The Ad Hoc Committee interviewed two former SABC Board members, Mr Ronny Lubisi and Mr Vusi Mavuso as well as former Group CEO, Ms Lulama Mokhobo. They were called as witnesses to testify in the SABC inquiry and an overview of what was taking place during their tenure at the organisation.
Mr Ronny Lubisi, former SABC Board member, said that his time at the SABC was difficult as allegations of conflict of interest were levelled against him. There was no basis for this and he was currently in litigation against the SABC as a result of his subsequent removal. Mr Lubisi spoke about incidents where he was verbally attacked as chairperson of the audit committee. Processes were not followed on the implementation of the Public Protector's remedial action. He felt that one of the reasons he was removed was because he wanted those findings implemented. From the start, Minister Faith Muthambi had a problem with Mr Lubisi, stating that he was using the audit committee for his own agenda. Allegations of a conflict of interest were manufactured against him. In the end, Mr Lubisi, the late Hope Zinde and Ms Rachel Kalidass were recommended for removal from the Board.
Ms Lulama Mokhobo, former SABC Group GEO, testified that she was subjected to emotionally painful incidents during her time at the SABC. As Group CEO, her authority was undermined and she ran head-on into Mr Hlaudi Motsoeneng many times. Rumours were spread about her and her family to the point where she no longer felt able to work at the SABC. Her ability to perform was tampered with. During her time at the SABC she managed to make great strides in turning around its financial performance and was proud of her achievements in conjunction with her team. The Public Protector Report found that she was involved in two of the salary increases awarded to Mr Motsoeneng but she was involved only with one. At that time Mr Motsoeneng received a lot of accolades from the Board therefore she could not contest the salary increases.
Members wanted to know about the power dynamics happening between Board members, the chairperson and executives. The appointment of Mr Hlaudi Motsoeneng and the irregular process followed were questioned so as to get a clear picture of how it took place. The financial status of the SABC and the progress made during the former Group CEO Mokhobo’s time at the SABC. Members asked how the Public Protector's Report was handled by the Board and specifically which Board members did not want the recommendations from the Public Protector to be implemented. The Committee noted that it had been refused documents it had requested from the SABC and asked if there were any documents which could be commercially sensitive.
Former SABC Board member, Mr Vusi Mavuso, said before he became a Board member he was quite aware of some of the dynamics that happened in the Board. It was evident that there were problems with governance. Mr Motsoeneng's appointment had not followed due process. It was like a ‘skop, skiet and donner’. The meeting lasted five hours. Board members argued, but the three against the appointment were in the minority. When the delegation of authority framework was amended, it was problematic for Mr Mavuso as powers were taken away from the Board and given to the executives. He raised objections and requested that the matter be placed on agenda but his requests were not answered.
Mr Mavuso, was questioned about irregularities within the SABC Board, at senior level positions within the company, as well as interference from the Minister of Communications, Ms Faith Muthambi. His responses showed that Minister Muthambi undermined the SABC Board by granting abnormal levels of responsibility and power to senior company members, especially Mr Hlaudi Motsoeneng. In addition, Mr Mavuso spoke of how this undermining by Minister Muthambi affected the hiring of people such as Mr Motsoeneng.
Mr Mavuso explained that as he was an outspoken critic of the way the SABC was being run, he was targeted by Minister Muthambi and her allies on the board, and eventually he was forced to resign.
Committee members questioned Mr Mavuso about financial irregularities, bonuses, and salary increases that all transpired under Mr Motsoeneng’s tenure. Mr Mavuso explained that all of those issues happened after the board had been undermined, and the board was not consulted on any of those matters.
The Chairperson noted that the current SABC Board chairperson, Prof Mbulaheni Maguvhe, was supposed to be present at the Committee meeting, but had not presented himself. He gave the Committee two options. Firstly, proceed without Prof Maguvhe present. Secondly, exercise the Committee’s parliamentary authority and send a summons to Prof Maguvhe for him to present himself at a later Committee meeting.
The Committee unanimously agreed to send a summons, with many Members stating that they had questions for Prof Maguvhe, and he needed to provide documents that were important for the Committee to make a final ruling.
The Chairperson indicated that the programme for the day included Mr Lubisi, Ms Mokhobo, Mr Mavuso and Prof Maguvhe. He noted that the letter of notification to the Board still stood. Board members had been invited to participate from day one. This was to allow them to hear input from all the witnesses and test that input immediately. This arrangement was confirmed with Mr Maguvhe’s legal team the previous morning. Prof Maguvhe walked out with SABC members and did not participate in yesterday's proceedings. The Board was not present again today so witnesses could not be cross examined. When witnesses took the stand, he would allow the SABC Board members the opportunity to ask questions to witnesses to allow transparency and fairness.
Mr Ronny Lubisi - Former SABC board member
The Chairperson read out the oath to the witness, Mr Ronny Lubisi, which stated that according to law he was required to answer fully and satisfactorily all the questions lawfully put to him, or to produce any document that he was required to produce, in connection with the subject matter of the inquiry, notwithstanding the fact that the answer or the document could incriminate or expose him to criminal or civil proceedings or damages. He was however protected in that evidence given under oath or affirmation before a House or a Committee may not be used against him in any court or place outside of Parliament, except in criminal proceedings concerning a charge of perjury or a charge related to the evidence or documents required in these proceedings. He then asked him to sign the oath document.
Mr Ntuthuzelo Vanara, Senior Legal Advisor, Parliament, asked Mr Lubisi to state his full name.
Mr Lubisi stated his name as Mashangu Ronny Lubisi.
Mr Vanara asked whether he was a former member of the current SABC Board.
Mr Lubisi: Yes
Mr Vanara asked if the 21 page statement signed and submitted on 6 December 2016 was Mr Lubisi’s.
Mr Lubisi: Yes
Mr Vanara asked if he had it in his possession.
Mr Lubisi: Yes
Mr Vanara asked if the document could be shared with members of the Committee.
Mr Lubisi: Yes
Mr Vanara asked Mr Lubisi to state his academic qualifications.
Mr Lubisi replied that he was a chartered accountant by profession.
Mr Vanara asked Mr Lubisi when he became involved with the SABC Board.
Mr Lubisi replied that he was initially appointed on 25 March 2013 to the interim Board, and after the expiry of the interim Board, he was appointed to the permanent Board in September 2013.
Mr Vanara said that according to his statement on page 2 it stated Mr Lubisi was appointed to the permanent Board in 2014 and not 2013.
Mr Lubisi replied that it was incorrect. He was appointed to the permanent Board in 2013.
Mr Vanara asked permission to correct this mistake in his statement.
Mr Lubisi replied that he gave permission for such a correction.
Mr Vanara wanted to know about the Board meeting of July 2014 which Mr Lubisi mentioned on page 3 of his statement.
Mr Lubisi replied that yes there was a meeting which took place. It was a bilateral meeting between the Board and the Minister.
Mr Vanara asked what happened at the meeting of July 2014.
Mr Lubisi replied that after the announcement of the new Minister, the Board was to meet with her in July 2014. At that stage, it was the first bilateral meeting between the Board and the Minister. Such a meeting was always to introduce the Minister to the Board and during the meeting the Minister addressed the Board. At that stage the Board was dealing with the Public Protector's Report and in that meeting the Minister raised her concerns, one of which was that the Acting COO, Mr Hlaudi Motsoeneng, was in an acting position for too long and that she needed him to be appointed permanently. However, at that point the Public Protector's Report had not yet been addressed and it made some unfavourable findings against Mr Motsoeneng.
Mr Vanara asked which Minister Mr Lubisi was referring to.
Mr Lubisi replied the Honourable Faith Muthambi.
Mr Vanara asked Mr Lubisi to proceed.
Mr Lubisi said that during the meeting the Minister said the Board had problems and directed questions at each one of the Board members to indicate what their problems were because the Minister's perception was that the Board was dysfunctional. The former Chairperson of the Board, Ms Ellen Tshabalala and Mr Motsoeneng mentioned that the major problem of the Board was specifically Mr Lubisi and Prof Khumalo who were people causing problems for the Board. His personal analysis of the meeting was that there was a prior meeting to discuss these issues. The meeting was used to attack some Board members. The main issue the Minister said she had with himself was that he was using the audit committee to advance his own agenda. The way the Public Protector's Report was handled was that each board committee was allocated a section to deal with and implement the recommendations from the report. He was the chairperson of the audit committee at that time and the objective of the attack was to intimidate members of the audit committee for them not to come up with inputs to the Board on the Public Protector's Report.
Mr Vanara referred to page 3 paragraph 14 of Mr Lubisi’s statement in which he said the former Chairperson Tshabalala and Motsoeneng said that Mr Lubisi and Prof Khumalo were the cause of the problems. Then Mr Lubisi said “incidentally Tshabalala, Motsoeneng and the Minister came late to the meeting and walked in together”. Further Mr Lubisi stated that “it appeared they had discussed the Board prior to the meeting.” Mr Lubisi referred to “they”. Who was he referring to?
Mr Lubisi replied that he was referring to the Minister, Ms Ellen Tshabalala and Mr Motsoeneng.
Mr Vanara asked who the Group CEO was at that time.
Mr Lubisi replied that it was Ms Lulama Mokhobo at that time.
Mr Vanara asked if Mr Lubisi was implying that the Public Protector's Report was the basis for the treatment he received at that meeting in July. What was the basis for that?
