Pan South African Language Board on legal and disciplinary issues

Arts and Culture

30 August 2011
Chairperson: Ms T Sunduza (ANC)
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Meeting Summary

The purpose of the meeting was to discuss the crisis within Pan South African Language Board (PanSALB). It was facing a financial deficit which would lead the organisation’s bankruptcy as it was unable to meet its financial commitments. In addition to the financial challenges there were court cases surrounding the suspension of the former CEO and that of former legal adviser, Adv Feni. The court case against Adv Feni was still before the courts with a hearing scheduled for 16 September 2011.

There was also the matter of rising legal costs which was redirecting funds from PanSALB projects. The CFO of PanSALB, gave a detailed breakdown of the legal costs incurred by PanSALB in respect of the former CEO which amounted to R5,47 million, Adv M Feni, R373 200, and Mr Simelane, R181 680.

During the discussion the Chairperson stated that as court cases were still in progress, more legal fees would be incurred. The Committee expressed displeasure at the high legal costs and the fact that public money was being used to fund these legal costs. The appeared to be an abuse of power by both the executive staff and the board members. There was a lack of a willingness on the part of management to resolve the issues, and the present situation could not continue. A strategy to regain trust in the work environment was needed. While the Acting CEO had approved payment of the legal costs, the board should have played a part in the decision process when the amount involved rose above a certain level.

The members wanted to know why Adv Feni was not reinstated despite a court order instructing PanSALB to do so. The Acting CEO stated that the documents were submitted to the HR manager however the HR manager could not recall receiving the documents. The Chairperson then asked the HR manager if he had received the documents, however the HR manager did not respond to the Chairperson’s question. As a result he was asked leave the meeting. Before leaving the meeting, he was asked to apologise to the Committee and the people of South Africa for lying to the Committee.

The Committee decided that the PanSALB matter raised during the meeting should be submitted to the Minister. The Minister was to produce a report by 21 September (after the court hearing) on how the PanSALB matter should be resolved. Thereafter, the Committee would meet to discuss the Minister’s report.

Meeting report

The Chairperson noted that the Committee had been provided with financial documents showing that PanSALB was in a state of financial deficit, and in order to request additional funding, the Committee needed to know the breakdown of expenditure, including the organisation’s legal costs incurred in dealing with personnel issues. It appeared to her that the main challenges involved the leadership and an abuse of power.

Dr Elias Malete, Chairman of PanSALB, gave a brief background to the financial challenges facing the Board. Since PanSALB had been established, it had received no long-term financial support to ensure its sustainability. There had also been a dormant eight-month period when it had not had a board. This had led to appointments being made without budgets being available, and as costs rose, it was not able to meet demands for wage increases and escalating rentals. The new board realised it had to operate within its approved budget, but could not do so in the prevailing circumstances.

The Chief Executive Officer, Ms
Rosemary Nkosi, was suspended on grounds of insubordination, as she had disregarded a Board moratorium on further promotions within the organisation. A two-year investigation followed, and she was subsequently prosecuted. There was also a case involving Adv Feni, which was still before the courts.

A memorandum, expressing concerns, had been received from the union, and this had been tabled before the board. The Acting CEO was invited to give his version of events, after which the board decided that as this was a new union, with new leadership and new grievances, it should follow proper grievance procedures and negotiate with management.

Mr Lovell Singh, Chief Financial Officer of PanSALB, gave a detailed breakdown of the legal costs incurred by PanSALB in respect of the former CEO, Ms N Nkosi, which amounted to R5,47 million, Adv
Zixolisile M Feni, R373 200, and Mr Jabulani Simelane [former KZN provincial office manager], R181 680.

Mr Chris Swepu, Acting CEO of PanSALB, said that as the organisation’s accounting officer, he had approved the invoices, and these had been audited by the Office of the Auditor-General, which had advised PanSALB a week ago that they had found nothing wrong with the legal fees. He said the high fees in respect of the previous CEO were reflective of the length of the case.

The Chairperson asked what the current state of affairs was at PanSALB.

