Sawit in financial trouble 6 October 2007

Trust summoned to appear before parliamentary committee

The South African Wine Industry Trust (Sawit) is apparently in deep financial trouble, as has been rumoured for some time. With reports of over-spending coming out and a lack of money for the current financial year’s commitments, officials of the trust have now been summoned to appear before parliament’s standing committee for public accounts (Scopa).

Themba Godi, chair of Scopa has written to Sawit’s CEO Charles Erasmus, and copied to Masiphula Mbongwa, director generaal of the department of agriculture, under which Sawit functions.

Nellie Brand of Afrikaans daily Die Burger reports that Sawit has, for months, not reacted to Scopa’s questions about its financial status. Pierre-Jean Gerber, ANC member of Scopa confirmed that Sawit has been invited to come and explain.

Brand has, after a long struggle, finally got to see financial reports of the past few years (the last has not been made public). She reported extensively about what seems, on the face, of it like mismanagement. The main problems stem from the financing of the so-called empowerment component that bought into the KWV in 2004.

According to Brand, Sawit had only R52 million left to the end of the financial year ending February 2007 before all funding dried up. At the end of February 2006, the trust had over-spend by R68 million. Among the expenses for that period, are large amounts for travel and accommodation, as well as entertainment (R567 745).

Scopa is wanting some answers about these statements. Gerber told Brand that there are specific questions about Sawit’s financing of the Western Cape’s National African Farmers’ Union (Nafu). He also said they wanted to know how the money allocated to