Mr Lubisi replied that it appeared they were not happy with the approach the audit committee was coming up with in relation to their input towards the Public Protector's Report recommendations. He was personally attacked as the chairperson of the audit committee and was told that the audit committee had a hidden agenda. But the other members of the audit committee were not mentioned.
Mr Vanara asked who the other members of the audit committee were.
Mr Lubisi replied it was Mr Mhlakaza and Mr Krish Naidoo.
Mr Vanara said Mr Lubisi indicated on page 4 paragraph 12 of his statement that there were allegations made against him of conflict of interest. How did the Board handle this allegation and what was the outcome?
Mr Lubisi replied that in the meeting with the Minister she had indicated he had other interests and was using the audit committee for his own agenda. He did not know what they were talking about. After the meeting he wrote an email to the company secretary asking her to send an email to the Board members to ask them what was meant by “hidden agenda” and what the audit committee was doing wrong. No one responded. Accusations were made to certain Board members during the July 2014 meeting. After that Prof Mughuve came in as Acting Chairperson and he was written a letter saying that Mr Lubisi had a conflict of interest. The letter was not specific as to what the conflict was. It was just stating he had a conflict of interest and Prof Maguvhe had written to the Minister to recommend that he be removed as chairperson of the audit committee. The chairperson of the audit committee was appointed by the Minister. He was not told anything. He just received this letter stating he will be informed of the outcome of the Minister's response. He was not requested to respond. It was never discussed by the governance and nomination committee which looked at the chairpersons of committees.
Mr Vanara asked if Mr Lubisi had a copy of the letter to read it out to the members of the committee.
Mr Lubisi read out the letter dated 19 February 2015 as follows:
“Allegations of lack of compliance with the requirements of section 75 of Companies Act 71 of 2008 as amended, section 53A of the Public Finance Management Act of 1 of 1999 as amended, section 17 of the Broadcasting Act 4 of 1999 as amended.
It has come to my attention that in your capacity as an independent non-executive member of the SABC Board and the Chairperson of its audit committee you have not complied with the legislative requirements to declare your interests in respect of your acting as an auditor of companies doing business with the SABC. It is advisable that under the circumstances you be relieved of your duties as a chairperson of the audit committee as a result of the conflict of interest. I will inform the Honourable Minister Ms A F Muthambi of the above and I will inform you in due course of her decision in this regard.”
Mr Vanara asked from whom the letter came.
Mr Lubisi replied from Prof Maguvhe, acting Chairperson of the Board at that point.
Mr Vanara asked if Mr Lubisi responded to the letter.
Mr Lubisi replied that he did not respond but was sent another letter on 2 March 2015 which asked him to give reasons why an inquiry should not be instituted against him with a due date of 10 March 2015.
Mr Vanara asked Mr Lubisi to explain what then happened.
Mr Lubisi replied that he wrote an email and asked for details on the conflict of interest claims. He received documents for resolutions of the bid adjudication committee whereby some bids were discussed. There were two bids which were discussed as per the minutes of those meetings for two companies named Harambe and Mafoko security services. In the minutes there was a resolution that he was listed as the auditor of these two companies and the committee resolved to inform him the he was listed as the auditor in those companies. If it happened that those companies came before the Board he would be in conflict of interest. Together with this he received the conflict of interest policy as well as the ethics code of the Board. He had in reality never audited these companies and did not even know them. He was not concerned because in the past one needed an auditor to register a company so companies would request an audit letter. He searched and telephonically contacted the companies to explain there was this problem and was given letters from the companies to confirm that he was not the auditor of these companies. During that process he also requested the company secretary to set up a meeting with the acting Chairperson of the Board and she came back saying the Chairperson wanted to know what his agenda was. On 9 March 2015 a governance and nomination committee meeting was held and he received another letter stating that due to the fact that he did not respond to the letters he was sent it would be recommended to the Board that he be removed as chairperson of the audit committee. He responded that he was not the auditor of those two companies and he had evidence to prove it. He then received a notice of a special board meeting to discuss the removal of three Board members. The Board voted and they were taken out.
Mr Vanara asked who Mr Lubisi was referring to that was taken out.
Mr Lubisi replied it was himself, the late Hope Zinde and Rachel Kalidass.
Mr Vanara asked who the complainant was.
Mr Lubisi replied that in his case he was informed it was the bid adjudication committee that informed of his conflict of interest.
Mr Vanara asked who convened the “special Board meeting” at which the acting COO was appointed.
Mr Lubisi said members received a notice that a bilateral meeting would be held with the Minister. The agenda was not related to the appointment of the COO. It happened in the evening around 6pm. He went to the meeting and no documents were handed out. The chairperson at that time, Ms Tshabalala, read out a letter from Mr Motsoeneng’s legal team which stated that he was in an acting position for too long and this letter also mentioned his achievements. There was no advert for the position of COO at the time. It was a very long meeting and problematic for some Board members. They were not agreeing and the decision was put to a vote. The majority of Board members voted in favour of Mr Motsoeneng’s appointment and his appointment was then recommended to the Minister. The following day he was appointed as COO.
Mr Vanara asked Mr Lubisi if he voted in favour or against the appointment of Mr Motsoeneng as COO.
Mr Lubisi replied that he voted against Mr Motsoeneng's appointment because policies were not adhered to.
Mr Vanara asked if the Board had standard meetings for the year.
Mr Lubisi: Yes
Mr Vanara asked if the Board had meetings outside of those standard meetings from time to time.
Mr Lubisi: Yes
Mr Vanara asked if at this special Board meeting where no documents or agenda were handed out, if anyone explained why the meeting was called.
Mr Lubisi replied that he could not remember if the purpose of the meeting was explained.
Mr Vanara asked if any of the other Board members asked why the meeting was called.
Mr Lubisi replied it was not discussed as the meeting was paraded as a bilateral meeting between the Board and the Minister. If the Minister called, who could say no? Documents were read out at the meeting but no one was given a copy. There was no time to peruse the documents and to think.
Mr Vanara asked if the Public Protector's Report was in front of the Board at that time.
Mr Lubisi: Yes
Mr Vanara asked if the unfavourable findings by the Public Protector against the then acting COO played any role in his appointment as permanent COO.
Mr Lubisi replied that they did not.
Mr Vanara asked why those findings did not play any role.
Mr Lubisi replied that there were people on the Board who did not want those findings implemented.
Mr Vanara asked who those people were that did not want the Public Protector's Report implemented.
Mr Lubisi replied that it was unfair to answer the question.
Mr Vanara said it was not unfair because they were Board members.
Mr Lubisi replied it would be difficult to say. The SABC board chairperson (at that time) did not support the Public Protector's Report. When going through the report the chairperson of each committee was given a mandate to come up with recommendations to implement. During that time there were parallel processes happening unbeknownst to them with Mchunu Attorneys being appointed to dissect the Public Protector's Report. He did not remember a Board meeting where the Report was fully discussed as there were those who did not agree with the implementation of the Public Protector's recommendations. At that time people were saying the Public Protector's recommendations were merely recommendations and the Board was not forced to implement them; that was the attitude there. He was sure that the SABC board chairperson at that time did not support the implementation of the Public Protector's recommendations.
Mr Vanara asked if the “side process” Mr Lubisi said he did not know about, was referring to the investigation being conducted by Mchunu Attorneys?
Mr Lubisi confirmed he was referring to that.
Mr Vanara asked if the Board ever made a formal decision to make use of the services of Mchunu.
Mr Lubisi replied that he does not remember the Board saying whatever legal opinion coming out of Mchunu’s report, would be the opinion of the Board. In the end, the opinion of Mchunu was presented as the opinion of the Board in relation to the Public Protector's Report.
Mr Vanara asked if there was ever a Board meeting where the Public Protector's Report was tabled and a decision taken to appoint attorneys to look into the report.
Mr Lubisi replied that the activities of the Board were many, the legal firm was appointed to give legal opinion but the process which the Board agreed on was that the chairpersons of the different board committees had to come and give opinions on how to implement the Public Protector's recommendations. That never happened and became nil at the end. Adopting the Mchunu report as the opinion of the entire Board was not rational because the Board had its own process whereby the chairpersons of committees had to come up with resolutions.
Mr Vanara asked if the skills audit report was available at the time the acting COO was appointed.
Mr Lubisi: Yes
Mr Vanara asked if the skills audit report was one of the issues the Board had to deal with.
Mr Lubisi replied that the skills audit report was not done by the Board at the time. The skills audit report was done by the previous Board before the interim Board. The skills audit was initially discussed by the interim Board and if he remembered correctly the same skills audit report was presented to the Portfolio Committee on Communications at some point.
Mr Vanara asked if the Board received expert advice from the Group Executive: Human Resources about the recruitment process the Board was busy with at that meeting to appoint the permanent COO.
Mr Lubisi replied that no process was followed at all so the GE: HR was not involved at all.
Mr Vanara asked if Mr Lubisi was a Board member at the time when the contract between the SABC and MultiChoice was signed.
Mr Lubisi: Yes
Mr Vanara asked if a Board meeting was held that gave authority to Executive Directors to enter into a contract with MultiChoice.
Mr Lubisi: Yes. The contract was entered into during the time the interim Board was operating. It was not approved by the interim Board but by the previous Board. The interim Board did the implementation.
Mr Vanara asked what the relationship between Board members were like on the current Board.
