Parks Tau demands IDC report on controversial appointment of former Sanral CEO Reginald Demana

Trade, Industry and Competition Minister Parks Tau has requested a report from the Industrial Development Corporation (IDC) over the appointment of former South African National Roads Agency (Sanral) chief executive Reginald Demana as chief operating officer.

This follows parliamentary concerns about governance at the state-owned development finance institution.

Tau’s intervention follows a meeting of Parliament’s Portfolio Committee on Trade, Industry and Competition earlier this week, where MPs raised concerns about governance, accountability and oversight at the IDC.

Demana’s appointment faces scrutiny as the former Sanral boss left the roads agency amid questions over his role in irregularities involving a R9.5-billion procurement process and a tender that was eventually set aside by the high court. He denied any accusations of wrongdoing before leaving to take up the role at the IDC.

Responding to questions from Sunday World, Tau’s spokesperson Kaamil Alli confirmed the minister was seeking answers, but refused to comment until Tau had received the requested report from the board of the IDC.

“Based on the questions that were raised in the portfolio committee … as well as the grave matters contained in your questions, the minister is not in a position to immediately respond to your enquiry and will be requesting a report from the IDC board on the matter whilst also requesting the board to respond to your questions where possible,” Alli said.

“The minister would encourage you to direct all enquiries to the board and afford them [the opportunity] as the accounting authority to respond.”

Tau’s request comes as the IDC faces growing parliamentary scrutiny over its governance controls, accountability mechanisms and internal oversight processes.

At the portfolio committee meeting this week, IDC chief executive Mmakgoshi Lekhethe acknowledged that an internal review had identified shortcomings requiring intervention.

She told MPs that weaknesses had been uncovered in internal controls, governance processes and accountability mechanisms, prompting management to launch a programme to address the deficiencies.

However, lawmakers questioned whether the measures would be enough to resolve longstanding concerns.

Some MPs called for greater transparency around governance arrangements and the management of potential conflicts of interest, while others raised concerns about oversight, developmental impact and the effectiveness of accountability structures in the institution.

Demana’s appointment has drawn attention because of events during his tenure at Sanral. Before leaving the roads agency, he publicly acknowledged that procurement failures had left Sanral unable to successfully defend several court challenges related to tender processes.

One of the most significant cases involved a proposed five-year panel of road maintenance contractors that was abandoned after investigations uncovered procurement irregularities. Sanral subsequently conceded the legal challenges and supported an order declaring the tender invalid.

Demana has maintained that the procurement failures predated some of the decisions under scrutiny and has rejected allegations linking him personally to corruption or irregular expenditure.

He also disputed claims that R9.5-billion in corruption occurred during his tenure, saying the figure related to historic irregular expenditure incurred between the 2011/2012 and 2018/2019 financial years, before he joined Sanral in 2023.

Demana further denied allegations circulating on social media that he benefited from irregular tenders, saying no evidence had been produced to substantiate the claims.

While neither Tau nor the Department of Trade, Industry and Competition has suggested any wrongdoing by Demana in relation to his appointment, the minister’s request for a report signals that government wants answers to concerns raised about governance at the IDC.

The department said Tau expects boards and executives across entities under his oversight to safeguard institutional stability and avoid actions that could undermine the credibility of strategic state assets.

IDC spokesperson Tshepo Ramodibe had not responded to questions from Sunday World by the time of publication.

Trade, Industry and Competition Minister Parks Tau has requested a report from the Industrial Development Corporation (IDC) over the appointment of former South African National Roads Agency (Sanral) chief executive Reginald Demana as chief operating officer.

This follows parliamentary concerns about governance at the state-owned development finance institution.

Tau’s intervention follows a meeting of Parliament’s Portfolio Committee on Trade, Industry and Competition earlier this week, where MPs raised concerns about governance, accountability and oversight at the IDC.

Demana’s appointment faces scrutiny as the former Sanral boss left the roads agency amid questions over his role in irregularities involving a R9.5-billion procurement process and a tender that was eventually set aside by the high court. He denied any accusations of wrongdoing before leaving to take up the role at the IDC.

Responding to questions from Sunday World, Tau’s spokesperson Kaamil Alli confirmed the minister was seeking answers, but refused to comment until Tau had received the requested report from the board of the IDC.

“Based on the questions that were raised in the portfolio committee … as well as the grave matters contained in your questions, the minister is not in a position to immediately respond to your enquiry and will be requesting a report from the IDC board on the matter whilst also requesting the board to respond to your questions where possible,” Alli said.

“The minister would encourage you to direct all enquiries to the board and afford them [the opportunity] as the accounting authority to respond.”

Tau’s request comes as the IDC faces growing parliamentary scrutiny over its governance controls, accountability mechanisms and internal oversight processes.

At the portfolio committee meeting this week, IDC chief executive Mmakgoshi Lekhethe acknowledged that an internal review had identified shortcomings requiring intervention.

