The Public Service Commission (PSC) briefed the Portfolio Committee on Arts and Culture on the appointment of chief executive officers (CEOs) and chief financial officers (CFOs) of state-owned entities (SOEs). It also interrogated the National Arts Council on the reappointed of its CEO for a further five-year contract, despite the serious allegations against her contained in the Gobodo Report. The Minister also provided the Committee with an update of the Department’s activities for the year so far.
The PSC was clear on the fact that SOEs were not part of their mandate, but they were willing to assist, and hoped that SOEs would be put under its rule in the future. Its presentation was based on research done from sources such as the Report of the Presidential Review Committee on State-Owned Entities (2013) and the Department of Public Service and Administration (DPSA) handbook for the appointment of persons to the boards of state and state-controlled institutions (2008). The DPSA’s handbook was a guide for SOEs to use in their recruitment processes, but the provisions were not obligatory. The DPSA was currently processing a national guide for Cabinet approval. The guide would include information on the appointment of CEOs, CFOs and procurement officers. Some inconsistencies in the appointment of SOEs’ CEOs and CFOs were highlighted, which included the differences between regulating acts, and the fact that the ministers of the respective departments could use their powers to select and appoint them by personal preference. The Department of Public Enterprises was singled out as the only body that seemed to have an institutionalised and recorded recruitment guideline.
A recommendation had been extracted from the Presidential Review Committee, that the CEO should be appointed by the Minister, in agreement with the Cabinet, once the board had selected two or three deserving candidates; and that the board should have a structure and a strong performance management system. Both the National Arts Council Act and the National Film and Video Foundation Act afforded the National Arts Council (NAC) the freedom to appoint a full-time CEO for the Council, and to oversee the remuneration and reappointment at the expiry of the contract.
The Committee asked the NAC to explain why it had reappointed the CEO for a further five-year contract, despite the serious allegations against her contained in the Gobodo Report. The Council responded that the decision had been based on the CEO’s performance report, but had stated that the contract was conditional on a disciplinary process exonerating her. The Council’s head of human resources, responding as to why the CEO had been reappointed for another five-year term, said the NAC had been unsure of how long the disciplinary process would take, as well as its outcomes. It also felt that the CEO must be an employee of the entity in order to undergo a disciplinary process.
Members of the Portfolio Committee expressed dissatisfaction with conflicting responses provided by the Council. The Chairperson said that public trust in both the DAC and NAC had been broken. This was especially the case with the NAC which, on the one hand, said serious transgressions had been made, yet on the other hand had re-appointed the person who was alleged to have committed these transgressions. The actions of the NAC were contradictory and did not make sense. She asked it to work on rebuilding that trust, as the public was watching.
Appointment of senior officials of public entities
The Chairperson wished the Committee a happy Heritage Month and urged everyone to celebrate the month to the best of their ability. The main focus of the Portfolio Committee on Arts and Culture was on state entities, since 80% of its budget went to them. There was a lot not going well in state entities, so the Committee had decided to invite the Public Services Commission (PSC) to help find solutions. The focus of the meeting would be the appointment of senior officials in state entities. Public officials, including the Committee, had a responsibility to uphold the constitution and law.
Mr Ben Mthembu, Deputy Chairperson: PSC, stressed that the work of the Commission was limited to public departments and did not extend to entities, but it was happy to assist the entire public sector. Although it had not worked much with state entities before, it was the Commission’s task to ensure that the public sector was empowered with information in order to fulfill its constitutional mandate, and therefore they found it necessary to assist when asked to. He emphasised that the presentation they were about to do was a rapid desktop research conducted over a period of two days.
Mr Mthembu thanked the Chairperson for highlighting that 80% of the DAC’s budget was being spent on entities. He highlighted that emotions had to be put aside, and the constitution be upheld in order to fulfill the mandate and serve the country. He hoped to be given another opportunity to help departments improve their performance and be given more time to research.
