Transnet on deviations and expansions: hearing postponed

Public Accounts (SCOPA)

06 December 2017
Chairperson: Mr T Godi (APC)
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Meeting Summary

This meeting was called to allow Transnet to answer questions regarding contract deviations and expansions, as well as investigations that were being conducted by the Hawks. Transnet had requested condonations of over R200 million on these deviations and expansions. The meeting was a follow up to a meeting that took place the previous week. The Hawks had been invited to provide information regarding the cases that Transnet claimed had been reported to the police. The National Treasury had also been invited to provide information regarding the contracts. The Transnet management had prepared and submitted a report that contained the information that was to be the subject of discussion. However, both the management and board failed to show up at the meeting. The Minister of Public Enterprise sent a sick note and apology, but the Board Chairperson just sent an e-mail the previous night to the Chairperson of the Committee that they were unprepared and, therefore, could not attend the meeting. This absence infuriated the members of the Committee who accused the board and management of Transnet of running away from the responsibility of accounting. Members charged that the entity was guilty of the contempt of Parliament and that they were setting a dangerous precedent that could not be tolerated. They asked how Transnet could claim to have been unprepared and yet they had prepared a presentation which they had sent to Parliament beforehand. They also wondered whether this was proof that there was a lot of rot at the entity. They asked whether Transnet was preparing to lie. Members lamented that a lot of money had been spent on the meeting and this would result in fruitless and wasteful expenditure. It was resolved that the members of the Transnet management and board would reimburse Parliament for all the costs that had been incurred from their own pockets and not the finances of Transnet. A resolution was also made to subpoena the board and management of Transnet to appear before Parliament so that whatever they discussed at the meeting could land them into trouble. 

Meeting report

The Chairperson welcomed the members to the meeting and recognised the presence of Brigadier Basie from the Hawks and the Chief Procurement Officer from the National Treasury. It was a follow up meeting from the previous week to deal with deviations and expansions at Transnet. Transnet had also indicated that it had referred a number of cases to the police for investigations, hence, the presence of the Hawks. The meeting would start with a presentation from the Hawks and once the delegation from Transnet arrived they would also present their report.

Mr M Booi (ANC) proposed waiting for the Transnet team to arrive before they could commence with the proceedings. The idea was to talk to Transnet and to listen to them. The Committee could not speak to itself. It was important that Transnet listened to what the Hawks had to say so that they could verify or disagree with it.

Mr T Brauteseth (DA) was in agreement with Mr Booi saying that one of the reasons SCOPA had been so successful is because it always used an integrated approach which involved all stakeholders being present. Not having Transnet around would be nonsensical. Transnet not being on time was undermining Parliament

Ms N Khunou (ANC) agreed that they wait for Transnet, but was indignant that their absence was undermining the oversight role of Parliament. She suggested that SCOPA get legal advice on the matter so that Transnet could be dealt with harshly.

The Chairperson disclosed that the Transnet Board Chairperson had written a letter to him, stating that it would be better if they met in January so that they could discuss all outstanding matters in January from deviations and expansions to media reports. She said it would be futile for Transnet to come before the SCOPA without being fully prepared as that would defeat the whole purpose of the hearing. The purpose of the meeting was for Transnet to listen to the questions of the members and to provide comprehensive answers.

The Chairperson said that he had indicated to Transnet that the meeting would still proceed as planned. The Transnet Board Chairperson even sent a report containing information that was supposed to be up for discussion. Thereafter, she sent an e-mail last night claiming that they needed more time to prepare for the meeting. He insisted that they had an understanding that the meeting would go ahead as planned and that it was too late for him to cancel it. Transnet management had already submitted a presentation and it would be unfortunate if the board did not attend the meeting.

Mr C Ross (DA) said it was not right to send an e-mail outside of working hours. “We have tough interrogations and we need to get to the root of problems such as media leaks”. Extensions and deviations were not new for Transnet and he wondered what they were afraid of. He demanded that serious consequences be effected to prevent future occurrences.

Mr M Hlengwa (IFP) expressed his deep concern at what he termed thuggish behaviour by Transnet. An agreement had been reached with them and money had been spent by the Hawks, National Treasury and members to come for the meeting. This would result in fruitless and wasteful expenditure. He suggested that the board and management of Transnet pay for the costs from their own pockets. This was an abuse of office and they were running away from accountability. Sending an e-mail at night was unprofessional and the law needed to be laid down.

Ms T Chiloane (ANC) said Parliament has a right to hold entities to account. The mere fact that the Board Chairperson did not come raises some serious questions. No entity can dictate to Parliament, but Parliament dictates. Deviations and expansions have been happening for a long time so what were they running away from? “We represent the voters and they must account to us”. The State Security Agency (SSA) is coming tomorrow, but they should come on Friday. January was too far off for the meeting.

Ms Khunou suggested that SCOPA subpoena Transnet to appear before Parliament. If no serious measures were taken, it would set a bad precedent that other entities might follow. She suggested adjourning the meeting for 5 minutes to get legal advice on the punitive measures to enforce against Transnet. Who wrote the presentation if they were not prepared? Were they preparing to lie to Parliament?

Mr Booi said this was defiance. They must come and account. They were running a parallel structure of security at Transnet. The Board Chairperson had done a lot of rot and there was nothing she was going to say in January. At the last meeting she did not say a word. He agreed with Ms Knunou that she should be brought before Parliament.

Mr Brauteseth said Transnet treated Parliament with contempt and they needed to be charged with contempt of Parliament. He urged for an investigation of the costs incurred in preparing and holding the meeting and sending the bill to the board members and management so that they could pay from their own pockets, but he was unsure as to whether this was legally possible. It was despicable to be disrespected in this manner.

Mr Hlengwa revealed that he was aware that people from Transnet flew to Cape Town as he was on the same flight as them and their absence was an admission of guilt.

Ms Khunou suggested rejecting all the condonations that Transnet had asked for that were over R200 million.

The Chairperson said Transnet had made history by their refusal to come before Parliament and suggested writing a letter to the board and to the Minister to express the displeasure of the members. He proposed calling them on the second day of Committee week in January. A subpoena would be sought to let them know that whatever false information they would give would land them into trouble. He further suggested following up on Mr Hlengwa’s disclosure that some people from Transnet had travelled to Cape Town only to shun the meeting.

Mr Booi requested the Chairperson to even shame Transnet in the media. As members of Parliament they were not looking for jobs from Transnet and they needed to sit on them hard.

Mr Hlengwa said the Members would fully support whatever measure the Chairperson would take against Transnet.

Mr Brauteseth said the Members needed to invoke their rights and hit Transnet hard.

The Chairperson reminded the members that the South African Security Agency would be coming the following day and they needed to prepare for that meeting.

The meeting was adjourned.




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