Former Eskom CEO Brian Molefe has shed light on the R30-million payout he received as a pension payout when he resigned from Eskom.
Molefe received this amount despite only working 18 months at the power utility and being 50 years old at the time.
Speaking to the Commission of Inquiry into State Capture last week, Molefe said that the pension payout was given to him as a sweetener to accept a new fixed-term contract as CEO.
“When I was appointed, it was on an understanding that it will be for permanent employment,” Molefe told the Commission.
He said that after accepting the contract, the Ministry of Public Enterprises changed its mind and wanted to change his contract term to five years.
As Molefe had already signed the permanent employment contract, the two parties began to negotiate a deal in which he would accept the change to a five-year contract.
According to Molefe, the following resolution to this impasse was decided and enacted by the board: when Molefe left his position after five years, he would have been treated as working until retirement at age 60 and would receive a pension payout in line with this.
Molefe did not last five years at the power utility, however.
After the public protector released the State of Capture Report, which included various allegations directly involving him, Molefe promptly stepped down by activating the above agreement.
“The board approved it and put me on pension. So I left because I felt with these allegations it is not good to be at Eskom,” Molefe said.
The R30-million pension payout has resulted in a prolonged court dispute between various parties, and the matter is still ongoing.
Molefe conceded, however, that it was a mistake to give him this pension according to the Pension Fund rules.
“Eventually, the legal opinion is that it was a mistake to approve my pension in the first place,” he said.
“Early retirement can only be taken when you are 55. I was 50.”
Court battles over R30-million pension payout
Molefe was unable to comment further on the nuances of the mistake purportedly made by Eskom as the matter is still being heard in court.
The Constitutional Court ruled in 2019 that Molefe must pay back some of the pension amount he received from Eskom as a result of his agreement.
This did not directly result in Molefe paying back the amount, however, and legal battles continue over the payout.
Molefe was linked to the Gupta family and a number of figures that were implicated in the State of Capture report, as well as being implicated himself by the former Public Protector.
Molefe featured in the report as a Gupta family ally and was found to have had 58 telephone interactions with Ajay Gupta between 2015 and 2016.
Molefe was then sworn in as an ANC member of Parliament in February, and was expected to replace Pravin Gordhan as finance minister.
In May 2017, he returned to Eskom as CEO but in early June, Eskom announced that Molefe was no longer leading the company.
He has also come under fire for earning R57,000 a month for service in the military as a colonel, despite having no military experience.