Transport Minister S'bu Ndebele on Tuesday decided to return the top of the range Mercedes Benz he received as a gift, though President Jacob Zuma said that by law he was entitled to keep it.

"I have decided to voluntarily return the Mercedes Benz and two head of cattle that I received at a function in Pietermaritzburg last Saturday," he told a packed press conference in Cape Town.

He added that he would ask for the Mercedes S500 and the cattle to be sold and the money to be used to start a business training programme for emerging contractors.

Ndebele said Zuma and the African National Congress leadership had advised him that he may keep the car, which is worth more than R1-million, provided he declare it in the annual register of members' interests at Cabinet and Parliament level.

"The President advised that I should follow the code of ethics, which is to declare within 30 days, but I did speak to him and say my personal feeling is that I should return it."

He insisted the lavish gift from contractors in KwaZulu-Natal, where he served as transport MEC and then as Premier until his Cabinet appointment, did not create a conflict of interest.

"There definitely will not be a conflict of interest because there is no way that as national Minister or even provincial Premier, I will be granting any contracts to contractors in KwaZulu-Natal."

But the minister said he did not want the media outcry over the car to distract him as he settled into his new portfolio, or for the incident to sully his reputation.

"I've had 15 fairly good years in government and the only thing I really have is my good name," he said.

Ndebele brushed off suggestions that he should immediately have rejected the car when he was presented with it by businessmen who had benefited from KwaZulu-Natal's Vukuzakhe government programme to help emerging road contractors.

He said in African culture this would be considered rude, adding that he had been humbled by recognition from people in KwaZulu-Natal for helping to stabilise the region after years of political conflict.

"In the culture of the majority of our people, you don't do that. You don't throw the thing back in the face of people as if you are suddenly so important," he said.

The Mercedes was reportedly meant as thanks for Ndebele's role in creating a platform for small contractors in the province. He was also given fuel vouchers, a plasma screen television set, and wine glasses.

Ndebele has confirmed that in the past 10 years, government had allocated close to R10-billion in contracts to contractors associated with the programme.

The Democratic Alliance and the Congress of South African Trade Unions have urged him to return the car to avoid a perception of conflict of interest.

The gift presented a first ethics test for Zuma's new Cabinet, and Ndebele said when he reflected on the matter, the only precedent was two luxury cars - a Mercedes and a BMW - that were given to Nelson Mandela early in his Presidency.

Mandela kept the cars, Ndebele said, but never suffered accusations of conflict of interest.

Asked whether he had been tempted to keep the vehicle, Ndebele replied that he had no need for it as the generous car allowance for Cabinet ministers would enable him to acquire a vehicle to the same value.

"The DG tells me that we have a very good car scheme. I can get a car to the value of more than R1-million and I think for deputy ministers it is R850 000," he said.