Book Review: Licence to Loot – How the plunder of Eskom and other parastatals almost sank South Africa

License to Loot

In recent months, journalist Stephan Hofstatter has been pilloried from pillar to post for his role in the so-called SARS “rogue unit” debacle at the Sunday Times.
Some critics have held Hofstatter, part of the newspaper’s team that published largely baseless articles about the alleged unit, were personally responsible for the downfall of the revenue service.

The harshest among these critics have deemed him an enabler of state capture, since it was as a result of these stories that specialist investigative units at the tax authority were unceremoniously shut down.

As such, the timing of the book’s release was always going to be contentious. Reputations, both of SARS officials and the journalists involved, have been severely tarnished, so Penguin Books would have known publishing Licence to Loot amounted to a huge gamble.

For the most part, the gamble has paid off, although admittedly many will refuse to forgive Hofstatter and the Sunday Times’s past transgressions. 
In this instance, there is considerable value in not judging a book by its author, or at least the iteration responsible for the rogue unit fiasco. Hofstatter’s powers as an investigative journalist remain considerable, regardless of this most catastrophic of blunders.

So meticulous is he in linking the clandestine deals and the establishment of shell and letterbox companies that masked the Gupta family’s rise to power that the reader often has to double-back to understand the processes he so clearly does.  

Perhaps deliberately in light of the controversy surrounding him, Hofstatter provides thorough accounts of how he comes by his information, detailing the type of interactions only a reporter with “access” might be privy to.

For example, he recounts a conversation he had with former Cosatu general secretary Zwelinzima Vavi, in which Vavi raised concerns about the presence of Duduzane Zuma and Tony Gupta – “these young people” – who were given an audience with the leader of Equitorial Guinea even before Jacob Zuma became president.
The focus of the book lies mainly with the pillage of Eskom, currently under the scrutiny of the Zondo Commission of Inquiry.

As much the dubious transactions of the Guptas and their henchmen, notably Salim Essa, come into play, Hofstatter also delivers startling revelations about the personalities required to effect wholesale seizure of state enterprises to the gain of a few.

Describing the appointment of Brian Molefe as Eskom chief executive, he writes: “Enthusiasm for the new arrival didn’t last long, especially among his closest colleagues. It soon became apparent to them that Molefe’s fatal flaw was hubris. ‘He was astute, well read and hard-working. But he has an inflated sense of self-importance,’ one Eskom executive told me. ‘He’s arrogant and thinks he’s cleverer than everyone else’.”

To his political masters, such attitudes were a godsend, as those who dared to question Molefe’s reasoning were cowed into submission – to devastating consequence for the parastatal and the country. The strategic positioning of Molefe came at a high price. Eskom’s head of group capital, Dan Marokane, described as “urbane, articulate and highly competent”, was viewed as being too good at his job, having proved effective in dealing with the load-shedding crisis.

“We were just beginning to stabilise, which is what they (Guptas) didn’t want,” an executive told Hofstatter. “Then they would have an excuse to bring in Brian Molefe and the others. So Dan had to go.”

Licence to Loot is awash with such testimony, to the point that it is scarcely believable that it has taken so long for these matters to be probed publicly. Yet this also proves the value of the book at this time in the country’s history. Ironic it  may be, but what Hofstatter has delivered is the arguably best snapshot of state capture’s machinations to date.

John Harvey is a journalist with Cape Community Newspapers and a passionate reader of political books and book reviewer.