Ms Carmen Domingo-Swarts, Director of Monitoring and Investigation: PSC, said the Commission had been invited to make a presentation on the appointment process of senior officials such as chief executive officers (CEOs) and chief financial officers (CFOs), and the legislation regarding reappointment or extension of their employment contracts. Section 196 of the constitution placed the responsibility of overseeing public administration, specifically national and provincial spheres of government, on the PSC. The research sources for the presentation were the Report of the Presidential Review Committee on State-Owned Entities (2013), and the Department of Public Service and Administration (DPSA) handbook for the appointment of persons to boards of state and state-controlled institutions (2008).
She said that all public entities were required to have an enabling legislation that specifies the fiduciary executive duties and corporate governance structures, as well as their public mandate, and that there was no overarching regulation for the appointment of senior officials within public entities. For that reason, the DPSA had developed the handbook for the appointment of persons to boards of state and state-controlled institution, which had been approved by the Cabinet in 2008. Although the handbook was not prescribed in any formal legislation, it made reference to numerous policies and legislative frameworks, and provided guidelines to help departments comply. The DPSA was currently processing a National Guide for the Appointment of Persons to Board of State and State Controlled Institutions for Cabinet approval. The guide would include information on the appointment of CEOs, CFOs and procurement officers, and she hoped that it would be presented to the Portfolio Committee on Arts and Culture as soon as approved by Cabinet.
Ms Domingo-Swarts pointed out a number of inconsistencies in the appointment of senior officials. saying that the Presidential Review Committee on state-owned entities (SOEs) had highlighted that the appointment on CEOs had to be approved by the executive authority. The recruitment and appointment process in SOEs was highly reliant on the personal preference of the minister, who could delegate to the board of an SOE. Boards of SOEs may also delegate further down to the Human Resources Department. She said that ministers normally delegated the process to the Chairpersons of SOEs, who usually kept the ministers updated throughout the whole process. This gave the minister powers to have an influence on who was hired, as they could accept or reject a selected candidate.
The PSC also stressed that most SOEs’ founding acts dealt with the issue of appointing CEOs, which was a power bestowed mainly upon the minister, rather than the board. The Public Finance Management Act (PFMA) was silent, and the Municipal Systems Act contradicted most SOEs’ founding acts and offered the power of appointing CEOs to the board. This opened up loopholes in terms of interpretation and application.
The PSC’s research indicated that the Department of Public Enterprises (DPE) was the only body that had a clear and recorded recruitment and selection framework, but the framework’s emphasis was more on board members. The five-step institutionalised framework followed a sequence of activities, from skills review and identification, identifying suitable candidates for screening and vetting, selection and vetting, interviews, obtaining the minister’s approval and Cabinet approval, to the appointment of the ideal candidate. The institutionalised recruitment process allowed the reappointment of members to ensure stability in board dynamics and recognised the significant intellectual investment in being a good director, but such reappointments should be subjected to the director’s performance and skill relevance to the business.
Ms Domingo-Swarts extracted some recruitment guidelines from the Presidential Review Committee (PRC). It stated that the appointment of the CEO should be done by the minister, in agreement with Cabinet, at the recommendation of the board. The board was responsible for recruitment and assessment, and then recommending two or three outstanding candidates to the Minister and Cabinet for a final decision on who was to be appointed. She commented that the PRC recommended that the board adopt a strong structure and intensive performance management systems for executive management of SOEs, and employ them on long term contracts in order to manage sustainable development and the retention of skills.
The PSC had also taken a look at the legislation of the National Arts Council (NAC). Senior officials were allowed to have a maximum of two terms in a row in their executive positions. Both the National Arts Council Act and the National Film and Video Foundation Act afforded the NAC the freedom of appointing a full-time CEO for the Council, and overseeing remuneration and the reappointment at their employment expiry. Both of these acts were silent when it came to the appointment of the CFO.
The research also touched on the roles and responsibilities of the CEO, as per the NAC Act. These responsibilities included management of the Council’s affairs, and reporting on those affairs at the request of the Council. The CEO was also served as the accounting officer, accounting for all money received and utilised by the Council. The National Film and Video Foundation Act allowed the Council to appoint an employee of the Council to serve as an acting CEO in a case when the CEO was unable to carry out his/her duties for any reason, until the CEO returns or a new CEO was appointed, and the acting CEO should have all the powers to perform all the duties of the CEO.
