The ANC’s financial woes continue to haunt them, with ActionSA and the DA now calling for the Electoral Commission of South Africa (IEC) to investigate the party following its protracted legal battle with Ezulweni Investments.
The DA has also called on the ANC to immediately disclose its benefits, alleging the party is attempting to hide funding.
The financially crippled ANC has been facing liquidation after it allegedly failed to pay its debt to KwaZulu-Natal printing and marketing company Ezulweni Investments for supplying election campaign material in 2019.
In 2023, Ezulweni Investments applied to seize assets worth more than R102m from the ANC after the party refused to pay it despite two judgments in the company’s favour, one handed down in September 2020 and an appeal heard by a full bench of the Johannesburg high court in June 2022.
The Supreme Court of Appeal upheld a decision of the Gauteng high court last month, which the party initially said it would appeal at the Constitutional Court.
In the same year, ANC secretary-general Fikile Mbalula announced that the two parties had reached an agreement that saved the ANC from embarrassment leading up to the 2024 national elections.
We are in the red financially, and I suspect our campaign for the elections will suffer if Ezulweni executes the order. Fundraising has not done enough to pull us out, and Gwen [Ramokgopa] needs to pull a rabbit from the hat and fast.
— ANC leader and Luthuli House staffer
However, it emerged earlier this month that Ezulweni Investments had threatened to obtain writs of execution for the movable assets at the party’s provincial offices in a bid to recover a debt of more than R85m.
The frim has obtained a writ of execution attaching the ANC’s assets, including movable goods and incorporeal property at Luthuli House, the ANC’s headquarters in Johannesburg, IOL reported.
An ANC leader told the Sunday Times the party could face liquidation should the order be processed.
“We are in the red financially, and I suspect our campaign for the elections will suffer if Ezulweni executes the order. Fundraising has not done enough to pull us out, and Gwen [Ramokgopa] needs to pull a rabbit from the hat and fast,” the ANC leader and Luthuli House staffer said.
ActionSA national chairperson Michael Beaumont has now written a letter to the IEC demanding that it investigate the ANC and whether it failed to disclose funding.
Beaumont, whose first request for an investigation by the IEC was declined, said ActionSA’s experts have confirmed that the value of the settlement agreement entered into in 2023 is inflated by about R65m, and the terms of the agreement explicitly indicate that the purpose of the new order of goods serves to compensate Ezulweni for the debt owing from the original R102m as determined by the courts.
“By concluding an agreement which would see debt in excess of R145m in interest settled by the inflation of a contract for a new order in the amount of R65m, the ANC and Ezulweni violated the act in terms of a donation in kind that exceeded the annual maximum of R15m and did not disclose this.
“The act extends the definition of a donation in kind to any procurement of goods or services other than on commercial terms, and it is self-evident that the settlement of a debt in excess of R145m, as determined by the courts, with only R65m cannot be deemed to be on commercial terms.”
The DA said it will be submitting a formal PAIA [Promotion of Access to Information Act] request to the ANC to disclose all parties receiving election materials or support through the Ezulweni contract.
“The IEC must determine whether supplying materials to these ‘strategic partners’ and ‘strategic alliances’ amounts to undeclared funding in terms of the Political Party Funding Act.
“Any in-kind donations to other parties must be transparent, so voters can make informed choices.”
The DA called on the ANC to immediately disclose all parties benefiting from its “strategic alliances” programme.
“Attempts to hide funding or influence undermine democracy and breach South Africa’s electoral rules.”