nearly all of South Africa’s nine provinces. By doing so, the firm projected that it would rake in revenues of about R1 billion a year. But the national roll-out of the Mediosa scheme was seemingly halted by the changing political landscape and the concurrent demise of the Gupta family’s business empire in South Africa.
14
A family of fixers
The Vrede dairy scandal remains perhaps the most glaring example of the callous manner in which the Guptas and their accomplices in government captured state projects that were meant to uplift poor South Africans. Court documents filed over the matter later suggested Magashule had been involved in the scandal right from the outset.
In February 2012, the then relatively obscure MEC for agriculture and rural development in the Free State, Mosebenzi Zwane, delivered his department’s budget vote address in the province’s legislature in Bloemfontein. Zwane had not been in this role for too long, having been parachuted out of the provincial Department of Human Settlements following 2010’s R1-billion RDP advance payments fiasco, as unpacked in Part III.
Zwane stated that his department would embark on a ‘multi-year mega public and private partnership business concept’ to help initiate
‘income generation through farming in the rural areas of the province’
and, ultimately, to support ‘black economic empowerment’. 1 The initiative (initially) had a budget of more than R131 million, said Zwane, and it would include a dairy hub in the Thabo Mofutsanyana district municipality in the eastern Free State. 2 ‘With this investment we want to break the back of unemployment, poverty and food insecurity,’ Zwane declared. 3
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