The Committee met to deliberate on the observations and recommendations in its first draft report on the SABC inquiry. Members gave inputs pertaining to observations made mainly as a result of witnesses testifying during interviews held towards the end of 2016. During these testimonies the extent to which the SABC Board failed came to light. There was corroboration in the majority of the testimony presented by witnesses with regards to incidents that took place at the Board. One important observation made was that at the time of the institution of the inquiry, the SABC Board was non-existent. The SABC Board failed to discharge its duties as per the PFMA and failed to exercise effective oversight. An observation made was that the large number of special Board meetings and “round robins” called was indicative of the dysfunctional nature of the Board. The Committee observed that the Company Secretary had a role to play in the deterioration of Board functions by deliberately acting in a manner which was not within her mandate. Also, as an observation the Committee noted that major operational decisions that impacted directly on the SABC were not ratified by the Board because in some instances the Board was not quorate.
The testimony by former Board Chairperson, Ms Ellen Tshabalala, came under fire as she mentioned certain political figures who were involved in deals at the SABC and when asked to mention names she was not forthcoming. Members wanted her to submit her testimony in the form of a sworn affidavit. Members noted that the observations indicate the exact legislation that the Board was in contravention of as legal uncertainty played a big role in the deterioration of the Board. The Board directly opposed the implementation of the Public Protector’s report findings and other binding orders. Members felt there was a history and culture of non-compliance at the SABC resulting in the failure of previous Boards as well. The financial sustainability of the Board was questionable and members observed that this was a very important issue to be addressed. The Minister attempted to take over power as demonstrated by the Broadcasting Act Amendment Bill and members noted this in their observations. Members also observed that there was no adequate training of the Board as demonstrated by two former Chairpersons of the Board who appeared before the Committee as witnesses as they did not understand their roles and responsibilities.
The Committee recommended that an interim Board had to be appointed urgently following due process. Some members felt that interim Board members should not have any political affiliations. The Board also had to be properly inducted as this was not a normal environment that the interim Board would be coming into. The Committee recommended that the interim Board institute a forensic audit and institute disciplinary actions against those individuals found guilty of maladministration. The forensic audit had to be independent and done by a reputable company. The audit had to look at irregular, fruitless and wasteful expenditure because appropriate steps had to be taken against employees and former employees and those who influenced others to commit corruption and fraud at the SABC. Tender procurements, appointments and dismissals also had to be investigated. The Chairperson felt that some of these tasks could not be accomplished within the six month tenure of the interim Board.
Members strongly recommended that criminal punishment had to be executed following appropriate steps, if necessary. The SABC deteriorated under the current Minister’s watch and some members felt that she was not fit to hold office. Some members agreed that it be recommended to the President to have her fired. If not, there would be a further deterioration of the SABC. The documents the Minister presented such as the MoI had to be reversed and the proposed amendments to the Broadcasting Act had to be investigated or removed if necessary. The Committee planned to continue with deliberations until 27 January for the latest and adopt its final report by 21 February in order to stay within the deadline of 28 February 2017.
The Chairperson said that all inputs made the previous day would be considered and tabled the following week to be included in the report.
Mr S Swart (ACDP) said that he had two documents to submit for the Committee’s consideration to add to the report. The one was prepared by the legal department on the appointment and removal of Board members and the other document was about the Auditor General’s final management report.
Ms P Van Damme (DA) said that the DA also submitted proposed changes around the legislative parts in the report which would form part of the recommendations.
The Chairperson said that changes contributed by members would be made and highlighted in the draft report. A request was made to trhe former Chairperson of the SABC Board Ms Ellen Tshabalala to supply the Committee with names of individuals she referred to in her testimony. Thereafter she sent correspondence to the Committee but the wording thereof was a bit vague and not forthcoming, therefore he felt that the Committee had to request her to send it again in affidavit form.
Mr H Chauke (ANC) commented that there had been no facts around what Ms Tshabalala raised. The Committee asked her to name the politicians she referred to in her testimony and she refused to be forthcoming. He therefore felt that the issue around her testimony should be put aside.
Mr Swart disagreed with Mr Chauke’s opinion and said that the issue of political interference was an important one. There was gross political interference and the Committee had to bear that in mind.
Dr M Khoza (ANC) concurred with Mr Swart. She found it difficult to believe what Ms Tshabalala said. Her testimony was inconsistent and she was not truthful. Ms Tshabalala was not credit worthy and was using the Committee as a platform to redeem herself.
The Chairperson cautioned members not to make statements about people who were not there to defend themselves.
Ms N Singh (IFP) felt that every witness who appeared before the Committee had to substantiate their statements. He wanted the Committee to consider her statement in an affidavit form.
Prof N Khubisa (NFP) agreed with the notion of an affidavit. It was important that the evidence given came with strong recommendations from the Committee. Ms Tshabalala gave “back and forth” testimony; she first mentioned names then went back.
