KwaZulu-Natal economic affairs MEC Zweli Mkhize was expected to testify in the Schabir Shaik fraud and corruption trial, the Durban High Court heard on Tuesday.

The first session of the day focused on Deputy President Jacob Zuma's Nkandla traditional village project and Shaik's role in it.

Under cross-examination Shaik was asked why he used R900 000 from Zuma's account without his permission when he knew Zuma had to pay R2,4 million for the Nkandla project.

"It was the nature of our relationship," said Shaik, explaining that he was free to do as he pleased because of his friendship with Zuma and his role as his financial adviser.

The R900 000 in question was part of R2 million given to Zuma by former president Nelson Mandela. One million was supposed to go to Zuma's education trust fund and the rest to an organisation called Development Africa. That money would be used for Zulu king Goodwill Zwelithini's royal residence.

One million did go to the education trust fund, but Shaik said when he saw the remaining money in Zuma's account he used some of it to settle overdrafts as a result of money lent to Zuma.

He then put R900 000 into a call account to draw interest. Shaik said that money was later used in by his subsidiary companies.

Judge Hilary Squires asked why he took the money when he knew Zuma was going to need a substantial amount for Nkandla.

"That's a good question, my lord," said Shaik. He said at that stage he had "divorced himself" from the project and did not know what was still owing.

The court heard that R500 000 of the money taken by Shaik was paid back to Zuma. Shaik said the remaining R400 000 was given to Mkhize in the form of cheques and he believes Mkhize himself would come to court to testify about the payment. *1

The trial continues.

With acknowledgement to Sapa.

*1 Struggle Financing that would make Alan Boesak and Freddy Steenkamp blush - it be true.