September 24, 2017 / 11:28 AM / in a year

Head of S.African pension manager denounces plot to remove him

JOHANNESBURG, Sept 24 (Reuters) - The chief executive of South Africa’s Public Investment Corporation (PIC) said he was the victim of a plot to oust him because of the pension manager’s stance on bailing out other state firms.

PIC head Daniel Matjila was recalled from an overseas trip by the money manager’s board two weeks ago over allegations he had used funds reserved for social spending to bankroll a business of someone close to him.

In a newspaper article in the Sunday Times Matjila denied the allegations against him and said his refusal to authorise certain transactions had upset politically connected people. He did not name names.

His case is one of a series of scandals that are shaking confidence in the South African business and political establishment.

He defended himself further an interview on television news station eNCA.

“The allegations are that I funded a girlfriend ... I’ve responded to those allegations in writing to the board ... these are the allegations against me and I’m waiting for the board to finalise it,” Matjila said in an interview.

A number of the country’s 300-odd state companies are in massive debt and heavily reliant on billions of rand in government guarantees to stay afloat.

Matjila said in the television interview the money manager, which holds a large chunk of government bonds and stakes in leading South African companies, would consider deeper investments in state firms once governance there had improved.

This month Finance Minister Malusi Gigaba told lawmakers the Treasury was considering a 13 billion rand ($982 million) bailout to keep state airliner SAA going.

Gigaba has said selling the government’s 39 percent stake in landline provider Telkom to the PIC was an option to help fund shortfalls in SAA as well in crisis-hit energy utility Eskom.

The possible move has drawn sharp criticism from opposition parties and civil society citing allegations of large scale corruption in the granting of lucrative tenders by state firms.

A report last year by the constitutionally-mandated Public Protector watchdog, entitled “State of Capture”, accused the government of improperly steering hundreds of millions of dollars in state contracts to firms controlled by the Gupta family, business friends of President Jacob Zuma.

The Gupta family and Zuma have denied allegations of wrongdoing. ($1 = 13.2388 rand) (Reporting by Mfuneko Toyana; Editing by Keith Weir)

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