Mr M Waters (DA) said that Ms Tshabalala was under oath when she gave her testimony to the Committee and if it came out that she was untruthful there had to be consequences. She mentioned Minister Blade Nzimande and that he wanted to support a certain deal at the SABC. The Committee had to take it seriously. The SABC was in its current dire position because of political interference.
Ms F Loliwe (ANC) said Ms Tshabalala did not take the Committee seriously as they had asked for names and she had not provided them. When probed further on whether she spoke to Minister Nzimande, Ms Tshabalala reverted back to say she spoke to someone from the Minister Nzimande’s office. The Committee had timeframes to adhere to and Ms Tshabalala was aware of that. However, her delay in adhering to deadlines given by the Committee should not deter the Committee from doing its work.
Ms J Kilian (ANC) noted that when witnesses were before the Committee they were protected in terms of the law. When they were not before the Committee and said something which was untrue they would be exposed to litigation. Therefore, the Committee needed an affidavit from Ms Tshabalala. She agreed with some members that the testimony Ms Tshabalala gave was not all the truth. Ms Tshabalala made contradictory statements and the Committee had to hold her accountable.
Mr J Mahlangu (ANC) said there were contradictions between information in the Public Protector’s Report, the testimonies of former SABC Board members and what Ms Tshabalala presented. When Ms Tshabalala was asked whether Minister Nzimande called her, she said no, therefore there were doubts about her credibility.
Mr Chauke agreed that it was an item to deal with if there were details lacking which the Committee needed. But if there were no details to deal with, the Committee should not be creating dialogue with witnesses. He felt there were more important issues to be dealt with.
The Chairperson noted that Ms Tshabalala indicated “a certain official from the SACP”. He would request her to reduce her testimony to an affidavit form and when the Committee received it, it would be dealt with.
Ms Kilian agreed that in order for Ms Tshabalala to protect herself, if she would be mentioning names, it had to be a sworn affidavit.
The Chairperson said he would request the sworn affidavit from Ms Tshabalala and give her a deadline to submit. This was work in progress. He also made an appeal to the media the previous day to assist the Committee. A tweet was sent out on Twitter from a journalist and he had a conversation with her employer. The particular person then explained the situation and had since apologised.
Ms Van Damme said she did not accept the apology from the journalist as directly after the apology she tweeted that the Committee had the agenda of attacking the Guptas.
The Chairperson urged members to move on from the incident. The Committee would go through the observations per section and the recommendations per recommendation.
Mr Chauke said that observation 13.1 should include something referring to the lack of judgement, care and failure of the Board being independent.
Ms Kilian asked to extend paragraph 13.1.1 to include that the Minister extended the acting appointments of the executive to permanent without proper processes being followed. She felt that it was about the Board failing in executing its fiduciary duties in terms of the Companies Act but the observations had to be more specific in terms of section 13 (11) of the Broadcasting Act which stated that “the Board controls the affairs of the Corporation and must protect matters referred to in section 6 (2) of this Act”. The Board had a role to play in the public broadcaster and controlled the affairs of the SABC but it failed its responsibilities which was a massive failure. She suggested an extract from the Broadcasting Act similar to observation 13.1.3. This Board as well as previous Boards did not know its responsibilities and the Broadcasting Act.
Mr Singh questioned whether the heading for this section should be “fitness of the Board” because there were issues under the heading which went beyond the fitness of the Board. He noted some grammatical errors on 13.1.1 such as “has resigned” had to change to “had resigned”. In 13.1.2 the last line had to read “in light of the resignations”. He felt that the sentence at 13.1.3 was too long and needed revision. In 13.1.6 the wording “recommendation stipulated in the report” had to be deleted and inserted with “the findings of the report”. On 13.1.7 the word sentence had to read “… no meaningful intervention or at worst seemed unaware…” Paragraph 13.1.8 had to be redrafted and he questioned whether 13.1.9 spoke to the dysfunctional existence of the Board or whether the Board did not follow norms and practices in conducting its affairs.
Ms Loliwe wanted to add to 13.1.5 to expand on Human Resource Management as the Board failed to create stability by not filling vacant positions.
Ms Van Damme said that the Committee had to consider the relevant laws in its report. On 13.1.2 the second sentence had to read “In light of the resignations the Board was non-existent”. On 13.1.3 the PFMA was cited but had to include sections 50 and 51(a). The Board was also in violation of the Broadcasting Act. Paragraph 13.1.4 was in violation of section 51(b) of the PFMA and paragraph 13.1.5 had to include that the Board was in violation of section 13(11) of the Broadcasting Act.
Mr Waters supported Ms Kilian in saying that the Board failed in its duties. In paragraph 13.10 the Company Secretary was in violation of the Powers and Privileges Act section 17(2)(d) and 17(2)(e). He felt that 13.1.9 had to have stronger wording as it was a manipulation of the Chairperson at the time of the direction of the Board. So by having “round robins” the Chairperson could manipulate members by not giving them time to consider requests.