Ms Domingo-Swarts closed with a recommendation that the inadequacies in the current legislative framework to regulate the functioning of SOEs be addressed for better accountability and broader transformation of the state. She said the gap in the recruitment process was allowing senior officials the opportunity to feed their private interests in the appointments, and this needed a continuous review. Oversight departments ought to act seriously on the roles and responsibilities, to ensure effective and efficient management of state-owned entities.
The Chairperson welcomed Mr Nathi Mthethwa, Minister of Arts and Culture, on his arrival at the meeting, and opened an opportunity for comments and questions.
She asked whether or not the delegations between the minister and the board were in writing, or just verbal, as it was important for the Committee to have them in writing before they even began to discuss the matter.
Ms V Mogotsi (ANC) commented that the loopholes in the legislation were making it easy for SOE senior officials to do as they wished, and this was a problem. She made reference to the Government Pension Fund (GPF) salary band not being in line with that of the public service. She asked where an SOE employee or an applicant would report a CEO in the case of an inconsistency in recruitment, or the handling of a disciplinary hearing.
Ms S Tsoleli (ANC) commented that SOEs were a part of the public sector and therefore should also be regulated by the Public Service Commission, like any other state department.
The Chairperson added that SOEs were important wings of their respective departments, in that they helped the departments to achieve their goals. Seeing that about 80% of the DAC’s budget went to SOEs, there was no way that these entities could be allowed to do as they pleased.
Ms N Bilankulu (ANC) said reference was made in the PSC’s presentation, which showed the money delegations down from the minister, and asked who was to account at the end of the process.
Ms Domingo-Swarts responded that there were no written delegations, and that the said delegations had just been extracted from the Presidential Review Committee as a guideline. The PSC’s interpretation of the legislation referring to the term of accountability, was that the minister was accountable for the whole process. CEOs and CFOs could be reported to the Public Service Commission and/or the Public Protector. The presidential hotline was also available to the public to report any inconsistencies.
Ms Mogotsi asked if there had ever been any case reported by a citizen to the PSC about either a CEO or CFO and wanted to know how the complaint was handled.
Ms Domingo-Swarts replied that she was not aware of any case of such a nature but would like to double check with the PSC and report back to the Committee. She added that the PSC would do some research on any case before escalating it to the DAC. What applied to the public departments should apply to public entities as well.
Mr Mthembu added that delegation of work was by no means a transfer of power, and therefore all power, responsibility and accountability lay with the Minister. Delegation was just an efficiency vehicle. The PSC had no certainty as to whether or not delegations were written, but the Public Service Act was very strict about all delegations being formal and in writing. The government bodies had different guidelines and policies governing them, and that was where these inconsistencies came from. The Public Service Act was currently being amended so that it covered and catered for SOEs as well. Given more time, the PSC would like to have a thorough scrutiny of the many SOEs of the South African government and come back with better findings and recommendations.
The Chairperson said that the session had been crucial and beneficial, and wished that the PSC had been invited in 2014, when the Committee was established. She emphasised that the Portfolio Committee on Arts and Culture was available to assist the PSC whenever needed, and that they appreciated its work.
Briefing by Minister
Minister Mthethwa gave a briefing on the work and achievements of his Department for 2018.
He said the Kokstad Centenary Nelson Mandela Celebrations had been successful, as well as the launch of Heritage Month and Book Week in Howick. He also gave details of an initiative led by the DAC towards changing the current name of Grahamstown to Makhanda, after the Xhosa struggle icon, poet and philosopher, Makhanda ka Xele. This name changing effort, though important for the promotion of heritage and long overdue, had met with some resistance, but the DAC had also received overwhelming positive support, and had consequently gazetted the intention for the name change.
Minister Mthetwa also said a bill on the criminisation of crime against albinos was being worked on, with the aim of stopping crime specifically targeting albinos.
