Probe reveals R3.5bn youth training funds diverted to PetroSA bailout

An investigation by the amaBhungane Centre for Investigative Journalism has revealed that a R3.5 billion proposal meant to train thousands of young artisans was instead earmarked to help rescue the struggling state-owned oil company PetroSA.

Investigative journalist Susan Comrie explains that the funding was to come from the National Skills Fund (NSF), which is financed by a mandatory levy paid by working South Africans to support skills development and job creation.

"What we discovered was that the state-owned oil and gas company PetroSA and its business partner had put in a request for a R3.5 billion grant from the National Skills Fund. The claim was that they were going to train 5,500 artisans. Now that works out to over R600,000 per artisan.

"The reason that we discovered from the documents that this was so expensive is that a large chunk of that money was going to be used, around a third of the money, over R1 billion, was going to be used to repair an offshore oil rig.

"Now that deal in the end didn't go ahead because it seems like PetroSA had changed leadership. The new CEO, who had come in when he caught wind of it, said, no, no, this is ridiculous. But when we dug into the documents, we could see what the problem was.

"PetroSA has a training centre to train artisans, but they can only take 150 a year. Suddenly, this proposal was talking around 5,500, and it really sort of raises questions about whether this was really just a scheme to get money out to rescue a failing state-owned entity, which sits under Gwede Mantashe's own portfolio."

The revelations come amid public comments by National Chairperson of the African National Congress (ANC) and Minister of Mineral and Petroleum Resources Gwede Mantashe, who recently suggested that unemployed young people lack initiative.

At the same time, the NSF is sitting with a multibillion-rand surplus and has been repeatedly flagged by the Auditor-General for poor governance, including billions of rand that cannot be properly accounted for.

To listen to Comrie in conversation with 702's Bongani Bingwa, use the audio player below: