McKinsey to repay R1bn

Global consultancy McKinsey has set aside the R1-billion Eskom has demanded it repays, and is keen to pay back the money, the firm's global leader for the public and social sector practice, David Fine, said on Wednesday.

Fine was giving evidence before the inquiry into state capture being held by parliament's public enterprises committee. The money was paid for McKinsey's work on a turnaround plan, but the Treasury did not approve of the contract.

"McKinsey does not want any tainted money. We went into a relationship with Eskom in good faith," Fine said. Eskom had given verbal confirmation that the contract had all the requisite approvals.

Fine said even if the court decided that the contract was valid, McKinsey would still give the money back to South Africa, not because the firm felt guilty but because the contract did not have the required Treasury approvals.

Asked by evidence leader Ntuthuzelo Vanara why McKinsey did not simply go ahead with the repayment regardless of the outcome of the inquiry, Fine said McKinsey did not want to pay the money twice.

It needed to know whether the money should be paid back to Eskom or the fiscus. Fine said the question had been discussed within McKinsey globally and it was agreed the money should be paid back.

In addition to the R1bn demanded from McKinsey, Eskom is also demanding the repayment of R564m from Trillian Capital, which worked alongside McKinsey before discussions about them becoming a supplier development partner were terminated in march 2016.

- BusinessLIVE