He referred to an upcoming unveiling of a Nelson Mandela statue at the United Nations offices in New York on 24 September 2018, as part of the Nelson Mandela Centennial celebrations. This would make Nelson Mandela the first person ever to have his statue displayed at the UN offices. In addition to the unveiling of the statue, which would be done by President Ramaphosa and the UN Secretary General, some 193 Heads of States would on the same day also engage in various discussions on the theme of Nelson Mandela, as an instrument of peace.
Minister Mthethwa explained the role that he and his Department had played regarding the remedial actions recommended by the Gobodo Report. He explained that his involvement had mainly been to intervene in an oversight manner, as prescribed by law. He had also cautioned and advised the new NAC board, especially on how it had addressed the renewal of the CEO’s contract.
He spoke about the DAC’s ongoing efforts to fight racism, which had resulted in a three-pronged campaign aimed to ‘persuade and strengthen legislation, as well as continuously mobilise society’. The anti-racism campaign had also led to successful engagements with relevant stakeholders, such as the Dove Company after its one controversial campaign of 2017. He also discussed the Department’s efforts to revive pride and patriotism in national symbols, including the flag, and said it was leading an effort which would make a record-breaking flag of South Africa -- made up by people -- in honour of anti-apartheid struggle icons Nelson Mandela and Albertina Sisulu.
Outcome of National Arts Council (NAC) investigation
The Chairperson opened the second session by reminding those present of the four-year period that the current Committee had been in office, and the continued commitment they had taken towards assisting entities that fell within their ambit. She said the Minister’s presence would help in resolving issues to be discussed.
The Chairperson took time to highlight critical stumbling blocks faced by the Committee in its four-year work. In some entities, its work was perceived as interference. It had also encountered the phenomenon of 'three sides to a story,' and consequently its work was critical in looking for the middle, or the truth of the matter. As such, its task was not to uncover personal feelings and relationships, but rather what the Constitution said and if that was being complied with. She quoted section 25 of the Constitution, which set out the constitutional mandate of a Portfolio Committee, including that of the oversight function. The Portfolio Committee was empowered to receive petitions and submissions from any interested parties and act on their behalf. Doing so was for the protection of citizens and also to enhance public trust in government.
The Committee had called for this presentation because the National Arts Council had not wanted to meet with the Parliamentary Committee.
Departmental entities made Portfolio Committees understand what they wanted to do, and then the Committee persuaded the House to allocate the needed budget.
Professor Sekgothe Makgoatšana, Board member, National Arts Council, said that the Portfolio Committee’s summons had arrived only after the NAC board had been newly appointed, and he therefore extended an apology for the misunderstandings that had ensued. Most of the issues raised had had to do with the previous NAC Board, which the new Board had inherited. It had launched its own investigations when the new board was constituted, and had uncovered a lot of issues, including inaccurate records from previous Council meetings.
Among the pressing matters that the new board had tackled and had been dealing with were salaries, irregular bonuses, whistleblowing, financial maladministration, incompetence and disciplinary proceedings, the CEO’s ending contract, as well as the Gobodo Report. The new NAC board had decided that to tackle things one at a time, to avoid disrupting the department and putting at risk the many artists and organisations that relied on them. It had decided to start at the bottom and work its way up in terms of its remedial actions.
It had started with the secretary, against whom charges related to whistle blowing had been withdrawn. However, the board had underestimated how long the disciplinary process would take – over one year for the secretary’s case. Because of the length of time involved in dealing with each person’s case, the CEO’s contract had expired, and the NAC board had decided to renew it for another five years, to make sure she was in the system to face any allegations and corresponding disciplinary proceedings.
Prof Makgoatšana added that recording consecutive clean audits in the department was a major achievement. He ended by saying that the NAC board members had read the Gobodo report and agreed with its findings and recommendations.
Mr T Makondo (ANC), said the Portfolio Committee had not received a copy of the Gobodo Report. He suggested that Prof Makgoatšana give extensive details on work done, including dates and times to help the Portfolio Committee to better understand the chronology of events. Without dates and times, the briefing became just another story.
