Former Eskom CEO Brian Molefe should never have been a member of the parastatal’s pension fund, despite receiving a sizeable payout, MPs have been told.
Eskom’s Pension Fund chief executive Sibusiso Luthuli told lawmakers on Friday that he received legal advice that Molefe should not have benefited from the fund, because he was on a fixed-term contract and not a permanent employee.
Luthuli is testifying in the Portfolio Committee on Public Enterprises’ inquiry into allegations of state capture at Eskom.
Molefe’s departure from the utility after 16 months on the job has been shrouded in confusion and controversy.
Eskom, with the approval of the chairman of the board, authorised a hefty pension payout for Molefe when he left the parastatal in November last year.
Penalties for early retirement were waived for the 50-year-old Molefe, and additional benefits amounting to 13 years of service were secured for him.
The fund calculated his R30 million payout based on his annual salary of R5.6 million and his younger wife’s age, lawmakers were told.
He received a cash payment of around R7 million after tax, while the rest would be paid in monthly installments.
The controversy surrounding Molefe’s pension forced the fund to seek legal advice, Luthuli told MPs.
“If Mr Molefe was on a five-year fixed contract, he should have never been a member of the pension fund in the first place. The fund relies on information that it’s received from Eskom.”
Luthuli told parliamentarians that he followed the rules and had no reason to mistrust Eskom.