She told MPs that weaknesses had been uncovered in internal controls, governance processes and accountability mechanisms, prompting management to launch a programme to address the deficiencies.

However, lawmakers questioned whether the measures would be enough to resolve longstanding concerns.

Some MPs called for greater transparency around governance arrangements and the management of potential conflicts of interest, while others raised concerns about oversight, developmental impact and the effectiveness of accountability structures in the institution.

Demana’s appointment has drawn attention because of events during his tenure at Sanral. Before leaving the roads agency, he publicly acknowledged that procurement failures had left Sanral unable to successfully defend several court challenges related to tender processes.

One of the most significant cases involved a proposed five-year panel of road maintenance contractors that was abandoned after investigations uncovered procurement irregularities. Sanral subsequently conceded the legal challenges and supported an order declaring the tender invalid.

Demana has maintained that the procurement failures predated some of the decisions under scrutiny and has rejected allegations linking him personally to corruption or irregular expenditure.

He also disputed claims that R9.5-billion in corruption occurred during his tenure, saying the figure related to historic irregular expenditure incurred between the 2011/2012 and 2018/2019 financial years, before he joined Sanral in 2023.

Demana further denied allegations circulating on social media that he benefited from irregular tenders, saying no evidence had been produced to substantiate the claims.

While neither Tau nor the Department of Trade, Industry and Competition has suggested any wrongdoing by Demana in relation to his appointment, the minister’s request for a report signals that government wants answers to concerns raised about governance at the IDC.

The department said Tau expects boards and executives across entities under his oversight to safeguard institutional stability and avoid actions that could undermine the credibility of strategic state assets.

IDC spokesperson Tshepo Ramodibe had not responded to questions from Sunday World by the time of publication.

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Trade, Industry and Competition Minister Parks Tau has requested a report from the Industrial Development Corporation (IDC) over the appointment of former South African National Roads Agency (Sanral) chief executive Reginald Demana as chief operating officer.

This follows parliamentary concerns about governance at the state-owned development finance institution.

Tau’s intervention follows a meeting of Parliament’s Portfolio Committee on Trade, Industry and Competition earlier this week, where MPs raised concerns about governance, accountability and oversight at the IDC.

Demana’s appointment faces scrutiny as the former Sanral boss left the roads agency amid questions over his role in irregularities involving a R9.5-billion procurement process and a tender that was eventually set aside by the high court. He denied any accusations of wrongdoing before leaving to take up the role at the IDC.

Responding to questions from Sunday World, Tau’s spokesperson Kaamil Alli confirmed the minister was seeking answers, but refused to comment until Tau had received the requested report from the board of the IDC.

“Based on the questions that were raised in the portfolio committee … as well as the grave matters contained in your questions, the minister is not in a position to immediately respond to your enquiry and will be requesting a report from the IDC board on the matter whilst also requesting the board to respond to your questions where possible,” Alli said.

“The minister would encourage you to direct all enquiries to the board and afford them [the opportunity] as the accounting authority to respond.”

Tau’s request comes as the IDC faces growing parliamentary scrutiny over its governance controls, accountability mechanisms and internal oversight processes.

At the portfolio committee meeting this week, IDC chief executive Mmakgoshi Lekhethe acknowledged that an internal review had identified shortcomings requiring intervention.

She told MPs that weaknesses had been uncovered in internal controls, governance processes and accountability mechanisms, prompting management to launch a programme to address the deficiencies.

However, lawmakers questioned whether the measures would be enough to resolve longstanding concerns.

Some MPs called for greater transparency around governance arrangements and the management of potential conflicts of interest, while others raised concerns about oversight, developmental impact and the effectiveness of accountability structures in the institution.

Demana’s appointment has drawn attention because of events during his tenure at Sanral. Before leaving the roads agency, he publicly acknowledged that procurement failures had left Sanral unable to successfully defend several court challenges related to tender processes.

One of the most significant cases involved a proposed five-year panel of road maintenance contractors that was abandoned after investigations uncovered procurement irregularities. Sanral subsequently conceded the legal challenges and supported an order declaring the tender invalid.

Demana has maintained that the procurement failures predated some of the decisions under scrutiny and has rejected allegations linking him personally to corruption or irregular expenditure.

He also disputed claims that R9.5-billion in corruption occurred during his tenure, saying the figure related to historic irregular expenditure incurred between the 2011/2012 and 2018/2019 financial years, before he joined Sanral in 2023.

Demana further denied allegations circulating on social media that he benefited from irregular tenders, saying no evidence had been produced to substantiate the claims.

While neither Tau nor the Department of Trade, Industry and Competition has suggested any wrongdoing by Demana in relation to his appointment, the minister’s request for a report signals that government wants answers to concerns raised about governance at the IDC.

The department said Tau expects boards and executives across entities under his oversight to safeguard institutional stability and avoid actions that could undermine the credibility of strategic state assets.

IDC spokesperson Tshepo Ramodibe had not responded to questions from Sunday World by the time of publication.