Mr Swepu said employees were carrying on with their work as normal. Certain people had been disciplined in terms of the organisation’s regulations, and the Feni and Simelane court cases were continuing.

He said the union’s memorandum to the board, including its grievances, had been accompanied by a list of signatures of staff who had attended a meeting. A number of signatories had subsequently advised the board that although they had attended the meeting, they had not signed a list of grievances. PanSALB had responded within the seven days stipulated by the union, but to their surprise, the memorandum was given to the press. Proper grievance procedures had since been followed, and the issues raised had been dealt with. There were now no outstanding grievance matters, and there had been no industrial action at PanSALB.

The Chairperson said that as some of the court cases were still in progress, what additional legal fees would be incurred.

Dr A Lotriet (DA) asked how many days each of the disciplinary hearings had taken. The fact that PanSALB had received an unqualified audit did not mean everything was fine, but merely indicated that expenses had been fairly reflected. She expressed concern that some staff members of the union were now being sent back to deal with the management with whom they had had a problem. PanSALB should have looked at other options, rather than hiding behind a technicality.

Mr L Khoarai (ANC) wanted to know whether the Chief Financial Officer had advised the CEO regarding approval for the payment of the legal fees.

Mr P Ntshiqela (COPE) asked whether any strategy was being devised to overcome the damage which the image of PanSALB had suffered.

Mr S Ntapane (UDM) inquired about staff turnover, in the light of all the disciplinary hearings going on. He also raised questions about the legal fees incurred, such as the high cost of the Nkosi case in relation to the other two, why the court ordered the use of high-priced senior counsel, the length of the cases and their outcomes, and whether it was necessary for Board members to travel to attend the cases, bearing in mind the costs involved.

Ms L Moss (ANC) asked if there was a willingness on the part of management to resolve the issues, because the present situation could not continue. A strategy to regain trust in the work environment was needed. She also argued that while the Acting CEO had approved the payment of the legal costs, the board should have played a part in the decision process when the amount involved was above a certain level.

The Chairperson pointed out that not long ago, PanSALB had come to Parliament to say that progress with their mandate had been stalled because of a lack of funds, so she was amazed that it could find over R5 million to pay for legal fees. The courts had ruled that both Feni and Simelane must be reinstated, so what was the issue that was preventing this? Was there not another mechanism that the Board could have used to avoid court proceedings? It seemed, from reports she had received, that some board members did not know what was going on. There also seemed to be conflict within the organisation.

Ms M Morutoa (ANC) said she could not understand how the organisation, lacking funds, could allow the legal costs to escalate to such heights. There was obviously something seriously wrong, with many unanswered questions, and she felt it might be appropriate to refer the matter back to the Minister.

Mr Ntapane asked when the court order to reinstate the workers was given.

Ms F Mushwana (ANC) asked whether PanSALB had a code of conduct that would guide the Board in its relationships within the organisation.

Mr Ntapane said the presentation had indicated that there were no longer any grievances, yet there was still infighting within the organisation.

Dr Molete said there was a long history of conflict and tensions between the Department and the CEOs, and there was a need for the Portfolio Committee to intervene in the area of responsibilities and relationships, and to create an understanding of how the organisation should operate properly. In terms of governance issues, the chairman of the board should report to the Minister, while there should be communication between the Director-General and the (Acting) CEO on operational issues.

The reason the court order that Adv Feni should be reinstated was challenged, was because PanSALB was not represented at the court when the order was made.

This drew the comment from Ms Morutoa that this was an unacceptable response, following the disclosure that board members had been reimbursed their expenses for attending the legal proceedings.

The Chairperson asked whether they would still have challenged the ruling, if they had been present in court. She said Mr Swepu appeared to be the only one who knew what really happened, and he should give an explanation.

