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Ed Herbst: Good riddance to Cell C – it’s Kharma

Yesterday’s news that Cell C’s Saudi parent has had enough, sparked this contribution from investigative journalist Ed Herbst. The background to how Cell C’s licence was awarded suggests Herbst is onto something about Kharma. While the country is heaping criticism on the Zuma Administration, it’s worth remembering that many strange things went down that caused his ascension. If you doubt Herbst’s allegations consider the now well documented and deeply corrupt practices of political influencers in the Mbeki Administration that were close to the late Brett Kebble (and proudly served as the mining crook’s pallbearers). We’re not sure if Herbst is 100% right – but where there’s smoke…… – AH     

Veteran journalist Ed Herbst
Veteran journalist Ed Herbst

By Ed Herbst*

Cell C – a Media Retrospective

“The accusations then gained momentum in August 1999 after Snuki Zikalala claimed on SABC news that a report by forensic auditors Gobodo Inc had confirmed the ‘damning allegations’ of nepotism, mismanagement and in-fighting at Satra. However, a month later, the Broadcasting Complaints Commission ruled that Zikalala’s reports gave the impression that Gobodo had already investigated and come to conclusions about the truth of the allegations, when they had not, and instructed the SABC ‘to rectify any misunderstanding in this respect’. No evidence has been advanced to support any of these allegations.”

Helen Suzman Foundation, “May the best bid win”, 30/1/2001

“Five CEOs and hundreds of millions of dollars later, Cell C’s owners appear to have now run out of patience. Appointing Goldman Sachs to ‘explore options’ is easily interpreted as a euphemism for ‘get us the hell out of there…’.”

Alec Hogg, Biznews, 18/2/2015

Article summary: The bombshell news by Alec Hogg that the parent company of Cell C, the Dubai-based Oger Telecom Ltd., is working with Goldman Sachs Group Inc. on finding a buyer for the cellular phone company, prompted me to go into the archives because there is a disturbing story about the role of the SABC in general and the former head of news, Snuki Zikalala, in particular in a saga which is once again generating headlines.

The Helen Suzman Foundation has never been sued for the allegations in this regard which can be found on its website and neither have there been any denials of the veracity of their content.

To buttress that account and to be of assistance to media scholars and researchers, I have transcribed an equivalent account which can be found on pages 175-176 of R W Johnson’s book, South Africa’s Brave New World – The Beloved Country since the End of Apartheid (Allen Lane, 2009). He, too, has never been sued.

The Cell C Saga

Shortly after the (2 June, 1999) election a similar settling of accounts took place with Nape Maepa, chairman of the independent South African Telecommunications Authority (SATRA), who had dug in his heels over the award of the lucrative third cellphone licence to the Cell C consortium. At the root of the matter stood a R7 billion arms sale to Saudi Arabia negotiated by Joe Modise in 1997, a deal which remained stalled despite the payment by Denel, the state arms manufacturer, of a R100 million ‘commission’. This was embarrassing to Mbeki, not only because he sought to back up Modise’s deals but because the ANC had developed close relations with the Saudi royal family, and had received a $60 million Saudi donation to ANC funds. To help push the deal through a promise had been given that Cell C (in which the Saudis were majority shareholders) would get the crucial licence. Cell C had then taken on black empowerment partners in South Africa, including Schabir Shaik and his brother Yunus, Jakes Gerwel, Mandela’s tailor, Yusuf Surtee and various others. So while SATRA was supposed to weigh up the competing bids for the licence, Mbeki was determined that it had to go to Cell C. And Nape Maepa was being difficult, insisting that Cell C was by no means the best bidder.

In May 1998 Mbeki’s appointee, Snuki Zikalala, was suddenly jumped from a junior to a top job at the SABC and, simultaneously, press leaks accused Maepa of nepotism, maladministration and corruption. Zikalala, who had a Bulgarian Ph.D. in journalism and a Soviet ruthlessness in controlling the news, was rapidly advanced to control all radio and television news in the run-up to the 1999 election. With the election over, Zikalala turned on Maepa, claiming on air that a forensic audit had found him guilty of corruption and mismanagement. This was untrue. No such audit had been completed and there was no evidence against Maepa. Nonetheless, the parliamentary communications committee went into closed session to discuss these allegations, while ignoring the fact that Maepa’s deputy, Eddie Funde, was outspokenly pro-Cell C and had connections with Cell C’s shareholders. Mbeki’s spokesmen did their work in the closed session and the committee called for the Auditor-General to investigate Maepa. The anti-Maepa campaign reached a climax which included death threats and forced his recusal from the selection committee just on the eve of its final decision — which, of course, went in favour of Cell C despite two independent evaluations, both unfavourable to Cell C.

Mbeki also ordered the NIA to investigate bidders for the licence — in effect, an intimidating investigation of those bold enough to challenge Cell C — and the Minister of Posts and Communications, Ivy Matsepe Casaburri, stopped the Auditor-General from investigating alleged irregularities in the selection of Cell C. Moreover there were reports that the Minister, her lawyer, and Mbeki’s chief enforcer, Essop Pahad, were all at the secret venue where SATRA made its decision. SATRA members were apparently told that Cell C ‘had’ to win the contract in the national interest though the usual tape recording of their proceedings was mysteriously found to be blank on this occasion. Thereafter Maepa tried to resume his position on SATRA but Mbeki’s legal adviser, Mojanku Gumbi, intervened to stop him.

The manipulation of the tendering process for this multi-billion rand project was so obvious that it became a major impediment to foreign investors: it was one of the three greatest factors contributing to the 43 per cent drop in foreign investment in South Africa in 2000.

Saki Macozoma

Johnson’s account hardly tells the whole story of the way in which the SABC was exploited and abused to settle personal political scores during the Mbeki era.

Further essential reading in this regard can be found on page 89 of the book, ‘Media Ethics – An introduction to responsible journalism’ (Oxford University Press 2002) by Johan Retief, the Deputy Press Ombudsman at Print and Digital Media South Africa

            “Mr Saki Macozoma, the then Managing Director of Transnet, lodged a complaint with the Broadcasting Commission of South Africa (BCCSA) in his personal capacity with regard to reports by the SABC that implicated him in the theft of shipping containers. He was referred to as a ‘possible suspect’.”

The person behind the falsehoods being broadcast against Macozoma in late 1997 was Snuki Zikalala.

What is not made clear is why he was targeted in this way – perhaps he was seen as a political threat to the incumbent and had to be neutralised.

“Macozoma also claimed that the SABC reporter, Mr Snuki Zikalala, made no attempt to contact him to give him the opportunity to respond to the allegations. In addition, Macozoma argued that Zikalala failed to report on some germane issues of which the latter was well aware.”

The Broadcasting Complaints Commission found in Macozoma’s favour and Retief concluded: “It is more than scandalous to portray an innocent person as being corrupt, involved in criminal activities such as fraud, theft and extortion, etc, as this could be seen as libellous. The SABC’s report on Macozoma was blatantly unfair because it lacked balance on just about every count.”

Given the apparently nefarious provenance of Cell C in South Africa, the Bhuddist doctrine of Karma seems apposite in the context of the problems to which Alec Hogg now refers.

* Ed Herbst is a pensioner who, after 41 years in newspapers, broadcast news and PR, writes on the interface between news and politics.

 

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