Mr Lubisi replied that the relationship started out well and a governance review would have given a clearer picture. The previous Board had a governance review done by an independent firm which gave a better view of how the Board operated. It showed the weaknesses of the previous Board and its problems. He felt that the same problems were still there. The audit committee needed that review to be done and by the time he left they were in the process of procuring a service provider to do the same exercise. Governance was falling apart.
Mr Vanara asked what Mr Lubisi meant with his statement that “governance was falling apart”.
Mr Lubisi replied that it was common knowledge that the current Board had failed. They were not following processes and there was no direction to executives. Executive directors of the Board should not have been involved in some processes. The whole setup from the legislation itself and the appointment of some executives was a problem. Decisions were also taken without proper documentation and the company secretary became lost in the whole picture because if one was a proper company secretary one would give proper direction to the Board ensuring that documentation was available at meetings. He felt lied to in order to attend meetings being told it was with regards to something, when it would be related to something else. That was a clear lack of governance. Also the number of special meetings was indicative that governance was falling apart.
Mr Vanara asked Mr Lubisi to explain the investigation that was done on Board members by the company secretary and if the report of this investigation formed the basis of the allegations against Mr Lubisi.
Mr Lubisi replied that in the first meeting with the Minister she indicated that she needed a one on one with Board members because she felt that the Board was dysfunctional. When he arrived for his meeting with the Minister he found that she was not present. Instead, he met with a legal advisor and another gentleman. To his surprise he found that the company secretary had prepared a report on him and each Board member and some allegations were read to him. Conflict of interest was one of the allegations. He requested a copy of the report and evidence to support the allegations.
Mr Vanara asked if ever a Board meeting was held where the Board empowered the company secretary to conduct investigations on the behaviour of the Board members.
Mr Lubisi replied there was never such a meeting and her report was never served on the Board. The company secretary was an employee and an employee could not investigate a fellow employee. He did not expect the company secretary to have an interaction with the Minister without the Board knowing, yet the company secretary’s report went to the Minister.
The Chairperson commented that the MultiChoice contract was one of the documents that the Committee requested from the Board. He advised committee members not to go into the actual detail of the contract until the contract was available.
Mr Waters (DA) suggested that the Chairperson give committee members five minutes each to ask questions and receive answers. In that manner members would be provided with more clarity.
Mr S Swarts (ACDP) said that Mr Waters made a good suggestion. He asked if Mr Lubisi’s statement had been handed in as evidence.
Mr Vanara replied that it would be admitted into evidence together with the annexures and marked as A1.
Dr M Khoza (ANC) asked why the members did not have the annexures.
The Chairperson replied that it was a whole arch lever file of annexures and it might be costly to copy it for all members, but it could be made available.
Mr F Mokoena (EFF) asked Mr Lubisi if the current Acting Group CEO was appointed at the time when Mr Lubisi was part of the internal audit committee.
Mr Lubisi: No
Mr Mokoena asked if he was appointed as Acting Group CEO at any time during Mr Lubisi’s tenure.
Mr Lubisi: No
Mr Mokoena asked if Mr Lubisi was stating that the SABC had an internal audit committee.
Mr Lubisi: Yes
Mr Mokoena said that a statement made by the Acting Group CEO was that he did not know of this internal audit committee and that it did not exist.
Mr Lubisi felt that this was using semantics because the audit committee can be known by many names but the audit committee had been there all along.
Mr Mokoena asked if the Board was in possession of the Public Protector's Report at the meeting with the Minister when she suggested that the acting COO be appointed in full capacity because he had been acting for too long.
Mr Lubisi: Yes
Mr Mokoena asked if the Minister was present at the evening meeting where the COO was then appointed.
Mr Lubisi replied that the Minister was not present but she was around the SABC.
Mr Mokoena asked if the Board was in possession of the Public Protector's Report when the acting COO was appointed as permanent.
Mr Lubisi: Yes
Mr Mokoena asked what the relationship between the current Board chairperson and the Board was and how did the decline of the Board take place.
Mr Lubisi replied that it had to do with governance issues which resulted in the disintegration of the Board.
Mr J Mahlangu (ANC) asked if Mr Lubisi had conducted risk analysis
Mr Lubisi: Yes, this was done.
Mr Mahlangu asked if risk management was a top down approach.
Mr Lubisi replied that there were some strategic risks which were the responsibility of the Board.
Mr Mahlangu asked if the Board put all the risk indicators in place as they should have been.
Mr Lubisi replied that there were risk factors in place.
Mr Mahlangu asked if any of those risk factors indicated the demise of the Board.
Mr Lubisi said he was not sure. The governance review was a good practice and needed an independent view.
Mr Mahlangu asked if there were any issues from the previous Board which needed to be looked at by the interim Board.
Mr Lubisi replied that he would not specifically know but governance was always an issue at the SABC.
Mr Swarts wanted to confirm that Mr Lubisi was appointed in March 2013 and the meeting with the Minister took place in July 2014 where certain issues were raised with regards to the permanent appointment of Mr Motsoeneng. Also Mr Lubisi favoured the implementation of the Public Protector's recommendations. After that the allegations of conflict of interest surfaced against him. Was it not strange to Mr Lubisi?
Mr Lubisi replied that he was not surprised because he knew why it was taking place because he opposed the appointment of Mr Motsoeneng.
Mr Swarts asked if Mr Lubisi felt that there was no basis for the conflict of interest allegations and if this was the basis for his litigation against the SABC.
Mr Lubisi replied that he firmly believed there was no basis for in the conflict of interest allegation against him. He felt that the Portfolio Committee did nothing to help. The Committee was written to but they never protected Board members and left them exposed.
Mr Swarts asked if another reason Mr Lubisi was removed could be because he requested further forensic investigations to be done to support the Public Protector's findings.
Mr Lubisi: Yes. There was more to what the Public Protector's Report found, about the unauthorised and irregular expenditure.
Dr Khoza asked for clarity in Mr Lubisi’s statement when he made reference to the dissolution of the Board. How many members were remaining at the point it was dissolved.
Mr Lubisi replied that all the Board members resigned.
Dr Khoza asked for the relationship between the qualifications of the former chairperson of Board and the findings of the Public Protector which might have tipped the Board towards the attitude it took to the Public Protector Report.
Mr Lubisi replied that he could not link the two.
Dr Khoza asked Mr Lubisi to characterize the financial position of the SABC, especially on the quality of financial information.
Mr Lubisi felt there was no problem with the quality of financial information but a lot of work was done to address the 2012/13 disclaimer by the Auditor General. He did not know the SABC financial status currently as he was not involved in it since his departure from the SABC in March 2015.
Dr Khoza asked how performance bonuses were calculated in the absence of a performance management system and the AG picked up weak internal audit controls. What was Mr Lubisi’s view?
Mr Lubisi replied that SABC used consultants a lot especially in the financial division of the organisation at the time and it had a plan to capacitate the financial division. There were many vacancies at the time therefore internal audit controls were falling apart. By the time he left, the SABC was in the process of filling those vacancies.
Ms F Loliwe (ANC) asked if it was a common practice to absorb acting executives into positions.
Mr Lubisi replied that it was not a common practice. There was a structural challenge with regards to who appointed whom. The standard practice is that the Board appointed executives but the Memorandum of Incorporation was changed and now executives were appointing themselves and the Board was not involved. It became a problem because positions were no longer advertised and people were merely appointed. This happened subsequent to his departure.
Ms Loliwe asked what Mr Lubisi meant with his statement in paragraph 19 that the Minister's inputs were not audible. Was there any other form of evidence available to indicate what the Minister had said in the meeting held in July 2014?
Mr Lubisi replied that from the transcripts he was given it stated that the Minister's inputs were not audible on the actual recording.
Ms Loliwe asked if Mr Lubisi challenged any of the decisions the Board took since there were no proper documents available to take those decisions.
Mr Lubisi: Yes.
Ms Loliwe asked how many Board members heeded the Minister's call to resign.
Mr Lubisi replied that the Minister wrote letters to only five Board members.
Mr Waters asked if the audit committee kept minutes of its meetings.
Mr Lubisi: Yes
Mr Waters asked if these minutes were available.
Mr Lubisi replied: Yes
Mr Waters asked when the Minister raised the issue of the acting COO being in an acting position for too long, was there anyone who raised the Public Protector's Report with the Minister which indicated unfavourable findings against Mr Motsoeneng’s qualifications.
Mr Lubisi replied that the issues the Minister raised were not meant for comment from the Board.
Mr Waters asked if Mr Lubisi ever got the report which the company secretary sent to the Minister.
Mr Lubisi: No
Ms P Van Damme (DA) asked if the previous Minister, Mr Yunus Carrim, ever attended Board meetings.
Mr Lubisi: Yes. These were called bilateral meetings.
Ms Van Damme noted in Mr Lubisi's statement that right from the start, Minister Muthambi adopted quite a hostile attitude. What was the Minister’s demeanour at the July 2014 meeting when she suggested that Mr Motsoeneng be appointed permanently?
Mr Lubisi replied that he took it as a comment because he thought it would never happen. He did not feel that her attitude was hostile.
Ms Van Damme asked what Mr Lubisi meant by "the Minister adopted a hostile attitude".
Mr Lubisi replied that it was based on subsequent events where the company secretary was tasked with investigating Board members. The subsequent letters from the Minister were not nice letters.