Ms Jabu Dlamini, Deputy Chairperson: NAC, took over the presentation to clarify the details requested. She went into detail about the dates and times of the activities undertaken by the new board, which began with the first board meeting in February, the process of the CEO’s first annual performance review in February, the tabling of the Gobodo Report in April, and the renewal of the CEO’s contract for another five years in May.
The ensuing confusion led to a question by the Chairperson, who asked if all new board members of the NAC had read, understood and stood by the report. She asked that subsequent questions from the Committee be answered not only by Professor Makgoatšana and the Deputy Chairperson, but by all members of the Council. She also wanted to know what kind of actions it took for a member of the entities in question to be suspended.
Mr Makondo interjected to say that he had expected the briefing/presentation to speak extensively about the issue of the re-appointment of the current CEO of the NAC.
Ms Tsoleli also entered the discussion to ask the NAC members if they had all read the report, given that the presentation of by the Deputy Chairperson of the NAC had come across as uninformed and unprepared.
Ms Avril Joffe, Chairperson: Audit and Risk Committee, NAC, acknowledged that the NAC had indeed received and read all the information, and had collectively agreed on it. However, they had not received the briefing mandate from the Committee, which had gone to the DAC officials instead.
Responding to the Chairperson's query as to what it took for someone to be suspended, Ms Joffe said that if conditions existed whereby the person under investigation could be seen to have the ability to interfere with issues under investigation, that person could be suspended to avoid such interference taking place.
Regarding Mr Makondo's dissatisfaction with the presentation made, she said that she was under the impression that the new/current committee of the NAC, of which she was a member, were meant to give an account of what they had done regarding the disciplinary processes of those implicated. She had not been aware that the presentation had to focus on the problems of the previous Council, which they had inherited.
Her final comment was that the current CEO of the NAC had been placed on special leave, to allow her to prepare her defence of the charges levelled against her.
Mr Makondo asked what considerations, if any, the NAC had when it came to deciding the likelihood that the accused would or could interfere. Surely, in cases such as the one under discussion, where the person facing allegations was positioned in an authoritative position, the likelihood of interference was high?
The Chairperson asked for clarification on the process that had led to the re-appointment of the NAC’s CEO.
The Minister interjected that he too had had concerns on about the matter and felt that the situation was long overdue for an intervention. Because of his oversight role, he had requested a meeting with the new NAC to discuss his concerns on the extension of the CEO's contract for another five years. He had urged the new NAC to use caution in the matter. However, because the legal framework placed the appointment of the CEO within the functions of the NAC, there was little he could do. He turned to the Board and asked them to respond on this matter to the Committee.
Before the NAC started with its response, the Chairperson reminded those present that aside from the CEO issue, the board had also employed a CFO who had previously been employed at the National Foundation for Video and Film (NFVF) and had left because of serious issues and allegations.
Prof Makgoatšana responded to the question about the appointment of a CFO with negative ties to his previous employer -- an employer which also happened to fall within the ambit of the DAC – and said that the problem lay not with the NAC, but rather in the weakness of the delegation process whereby a CEO was empowered to appoint everyone below them. The process had therefore been out of the NAC's hands.
The Chairperson interrupted again to comment once again that this showed a serious lack of consequence management. This was because the CFO did not appoint him or herself, and neither did the CEO. This had implications, so who took responsibility for those questionable appointments?
Ms Tsoleli at this point reprimanded the NAC board for defending the CEO where she had failed. She commented that as the CEO was responsible for appointments, payments and the management of the entity, that easily gave them the opportunity and space to interfere.
Mr Makondo asked what the role of the Council was, and what, if any, the role and responsibility of the human resources committee was when such contentious appointments were being made.
Ms Dlamini responded that on August 29, 2018, the CEO had been served with a charge sheet. This had been handled through the office of Mr Hartley Ngoato, Chairperson of the NAC.
The Chairperson called on the members of the NAC to elaborate on what they termed 'cautionary suspension' of the CEO, given that her last day in office had been the previous Friday. The Chairperson also requested clarity as to why specifically the renewal had been for a five-year term.
Mr Makondo urged the HR manager of the NAC to elaborate on the points raised, especially since HR had processed the appointments.