Mr Mokoena agreed with Ms Van Damme on citing the relevant Acts. He also wanted to make changes to 13.1.6 to delete the wording “failed to fully implement” and replace with “directly opposed the implementation” because they chose to implement their own remedial action through the Mchunu report. He wanted to add an observation that the ability of the Board to discharge its duties was curtailed by the Memorandum of Incorporation (MoI) and the Delegation of Authority Framework (DAF). It had to be mentioned as the changes to the MoI impeded the Boards abilities. Also, some Board members, including Mr Aguma, had a press conference and publicly defied the Shareholder by stating that they did not recognise Parliament. Those Board members had to be held accountable to Parliament so that it does not happen again.
Mr Khubisa felt that it should be included in paragraph 13.1.2 that legal uncertainty played a big role in the breakdown of the Board and the manipulation of the uncertainty contributed immensely to the breakdown of transparent corporate governance. In 13.1.3 it should be added that new members to the Board got caught up in a culture of non-compliance with the PFMA which stemmed from previous Boards. The Board had a lack of skills and was divided which added to non-compliance.
Dr Khoza said that issues of morality, ethics and the skills exodus out of the SABC had to be noted in the observations. The Board dismally failed to carry out its duties notwithstanding the technical know-how, experience, skills and qualifications. The Board leadership, notably its Chairpersons, appeared to have had high tolerance levels for immoral, unethical, unbecoming conduct and practices in that they incapacitated the Group Executives from carrying out their operational duties thus rendering the work environment extremely unbearable which led to a costly skills exodus. She said that it also created futile conditions for ill-informed policy decisions which made the institution very vulnerable to reputational risk and made the institution extremely uncompetitive and compromised governance of the institution.
Mr Swart suggested that paragraph 13.1.5 related to whether the institution was an on-going business under solvency and that was part of the document he was planning to submit. According to the AG’s report, the financial statements for auditing was not prepared according to international standards of financing as required by section 15 of the PFMA and section 29 of the Companies Act which resulted in the qualified audit. In the AG’s report there was further information which raised serious concern as to whether the SABC was an on-going viable business. On clause 13.1.6 he suggested to change the wording to indicate there was a disagreement with the findings of the report.
Mr Mahlangu referred to paragraph 13.1.2 and wanted to add that the Board, although it was not quorate, continued to take decisions and had them implemented. On 13.1.5 he wanted to add that the Board appointed people without following the proper procedures for appointment, including remuneration increases. On clause13.1.7 the Board also failed to uphold the laws of the Republic by itself failing to uphold the ICASA ruling and media independence. He wanted to add another clause which would state that the Board in allowing the amendment of the MoI abdicated their responsibility. The Board failed to protect the National Key-point and did not ensure that senior members were subjected to security clearance.
The Chairperson summarised all points made by members and said it would be included in the report and reviewed at the next meeting.
Dr Khoza said that paragraph 13.2.1 should include that testimony given by witnesses indicated that the Minister attempted to take over the powers of Parliament in as far as the appointment and removal of Board members. There was a Bill that was currently underway to give the Minister all the powers of Parliament and that process had to be stopped. In paragraph 13.2.2 the allegations around the Minister’s involvement in the appointment of the COO and terminology around it had to be looked at because there was undue influence as opposed to direct involvement. She also felt that the Multichoice deal was selling public assets and something had to be crafted along those lines to be included in the observations.
Mr Swart noted that in paragraph 13.2.1 the process mentioned was not without any involvement from Parliament as the Portfolio Committee endorsed the firing of the three former Board members. This was on the Minister’s understanding that the Companies Act, read with the amended MoI, gave her the power to remove Board members. This approach was endorsed by the then Portfolio Committee on Communications in 2015. Mr Krish Naidoo indicated that the letter he received asking him to resign was an indication of a dysfunctional ministry which compounded the dysfunction of the SABC Board. This information should be considered as an observation from this Committee. Another issue related to corporate governance and Prof Bongani Khumalo made a lot of observations in his written statement. Prof Khumalo stated that general concerns included failure to observe the differentiation of functions and management of boundaries between the Board and executives. On the roles and responsibilities as per clause 13.4.1, the Board should oversee and supervise the organisation and the executive should implement the Board’s mandate. Prof Khumalo also indicated that inexperience, inadequate training, ill-discipline, familiarity, misdirected or bad corporate politics, internal power contests, poor and diminished business ethics was among governance failures at the SABC. Shareholder representatives needed orientation and training to the greatest extent to understand their role. This could be an observation to add. On clause 13.4.5 there was reference to a “deal” which should actually state “Multichoice agreement”. He was not sure whether the word “monopoly” was the right word to use as the word “company” would be a more suitable word.
Mr Mokoena felt that there was no adequate training of the Board. There were two former Chairpersons before the Committee who clearly did not understand their responsibilities. On the role of the Shareholder, it should be noted that the Shareholder actively tried to centralise power and put it in her office. Under legal status it had to be noted that the Broadcasting Bill was now before Parliament and the Minister was trying to make amendments to centralise power. The Broadcasting Act indicated that an advisory body had to be established to advise the Minister in how the development, production and display of local television and radio content could be supported. He felt that the lack of such an advisory body was manifest in the confusion observed in issues of local content and the Minister’s failure in establishing such an advisory body was a serious oversight.
