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East London IDZ executives must repay R7 million bonuses: DA's Ross Purdon

MARCH 16, 2015
East London IDZ executives must repay R7 million bonuses: DA's Ross Purdon

The Democratic Alliance (DA) in the Eastern Cape on Monday called for the executives of the East London Industrial Development Zone (IDZ), who late last year reportedly paid themselves R7 million in performance bonuses, to immediately repay them to the IDZ coffers.

This comes after last week’s bail out of the insolvent IDZ by national government’s Department of Trade and Industry. The East London IDZ has been driven into a cash crisis and is now unable to pay salaries, wages and debts to creditors.

"It is unconscionable and unacceptable that executives draw R7 million in performance bonuses from the IDZ while simultaneously pushing the entity to bankruptcy. This money must be immediately repaid," said the DA's Ross Purdon, in a statement.

"The IDZ is unable to draw on available Development Bank funding because it cannot produce sound financial statements. It is through the mismanagement of the IDZ executives that the financials are in a mess, and therefore any performance bonuses are clearly not deserved.

"The IDZ should be a source of major industrial development and job creation; but that is now seriously under threat."

He said that DA will therefore write to the MEC for Economic Development, Environmental Affairs and Tourism, Sakhumzi Somyo, to call for him/her to secure repayment of these lavish bonuses in the face of this cash crisis.