Ms Erica Elk, HR Manager: NAC, provided a summary of the events that had unfolded after the induction of the new board. She explained that all subsequent Council actions had been predicated on the understanding that concurrent processes had to be followed so as to ensure the stability and the continued functioning of the NAC. In that regard, these concurrent processes were implemented in three phases. Phase 1 sought to stabilise the entity so as to prepare for its complete shutdown, and rather to enable it to continue to deliver on its mandate. Phase 2 then sought to examine the existing allegations against the CEO and others and begin systematic disciplinary proceedings against those implicated. Those facing allegations would be pursued one by one, to avoid disrupting and destabilising the entity. In that regard, the disciplinary process had begun with the secretary of the Council. Phase 3 dealt with considering the Gobodo Report, whilst at the same time addressing the upcoming renewal of the CEO's contract.
Mr Makondo said he had taken issue with the Professor's presentation, as some of the details provided seemed to be in contradiction with what other members had presented. For example, these referred to when the CEO's contract came to an end, when the Council met to discuss this development, as well when the Council met to deliberate on the Gobodo Report, among other things. He insisted, therefore, that Council members provide detailed and specific accounts of dates and times where meetings and major decisions had been made by the Council.
Ms Elk offered to take the Committee through a chronology of events.
She started with the first meeting of the new Council on 7 February 2018, where a request had been tabled and an agreement to appoint a review Committee had been reached.
On 18 March, the new Council had held an annual performance review, and the CEO had been present.
A second session had taken place on 5 May, where the CEO's performance review was conducted. This review included being based on the narrative report, in conjunction with the key performance indicators set out in the CEO's contract. It had not been an easy time to engage with the CEO, given the undercurrents of the Gobodo report. However, on same date, the Council had deliberated, and based on her performance, had agreed to re-appoint the CEO. As to why the CEO was reappointed for another five-year term, the Council had been unsure of how long the disciplinary process would take, as well as its outcomes. The Council also felt that the CEO must be an employee of the entity in order to undergo a disciplinary process.
Ms Tsoleli said that given the contradictory statements given by different Council members, it made it difficult to trust their presentations. She asked why, if the Gobodo Report had come out on 18 April, its findings were not taken into consideration when renewing the CEO's contract. Why were the ending of contracts not re-advertised to the public according to process and procedures, as well as recruitment strategies? Stating that the CEO's key performance benchmarks had been met was one thing, but it should not have been relied upon heavily, to the exclusion of the negative cloud hanging over her, which had ethical implications.
Mr Makondo asked the Minister if the employment in question was a re-appointment, or a renewal of contract, as these two terms were different. He also expressed concern that the obvious lack of due diligence shown during the re-appointment/renewal of contract pointed to a possible collusion between the Department of Arts and Culture and the National Arts Council. He went on to remind those present that at the last meeting with the previous chairperson, he had accused him of being in the business of protecting the CEO. He had been shocked that the chairperson had not made any efforts to defend himself, or even to refute these assertions.
He indicated his doubts that the disciplinary processes would bear the expected results, because it had been tainted. The CEO could conceivably argue that in her new contract, she was blameless as she had done nothing wrong since signing her new deal. He ended his comments by asking about the minutes of the previous NAC meeting, which had stated that the Minister was “fine” with the re-appointment of the CEO. Was the Minister “fine”?
Ms Mogotsi requested clarity on the role, if any, that unions had played in the CEO saga. She also asked whether the CEO was on leave or suspension, given the contradicting information provided by the Council members.
The Chairperson recalled that at the last Committee meeting, the chairperson had been asked when the CEO's contract would end and had indicated at end of March 2018. When pressed further as to why no action had been being taken in the meantime, no response had been given. She therefore requested that copies of the new contract with the CEO be shared with the Portfolio Committee, which was agreed to by the NAC. The Committee needed an indication of the amount of money spent so far on the CEO matter.