Ms Van Damme said she was particularly interested in the conflict between the Companies Act, the Broadcasting Act and the Memorandum of Incorporation. It seemed as if the Board and the Minister picked and chose from each Act as it suited them. For Parliament's purposes the Broadcasting Act was the Act that governed the SABC. When Mr Lubisi was dismissed, it was according to the Companies Act and not the Broadcasting Act which required a process to take place. What was the outcome when Mr Lubisi raised this with the Minister and the Board?
Mr Lubisi replied that it was important to go through the letters which the Minister wrote to Board members. The Minister acknowledged that she could not remove them and it was then delegated to Mr Maguvhe to take them out.
Mr H Chauke (ANC) asked if Mr Lubisi’s understanding of the remedial action recommended by the Public Protector's Report was the reason he was taken out, as he wanted to implement the findings.
Mr Lubisi replied that the issues the Public Protector raised were more HR orientated, such as people lying about their qualifications, salary increases without a process, appointment of people without processes. He felt 90% of the issues were HR related and it would be good to get the minutes of the HR committee meeting to see the recommendations it made to the Board. The main recommendation was to implement a disciplinary process against Mr Motsoeneng.
Ms J Kilian (ANC) asked if the Board provided facilities for Prof Maguvhe’s disability.
Mr Lubisi: Yes. The Board acquired equipment for Braille conversion of documents.
Ms Kilian said the Public Protector's Report was released in February 2014 and the meeting with the Minister took place in July 2014. She asked when the Public Protector Report was tabled by the Board.
Mr Lubisi replied that he did not remember exactly when the report was tabled as it was a long process.
Ms Kilian asked how the process worked with this meeting when the Minister was called in and the meeting was “converted”.
Mr Lubisi replied that when a new Minister came in, he/she would meet with all entities reporting to him/her. Now and then there would be a meeting held with the Minister. This specific meeting held in July 2014 was the first one where the Minister introduced herself to the Board.
Ms Kilian asked if the July 2014 meeting was to appoint the acting COO permanently.
Mr Lubisi: No. His appointment happened at a subsequent meeting.
The Chairperson asked if Mr Lubisi, as the chairperson of the audit committee, had a policy in place which regulated record keeping.
Mr Lubisi: Yes, there was a document control policy in place.
The Chairperson said that he had requested internal audit committee reports from the Board and he was told these were not available because the Board did not have them.
Mr Lubisi said all meetings were recorded and minutes were produces. Proper record keeping was done.
The Chairperson asked if there were examples of content in the audit reports which might have threatened the commercial interests of the SABC.
Mr Lubisi: No. Most things were public knowledge.
The Chairperson noted for the record that Mr Lucky Kagiso, who represented the Board chairperson, responded to the Committee that certain documents could not be provided as its disclosure may negatively affect the commercial interests of the SABC.
Ms Lulama Mokhobo – Former Group CEO
Ms Lulama Mokhobo was sworn in under oath by the Chairperson and asked to sign the oath document.
Mr Vanara asked Ms Mokhobo to state her full name.
Ms Mokhobo stated her name as Lulama Patricia Mokhobo.
Mr Vanara asked Ms Mokhobo what her position was at the SABC.
Ms Mokhobo replied that she was Group CEO.
Mr Vanara asked Ms Mokhobo for the period in which she was employed at the SABC.
Ms Mokhobo replied that her contract was from 16 January 2012 and her tenure was supposed to end around the same date in 2017.
Mr Vanara asked what the link between the Board and Administration was like.
Ms Mokhobo replied that it was according to Company Law. However, the Board had a significant leaning towards Mr Motsoeneng and as a result her ability was severely tampered with. She ceased to be the normal link between the Board and Administration.
Mr Vanara asked in what ways was Ms Mokhobo’s ability tampered with.
Ms Mokhobo replied that there were many instances where Mr Motsoeneng had meetings with the Board chairperson and other Board members without her knowledge or presence. Things were planned which she was unaware of and frequently she would be made to look as someone who did not know what she was doing. She would be juniorised to a degree that it seemed Mr Motsoeneng was “the go to man”. Her role was largely confined to a position of ensuring that the company came back to financial stability. She was given a very strong mandate by Dr Ben Ngubane, Board chairperson, to ensure that the government guarantee requirements and austerity measures were implemented and there were other requirements which she had to meet. Some were impossible to do purely because it had to be done over a period of time. The key one was putting key financial controls back in place. She did that with the support of the Board which saw the importance of that work. The SABC reported a profit at the end 2013 and 2014 and the substantial profits had to do with prudent financial management.
Mr Vanara noted that as a group executive Ms Mokhobo drove a certain strategy derived from the Board. Other than the government guarantees, what were other orders given?
Ms Mokhobo replied that there were serious concerns about the Auditor-General findings in previous years. The concern was the audit findings needed to be turned around rapidly. The launch of the 24 hour news channel was another critical component of being able to test the SABC’s capability to run such a channel. Another concern had to do with the skills in the organisation, with the area of finance having a big shortage of critical skills. It was proposed to the Board to do a skills audit, geared towards skills in the organisation which could be improved.
Mr Vanara asked when Ms Mokhobo left the SABC.
Ms Mokhobo replied her last day at the SABC was 28 February 2014.
Mr Vanara asked at that stage how far had Ms Mokhobo gone to implementing the mandate given to her by the Board.
Ms Mokhobo replied that the skills audit had been completed and was presented to the Portfolio Committee on Communications. The news channel was launched and financial management drastically improved. The SABC had received a disclaimer in 2012/13. The HR policies became a contentious issue because processes were largely protracted through the unions.
Mr Vanara asked what the relationship was like between Ms Mokhobo and the Board under which she served.
Ms Mokhobo replied that the relationship between Board members themselves was highly fractious. The Portfolio Committee on Communications was exposed to huge fights that were happening between Board members. Part of the problem was the “camps” which the Board itself created.
Mr Vanara asked during the time of which Board was this happening?
Ms Mokhobo replied that it happened during the time that Dr Ngubane was chairing the Board. Fights would spill over into the media which was hugely embarrassing. There were Board members who seemed to surround Mr Motsoeneng very tightly and there were those who seemed to be the “Lulama Board”. It was very uncomfortable. The governance review showed that executive meetings were not run very well. These meetings would be undermined by Mr Motsoeneng. She would have to fight to have people stay. The extent to which she was undermined was unbearable. Many things were said about her and the organisation saw her as a weak leader.
Mr Vanara asked who those people were that were seen to be around Mr Motsoeneng and those around Ms Mokhobo.
Ms Mokhobo replied that it was not easy for her to say but she had mentioned that Dr Ngubane was very close to Mr Motsoeneng and there were another four members who were very close to Dr Ngubane.
Mr Vanara said that Ms Mokhobo was the leader. Why did she not try and discipline Mr Motsoeneng within the confines of the law.
Ms Mokhobo replied that she raised the matter and requested that Board members assist her in removing Mr Motsoeneng. How things worked at the SABC was that one had to lobby Board members to get them to understand where one was going and she raised the fact that there appeared to be a misunderstanding on Mr Motsoeneng’s part on what his role really was. Her suggestion to the Board was that Mr Motsoeneng be found a different role. She was in absolute shock when the following day, or perhaps it was the same day, Mr Motsoeneng marched into her office absolutely furious, telling her that she should not forget that if it was not for him she would not be at the SABC, and that some Board members were so angry at her that she could possibly be fired. After that rumours started to emerge that she would not be at the organisation beyond August 2013. Suddenly stories were being planted about her in the newspaper, to make her look dishonest and dishonourable to the worst degree. It was a very painful period for her.
Mr Vanara asked which Board members Ms Mokhobo approached to lobby with her to remove Mr Motsoeneng.
Ms Mokhobo replied that she could not name them as she could be accused of slander.
Mr Vanara asked how often the delegation of authority framework was reviewed during Ms Mokhobo’s time at the Board.
Ms Mokhobo replied that when she was at the SABC, the Board applied the old delegation of authority framework which was very clear and consistent and had delineated responsibilities. Towards her departure from the SABC, a review was being done, which gave the executive far more power.
Mr Vanara asked during Ms Mokhobo’s time at the SABC, how did the Board oversee its delegated power to the executive?
Ms Mokhobo replied that there were Board sub-committees of the Board formed which worked directly with the group executive in receiving strategies and reports.
Mr Vanara asked if the sub-committees could make any binding decisions or if it made recommendations to the Board.
Ms Mokhobo replied that it made recommendations to the Board.
Mr Vanara asked if there was any document which contained these rules.
Ms Mokhobo replied it was contained in the delegation of authority framework document.
Mr Vanara asked Ms Mokhobo why she resigned from the SABC.
Ms Mokhobo replied that there were several periods where the Board chairperson disagreed with her decisions. She ran head-on into Mr Motsoeneng and the chairperson. Their relationship deteriorated to the point where there were unbecoming arguments. Things got to a point where the rumour mill started again and there were talks about her being suspended; and she was a shareholder at eTV and had children working at eTV. At that point staying on at the SABC did not make sense to her at all. Also she believed she had done substantial work and her team had made headway in turning the finances around at the SABC.
Mr Vanara asked how the financial performance was at that stage.
Ms Mokhobo replied that finances were very viable. The SABC made profits of over R300 million that year and R200 million the previous year. At that moment the SABC had over R1 billion in the bank. The government guarantee was paid off and all other debts were settled.
Mr Vanara asked if Ms Mokhobo was given the mandate to implement austerity measures.