Mr Swepu said that on 22 June, PanSALB had discussed the matter of the memorandum sent to the board with the Portfolio Committee, and it had been resolved that the office of Mr Feni should engage with the organisation on the matter. This had happened, and the board had been asked to consider how it would go forward. The board’s response was that even though there was a judgment of 18 April that Mr Feni must be reinstated, it believed the judgment had not been obtained correctly and would prejudice the board. Adv Feni then applied for Mr Swepu to be imprisoned for contempt of court – but the application was struck off the roll. He then applied for a writ of execution for the payment of R1,3 million, plus 15% interest. A court order to stop this was obtained, with the judge ordering that all the issues must be consolidated and dealt with in court on 16 September. Mr Swepu said there had been irregularities involving two courts sitting on the same matter, and arriving at different conclusions. He said PanSALB would abide by the court’s decision on 16 September. Adv Feni had brought many issues before court, including a claim for R38 million, and it was in this context that he felt it would be irresponsible for the organisation not to defend itself.

In the case of Ms Nkosi, the board had offered a settlement, but she had refused it, while he had travelled to KwaZulu Natal to negotiate with Mr Simelane, in an attempt to persuade him to return to work, and he had also refused the offer.

The Chairperson said she had contacted Mr Simelane herself, and he had advised her that conditions had been attached to the offer.

Mr Swepu said he had suffered personally as a result of these events. He had been investigated by Price Coopers Waterhouse at the demand of Adv Feni, and had received unwelcome press coverage. It had been insinuated that he was not qualified for the job, and that his appointment had been irregular. All this had been disproved.

Regarding the approval of the legal fees, he said all payments went through a standard process, culminating with a recommendation from the CFO. He was advised by many layers within the organisation, and wanted to dispel the notion that he was a one-man show. He was shocked to hear that things were not right in the organisation, and said he would welcome an investigation by the Auditor-General, as he felt this would be of value to all involved.

The Chairperson asked what PanSALB’s next step should be.

Mr Swepu said that the Board would follow the court processes, as it had just as much right to appeal a court’s judgment as Adv Feni.

Dr Lotriet asked why Adv Feni had not been reinstated.

A Spokesman for Adv Feni said a valid court order had stipulated that he must be reinstated with immediate effect, but the Board was under the impression it had 14 days in which to decide how to react – an impression which they could not justify. He should have been reinstated right then and there. The Acting CEO had then been asked to consult with the chairman of the Board to adopt a more strategic approach, in order to avoid escalating legal costs.

The Chairperson commented that this presented a contrary view, and she wondered where the truth lay.

Mr Ntapane and Ms Morutoa both expressed frustration that the issue was not being resolved.

[PMG note: The meeting was not monitored by PMG for five to ten minutes at this point]
The Chairperson asked Mr Swepu whether he had received the documents regarding the reinstatement of Adv Feni.

Mr Swepu responded that the HR manager had indeed received the documents. He said that these were not the first of the documents received by him. Adv Feni had submitted the document through his lawyers and the Committee was misunderstanding what the HR manager had stated.

The Chairperson said that the HR manager had informed the Committee that he had not received the document which according to the Chairperson was contrary to what was being said by Mr Swepu. The Chairperson then asked the HR Manager whether he had received the documents.

The HR manager stated that he had not lied to the Committee.

The Chairperson interrupted and stated that if the documents had been received then there would have been records and in fact the HR manager had lied to the Committee.

The HR manager reiterated that he would not have lied to the Committee and in fact the Chairperson misunderstood his earlier comments. He said that he could not recall receiving those documents and if the documents had been received in his office they would have been kept for record keeping purposes.

The Chairperson interrupted and asked the HR manager whether he received the document and requested a Yes/No answer.

The HR manager said that he did not know how to respond to that question.

The Chairperson asked the HR manager to leave the meeting because he had failed to respond to the questions asked by the Committee.

Ms Moss (ANC) said that the HR Manager had to apologise to the Committee members and to the people of South Africa for breaking their trust in a government institution. The Portfolio Committee had been misled and an apology was in order.

The Chairperson said that there was a perception that parliamentary committee members were uneducated and if PanSALB came to the meeting with that belief then they were highly mistaken.

The Chairperson also acknowledged that some matters were of a sensitive nature and she did not want to compromise anyone’s position before the court trial and if that was the reason the HR manager was not answering the questions, then he must state that to the Committee.

