COSATU’s response to Mail& Guardian story
COSATU has noted the report in the Mail & Guardian, 1 April 2010, “Mrs Vavi,
the pension funds and the bribe”. The General Secretary has responded, with the
following answers to questions put to him by the M&G reporter, Matuma Letsoalo:
Are you aware of the fact that your wife Noluthando is contracted to SA Quantum
and receives R60 000 a month for doing marketing for the company [SA Quantum]
within the labour Union movement, Cosatu and its affiliates?
Yes I am aware that my wife is doing consultancy work for SA Quantum. The
agreement signed between SA Quantum and her states that she “undertakes to:
1. Furnish professional consulting services in respect of marketing,
distribution and servicing strategies into the employee benefits market;
2. Keep quantum informed on developments, trends, political dynamics
and key role players in order to improve Quantum’s understanding of the market;
and
3. Improve Quantum’s effectiveness in distribution employees’ benefits
solutions into the market.”
In this direct quote from the contract, nowhere is it stated that she will do
“marketing of the company in the labour union movement, COSATU and its
affiliates” as your question seeks to imply. In my view there is no conflict of
interest at all. COSATU has no relationship with SA Quantum and if it did that
would constitute a conflict of interest indeed. The provident funds of workers
are controlled by workers and employers who have a 50-50 representation in the
board in terms of the law. My wife has no relationship with any of the
provident fund boards. I have no direct relationship with and provident fund
board that has a relationship in SA Quantum. As far as I know no union is able
to dictate to the boards of the provident funds in which company their monies
should be administered. These decisions are left to the boards controlled by
workers and employers.
Given that you are the general secretary of COSATU, don’t you think the
business that your wife is doing with a company that does business with COSATU
and its affiliates constitute a conflict of interest?
As stated above, SA Quantum has no business relationship with COSATU and I am
not even aware which COSATU unions have their provident funds/pension funds
administered by SA Quantum. I assume that there should be some who have a
relationship. In that case there is no way she can influence the decisions of
the provident fund boards in terms of where they invest their money or who
should administer their provident funds.
After COSATU first called for a lifestyle audit for public representatives, you
publicly declared some of your assets, including the Morningside house, but did
not mention anything about Zwelothando. Do you have any reason why you did not
mention this?
Zwelothando is a company owned 100% by my wife and not me. Secondly I answered
all questions to me by the Star journalist honestly and truthfully. I did not
hide any interest. I have no personal business interest. I am not registered in
any company as a director. You can verify this with CIPRO. Noluthando has a
consultancy company called Zwelothando. She had that interest by the time we
were married. I married her not because of her consultancy interests or
business interests. I am not going to instruct her to withdraw from consultancy
or even business because she is married to me. I don’t seek to control anyone
in that manner. The only interest I have is that there should be no conflict of
interest with COSATU and or with government. This is so precisely because if
she was to win any contract with COSATU and or government this will raise a
question as to whether she won it because she has my surname or is related to
me instead of winning it above
board. I have an agreement with her that she should never do any business with
either COSATU or government. I am satisfied that SA Quantum indeed has no
relationship with COSATU and therefore the conflict of the interest issues does
not arise.
Don’t you think it would have been appropriate for you to declare this publicly
as well? Did you declare your wife’s business interests in SA Quantum to Cosatu
and its affiliates, who are doing business with the company?
I have answered this question already. I did not declare because COSATU does
not have any business relationship with SA Quantum. I am not aware of any
relationship between SA Quantum with COSATU affiliated unions. Even if there is
as I assume there would be, the driving question to me is whether any observer
would reasonably believe that I have in any way influenced worker provident
funds to enter into a business relationship with SA Quantum. The answer is
clear that such a possibility does not exist, as all provident funds board have
a 50-50 representation between workers and the employers.
It is clear from the tribute you delivered at the funeral of former SA Quantum
CEO Abraham Nduru in 8 December 2009, that you personally had close ties with
directors of SA Quantum, which did business with your wife. How do you explain
this?
I have known, and in fact have worked with, Abe Nduru for many years as
indicated in my tribute at his funeral. I don’t know any other director of SA
Quantum as your question suggest. Please read the speech again and see if it
suggests that I know the other directors as well.
Do you find it comfortable with your wife involved in business, while you on
the other hand are pushing the communists’ agenda? What was your relationship
with Nduru like? SA Quantum CEO Veon Back offered us R120 000 not to write the
story about SA Quantum’s business dealings with Zwelothando Consulting, a name
which appear to be a contraction of her first name and your first name. Already
Bock gave us a payment of R40 000 and promised to give us the balance by the
end of April. This is to us a clear cover up for you and your wife. What is
your reaction to this?