Ms Mokhobo replied that they had gone quite a way towards stabilizing finances. Mr Aguma was appointed by Mr Motsoeneng and he was very useful in helping to establish a proper auditing system. Previously the SABC had big problems with media houses shutting down because the SABC could not pay them, and these media houses were slowly coming back.
Mr Vanara said according to the editorial policy, Ms Mokhobo was considered the Editor in Chief. He asked how she managed to ensure that news independence was maintained.
Ms Mokhobo replied that the news team had to play a role in providing news without fear or favour and ensuring that a balance of views was captured. The head of news and his team had the right to freedom to choose to cover any news. However, if complaints were received about certain views being given undue coverage and others being suppressed, then she would give her opinion and assist where it was necessary.
Mr Vanara asked how the Public Protector's Report was handled.
Ms Mokhobo replied that she left the organisation on 28 February 2014 just after the report was released. She was not there when any work was done on the report. The Public Protector was concerned about salary increases given to Mr Motsoeneng but Ms Mokhobo was only involved in one instance where a salary increase was given to Mr Motsoeneng. This happened when the organisation went through the process of parity. One of the instruments was to look at what salaries were being paid at a certain level and if indeed salaries were below par. If the person was delivering, then the salary would be reviewed. Mr Motsoeneng complained that his salary was way too low, accolades were given by the Board to increase his salary and a new salary was put down. It was then up to the Board chairperson to approve it. The Board chairperson agreed and that was the salary which was approved.
Mr Vanara asked if the Board chairperson was a non-executive member.
Ms Mokhobo replied that the Board chairperson could, on behalf of the Board, make certain decisions. Issues of parity were being handled along these lines.
Mr Vanara asked if there was any performance management system at the time and if any performance bonuses were paid to staff members.
Ms Mokhobo replied that when she left the SABC, a performance management system had been designed and was ready to be implemented. There was a stoppage on bonuses due to austerity measures. Performance bonuses had to be linked to actual performance at executive level. At lower staff level there would be a 13th cheque. No performance bonuses were given during her time there.
Mr Vanara asked what the role of the Board was with regards to the MultiChoice contract.
Ms Mokhobo replied the broadcast digital migration policy, which is what had informed development around DTP, came with a provision for set top box control to be included in the new set top boxes. In fact that would enable the public to access e-services; they could get onto the internet and work on the internet right from home. It did not matter how poor people were. If they had a set top box with a written path it would be able to do that. Sadly this was seen as a way to enrich a few manufacturers which did not make sense and there was a strong drive not to include it. Even the MultiChoice agreement consisted of the non-inclusion of that. That was when she felt that she needed to go, where relations had deteriorated to the point of no return. During the week when the contract was signed, she was on leave, and in her absence the contract was pushed through and signed.
Ms Kilian said Ms Mokhobo started working at the SABC during a serious period. She wanted to know when Ms Mokhobo determined that there were factions within the SABC.
Ms Mokhobo replied that there were a number of incidents which happened. During the time when Dr Ngubane was the Board chairperson it did not affect her as badly but when Ms Tshabalala became chairperson, the negativity around her started. Meetings were being held with executives without her presence. In general it became untenable. During Dr Ngubane’s time, as the chairperson he would calm her but when Ms Tshabalala came, it was extremely difficult.
Ms Kilian asked how it came about that Mr Motsoeneng was appointed and what was Dr Ngubane’s role in that.
Ms Mokhobo replied that the Board had prior to her appointment done a structural review and the decision to appoint Mr Motsoeneng was done before she was at the Board. But it was entirely a board decision.
Ms Kilian asked how the Board dealt with the interim Public Protector's Report.
Ms Mokhobo replied that the interim report went to the Board chairperson but she could not recall if it was ever discussed at the Board. Certain questions were given to her and she was asked to give her responses which she did. Being an interim report it was not dealt with vigorously.
Mr Chauke asked if the allegations of Ms Mokhobo’s children working at eTV were true.
Ms Mokhobo replied that it was completely false.
Mr Chauke asked if Ms Mokhobo ever challenged newspaper reports about her through the Ombudsman.
Ms Mokhobo replied that she was naïve thinking that people did not know who she was and therefore she did not take the matter to the Ombudsman. There were reports stating she was given the amount of R11 million in eight months which was completely untrue. The correct thing to do was to defend herself.
Mr Chauke asked if Dr Ngubane ever intervened when Ms Mokhobo was attacked.
Ms Mokhobo replied that she tried several times to inform Board members including Dr Ngubane but she felt her complaints were seen as her being a “cry-baby” and that others felt she did not want to take responsibility for anything.
Mr Chauke asked how Ms Mokhobo could have been so comfortable knowing there were allegations going around with regards to her getting R11 million in increases.
Ms Mokhobo replied that she did not have the strength to respond to those allegations. It would have been a long drawn out matter in the end.
Ms Van Damme asked if the MultiChoice deal was finalised in Ms Mokhobo’s absence.
Ms Mokhobo: Yes. The deal was signed by Mr Motsoeneng and the Board chairperson.
Ms Van Damme noted that in the Public Protector's Report remedial action had to be taken against those involved in approving Mr Motsoeneng’s salary increases from R1.4 million to R1.7 million and then from R1.7 million to R2.4 million in the space of one year.
Ms Mokhobo replied that she was involved when the second increase was approved. The first increase was done before she was at the SABC.
Ms Van Damme asked how much the settlement was that Ms Mokhobo received when she left the SABC.
Ms Mokhobo replied that she received the equivalent of one year’s salary plus benefits and allowances totalling an amount of around R4 million.
Ms Van Damme said that the Public Protector's Report came out in February and Ms Mokhobo left at the same time. Ms Mokhobo would have seen the interim report which recommended that disciplinary measures be taken against her. The impression created was that Ms Mokhobo left the SABC because of the Public Protector's Report which was coming out.
Ms Mokhobo replied that the discussion of her departure started as early as November the previous year so this was not the case.
Mr Waters asked Ms Mokhobo if she signed a confidentiality clause with the SABC when she left.
Ms Mokhobo replied that she had signed a confidentiality clause.
Mr Waters asked if Ms Mokhobo was aware of any fraudulent or illegal activities taking place at the SABC.
Ms Mokhobo replied that the Special Investigating Unit report (SIU) was the most telling of illegal and fraudulent activities taking place.
Mr Waters asked why Ms Mokhobo was concerned about the confidentiality clause that she signed with the SABC, in coming to Parliament.
Ms Mokhobo replied that she was threatened that things she divulged in Parliament would be used against her and there was talk of people being sued.
Mr Waters said Mr Motsoeneng had two salary increases. Ms Mokhobo mentioned that the Board chairperson had a leaning towards him.
Ms Mokhobo replied that they were exceptionally close.
Mr Waters asked if their closeness was not a concern.
Ms Mokhobo replied that there were reports which spoke good things about Mr Motsoeneng, that he was exceptional. When the request for the salary increase came to her, she did not have a leg to stand on; it was also about parity. A lot of adoration was poured on Mr Motsoeneng.
Mr Waters asked if Ms Mokhobo refused to sign off on contracts.
Ms Mokhobo replied that there was a contract related to the collection of VAT revenue from SARS and the proposal was that the process be given to a third party. There was a treasury department at the SABC to do that and therefore she said no.
Ms Loliwe felt that Ms Mokhobo was telling her story as if she was a victim of constructive dismissal. Why did she not decide to challenge it?
Ms Mokhobo replied that she was just a human being and she was exhausted. She felt there was nothing more to do. She could not force herself to stay on at the SABC and left to protect her family.
Ms Loliwe asked if the SABC provided Braille for Mr Maguvhe.
Ms Mokhobo: Yes
Ms Loliwe asked if Ms Mokhobo felt that there were any shortcomings in the Memorandum of Incorporation.
Ms Mokhobo replied that she had not engaged with the new Memorandum of Incorporation thoroughly yet because she left at that point. It sought to supersede the Broadcasting Act and the Broadcasting Act was superior to the Companies Act and addressed the entity; it was not just a generalised document.
Dr Khoza said that Ms Mokhobo indicated that it was during Ms Tshabalala’s tenure when her operational ability was severely negatively impacted upon. How would Ms Mokhobo characterize the relationship between Mr Motsoeneng and Dr Ngubane and the relationship between Mr Motsoeneng and Ms Tshabalala?
Ms Mokhobo replied that it was a difficult question but the relationships were completely wrong. The CEO should be the head and the COO had to ensure that operations ran smoothly. The reporting lines had to be between CEO, COO and CFO. From a Board management perspective, the first line had to be CEO.
Dr Khoza asked what the R3.4 billion irregular expenditure as per the AG report was attributed to.
Ms Mokhobo replied it was largely the misreporting problem with systems not applied appropriately. It had to do with approvals not being awarded correctly. Individual projects were done but not as a process through approval lines. Expenses were not accounted for according to normal accounting. On the SABC television side, there were peculiar problems such as the greenfield contracts where a contract would go on and on and the programming could not used because there was no space. International content was bought and not used.
Mr Mahlangu asked who the appointing authority for the SABC was at senior levels.
Ms Mokhobo replied that the positions of CEO, CFO and COO were appointed by the Board with the assent of the Minister. The group executive positions were appointed by the Board and the Minister would be informed of the appointments.
Mr Mahlangu asked if Ms Mokhobo in her capacity of group executive made any irregular appointments
Ms Mokhobo: No
Mr Mahlangu asked if Ms Mokhobo knew that Mr Motsoeneng did not have qualifications.
