UNDER A CLOUD: President Jacob Zuma's homestead in Nkandla. Picture: SUNDAY TIMES
UNDER A CLOUD: President Jacob Zuma's homestead in Nkandla. Picture: SUNDAY TIMES

PRESIDENT Jacob Zuma had financed developments at his Nkandla home through a mortgage bond, Presidency spokesman Mac Maharaj said on Tuesday in a bid to dispel talk to the contrary.

This comes more than two days after reports that Mr Zuma may have misled Parliament last week when he said developments at his Nkandla home were financed through a bond. Mr Maharaj did not disclose the name of the bank that had provided the finance.

Pressure has been piling up on the government to reveal how much in public funds has been spent on the so-called security upgrades at Mr Zuma’s Nkandla home.

"We urge the media to respect the agencies that are investigating the various aspects of the security enhancements at the residence as speculations and rumour-mongering will not assist the process," Mr Maharaj said in a statement.

In another statement later on Tuesday he said evidence on Mr Zuma’s mortgage bond would be made "available to an authorised agency or institution empowered by the law of the land". Speculation has been that more than R200m of public funds were being used to upgrade Mr Zuma’s private residence.

The Mail & Guardian websiteon Tuesday said Mr Zuma first applied for a home loan on his Nkandla residence in 2001, when it was worth between R650,000 and R750,000 according to a bank valuation and insurance assessments.

By December 2002 he had been granted that home loan by First National Bank (FNB), despite being in dire financial straits, not having a formal lease on the land, and a bank policy not to bond property owned by tribal trusts, the website said.

Mr Maharaj was a highly paid director of the bank at the time.

But although the existence of the loan, which Mr Zuma could still be paying off, strongly suggests he did not lie to Parliament, the numbers still do not add up.

The existence of the loan, and some of the details around it, were confirmed in the original indictment against Schabir Shaik, Mr Zuma’s former financial adviser.

The document formed the basis of the case that ultimately saw Shaik convicted.

Public Works Minister Thulas Nxesi said last month the exact figure of how much in state funds were being used to upgrade the house would never be disclosed because it was a matter of national security.

A task team of the auditor-general, the public protector and Department of Public Works would investigate the Nkandla project.

Mr Zuma’s friends and businessmen, including Vivian Reddy and Mr Shaik, have previously contributed to developments at his home. Mr Reddy said yesterday he had no role in current renovations. He allegedly paid R50,000 in 2000 towards construction at Mr Zuma’s house.

Derek Luyt of the Public Service Accountability Monitor said Mr Zuma did not have to declare the alleged loan from Mr Reddy to Parliament. As deputy president in 2000 and the most senior MP, he would have been expected to declare what he spent Mr Reddy’s funds on but not necessarily their source.

But constitutional law expert Pierre de Vos said the money could be seen as a benefit if it was an interest-free loan. "Then the interest part of the loan could be a gift."