Mr Khubisa wanted to add to the observations that the Portfolio Committee failed to recognise the AG’s report and the serious governance deficiencies at the SABC. He felt that individuals had to be held personally accountable in their individual capacity because some individuals acted in their own capacity under the guise of the SABC which were not motivated by the best interests of the SABC. Issues that were raised by the AG were not addressed timeously; they went on unabatedly and no-one paid attention to them and in the meantime rogue decisions were taken. Going forward, he wanted to see the Board nominated in a transparent way which would include a proposal to the legislation. This process could be done in a way similar to the Public Protector’s candidate nominations.
Mr Kwankwa said that the Boards at the SABC seemed not to understand the relationship that had to exist between administration and itself and between the Board and the Shareholder representative. That came out strongly during the testimony of Prof Maguvhe because he demonstrated the lack of that relationship. This could be elevated in paragraph13.1.5. Another issue was the fact that many Board members testified that the Guptas attempted to rebrand the SABC morning show. Perhaps an observation should be included that they tried to capture the National Broadcaster. Although the Committee picked up that there was wasteful, fruitless and irregular expenditure, it should be added that there was no consequences followed for those who were found to be involved in such practices. The Minister herself also seemed unclear as to the bounds in which she was supposed to operate. He felt that the previous Boards also lacked in understanding the Broadcasting Act because the walk-out and some of the utterances made by Board members indicated they did not understand their mandate.
Mr Singh said that he wanted to bring in a few more elements on the observations around the Shareholder. There was conflicting testimony by the Minister and certain members of the Board where the Minister denied that she interfered in editorial policy but then Ms Rachel Kalidass said something else and the Minister also denied that she signed the MoI. Also, the walk-out by the Board was not only done by Board members but there were others from the executive management who were also active in this process. ICASA had also given certain directives to the Board which it did not adhere to and this had to be observed by the Committee.
Ms Loliwe said that in paragraph 13.5.3 she wanted the observation to indicate that it was not reluctance by the SABC to submit documents but a refusal as there were some documents which the Committee still did not receive. She wanted to add to 13.5.6 to include the issue of payment of legal fees of Prof Maguvhe. When the Committee asked him he said that the SABC would be responsible for his legal fees.
Mr Waters said that in paragraph 13.3.3 it should be added that this was in violation of section 96(2) of the Constitution as well as the Executive Ethics Code. On 13.4.1 these individuals should have had contracts even if it was temporary and the contracts should have stipulated their roles and responsibilities. Then on clause 13.4.5 the PFMA was violated as well. With regards to the Security Agency in 13.4.7 it should be “State Security Agency”. Referring to 13.7.1, he said that the Portfolio Committee on Communications lacked urgency but was derelict in their duty and that should be stated.
Ms Van Damme agreed with Ms Khoza that an observation should be added about the Broadcasting Act Amendment Bill. Under paragraph 13.6 a section should be added on the 90% local content decision and how the Committee received evidence that the Board was not consulted and therefore this was a unilateral decision by the COO. The Minister was not allowed to interfere as her role was in drafting communications policy but she interfered in affairs of SABC by encouraging them to appoint Mr Motsoeneng as COO. By interfering the Minister violated the Executive Ethics Code and the Powers, Privileges and Immunities Act as she refused to give Parliament full disclosure of what happened at the SABC.
Mr Chauke noted that problems started from previous Boards. It had to be reflected as systematic mismanagement. The entering of the Multichoice contract had to be looked at so the interim Board had to be recommended to take action because they needed instruction. He emphasised that the separation of powershad to be defined. The process of appointment had to be an open process to members of the public. Through evidence the role of State Security was misplaced because their core mandate had to be to deal with issues of clearance.
Ms Kilian said she felt 13.3.3 should be relocated under the Shareholder because it referred to the level of Ministerial involvement. She noted that there were duplicates under specific headings. On 13.3 the heading had to be “non-compliance with legislation” and on 13.3.1 sentence one should be be relocated to the recommendations. She said that paragraph 13.4.1 had to suggest the roles, responsibilities and reporting lines of the Chief Executive was not clearly delineated. A separate paragraph was needed to indicate that the roles and responsibilities between the executive and non-executive members were diffused. On clause 13.5.1 she wanted to add the sentence “This demonstrates a total misunderstanding and disregard for the Broadcasting Act, the PFMA and Parliament”. As far as testimony was concerned she suggested that it be used throughout and the terminology of “the Board” should not be interchanged with “the Accounting Authority” but rather to just use “the Board”.
Mr Mokoena noted that an advisory Board to the Minister was established recently. In addition, given the evidence that the Committee received from various witnesses around the issue of the New Age and the rebranding of the SABC News Channel, an observation should be included that the Committee observed a possible state capture.
The Chairperson said 13.1.4 included fruitless and wasteful expenditure of R5.1 billion but that was incorrect as it was actually around R92.3 million and R5.1 billion was irregular expenditure.
