Eskom coal

‘McKinsey, Trillian tried to squeeze R7.8bn out of Eskom’: amaBhungane

The vultures have circled a struggling state enterprise

Eskom coal

American consultancy firm McKinsey could pay a hefty for jumping into bed with the Guptas. Their apparently shady dealings with the Gupta-owned Trillian organisation have been rumbled by Amabhungane.

The investigative team behind the #GuptaLeaks emails have uncovered the extent of the gruesome twosome’s plans for Eskom: It seems that both were planning to charge the energy firm nearly R8bn in ‘consultancy fees’.

With Eskom being a state-owned enterprise however, the puzzle-pieces in the state capture jigsaw suddenly fall into place. The McKinsey company – coerced by a Gupta firm (Trillian) – are directly trying to raid government owned businesses to line their own pockets.

What were McKinsey planning to take?

In total, McKinsey and Trillian projected they could extract R4.96-billion and R4.46-billion respectively from Eskom. Although, the energy regulator says it desperately needs a tariff increase of 20% next year.

Now, the American consultancy firm are in seriously hot water over their thinly-veiled looting attempts: Corruption Watch have branded McKinsey’s conduct as a ‘gross contravention of the US Foreign Corrupt Practices Act’, and have already asked the Department of Justice for an investigation into this.

McKinsey have since moved to defend themselves, however, in a statement they made to Amabhungane. They maintain they’ve done nothing out of the ordinary and say they aren’t the only ones who charge such fees…

“A growing share of our work is undertaken ‘at risk’. This means we are paid based on agreed performance improvements, due to a direct result of our work.”

“The fees we charged are in line with similar projects we, and other firms, undertake in South Africa. and elsewhere around the world. We are proud of our work at Eskom. We stand fully behind the impact and value we delivered.”

The state capture network

McKinsey were initially hired by Eskom for R1bn and immediately struck a deal with Gupta company Trillian for at least R266m: Trillian got almost 30% of the contract for ‘very little work’.

Eskom, McKinsey and Trillian are effectively passing money between each other to cover up the true extent of state capture.

However, they’ve done an awful job of it.