Ms Mokhobo: Yes
Mr Mahlangu asked what Ms Mokhobo did when she found out that Mr Motsoeneng was not suitably qualified.
Ms Mokhobo replied that when she was notified that Mr Motsoeneng had no qualifications, the Board still had the attitude of “wow, look what he is doing” and the excuse was that Mr Motsoeneng was extremely talented.
Mr Mahlangu asked if there were any documents which were commercially sensitive at the SABC.
Ms Mokhobo replied that the only commercially sensitive documents would be the agreements between SABC and international content suppliers as well as agreements between SABC and the advertising fraternity.
Mr Mokoena said that he was trying to understand the power dynamics at the SABC. Mr Motsoeneng went through three or four tenures of Board chairpersons that were in favour of him. He wanted to know who gave Mr Motsoeneng power.
Ms Mokhobo declined to answer.
Mr Mokoena asked what the relationship between Minister Carrim and Chairperson Tshabalala was like.
Ms Mokhobo said it was uncomfortable.
Mr Mokoena asked if Mr James Aguma was appointed as CFO by Mr Motsoeneng.
Ms Mokhobo: Yes
Mr Mokoena asked if it was a fair process.
Ms Mokhobo replied that Mr Aguma was a highly qualified man and had worked at the Auditor-General. He was headhunted and it made sense when he came in.
The Chairperson asked if there was any reason why the skills audit report could not be made available to the Committee.
Ms Mokhobo: No. It was presented to the Portfolio Committee on Communications as well. The skills audit did not point to anyone by name. It merely looked at percentages.
Mr Mokoena asked if the threats that Ms Mokhobo spoke about came from people within the SABC.
Ms Mokhobo: Yes
Mr Waters said the Committee was trying to get an idea of what was happening at the SABC. Two questions from the EFF member were not answered which was where did Mr Motsoeneng get his power from and who was threatening Ms Mokhobo. The Committee had to know these things.
Dr Khoza felt that the Committee had to be fair with witnesses if they did not feel comfortable answering certain questions.
The Chairperson suggested that he would have a private conversation with Ms Mokhobo to address those questions which she did not feel comfortable answering publicly.
Mr Vusi Mavuso – Former Board Member
Mr Mavuso was sworn in under oath by the Chairperson and asked to sign the oath document.
Mr Vanara asked Mr Mavuso to state his full name.
Mr Mavuso stated his name as Vusumizi Mavuso.
Mr Vanara asked if Mr Mavuso’s statement could be handed in as evidence.
Mr Mavuso: Yes
Mr Vanara asked what Mr Mavuso meant in paragraph one of his statement.
Mr Mavuso replied that before he became a Board member, he was quite aware of some of the dynamics that happening in the Board. With the information he received from the governance review, it was quite evident that what happened at the Board under the chair of Dr Ngubane were problems with the relationship between Board members and also between Board members and the executive.
Mr Vanara referred to paragraph three of page one of Mr Mavuso’s statementwhere the governance review process had been undertaken by the previous Board. What were the findings of the governance review?
Mr Mavuso replied that amongst the issues raised in the review was the extent to which meetings would be arranged outside of the diarised meetings of either the Board or the Board committees. There was an excessive proportion of meetings being undertaken which would appear to be inappropriate. Also, the body language which took place between some of the Board members and executives was in itself inappropriate.
Mr Vanara asked what Mr Mavuso meant by body language between the Board members and executives.
Mr Mavuso replied that the first point of call of any organisation or institution would be the CEO. An anomalous situation was present at the SABC Board whereby Board members could go directly to members of the executive without going through the CEO. He felt that it did not bode well for governance because it suggested that something was happening which should not be.
Mr Vanara asked on which board committees did Mr Mavuso serve.
Mr Mavuso replied that he served on the HR and remuneration committee, the public broadcasting services (PBS) committee dealing with broadcasting matters, the risk committee and the social and ethics committee.
Mr Vanara asked what Mr Mavuso meant in his statement about the risk register was not adhered to.
Mr Mavuso replied that he was referring to a previous audit done by a company on behalf of the SABC.
Mr Vanara asked how the Board ensured that deficiencies identified by the AG were attended to by the executives.
Mr Mavuso replied that, subsequent to receiving audit disclaimers, there was progression in trying to deal with these matters and Ms Mokhobo ensured that those audit matters were attended to. Other issues were outside of the organisation such as licences which was a sticking issue and still was. What had since transpired was a regression which had to do with leadership. The oversight role that the Board had over the executives was undermined.
Mr Vanara said that Mr Mavuso had a fiduciary duty towards the public. What did Mr Mavuso do to address the challenges that he pointed out.
Mr Mavuso replied that he always spoke out when it was necessary.
Mr Vanara asked if he was alone in the Board in seeing this regression. If not, what were other members of the Board doing to address this regression?
Mr Mavuso replied that he was not alone. There were others who were quite vocal who expressed their views quite sharply like Prof Khumalo, Mr Krish Naidoo, Mr Ronny Lubisi, Ms Kalidass, Ms Zinde and Adv Thembinkosi Bonakele. They all expressed their views and more often than not their views would end up being the minority.
Mr Vanara asked if the Board gave executives the necessary support to execute the strategic objectives.
Mr Mavuso replied that the Board did its best to support the executives.
Mr Vanara said there was a complaint from Ms Makhobo which raised a lack of support from the Board in certain instances.
Mr Mavuso replied that the implementation of the strategies was done. It was the duty of the Board to provide oversight to ensure the implementation of strategies was done. He was not aware of instances where that did not happen so there was a difference in his opinion from Ms Mokhobo’s.
Mr Vanara asked if the Minister Muthambi raised any issues at her first meeting with the Board and shareholder.
Mr Mavuso replied that the Minister arrived at a strategic retreat of the HR committee that was held in Magaliesberg between 2 and 3 July 2014. She appeared out of the blue because she was not invited. The programme then had to be changed to accommodate her arrival. She indicated that the Board was dysfunctional and this had to be remedied as a matter of urgency. Some members were chided for undermining the authority of Chairperson Tshabalala and some of the executives.
Mr Vanara asked who was responsible for delegating the Board functions to the executives as per the delegation of authority framework.
Mr Mavuso replied that the delegation of authority framework arose out of the amended version of the Memorandum of Incorporation. Ordinarily, the Memorandum should be amended by the Board but it was done by the Minister; it bore her signature, not the signature of the Board chairperson. That Memorandum of Incorporation changed a number of things including the responsibilities which would have ordinarily resided with the Board but were then transferred to the executive. It then gave rise to the delegation of authority framework being accordingly amended. He felt it was quite problematic.
Mr Vanara asked what the Board did when its powers were taken away and given to the executives.
Mr Mavuso replied that he was quite alarmed because it was an abnormal and unfortunate situation, and he left it at that.
Mr Vanara asked if Mr Mavuso ever raised his views in the Board meetings.
Mr Mavuso replied that he raised his views with his some of his colleagues. It was unfortunate that it did not resonate with the entire Board for it to be reconsidered. He felt that there was a solid line of divide between Board members which led to some Board members resigning prematurely.
Mr Vanara asked if the Public Protector's Report was ever served on the Board.
Mr Mavuso replied that at the point when the Public Protector's Report was released, Ms Kalidass in a Board meeting was able to download it and share it. It became apparent that an interim report was released earlier which none of the Board members had sight of. The Board addressed this and Chairperson Tshabalala said the interim report was addressed to her specifically; it was confidential and she could not share it with the Board, which was very odd. A month after the Report was released, it was split into sections and each board committee had a section to deal with. There was a law firm appointed to help the Board deal with the Public Protector's Report. Findings from the Public Protector's Report were not handled appropriately. Issues dealing with Mr Motsoeneng’s appointment had to be addressed by the HR committee but it was not and that was quite problematic.
Mr Vanara asked that as a Board member, giving the Ad Hoc Committee an objective view, could the Public Protector's Report have been handled in a different way?
Mr Mavuso replied that it was not handled in the correct way. With the necessary passion and preparedness, it could have been done differently but it was not.
Mr Vanara asked about the special Board meeting relating to the appointment of the acting COO as the permanent COO.
Mr Mavuso replied that after the meeting on 2 and 3 July, an urgent meeting was held on 7 July. It was after the meeting with the Minister in Magaliesberg that they received an urgent meeting scheduled for the 7th. It was planned with the Minister for the evening around 6 pm. Upon arrival, the Minister was not present. Instead the Board chairperson told the Board there was an instruction to execute which related to the appointment of the COO. She flashed a letter reportedly coming from Mr Motsoeneng’s lawyers indicating that he had been in an acting position for too long and stated that he had to be appointed full time. Mr Mavuso raised the concern that due process had to be followed, the position had to be advertised, a job description had to be created, minimum requirements of the position had to be stated, shortlisting and interviews had to take place. After that three names of candidates had to be submitted to the Minister for her consideration but none of those processes were followed or took place. It was like a “skop, skiet and donner” whereby Board members were cajoled into a decision. It was a long meeting up until about 11pm and the decision was then put to a vote where the majority of Board members decided that Mr Motsoeneng must be appointed COO.
Mr Vanara asked what Mr Mavuso’s vote was.
Mr Mavuso replied that he abstained from voting.
Mr Vanara noted that the Western Cape High Court found the appointment of Mr Motsoeneng as unlawful and irrational. Was it a surprise to Mr Mavuso?
