Mining royalties possibly redirected

Workers at Anglo American Platinum mine in Rustenburg

Workers at Anglo American Platinum mine in Rustenburg, North West. Employees Siphumelele shaft did not report for duty on Tuesday 19 February 2012 following a shooting at the mine.

Mahikeng – Parliament&39;s Standing Committee on Public Accounts (SCOPA) in the North West suspects several hundred million rand in royalties, for a small rural community on the platinum mining belt, may have been redirected.

This emerged after the finance department briefed the committee on the Bapo ba Mogale “D-Account” – an account set up in the Apartheid-era for mining houses in the Bapong area, to inject royalties meant for community development.

Although the account received more than R243-million in deposits between 2007 and 2009, since 2010 the amount of royalties reflecting in the trust account has declined drastically.

While in 2009, more than R100-million was paid into the account, in 2010 just R1-million was deposited.

Cope SCOPA member, Nikiwe Num said there was a need to investigate the drastic drop in income as it appeared the funds were being “redirected purposefully”.

Auditor General business director in the North West, Schalla van Schalkwyk was of a similar view, saying he had audited other traditional accounts where monies had been redirected into separate accounts.

The committee is investigating the management of the account following complaints by the community.

Committee chair Hlomane Chauke says platinum mining houses in the North West hold the key to uncovering the truth, since they know how much has been deposited into the D-Account over several years.

“We are going into recess now. But we’ve already started getting the contact details for the CEOs [of the mining houses]. We don’t want low ranking people coming to brief us. We want the CEOs and MDs of the mines to come and explain,” Chauke said.

The committee is likely to call representatives from the seven mines operating in the Bapong area, including Lonmin, towards the end of July. 



“Lonmin welcomes the SCOPA and Public Protector investigation into the D-Account. At this stage, Lonmin has not yet been contacted by any government agency. Lonmin will co-operate fully with the relevant government agencies,” the mine said in response to questions from

Lonmin confirmed that it has paid “around R370-million” into the Bapo ba Mogale D-Account to date.

“The royalties, which have been independently audited, are paid to the North West Provincial Government, which holds the money in trust on behalf of the Bapo Ba- Mogale community.

"Lonmin therefore does not have any control over this money once it is paid over,” the company said.

In a press statement, North West premier Thandi Modise said the provincial government was conducting its own audit.

Public Protector Thuli Madonsela is also investigating the management of the account, which has been under the control of the North West provincial government since 2009.

Public Protector spokesperson Kgalalelo Masibi said investigators had ”initially experienced cooperation hurdles, including failure to supply documents on time.”

“We eventually got the cooperation of the premier and [Local Government and Traditional Affairs] MEC China Dodovu,” Masibi said.

“Regarding the investigation into finances, after several interactions with the community, a decision was made to embark on a forensic investigation.

"An expert forensic team is currently concluding the forensic investigation, which focuses primarily on a forensic audit of the D-Account,” she said.

Masibi would not disclose any preliminary observations “as that would be unlawful and would compromise the integrity of the investigation.”