I have stated in other interviews such as Destiny magazine, November/December
2009, that sometimes that makes me feel uncomfortable. This is so because some
people would not buy a suggestion that I have nothing to do with my wife
business activities and yet I seriously never ever attempted to micromanage
her. I did not her ask to enter business. This is her own initiative. I am not
going to divorce her though because she has business interest. I had enough of
that. Our relationship is not founded on whether she has a business interests
or that I am the leader of COSATU. As I said the only protection I have is that
she should never conflict me through getting into business deals with COSATU or
even with the government. So far she has not done that. Regarding Abe Nduru as
I have said above I have known him since the days he was working for NBC. See
my speech which traces the relationship between COSATU and Abe Nduru.
Regarding the alleged attempt to silence Mail and Guardian, I must state
categorically that it has absolutely nothing to do with me and the person best
suited to answer your question will be the one who offered you money. Veon Back
has no reason to protect either me or Zwelothando in this regard – there is no
conflict of interests there is no scandal. Lastly Zwelothando is not a
contraction of my name Zwelinzima and that of my wife Noluthando. It is a name
on its own with a completely different meaning. Zwelinzima means this world is
difficult/heavy/tough and Noluthando means love. Zwelothando means a country of
love.
___________________________________________________________________
Conveniently the Mail & Guardian chose not to run this full response to their
questions, despite the General Secretary asking them to do so, through a text
message to Mr Matuma Letsoalo.
The article is a typical example of journalists being used to fight factional
battles. Mr Matuma Letsoalo has a long documented history as a journalist of
being used by factions in COSATU to tarnish the name of its leaders, in
particular its General Secretary.
We wish to point the following inaccuracies, sensationalism, innuendos and
outright lies in the article:
1. The headline of the story is: “Mrs Vavi, the pension funds and the
bribe”. Whilst this headline seems to be an honest summary and caption of the
story, anyone reading the headline and street posters, without reading the
article, will go home wrongly thinking that Mrs Vavi is involved in some
scandal that has to do with pension funds and she may have also be involved in
bribery. This is sensationalism at its worst.
2. Despite the correction printed above, the article, throughout and in
particular in the first paragraph, makes a damaging claim that Noluthando Vavi
“is being paid R60 000 a month to market financial products to union members”.
Mr Matuma prints this despite being in possession of the contract signed by Mrs
Noluthando Vavi and SA Quantum that categorically states the terms of the
agreement between the parties. There is no single line in that agreement that
says Mrs Vavi will be “marketing financial products to union members”. This is
being done deliberately to suggest improper conduct on the part of Mrs Vavi and
by association the COSATU General Secretary, who is the real target of what is
clearly a smear campaign.
3. The article claims that Veon Bock, CEO of SA Quantum, told the Mail &
Guardian that “she was engaged specifically to market its products which
include pension and other employee benefits to labour unions, particularly
COSATU unions”. The article further make the claim that “she has already helped
secure direct and indirect business with two of COSATU’s biggest unions, the
National Union of Mineworkers (NUM) and the National Union of Metalworkers of
South Africa (NUMSA), which together account for about 500 000 of COSATU’s
membership”.
4. Whilst we cannot vouch for what was said in the discussion between Mr
Veon Bock and Mr Matuma Letsoalo, we are in possession of Mr Motsoalo’s written
questions to Mr Veon Bock and his written responses. At no stage does Mr Bock
make the above assertions that “she has already helped secure direct and
indirect businesses with the two of COSATU’s biggest unions…”
5. The article then mischievously, inappropriately, and with a clear view to
mislead unsuspecting readers, makes a link between the speech the General
Secretary made at the funeral of Abie Nduru and the decisions of the Metal
Industry Benefit Fund. The speech, which is available on the COSATU website,
traces the relationship, between the General Secretary and Abe Nduru, not as a
personal relationship, but one that existed between Mr Nduru and COSATU. This
relationship predates the existence of SA Quantum. Yet the article seeks to
suggest that Mr Nduru or SA Quantum or even with Mrs Vavi benefited from a
relationship. There is no shred of evidence to suggest that COSATU, the General
Secretary or his wife ever tried to influence the Metal Industry Benefit Fund
to have a business relationship with SA Quantum as emplied in the article.
6. The article then goes further to say that “Bock told the Mail & Guardian
that Noluthando had been instrumental in securing a contract with TEBA Bank,
owned by members of the NUM, Zwelinzima Vavi’s former union”. Again in the
written reply to Mr Letsoalo’s questions Mr Bock did not make this claim simply
because it is not true that Mrs Vavi was instrument in securing any contract
between SA Quantum and TEBA Bank. This lie is being told in order to suggest
that there is a conflict of interest that is not there.
7. The article, consistent with its political purpose, then claims that
“nevertheless the close political and personal proximity of the key players has
raised concerns that the Vavis are profiting from the suggestion – however
implicit – that any deal proposed by Noluthando is backed by her husband and
COSATU”. It is true that COSATU General Secretary enjoys a close relationship
with the General Secretaries of NUM and NUMSA, but equally he enjoys the same
relationship with the leaders of all COSATU unions. It is not true that he
lobbied for the election of General Secretaries of the two unions. Even if that
was true that there is no relationship between that and the innuendos in the
article.