Mr Mavuso replied that, on the contrary, he was vindicated.
Mr Vanara asked how the Board exercised financial oversight over the executives.
Mr Mavuso replied that ordinarily a number of board committees were set in place but specifically the audit committee which dealt with audit matters, finances, the procurement of goods and services and dealt with financial oversight. Certainly the CFO and the CEO would report to the committee who would then make recommendations which had to be ratified by the Board.
Mr Vanara asked who decided to approve the decision on local content; the 90/10 per cent for local content on radio and 80/20 percent local content for television. Was the Board ever involved in the development of this policy decision?
Mr Mavuso replied that the public and commercial broadcasting services committee had to deal with it but it never came to the committee. Mr Motsoeneng said it took him 10 minutes to take the decision and to implement the decision. It was never placed before the Board.
Mr Vanara asked what the Board did in this scenario.
Mr Mavuso replied that he raised objections and requested that the issue be placed on agenda. Those requests were not heeded. Another example which happened on 29 September 2016 was that he made a request to have a meeting prior to the meeting held with the Portfolio Committee on Communications on 5 October 2016. This was not taken into consideration and until now there was no response to his request.
Mr Vanara asked if the Board approved the amendment of the 2016 editorial policy which moved the powers of Group CEO to Group COO.
Mr Mavuso replied that public participation took place and provincial visits were embarked upon by members of the executive committee. Subsequent to that a report was presented directly to the Board and it required ratification. He was very upset about that because it was a very thick document, no less than 50 pages, and he could not read and apply his mind to that document because it was placed before the Board just like that. Once again it was approved by a vote and not by consensus.
Mr Vanara asked why Mr Motsoeneg still had a position at the SABC if his appointment was found to be unlawful and irrational by the Public Protector.
Mr Mavuso replied that he did not take kindly to his appointment. Mr Motsoeneng’s R11 million bonus did not go through the Board or any of the board committees. Some of the relationships would devolve around the Board chairperson and members of the executive, in particular Mr Motsoeneng. The court found Mr Motsoeneng wanting and therefore he should not have been an employee of the SABC.
Mr Vanara asked if a Board meeting was called to discuss the ruling of the Western Cape High Court.
Mr Mavuso replied that an anomalous situation occurred where decisions were taken via “round robin” meetings which had always been problematic because it gave Board members anonymity. Between January and September 2016 there were no less than 20 round robins approvals.
Mr Mokoena asked if Mr Mavuso had been threatened by anyone at the SABC for being in Parliament.
Mr Mavuso replied that he wished they would try.
Mr Mokoena asked who was at the centre of the “whirlwind” at the SABC.
Mr Mavuso replied he had indicated from the start that it was Mr Hlaudi Motsoeneng.
Mr N Kwankwa (UDM) noted that Mr Vusi Mavuso had mentioned that the Minister of Communications Faith Muthambi changed the Memorandum of Incorporation, taking powers away from the Board and giving them to the executive. He asked Mr Mavuso to give examples of those powers.
Mr Mavuso explained that one key example is the power to appoint Group Executives, which Minister Muthambi believed should be the responsibility of the Group Chief Executive Officer (Group CEO), Chief Operating Officer (COO), and Chief Financial Officer (CFO), and not the Board, who should merely be informed of the decisions.
Mr Kwankwa asked if that meant that those holding the aforementioned positions could then promote people without input from the Board. For example, he noted one such promotion of the COO to Group CEO.
Mr Kwankwa noted that this specific situation was one for which Minister Muthambi’s endorsement was needed. He asked if Mr Mavuso was aware that Minister Muthambi had indeed endorsed this promotion.
Mr Mavuso noted that there are three positions that need ministerial endorsement: CEO, COO, and CFO. Under normal circumstances, the hiring of Group Executives would be handled by a hiring committee, and then ratified by the Board. However, things at the SABC had changed, and the recent practice was to promote people from within. The SABC hiring process for senior positions did not follow the normal hiring practice, and those job positions would never be advertised externally.
Mr Kwankwa asked if that was the process that took place during the promotion of Group CEO James Aguma.
Mr Mavuso noted that Acting Group CEO Aguma had been recruited from the Office of the Auditor-General to be the CFO, and he did not believe that Mr Aguma was in any way undermined.
Mr J Mahlangu (ANC) and asked for clarification about the purges of staff members during the period in which Mr Mavuso was on the Board.
Mr Mavuso explained that corporate purging did occur, and that no fewer than eleven Group Executives were let go, noting that some were let go quite unceremoniously. He believed that these purges hurt the SABC, because in letting these employees go, a considerable amount of institutional memory was lost.
Mr Mahlangu asked what the position of the Board was on the corporate purging, and how many members made up a fully staffed board.
Mr Mavuso stated that he had asked for a board meeting to deliberate on the mass employee dismissals. He explained that the minimum number of board members for an operable board is nine, and fewer than that it cannot make binding decisions.
Mr Mahlangu noted that there was a rumour that the Board was taking its dictates from the board secretary. He asked Mr Mavuso if he were aware of such a situation.
Mr Mavuso stated that he was aware of that. He was called into a meeting at six o’clock in the morning, with the understanding that he was to have a one-on-one meeting with Minister Muthambi. Instead, the Minister was not there, and the only person present was her legal advisor, who presented him with a list of infractions, as compiled by the SABC Board secretary. However, he was not allowed to view the document. Included in that list, were accusations that Mr Mavuso was disruptive, late to meetings, and argumentative, which in his opinion, were “nonsensical”.
Mr Mahlangu asked where the Board gets its mandate.
Mr Mavuso stated that the SABC Board mandate comes directly from the Broadcasting Act of 23 April 1999.
Mr S Swart (ACDP) noted that the circumstances around the six o’clock meeting must have been very unusual, because as a board member, Mr Mavuso, is accountable to the Board itself through the Broadcasting Act, and not accountable to the Minister, Ms Muthambi. He asked if Mr Mavuso had a similar understanding of his accountability as a board member.
Mr Swart asked if Mr Mavuso thought he was punished for abstaining or voting against certain measures put forward by those board members allied with the Minister Muthambi.
Mr Mavuso stated that he thought the meeting was going to be a cordial sit-down with Minister Muthambi to discuss his role. Instead, he was ambushed by her legal advisor.
Mr Mavuso stated that perhaps this was a backlash against him for his voting record, and his resistance to the changing nature of the SABC power structure.
Mr Swart, on the legal opinion, asked if Mr Mavuso could explain the legal opinion about disciplinary action against Mr Hlaudi Motsoeneng, Group Executive Corporate Affairs. He asked if Mr Mavuso and the Board were aware of that disciplinary action against Mr Motsoeneng.
Mr Mavuso noted that the people who were supposed to arbitrate the hearing were changed three times, giving the very clear impression that there was a desired outcome to the proceeding. He found it odd that Mr Motsoeneng was acquitted on all charges.
Mr Swart asked about the round robin decision making process, and how this worked.
Mr Mavuso explained that each document was circulated and people voted yes or no, and returned the documents, without any discussion.
Mr M Waters (DA) thanked Mr Mavuso, and asked about the Minister Muthambi attending a meeting unannounced, at which time she put forward her recommendation that Mr Motsoeneng be elevated to COO permanently.
Mr Mavuso stated that this was what transpired, and that Minister Muthambi was displeased with the fact that the appointment of Mr Motsoeneng had not been cleared yet by the Board.
Mr Waters asked if any of the board members raised with Minister Muthambi the findings on Mr Motsoeneng in the Public Protector’s Report. He asked if Mr Mavuso was under the impression that Minister Muthambi was unaware of the report, and thus continued to push for his elevation to the position of COO.
Mr Mavuso explained that none of the board members raised the Public Protector’s Report with Minister Muthambi. He noted that she is a lawyer, and therefore should have been aware of the report.
Mr Waters asked for confirmation that during that meeting in which the Board was supposed to decide on Mr Motsoeneng’s elevation, they were not given any prior notice as to the meeting agenda, and that the meeting lasted six hours, from 17h00 to 23h00. He asked if any of the board members brought up the Public Protector’s report during that meeting.
Mr Mavuso explained that the meeting discussion was quite broad; however the Public Protector’s Report did come up, as well as a discussion around due process.
Mr Waters asked how the Board could entertain the idea of promoting Mr Motsoeneng to COO permanently, when the Public Protector’s Report stated that he had falsified his credentials, and was not qualified to hold such a position.
Mr Waters asked about the arrival of Minister Muthambi at 23h00 at the SABC building in Auckland Park, musing on the coincidence of her being there at that time.
Mr Mavuso stated that the board decision to promote Mr Motsoeneng was a majority decision, and did not require unanimous approval of every board member.
He agreed with Mr Waters that the coincidence of her being there was suspicious.
Dr M Khoza (ANC) noted that although Mr Motsoeneng was merely a COO, nonetheless, he had quite expansive powers for his position. She asked Mr Mavuso to what he would attribute Mr Motsoeneng’s power.
Mr Mavuso explained that Mr Motsoeneng had a particularly strong relationship with many of the board members, as well as the chairperson, and they would defend him when these issues were brought forward.
Dr Khoza asked if Mr Motsoeneng received a commission for the MultiChoice contracts, how much that commission amounted to, and, if he did indeed receive one, was it board sanctioned.