Mr Singh said that right at the beginning when the Ad Hoc Committee was instituted by Parliament; there were some challenges with the court. There was no reference to it in the draft report as “part of the story” in the beginning. Perhaps that should be included as part of the narrative of the report.
The Chairperson replied that this information would be populated in the introduction of the report.
Mr Mokoena said that at the hearings of the Portfolio Committee on Communications when two Board members resigned, the Board became non-existent. Therefore at the commencement of the Ad Hoc Committee there was no Board and it had to be made clear.
Mr Swart said he wanted to emphasise that the Board failed to take care of its staff. This was evident through the purging of staff members, the way the SABC 8 was dealt with from a labour relations perspective and the issue around the status of the Independent Contractor Agreements where some of them were promised permanent contracts and it was not fulfilled; some of those individuals had up to 30 years’ experience at the SABC. This information was important as it had financial implications.
Ms Kilian said that even though the Committee spoke about Board members induction, it would be helpful if the Portfolio Committee members could also be inducted and trained around the various laws which affected their portfolio.
Ms Van Damme said that she wanted to add under clause 13.8.1 that perjury would be in violation of the Powers and Privileges Act section 17(2).
The Chairperson noted that there was consistent bad advice given to the Chairperson and the Secretary of the Board by a certain law firm. The parliamentary legal team had to look at the law firm that assisted the Board and stated that the documents the Committee requested was commercially sensitive yet the Minister testified that there were no documents requested which the SABC could not submit.
The Chairperson noted that Committee members had to submit their inputs electronically to assist with the editing process of the report. For those people observing, this report would only become the position of the Committee once the report was adopted on 24 January 2017, from 14:00 to 16:00. Committee members would receive draft two by Monday 23 January at 17:00 and by Wednesday 25 January the report would be sent to the various parties for comment. The Committee would give those who wished to comment until 9 February to submit responses. On 14 February comments received would be deliberated on.
Mr Singh had a problem with the dates given by the Chairperson. On 14 February all party leaders were expected to respond to the President’s address. The morning would be fine to meet but not in the afternoon. Even on 15 February the responses were expected to continue.
The Chairperson said that he would schedule morning sessions for those two dates instead. He asked that members of the Committee all be present on 15 February 2017 as the Committee had to be quorate in order to do clause by clause deliberations.
14.1. The Board
Mr Singh suggested that clause 14.1.1 be removed completely as a recommendation as there was no Board. It should be replaced with “an interim Board had to be appointed urgently following due process”.
Mr Mokoena felt that the timeframe as to when the interim Board be appointed be added to clause 14.1.1.
Dr Khoza agreed with Mr Mokoena and said that recommendation 14.1.1 should qualify what types of individuals were needed; people with high moral standing.
Mr Waters wanted clause 14.1.1 to emphasise those interim Board members should not have any political affiliations. The person could have high morals but not be influenced politically. It should also include that the interim Board had to be “fit for purpose” to make sure that the law was adhered to.
Mr Singh said that the qualifying criteria should be looked at within the relevant Acts.
Ms Van Damme noted that the qualities of Board members were cited in the Broadcasting Act. The idea of high moral standing was a good idea but the concept of moral values could differ from person to person. She agreed with Mr Waters that no political affiliation was needed. Former Chairperson, Ms Tshabalala, had testified that she received her nomination from Luthuli House.
Mr Swart felt that no political affiliation might limit the number of Board members that could be appointed.
The Chairperson said that the Board must be appointed timeously, according to the law. These were the minimum requirements and the Committee could not dictate what type of person should be appointed.
Dr Khoza felt that political affiliation should not be confused with having no high morals. People should not be excluded in the appointment to the interim Board because of their political affiliation as this went against the Constitution.
Mr Waters commented that in the past people were sent to the SABC to fulfil a particular agenda therefore a lot of damage had been done over a period of time.
The Chairperson reiterated that the minimum standards should apply according to the law. An interim Board had to be appointed as soon as possible complying with existing legislation. One particular law could not be singled out.
Ms Kilian noted that the report could stipulate that the interim Board be appointed within 90 days as there was no provision in the Act for how soon after the dissolution of the Board an interim Board had to be established.
The Chairperson said the wording would include that an interim Board be established expeditiously, according to existing legislation. He did not agree that the Committee should stipulate exact timeframes.
Mr Swart said that the legislation referred to should be specific and be guided by section 13 of the Broadcasting Act and then state any other applicable legislation.
Mr Mokoena said that 14.1.2 should stress the training of the Board so its members could understand the legislative environment and their roles and responsibilities.
The Chairperson said that the Board should be properly inducted and this would be added in another line.
Dr Khoza noted that this was not a normal environment that the interim Board will be coming into and she felt that some kind or normalcy had to be provided to the Board.
Mr Mokoena added that the interim Board should institute a forensic investigation and disciplinary actions.
