By Jan Cronje.
A decade ago, well before the publication of Thuli Madonsela’s State of Capture report or the first inklings of the State Capture Inquiry, a host of big names lined up for interviews at breakfast briefings hosted by the Gupta-owned New Age newspaper (TNA) and broadcast on the SABC.
The inquiry would later find that state departments paid at least R1 million, often more, to “sponsor” these 45-minute events where interviewers lobbed softball questions at ministers and top government officials.
Between 2011 and 2017, Eskom paid over R50 million in sponsorship fees, while Transnet paid an astonishing R122 million. While the briefings were supposed to be a joint venture between TNA and the state broadcaster, some senior SABC officials later said they were unaware the newspaper was raking in millions in rands.
Despite the vast sums spent, the inquiry’s chair, former Chief Justice Raymond Zondo, concluded that the state-owned entities received little in return for the sponsorships.
“The most exposure that Eskom gained from these breakfasts was some opportunity to display its branding at the breakfast. This included hanging some banners”, he said.
While Eskom would be given an “opportunity to speak” if it sponsored an event, this section of the breakfasts was not aired. The actual interview was often wholly unrelated to the power utility. Research would later show that viewers were not aware Eskom was sponsoring the programme at all.
So, what did Eskom receive for its R1-million sponsorship? According to Zondo, it got two tables at the event, each seating 10 people – meaning each seat was worth R50 000. An Eskom official testified that the reputation of the breakfasts and The New Age was so poor that they even struggled to fill those few seats.
In the end, Zondo concluded that the whole arrangement was a mess; the contracts were irregular and created solely to enrich the Guptas to the “detriment of the mandate that the SABC had towards the public”.
“The New Age serves as an example of the way in which state capture took hold in South Africa,” he said, adding.
It shows the extent of the Guptas’ influence in the public sector in South Africa as well as the Guptas’ strategy to replace officials that were not compliant with their looting scheme.
Earlier this month, President Cyril Ramaphosa announced he had given the SIU the green light to probe “serious maladministration” linked to the series of costly breakfast briefings.
He also ordered the unit to probe hundreds of millions if rands money spent on the briefings by Transnet, Eskom, PetroSA, SAA, and the Department of Human Settlements, along with other state entities.
Paul Holden, director of investigations at Shadow World Investigations, told News24 that the TNA business breakfasts had an important place in state capture history for two reasons.
First, it was one of the early instances of the Guptas getting their foot in the door.
“There are basically two early ‘streams’ of state capture, which the Guptas then use as a springboard to capture bigger prey like Transnet and Eskom,” said Holden from London this week. One stream was the business breakfasts and The New Age. The other was the Free State.
“It’s in those streams that the Guptas developed their relationships with [Brian] Molefe and the like within the parastatals and with Ace Magashule and Mosebenzi Zwane directly in government.”
Second, the breakfast shows evidence of Zuma’s hands-on role in the capture effort.
“The New Age was really the only state capture case where JZ [Jacob Zuma] was clearly shown to play an active role,” Holden.
Zuma, who is now heading the MK Party, has repeatedly denied being involved in corruption. In 2018, he denied that state capture existed, saying the concept was being used as a tool by his enemies.
He did, however, testify before Zondo that the Gupta newspaper and TV station were his idea.
“Mr Zuma said he even came up with the name The New Age,” Zondo concluded.
Cash cow
Rajesh Sundaram, the former editor of the Guptas’ 24-hour news channel ANN7, said the announcement of a probe by the SIU was long overdue.
“It gives me hope that those who are responsible would have to face a court of law or justice,” he said from his home in India this week.
Sundaram moved to South Africa from India in June 2013 to help oversee the launch of the Gupta’s 24-hour news station. While The New Age marked the Guptas’ venture into print, ANN7 was their attempt at a television station. But he lasted just three months in the job.
Despite his short stay, the experience left an indelible mark on him. He later wrote the book Indentured: Behind the Scenes at Gupta TV. In June 2019, he returned to give evidence before the State Capture Inquiry.
Sundaram said he is not overly concerned about the five-year time lag between giving evidence at the inquiry and the announcement of the probe. “I am used to the judicial processes in India – it takes much longer.”
Since leaving ANN7 over a decade ago, he has helped set up three television stations and a news agency. He is currently the chief editor for video and content services for the Press Trust of India. He still wants to see justice done for the wrongs of the Guptas’ media empire.
“It does make me happy,” he said, adding:
“There were many nights when I would wake up and be totally devoid of hope that anything would come out of my struggle.”
While Sundaram did not work for The New Age, he was present at many meetings with the Gupta family and their retainers where their budding media empire was discussed. This included three meetings with then-president Jacob Zuma.
“I was part of discussions about the breakfast briefings. I had been privy to conversations about how they made money,” he said this week
In his book, Sundaram said that then-president Zuma would keep his ministers waiting “for hours” while meeting with the Guptas, who had “fairly free access to his residence”. He was also told that he should take Zuma’s suggestions about how the new channel should run seriously and “make him feel important”.
A ‘great success’
Speaking to News24 this week, Sundaram said the the Guptas were “gleeful” about how easy it was to generate money. “It was a cow they would just keep milking,” he said this week. “It was a gold mine.”
The State Capture Inquiry found TNA did not spend much – if any – of its own money on the breakfasts it hosted while receiving millions in sponsorships. The SABC did all the work. The briefings also brought in a flood of “free marketing” and made money from the sale of tickets.
The public broadcaster, meanwhile, had to pull staff from other events to cover the briefings. Zondo found it did this without “any monetary benefit”.
The promise of positive and “unfiltered” media coverage, and, according to Sundaram, behind-the-scenes arm-twisting by the Guptas and prodding by Zuma meant they were never short of guests.
A video from October 2015 shows then-TNA editor Moegsien Williams introducing the ANC’s top six who all dutifully filed onto the stage to be interviewed.
“There is a great deal of miscommunication, and sometimes lopsided and biased reporting on government, political parties, and other events,” said Williams. He approvingly quoted a remark by Pallo Jordan that sections of the media had elected themselves the “unofficial opposition”.
The briefings, he continued, allowed the government to speak “directly to the electorate” without interference from those “keen to portray our country as a failed state”.
He added: It is commonly accepted that these briefings have been a great success.
Few ministers could ignore the pressure to appear. One who did was then-finance minister Pravin Gordhan, who said the Treasury simply refused to be part of the “arrangement”.
“Implicit in that, if not explicit, is the fact that we do not want anything to do with the Guptas,” he told the State Capture Inquiry.
Williams would later deny that Zuma was the guiding hand behind the Guptas’ media empire, calling it “preposterous”. None of the Guptas had any influence whatsoever in what the newspaper wrote, he said in an affidavit. “I deny that I acted improperly in any way whatsoever,” he said.