The Committee met with the South African Maritime Safety Authority and decided that they could not discuss the 2008/09 Annual Report because it was an unapproved, unofficial document that had not yet been adopted by the SAMSA Board.
The Committee asked the SAMSA Chief Executive Officer to explain the reason for this. In his response, he noted that the Board had not been functioning all year. The Board chairperson and secretary had resigned amidst conflict and not even SAMSA’s current budget was approved. Despite legal opinion stating that there were sufficient members to continue as a board, and that no vacancy should lead to the Board to neglect its duty, board meetings had not happened. After one of the four remaining members had resigned, there was now no longer a quorum. The Minister and Director General were aware of the problem.
The Committee were interested to know if the board members were still being paid. The Chairperson deferred the meeting until the Annual Report approval had taken place.
The Chairperson noted that SAMSA had not submitted their 2008/09 Annual Report and asked the CEO to explain to the members the reason for this.
Mr Tsietsi Mokhele (CEO: SAMSA) said that the 2007/08 Annual Report was also late which caused delays. He said that the audit report for 2008/09 had been completed and they had tabled the draft Annual Report on time. However, in the interim the composition of the SAMSA Board had collapsed. He said that the remaining four members believed that they did not form a quorum and therefore they could not meet and adopt the Annual Report. The report was ready but it was the board’s opinion that because they did not have a chairperson they could not convene and approve the prepared Annual Report. The acting Director General of the Department of Transport met with the board to find a way forward and it was then revealed that according to the South African Maritime Safety Authority Act, four members did form a quorum. However, subsequent to that the fourth member had resigned. The Annual Report had been ready since 31 July 2009 but it awaited the appointment of a full board to approve it. He had met with the acting Director General the previous morning who had assured him that a chairperson would be appointed soon so that they could convene and adopt the Annual Report and present it to Parliament.
The Chairperson said that they could not engage with SAMSA because the document they presented was an unapproved Annual Report and it would just be wasting their time as it was not an official document. She said it was a challenge that needed urgent intervention by the department. The adoption of the 2007/08 Annual Report had also been delayed which meant that there was a major challenge within SAMSA that needed to be attended to. She suggested that they defer the meeting until the report had been approved.
Mr M De Freitas (DA) asked why SAMSA board members were resigning from the board.
Mr Mokhele replied there had been a governance problem within the Board before 2008. The conflict within the organisation had escalated by the end of 2008 to such an extent that, for all of 2009, the Board had not been effective. It had not convened and had not considered a number of matters of governance. They had to deal with the delays of submitting a budget and they still did not have an official budget for 2008/09.
Mr Mokhele continued that the Board decided to launch a forensic investigation into the organisation at the beginning of this year. Since then the Board secretary had resigned in the middle of the conflict, citing as a reason that the Board was not taking his advice as Board secretary. The chairperson of the Audit Committee also resigned and subsequently the Board chairperson resigned. The four remaining board members did not meet citing the reason that without an appointed chairperson they could not convene. They decided this despite the SAMSA statute which said that four members did form a quorum and that no vacancy on the Board should lead to the Board to not being able to carry out its duties. One of the members could be appointed to preside as chairperson over the board meeting so that they could continue adopting resolutions and leading the organisation.
Mr Mokhele said he was sitting in a difficult position in that there was no Board and yet he did not want to speak on their behalf. He assured the Committee that all the processes leading up to the production of the Annual Report had been concluded timelessly.
The Chairperson said she found it pointless to discuss a report that was not official
Mr M De Freitas (DA) noted that the CEO said that the Board members felt that they could not meet despite forming a quorum. He asked if they had come to this conclusion based on legal advice or if it was their own decision. Had they been paid throughout the year despite not having met once?
Mr B Dhlamini (IFP) asked what steps were followed by the management towards insuring the alleviation of the challenges that the Board faced.
Mr Mokhele replied that the Board had requested that they seek legal advice about the standing of the four member who did not have a chairperson. According to this legal advice, it was realised that the SAMSA Act of 1998 gave them authority to meet and that anyone could be appointed to preside over the meeting and that no vacancy of members should lead to the Board neglecting its duty. This legal advice was provided to the Board and Department of Transport. Even at their AGM, they got into the details of that opinion in front of the Minister.
Mr Mokhele said that throughout the difficulties, they still had managed to deliver on major things such as coming out of a disclaimer by the Auditor-General in 2007/08. Despite difficulties they made sure that they had concluded on time their accountability processes in terms of compliance and governance in a report that was tabled timeously. They had sought advice outside the audit itself from the Auditor-General to seek ways out of the problem. They had still managed to deliver on a whole lot of matters that had been problems.
He was glad that the issue of Board members’ payment had come up. He said it was a problem he was dealing with as he did not have the board member fees for the second two quarters of the financial year. They only had the board member fees for the first two quarters of the financial year because the Board had only approved the budget for six months and not 12 months. The reason for this was because of tariff adjustments and the change of administration. The Board members had approached his office for the payment of the third quarter fees. He noted that even staff bonuses that should have been paid in July, were still outstanding. The Director General had taken up the issue and was meeting with the Minister of Transport that day so that they could then advise him if SAMSA should be paying the board members - who had not convened once that year - and what was the basis for such a payment.
The Chairperson said that they now had an understanding of what was happening and said that they would look at the committee programme and see when they would fit in SAMSA. On that day they would invite the Department of Transport to be part of the meeting. It would assist them if they had the Board members present so that they could know exactly what had been happening and the Department could respond.
The meeting was adjourned.
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