Mr Waters said the forensic audit should be independent by a reputable company. He wanted to know whether the audit would be limited to irregular, fruitless and wasteful expenditure because appropriate steps had to be taken against employees and former employees and those who influenced others to commit corruption and fraud at the SABC. Tender procurements, appointments and dismissals also had to be investigated.
The Chairperson urged members to be practical as all these tasks could not be accomplished within the six month tenure of the interim Board.
Mr Singh said that it was important to make some reference to the powers of the interim Board. The interim Board had to initiate processes for investigation into the Public Protector’s Report, ICASA report and the AG’s report.
Ms Van Damme emphasised that the company to do the forensic audit had to be a reputable company as the SABC had a history of hiring companies that gave it bad advice.
Mr Swart noted that according to the AG’s report recommendations, pending investigations had to be completed to assess the financial sustainability of the SABC.
Mr Chauke said the process of the forensic investigation had to be divided. The interim Board had to first deal with what was urgent such as the bonuses, salary increases and fraudulent contracts not processed through Supply Chain Management (SCM). The Auditor General and National Treasury could be called in to assist with the investigation into irregular, fruitless and wasteful expenditure.
Dr Khoza added that the reputable company to do the audit had to be in sync with national priorities and policies.
Ms Kilian said it was important that the interim Board limit further risks and potential losses and identify interventions to stabilize the SABC.
The Chairperson noted that this would be included in the recommendation.
Mr Chauke said that clause 14.1.3 could be removed because it was already mentioned as per the PFMA.
Ms Van Damme said section 83 of the PFMA stated that “The Accounting Authority for a Public Entity commits an act of financial misconduct if that Accounting Authority wilfully or negligently fails to comply with a requirement of sections 50, 51, 52, 53, 54 or 55”. Section 51 of the PFMA stated “The Accounting Authority must take effective and appropriate steps to prevent irregular expenditure, fruitless and wasteful expenditure, losses resulting from criminal conduct, etc.” Furthermore the Act stated that offenses and penalties for financial misconduct were criminal charges so these had to be laid against those found guilty.
The Chairperson said that instead of elaborating on the specific laws, it could be stated in the recommendation that the PFMA will apply and appropriate action will be taken according to the relevant sections as mentioned.
Mr Swart felt that criminal punishment had to be executed following appropriate steps, if necessary. The Companies Act and other law should be included.
Mr Singh said that the terms “Accounting Authority” and “Board was used interchangeably in the recommendation.
The Chairperson said that the wording “Accounting Authority” should equal “Board” and would be noted in the glossary of the report.
Mr Mokoena wanted a preamble to be included before the recommendations which would indicate the gravity of the problems at the SABC.
Ms Loliwe cautioned the Committee not to dictate to the incoming interim Board what to do. It would have roles and responsibilities to adhere to according to legislation.
Ms Kilian felt it was not necessary to go into extreme detail. The role of the interim Board was to stabilise and regularise as it was only in place for six months. The Committee should refrain from adding too much.
Mr Khubisa proposed that clause 14.1.4 be left as it is since it spoke to what the interim Board should do. He said that the Committee had to be as objective and constructive as possible because even though there was work done at the SABC, critical positions had to be filled as soon as possible.
Mr Mokoena wanted clauses 14.1.1 to 14.1.4 to be condensed into one clause which would make it less prescriptive.
Mr Swarts suggested that clause 14.4.3 replace clause 14.1.4 as it indicated the specific critical senior management positions referred to in clause 14.1.4.
Mr Mahlangu said that all these points raised and recommendations brought up were better crafted in existing documentation. It seemed as if the Committee was trying to micro-manage the incoming interim Board. All the things expected of the interim Board was close to impossible. He suggested that all Committee members make written submissions so that the administration team had substance to work with.
Dr Khoza said that recommendations should speak to observations made. On clause 14.1.4 she wanted a sub-clause to indicate that the interim Board amongst other critical assignments seek to stabilise and regularise the historical and current Human Resources environment. Staff were really hurt and sitting at home because they were purged and now they are not employable.
The Chairperson made a proposal that the date of 24 January 2017 to finalise the report be reconsidered. However, the deadline of 28 February 2017 still stood. He suggested that the Committee meet on the afternoon of 24 January until Thursday 26 January to adopt the draft report. Thereafter, respondents would be given 14 days to submit their inputs which would run from 31 January until 16 February 2017. On Tuesday 21 February the Committee would meet to consolidate the feedback from respondents and the following day the final report could be adopted, which will then go to Parliament.
Ms Kilian suggested that the Committee meet at 10:00 on 24 January instead of 14:00. Those members who could not make it could get someone to alternate on their behalf.
Ms Van Damme did not agree and wanted the Committee to meet at 14:00 as originally planned because she had other matters to attend to in her Portfolio Committee in the morning.
Mr Singh agreed with Ms Van Damme to start at 14:00 as the Portfolio Committee on Communications was meeting in the morning on 24 January to discuss issues of the SABC interim Board.