8. In introducing the story “On how the deal (bribery) went down”, Mr
Letsoalo states that “COSATU General Secretary insists his wife’s role in the
marketing financial products is no scandal. But the company that pays her to do
it clearly disagrees”. The article does not back this assertion. Mr Letsoalo
merely concludes that by paying a bribe, the company was admitting guilt to
some wrong doing. This is wrong and actually it amounts to character
assassination.
COSATU also condemns strongly the attempt by Mr Veon Bock to bribe journalists
doing their work. This is clearly unethical and it amounts to an attack on
media freedoms. The General Secretary also condemned this in his response
above, a condemnation which strategically Mr Letsoalo decided not to print.
The only sin committed by COSATU is to take a strong stance against corruption.
This article together with other attempts before to turnish the name of the
COSATU leadership will not deter us from campaigning to rid South Africa of
corruption. The General Secretary of COSATU has come under immense personalised
attack from those who have something to hide from life style audits. Recently
he was said to own a R6 million house – when this was proven to be a lie, it
was said that he abused a COSATU credit card – no evidence was produced and
when these forces were challenged, then they spread a rumour that his wife is
deep and has won governmetn tenders everywhere – they have not produced shred
of evidence to back this, then it was said he has a two months old baby out of
wedlocks – till to day they have not produced the baby and the mother. Quite
clearly there is an attempt to discredit him as the principal spokesperson of
COSATU. They will not
succeed to silence us!
Veon Bock’s responses to Mail & Guardian
Matuma,
Below are my responses to your questions. As indicated to you before, our
clients are Retirement Funds and not Trade Unions. Retirement Funds are run by
independent Boards of Trustees made up on a 50/50 basis by members and employer
representatives.
I therefore want you to read my response against this background.
Regards,
Veon
Dear Mr BockIt is with regret to inform you that we are intending to publish
the story on Friday on both your attempt to bribe me and the original story
about your company- SA Quantum- payment to Cosatu general secretary Zwelinzima
Vavi’s wife- Norah Noluthando Vavi. The intention from the start in my
accepting payment from you was in order to expose your attempted bribe. Now, I
would like you to answer the following questions for me;
* If there is nothing wrong with SA Quantum doing business with
Zwelinzima Vavi’s wife- Norah Noluthando Vavi, why would you go to the extent
of offering me R120 000 [and in fact paying me R40 000 in cash as the first
instalment on Saturday March 27 2010] in what clearly appears to be a cover up
for the Vavis?
I deny paying you the sum of R40,000 in cash or offering you R120,000. The
agreement with Mrs. Vavi, which was entered into by the Late Mr Abe Nduru is
above board and at no stage did Mrs. Vavi consult or market the services of SA
Quantum to COSATU affiliated Retirement Funds nor is a condition of the
agreement that Mrs. Vavi consult or market the services of SA Quantum to COSATU
affiliated Retirement Funds.
* Why should I not consider the agreement to pay me R120 and the actual
R40 payment as an attempt to bribe me and as criminal act?
I deny that an agreement of this nature exists.
* Why out of all people did SA Quantum chose Vavi’s wife to do
marketing for the company within the labour federation?
Mrs. Vavi is an independent business woman and has a right to earn a living, as
do any other individual. Why did the Mail & Guardian employ you?
* How much has SA Quantum paid Zwelothando since it entered in a
contract with Vavi’s wife?
I quote clause 4 of the agreement: “4.1. In consideration for the rendering of
the services contemplated in clause 3, Quantum shall pay Zwelothando a
consulting fee amounting to 5% (five percent) of first year income on business
generated for Quatum by Zwelothando. No consulting fees shall be paid unless
all the retainers are paid in full.” Furthermore clause 5 of the agreement
states that: “Zwelothando is not, and will never be deemed to be an employee of
Quantum.”
* Why would it be wrong for me to assume that the payment by SA Quantum
to Zwelothando, constitute a kick back or an attempt to influence Cosatu or its
affiliates through Cosatu or Vavi- to channel business opportunities to SA
Quantum?
As explained to you before, Mr Vavi does not excercise control over Boards of
Trustees of Retirement Funds, which are our clients and independent legal
structures outside of COSATU. The Boards of Trustees are made up on a 50/50
basis of members’ representatives/employer representatives.
* During our first meeting, you stated that SA Quantum was doing
business with Numsa, NUM and Theba Bank, which is owned by the mine worker’s
union [NUM]. Which other Cosatu unions are you [SA Quantum] doing business with
within Cosatu?
As indicated to you before, we do not deal with COSATU or any of its
affiliates. We deal only with Retirement Funds, which are independent of COSATU
and they make use of various service providers. I would appreciate it if you
could respond to my questions before 10am on Wednesday, for deadline
reasonsBest RegardsMatuma Letsoalo
________________________________
Hasta Siempre la comandante
Sithembewena Tsembeyi
Socialismo o Muerte...
________________________________
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