The milking way: R17m of provincial funds were earmarked to plan dairies

In a 2012 letter to then Free State Premier Ace Magashule, it was declared R17-million of provincial government funds had been earmarked for planning three dairy projects in the province. This emerged on Thursday, 15 August as the Zondo Commission continued its focus on the Vrede Dairy Project.

“It can’t be right, Mr Thabethe, that simply because I have a bright idea taxpayers’ money should be thrown at finding out if it is feasible or not,” said evidence leader advocate Leah Gcabashe SC on Thursday afternoon. “You can’t dream up something.”

The former head of the Department of Agriculture and Rural Development in the Free State, Peter Thabethe, disagreed with the suggestion that R17-million was a hefty fee for planning three dairies, stating that planning requires money.

“You will never know until you have done the study,” he said.

Thabethe authored the 2012 letter to Magashule, asking for permission to travel to India. Gcabashe asked why Thabethe wrote to Magashule, when Thabethe served under then Member of the Executive Council (MEC) Mosebenzi Zwane.

Thabethe explained he wrote to Magashule directly, as this was the norm when asking to travel abroad.

“The approval of overseas trips has not been delegated to the MEC,” Thabethe replied. “You get approval from the premier.”

In the correspondence, as read by Gcabashe, Thabethe asked Magashule for permission to visit a dairy farm and attend a meeting with a “strategic partner” in India from 29 February to 4 March 2012. This, he wrote, was in support of the expansion of dairy farming in the Free State.

The only notable dairy project from the “Mohuma Mobung” strategy was the controversial Vrede Dairy Project. Magashule mentioned “Mohuma Mobung” in his State of the Province Address on 22 February 2012, weeks before Thabethe’s return from India. Thabethe testified he developed plans to improve the dairy sector in the Free State, and Zwane devised the name “Mohuma Mobung” for the strategy.

A curious feature of Thabethe’s 2012 letter to Magashule is mention of Ashok Narayan, who – according to a contract – would become a special adviser on information and communication technology (ICT) to Magashule as of 1 March 2012.

Thabethe testified Zwane advised him to name Narayan in his letter as the person to accompany him on his fact-finding trip to India. Narayan was an odd choice for several reasons: he was a private businessman on the date of departure, he was due to advise Magashule on ICT matters, and the trip was focused on gathering information on dairies.

“He was not a dairy farmer, not an agricultural specialist, he’s an ICT chap,” said Gcabashe of Narayan. Thabethe could not answer why Narayan had been chosen to accompany him on the trip.

“Chair, I should have questioned...but I didn’t question,” he said.

Narayan’s name crops up in several reports on suspect business deals linked to the Gupta family. In this Daily Maverick article, Pieter-Louis Myburgh writes that Narayan was a “key cog in the Guptas’ State Capture machinery” associated with Gupta-linked front company Homix.

“Narayan would also play a role in the Vrede dairy saga,” reports Myburgh.

While the dairy project turned sour for many emerging black farmers in the eastern Free State, who were reportedly promised shares in the enterprise, the likes of Narayan benefitted. Thabethe testified the ICT businessman’s travel was paid for by Thabethe’s own department in the Free State government.

At the time of departure, Narayan was days away from becoming Magashule’s adviser. Chairperson, Deputy Chief Justice Raymond Zondo pressed Thabethe on why the trip to India was necessary, when a feasibility study had not yet been concluded. Thabethe responded by saying it was critical to be informed, and was therefore important to visit the country.

Despite Thabethe’s mention of visiting a “strategic partner” in his letter to Magashule, at the time of his and Narayan’s travel there was no agreement in place with the Indian dairy giant Paras. The company appears in various correspondence about developing dairy projects in the Free State, but was never formally involved.

Thabethe testified he had conducted “desktop research” to identify countries that had promising dairy industries. He settled on India and determined Paras as a potential strategic partner. How precisely desktop research led him to the two remains a mystery.

Gcabashe cited previous evidence critical of Thabethe’s choice. She reported more than half of Paras milk is thought to derive from buffalo and not cattle. Thabethe said the focus was on volumes and the system rather than the animals from which the milk came.

“I remain concerned about the quality of the desktop research,” remarked Gcabashe.

Zondo quizzed Thabethe on the timing of his request to Magashule, and the perceived urgency in visiting India even before a feasibility study had been concluded. Thabethe’s evidence continues on Friday. DM