Dr Khoza said that members agreed to dedicate their time to doing this work. The other Committees which she was delegated to were also meeting on Tuesday so it was not fair to accommodate some members and others not. She agreed with Ms Kilian to start at 10:00.
Mr Waters said that all members had obligations in other Committees. The agreement was to meet on Tuesday at 14:00.
Mr Mahlangu felt that it was becoming difficult to make progress on work if the Committee did not use every opportunity to do its work. In the end there was a danger of it not being complete.
The Chairperson agreed that this job should be everyone’s focus. There was urgency around it. The majority view was to start at 10:00 and therefore the Committee would meet the following Tuesday to Thursday from 10:00 onwards.
Mr Mahlangu said that in addition to appointments made at the Board, there were individuals who were purged from their positions. He wanted the interim Board to investigate whether these irregular appointments and removals should have been allowed.
Mr Kwankwa said that there was an abuse of the six month acting position requirement as people were hastily appointed thereafter without due process. The vacant positions should have permanent staff appointed.
Ms Kilian asked if it was possible to join clauses 14.1.5 and 14.1.6 as it spoke to the same point of the appointments and removals.
The Chairperson said that the intention of this recommendation was to say that all Board members were appointed and removed according to the supreme Act, which was the Broadcasting Act.
Mr Singh said that there should be a specific timeframe which had to be included to tell the Portfolio Committee by when the permanent Board should be appointed. It should be a transparent public process such as with the appointment of the Public Protector.
The Chairperson said that Parliament would be adopting the report and the report would give instruction to the Portfolio Committee.
Ms Van Damme noted that the Portfolio Committee on Communications was meeting on 24 January to discuss the appointment of the interim Board. She wanted to add a recommendation that the Portfolio Committee on State Owned Entities investigate Dr Ben Ngubane as he was a board member at Eskom.
The Chairperson said that this was a totally different matter and could not be included in the recommendations.
Mr Chauke said that the State Security Agency should be included in the vetting process of Board members.
Mr Mokoena said that the Broadcasting Act spoke to transparency in the appointment of Board members. He therefore suggested that the reference to transparency be left out of the recommendation.
The Chairperson said that there was not a lack of legislation. The issue was rather that the legislation was not implemented so it was important to note that Board members should be appointed according to the Broadcasting Act.
Mr Swart said that clause 14.1.7 should be deleted entirely; if there was a court order it should be implemented.
The Chairperson said that from experience with the SABC Board, things that had to be implemented were not.
Dr Khoza suggested that the clause not be removed; instead it could be recreated to come with stronger enforcement. For example the situation with the COO, Mr Motsoeneng, was that the court gave an order but he remained in his position. When the interim Board came in they would know what to do as it was an existing problem.
Mr Mokoena felt that the new Board coming in would create a new culture at the SABC. It was not necessary to micromanage it.
Ms Van Damme noted that there were three former Board members challenging their dismissals. It was Ms Kalidass, Mr Lubisi and the late Ms Zinde. She assumed that was what was referred to in the recommendation.
The Chairperson said that it was correct and whatever the court decided had to be implemented.
Mr Swart said that “former” should be included before “Board members”. The Board could possibly appeal any decision by the court so it was important to state that all court orders had to be implemented as soon as possible.
Ms Van Damme said that it was important to include that the SABC had to adhere to all court and binding orders as there was a problem at the SABC pursuing cases and on-going litigation. Another urgent court order was the disciplinary action that had to be instituted against Mr Motsoeneng as per the Western Cape High Court judgement.
Ms Kilian said that she wanted to keep the clause but have it redrafted. She asked for reference to the “Board” and not “Appointing Authority”.
Ms Kilian said that reference to the Broadcasting Act also be made in the clause.
The Chairperson agreed with Ms Kilian.
Mr Swart added that any other applicable legislation be added to the wording as there might be other relevant legislation pertaining to the work of sub-committees of the Board.
Mr Swart suggested that the clause be removed since there was earlier reference to court judgements and all binding judgements.
The Chairperson agreed that it should be removed.
Mr Khubisa said that the duties of the Company Secretary were listed in the Broadcasting Act. Therefore punitive measures had to be taken against the former Company Secretary.
Ms Kilian said the observations could include the Company Secretary’s failure to do her work under clause 13.1.10.
The Chairperson asked that members all make written submission to assist in the formulation of the recommendations.
Mr Singh said that clause 14.8.1 and 14.8.2 should be moved under clause 14.1.11 and 14.1.12.
Mr Mahlangu said the interim Board should annul decisions taken by the previous Board which was not quorate.
The Chairperson noted that it was addressed as a risk before and it would be addressed in the recommendations.
14.2 Role of the Shareholder
Ms Van Damme said that she did not know who this clause was directed to; whether it was the current Minister or not. If it was directed at the current Minister, the Minister should have known this.
The Chairperson replied that it was for going forward and not for the current Minister.
Ms Van Damme said that it was important to also speak about the current Minister and her role.
Mr Singh said that the current Shareholder left a lot to be desired. He thought the Committee should recommend to the President to consider whether the incumbent should be holding office.