Mr Mavuso stated his knowledge of it comes from what he has read in the newspapers, stating that Mr Motsoeneng received a commission of R11.4 million.
Dr Khoza remarked that during Mr Mavuso’s tenure, the Auditor General noted R3.4 billion of irregular expenditure. Mr Mavuso served in the SABC Risk Committee, and she asked if during his tenure he made the Board aware of any irregular expenditures, and if so, which ones.
Dr Khoza asked for clarification on how Mr Mavuso would characterize the relationship between the Board chairperson, Ms Ellen Tshabalala, and the COO.
Mr Mavuso explained that a number of risks were brought forward to the Board, and that there was close liaison between the Risk Committee and the Audit Committee. The Audit Committee was given a list of risks that were to be addressed by the full board.
Mr Mavuso noted that the two enjoyed a good relationship initially. However, it started to deteriorate when the set-top box control came out in the newspapers. The Broadcasting Digital Migration policy was quite clear that encryption was needed. This however was not strictly adhered to, even though the Board had made a decision that there would be full encryption.
Mr Mavuso explained that at the public hearings, Ms Tshabalala and the CEO did not agree. The Board supported the view that there should be full encryption, but Ms Tshabalala did not support that stance. This disagreement created tension between the CEO and Ms Tshabalala, which continued thereafter.
Ms F Loliwe (ANC) asked Mr Mavuso why he stayed at the SABC so long with all of the irregularities.
Mr Mavuso stated that he is not a quitter, and did not want to quit. He explained, however, that after a certain amount of time, he could no longer take it and decided to leave.
Ms Loliwe asked Mr Mavuso what happened to previous chairpersons when Prof Mbulaheni Maguvhe became chairperson of the SABC Board.
Mr Mavuso explained that when there was a full board, the chairperson position was rotated amongst a number of different senior board members. However, he explained that once a number of board members were purged, those who were left, besides Mr Naidoo and himself, were given the opportunity to hold the position of chairperson.
Ms Loliwe asked if there were other instances, besides Mr Motsoeneng and Prof Maguvhe, when due process in regards to hiring for senior positions was not followed.
Mr Mavuso explained that when Mr Aguma was hired for the CFO position, the SABC use the services of a hiring agency, put out a newspaper advertisement, and an interview panel was formed to interview the candidates. Mr Mavuso stated that he believed that due process was followed in this instance, and Mr Aguma was found to be a suitable candidate.
Mr Mavuso noted that the hiring process changed sometime following the hiring of Mr Aguma. He explained that the hiring process became unclear, and that board members would only receive a memo detailing who had been hired for senior level positions.
Ms L van der Merwe (IFP) stated that Mr Mavuso had painted a picture of undue influence by Minister Muthambi, breaching the Broadcasting Act. She asked if the President’s name was invoked, if instructions about the President were ever put forward.
Mr Mavuso stated that he did not know of any instances.
Ms Van de Merwe noted that there were several meetings that were held that were inquorate and asked what decisions were made during those meetings.
Mr Mavuso stated that no decisions could be made in such a setting, and would be slotted to be made during the next board meeting.
Ms van der Merwe asked if Mr Motsoeneng’s R1.5 million salary increase was approved by the Board. She asked if the Board’s approval was sought when the SABC was litigating on the behalf of Mr Motsoeneng.
Mr Mavuso replied that the salary increase was not formally ratified by the Board. He stated that nothing had come before the Board about litigation on behalf of Mr Motsoeneng.
Mr H Chauke (ANC) noted that Mr Mavuso was already aware of the dysfunction at the SABC senior level when he was appointed as a board member. He asked about the efforts made by certain board members to counter the dysfunction with the Board, and if those members, Mr Mavuso included, ever met outside of the board to discuss these issues.
Mr Chauke asked what Mr Mavuso’s view is on most of the Board resigning, and if he is satisfied that this may be the end of the dysfunction, and that this situation can be finally resolved and the SABC can finally move forward.
Mr Chauke asked if the decision to challenge the Public Protector’s Report was taken by the Board. He asked if Mr Mavuso was aware that the Independent Communications Authority of South Africa (ICASA) has opened a criminal case against the board chairperson, as well as another member.
Mr Mavuso replied that he was unaware of the criminal case by ICASA. He stated that the Board did not challenge the Public Protector’s Report, because it was a very clear report, and challenging it would be pointless.
Mr Mavuso explained that anyone who would be part of the SABC Board in the future would have to be properly vetted, and have had extensive board member experience. For the Board to function, more rigorous debate amongst the members needs to be encouraged in the future.
Ms J Kilian (ANC) asked if Mr Mavuso asked for the amended Memorandum of Incorporation, if he was aware that it had been amended, and asked him if he was aware that Minister Muthambi had signed it.
Ms Kilian asked about the role of the company secretary, who seemed not to understand the role she was supposed to play in the Board. For example, the company secretary compiled a list of members who were accused of having conflicts of interest. That list was created at the behest of Minister Muthambi.
Mr Mavuso stated that he noticed that the Memorandum of Incorporation was signed by the Minister, but not by the members of the Board as it should have been.
Mr Mavuso explained that the report in question was shown to him by Minister Muthambi’s legal advisor, but that he was not allowed to look over it. In addition, when he asked for a copy of that report, he was refused a copy.
Mr Mavuso stated that it is unprofessional and unethical to have a company secretary assume the role of something akin to a Public Protector, especially without the consent of the Board.
The Chairperson released Mr Mavuso.
The Chairperson noted that at 16:00 the Ad Hoc Committee expected the SABC Board chairperson, Prof Maguvhe, to appear before the committee. He noted that it was 16:04, and Prof Maguvhe was not present. He asked that it be put on record that yesterday the SABC Board decided on their own volition to walk out of the Ad Hoc meeting inquiry, because certain documents in were not provided to them beforehand in Braille.
He stated that the notice of inquiry was sent out to the Board on 17 November. On the 18 November, Ms Theresa Geldenhuys, SABC Group Executive of Governance and Assurance, requested that all documents be sent to the SABC so that they could be transmuted into Braille. He noted that previously the Auditor General and Public Protector had never received requests that their reports be put into Braille, which made this request to the Committee seem irregular.
He noted that through their interactions today, the Ad Hoc Committee has been informed that the SABC does have the machines to convert the documents into Braille. Therefore if the SABC Board were here today, it would have been useful to know why it is that if they have those machines, that they requested documents be transmuted into Braille. They then used that issue as one of the reasons that they deemed the Committee as not free or fair, because Prof Maguvhe could not read the documents.
He noted that the Committee has two options: The first is to proceed in the absence of Prof Maguvhe. Option two is to issue a summons in terms of Section 56(a) of the Constitution and Section 14(2) of the Powers and Privileges of Parliament Act. The second option would require Prof Maguvhe to present himself, and the documents which are still outstanding, before Parliament.
The Chairperson requested that MPs indicate which option they wanted to select.
Mr Kwankwa stated that it also must be put on the record that the Ad Hoc Committee had made concessions on about Braille documents. He noted that Prof Maguvhe had been to a previous Portfolio Committee before, and did not request Braille documents.
Mr Kwankwa stated that a summons should be made to Prof Maguvhe. It is important to hear what Prof Maguvhe has to say, and therefore a summons should be sent to him to attend a Committee meeting at a future date.
Mr Mahlangu noted that this meeting had been scheduled for a later date, but that Prof Maguvhe had requested that the Ad Hoc Committee meeting take place today, 8 December 2016. He noted that Prof Maguvhe in his role as SABC Board chairperson is accountable to the people of South Africa, and accountable to Parliament. He stated that an example must be made that nobody can defy Parliament.
Mr Swart noted that he would like clarity on how Prof Maguvhe has been running the Board. He would support a summons, also in regard to the documentation that is outstanding. He noted that he would consider letting certain documents not be provided, assuming that a request was made and evidence given that they are of a sensitive nature. However, a request of that nature had not been made.
Dr Khoza stated that she would support Option 2. She noted that the authority of Parliament is being subverted, and that he needs to be here to answer questions they may have.
Ms Loliwe said she supported Option 2, and noted that the integrity of Parliament needs to be restored, and that the Committee needs to ensure that the state parastatals are doing the work that is required of them.
Ms Van Damme stated that she supports Option 2. He has been given every opportunity to come and state his side of things, but he has failed to present himself. He has disrespected the Committee by failing to attend these meetings.
Mr Chauke stated his support for the issuing of summons. He noted that every accommodation has been made so that Prof Maguvhe can be here, and that he must present himself to the Committee.
Ms Kilian stated that she supports a summons, and that as a state owned entity, its chairperson and Board are accountable to Parliament.
The Chairperson noted that the Ad Hoc Committee has chosen to request a summons for Prof Maguvhe to attend a meeting on Tuesday, 13 December 2016.
The Chairperson explained that the SABC stated that those documents were either not available, or making them made public would hurt the commercial interests of the SABC. He said that those documents are necessary for the Ad Hoc Committee to make their final ruling.
The Chairperson noted that one of those documents was the SABC Skills Audit, which was done by PricewaterhouseCoopers. He explained that the document in question was already made public when it was presented to the Portfolio Committee of Communications on 30 January 2014. Two years later they are trying to withhold that document from the Ad Hoc Committee, under the pretence that it is of a sensitive nature. He asked the legal team if that action borders on contempt of Parliament.
The Chairperson thanked the MPs and the members of the media and delegations, and adjourned the meeting.
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