Mr Swepu apologised, saying they had no desire to undermine the Committee. He stated categorically that on 22 June 2011 that HR had received the documents.

The Chairperson asked who received the document.

Mr Swepu answered that the HR Manager had received the documents.

The Chairperson asked the HR manager again whether he had received the documents.

The HR Manager stated that in order to move the meeting forward, yes, he did receive the documents.

The Chairperson said that was an unacceptable answer. The Chairperson said that from henceforth all the questions regarding HR would be answered by Mr Swepu and the HR manager should vacate the meeting.

The Spokesperson for Adv Feni stated that the HR Manager was reprimanded for keeping the documents in his office.

The members again demanded an apology.

The HR manager apologised to the Committee members and the people of South Africa.

Dr Lotriet said that she was getting concerned because there was in increasing number of contradictions and discrepancies. She also could not understand why none of the staff from PanSALB was able to give a straightforward answer. The original issue was still not cleared up about why Adv Feni was not reinstated and why there were contradictions about the 14 days grace period and whether the documents were received or not. There were too many different answers. She asked the Chair to make a ruling and not proceed with any more questions.

The Chairperson agreed with Dr Lotriet and told Mr Swepu to explain to the PanSALB staff about parliamentary proceedings and how one should proceed when sitting in a Committee meeting. A Member could ask any question he/she wanted even if it went beyond the professional boundaries. The Chairperson said that this was a transparent government and as such it had the right to investigate any matter that could potentially be linked to corruption. It was the duty of the Portfolio Committee to fix the problems in PanSALB. It was also the duty of the PanSALB executive body to work with the DG of the Department of Arts to run a functional and effective organisation. The Chairperson then asked the Members for guidance on how the matters should proceed.

Ms Morutoa (ANC) said that a report must be submitted by the Minister within three weeks of this meeting.

Ms Moss agreed and supported Ms Morutoa and stated that the Minister should submit a report on the matters raised in the meeting and it should be submitted within three weeks.

The Spokesperson for Mr Feni stated that the report from the Minister should come after the court case of 16 September 2011. The Minister must wait for the Judge’s decision and then produce the report.

The Chairperson asked the Members about what the Minister should include in the report.

Ms F Mushwana (ANC) stated that the Minister should be given a background on what the Members had heard in the meeting and all the contradictions made by the staff of PanSALB. The Ministers should also be informed of how the executive body of PanSALB failed to reinstate Adv Feni despite a court order.

Ms Morutoa wanted the Minister to be informed of the money that had been spent on legal matters by PanSALB and the Minister must deliberate whether the Board was performing its duties. Also the Minister should speak to the Board and understand the dispute so that the matter could be resolved quickly and PanSALB could go back to performing its duties as mandated by the Constitution.

Mr D Mavunda (ANC) supported the other members that a report be submitted by the Minister. He said that it was a matter of concern for the Committee that public funds were used for legal matters on individuals in the organisation.

Dr Lotriet said that the information from Parliament’s legal section that the members had been using should be added to the Minister’s brief.

The Chairperson said that it was apparent that there was abuse of power by both the executive staff and the board members.

The Chairperson noted that the Minister should submit the report by 21 September 2011 at which time another meeting would be organised to discuss the report of the Minister. Also at the next meeting the finance manager should submit a break down of costs and produce tax receipts for all the expenses incurred during the last financial year.

Approval of Advisory Panel to appoint the National Council for Library
Mr Sibusiso Xaba (Director General: Department of Arts and Culture) asked the Committee to approve the list of Advisory Panel members so that they could appoint the National Council for Library (NCLIS). He stated that the NCLIS was constituted in terms of Sections 5 to 9 of the National Council for Library and Information Services Act, No 6 of 2001. The Act prescribed that the Council must advise the Minister of Arts and Culture and the Ministers of Education on matters relating to library and information services. The Advisory Panel consisted of people from various sections of the Department of Arts and Culture and they would appoint the new National Council for Library and information Services.

The Committee approved the list upon the stipulation that one of the new council members should belong to the National Library of the Blind.

The Department agreed to this stipulation.

The Chairperson thanked then Department and adjourned the meeting

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