Mr Mahlangu suggested that a clause be added stating that when people were appointed as Minister they had to undergo induction similar to that of Board members.
Mr Mokoena said that there was no resolution that the Minister was leaving and the role of the Shareholder then had to refer to the current Minister. The SABC deteriorated under her watch and she was not fit to hold office. He agreed that it be recommended to the President to have her fired. If not, there would be a further deterioration of the SABC. The documents the Minister presented such as the MoI had to be reversed and the proposed amendments to the Broadcasting Act had to be investigated.
Mr Chauke wanted to add a reference to separation of power and cite relevant legislation for clarification of duties. Ms Geldenhuys made mention of the MoI being submitted to the Board so if the Board decided to give powers to the Minister then the Minister could not be fired. When a recommendation was sent to the President it had to hold water.
Ms Kilian said that it was important to be clear about the role of the Shareholder. The SABC belonged to the people of South Africa and Parliament represented the public. She did not see a need to process the amendments to the Broadcasting Act with speed.
The Chairperson said that there was an Amendment Bill to the Broadcasting Act somewhere but it should not undermine the Broadcasting Act as the supreme Act.
Mr Khubisa said that due to the interference of the Minister in the affairs of the SABC Board, the President should consider her position in that portfolio.
Mr Waters noted that the Minister wrote and signed the MoI which transgressed the Broadcasting Act and that was illegal in the first place. The Amendment Bill to the Broadcasting Act further increased her power. This abuse of power had to be investigated by requesting the President to fire the Minister, the Public Protector to conduct an investigation, writing to the Ethics Committee to investigate and laying criminal charges against the Minister according to the Power and Privileges Act.
The Chairperson said that these would be recommendations to Parliament and only be adopted once Parliament agrees.
Mr Swart said that clause 14.2.1 should be for going forward. The comments on holding the present Minister accountable should be in a separate section and he agreed with a possible investigation to see if the Minister should be held accountable and her possible discharge from office.
Mr Kwankwa agreed with Mr Swart and said that another important point was that the clause should apply to other State Owned Entities and the role the Shareholder should play in other Boards.
Dr Khoza said that the recommendation should not be about a specific Minister but rather the Shareholder in this specific context. She felt that a separate recommendation could be crafted under the heading “Accountability” under clause 14.5 and refer it to the Ethics Committee which had the power to discipline.
The Chairperson told members to deal with clauses 14.2.2 and 14.2.3 at the same time.
14.2.2 and 14.2.3
Mr Mokoena said that clause 14.2.3 might be confusing therefore the wording should indicate that the Committee wanted the Minister to retract the amendment to the Broadcasting Act.
Mr Khubisa said clause 14.2.2 should include that the Shareholder must abide by legal prescripts.
Mr Waters agreed that clause 14.2.3 was misleading and the Amendment Bill should rather be withdrawn. He was concerned that the Minister was trying to centralise power. It should be stressed that the Broadcasting Act was the principal Act and the MoI should be aligned to it.
The Chairperson said that the clause should rather indicate that the Amendment Bill be fixed and not taken out completely.
Mr Swart recommended that the wording should indicate that the present Broadcasting Act Amendment Bill be reconsidered.
Mr Chauke said that the Bill process did not start and end with the Minister. He felt that the Committee could not comment on the Amendment Bill without knowing and understanding what it was about. Perhaps the Committee could look at the possible issues in the Bill and discuss it at the next meeting so that when a recommendation was done it would be an informed decision.
Ms Van Damme said that she had done extensive work on the Broadcasting Act Amendment Bill and it was about removing Parliament’s role in the appointment of Board members and give it to the Minister. It also dealt with reducing the number of Board members from 12 to nine, reducing the quorum from nine to seven and set new procedures for the appointment and removal of Board members. If Mr Chauke wanted a presentation on the Bill, it could be arranged. She wanted to add that in addition to the review of the Broadcasting Amendment Bill and the MoI, the Delegation of Authority Framework also had to be reviewed.
Ms Kilian said that there was adequate evidence before the Committee that the MoI had different versions and there was criticism that it was not compliant with the Broadcasting Act so its validity was under question. She suggested that clause 14.2.3 was not the Shareholder representative’s responsibility because should there be uncertainty it should be Parliament’s responsibility. The Portfolio Committee on Communications should also obtain a legal opinion on the MoI since it contradicted the Broadcasting Act.
Mr Chauke said that recommendations should not be made based on the fact that some members were privileged to have certain information based on the platforms on which they served. It had to come before the Committee first to identify which clauses were problematic and only then could the Committee decide as a collective to add it as a recommendation.
The Chairperson urged members to refrain from trying to micromanage other people. The Committee should identify its observations and give recommendations but it was the Portfolio Committees responsibility to find the relevant bodies to execute. He felt that it would be irrelevant to have a presentation on the Broadcasting Act Amendment Bill. The second version of the draft report would be put together and given to members at least 24 hours before the next meeting. Thereafter the process would be followed as discussed earlier.
The meeting was adjourned.
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