Prof Makgoatšana responded by repeating the dates on which key meetings had taken place, as had been presented by Ms Elk, and said that the CEO had been informed that the renewal of the contract was conditional upon the outcome of the disciplinary processes. Although the Council had disagreed on the term for her renewal of contract, they had been afraid of being accused of constructive dismissal if they failed to renew the CEO's contract without prior warning.
The Chairperson asked if the CEO had been informed three months in advance that they would not renew her contract.
Ms Tsoleli echoed the same question, asking if the Council had at any point informed the CEO of the upcoming end of contract.
Mr G Grootboom (DA) added further questions. If the Council faced such a dilemma, why not re-appoint the CEO, but in an acting position? This would have made things easier in the long run if the NAC had needed to act against her. What about the CFO, who also had a dark cloud hanging over him? What, if anything, was being done in his regard? Had there been an effort to try and recoup the missing money?
Ms Bilankulu asked if, according to labour practice, the CEO had been aware of her contract ending. There was a need to hear responses from other Council members. She reminded Council members that they had claimed to having received the Gobodo Report only two weeks prior to the Council's decision to renew the CEO's contract for another five years. Given that Council members had disagreed on the term to be offered to the CEO in the contract, what had happened? Had the Council used known objective processes, or were the decisions made simply through common sense?
Ms Mogotsi asked Prof Makgoatšana to explicitly name the law that stated one could not inform people of their impending end of contract, just because of the short time remaining.
Mr Zolani Mkiva, Council member, acknowledged that during the Minister's meeting with the Council, he had reprimanded it and suggested that the Council should have used caution. The Council had apologised to the Minister, and in that vein, Mr Mkiva sought to follow in the same footsteps and apologise to the Portfolio Committee for any misleading information they had presented. It had been misleading to insinuate that the only reason why the CEO's contract had been renewed was that it was the only way she could ever face disciplinary processes against her. The primary factor leading to the renewal was her performance-based assessment conducted by HR. It was not because there was a fear of her eluding justice once outside the DAC’s ambit. Additionally, the CEO was currently on leave, but would return to answer the charges leveled against her.
Ms Mogotsi asked what had given the Council the impression that they had to renew the CEO's contract before they could take disciplinary action against her. The minutes of that meeting had created the impression that the Council thought it only feasible to deal with someone still in the system. This was false, as external processes such as civil or criminal charges could pursued against a guilty person, even after they had left their employment.
Ms Elk responded that they had relied on the NAC to guide them in the appointment of a CEO.
The Chairperson also re-iterated Ms Mogotsi's question regarding why the Council was convinced there could be no alternative recourse to be pursued once the CEO was no longer an employee of the NAC.
Director General Mkhize responded to several points.
He clarified that while a former employee could not be disciplined according to company procedures, they could be pursued criminally.
On the issue of the Council receiving the Gobodo Report from the Department of Arts and Culture some while after it had come out, he said that incoming reports -- especially forensic reports -- usually underwent procedural verification before being circulated.
In April 2018, the Council had made a decision to re-appoint the CEO but had not yet communicated that decision to the CEO. In that regard, the Chairperson of the NAC had advanced 10 reasons why the Council wanted the re-appoint of the CEO.
He said it seemed the Council had followed the letter, but not the spirit of the law. The Chairperson of the Council had assured the Department and the Director General that should the CEO be found guilty; the CEO would be dismissed without financial implications for the DAC.
Mr Makondo said he had a problem with a Council that came before a Parliamentary Portfolio Committee and was not truthful. He added that Mr Mkiva had used the words “suspension” and “leave” interchangeably, even though they were not the same. The DAC did not seem to understand the difference between these two words.
He said that when it came to employment rules, an accused employee was considered guilty until proven innocent. It was only in court where a person was considered innocent until proven guilty by the accuser. It was a pity that the HR specialists at the NAC had failed to understand this difference. He recommended to the Chairperson that should the case end in the CEO being suspended or dismissed and she appealed, then the NAC must pay the costs.
The Chairperson said that public trust in both the DAC and NAC had been broken. This was especially the case with the NAC which, on the one hand, said serious transgressions had been made, yet on the other hand re-appointed the person who was alleged to have committed these transgressions. The actions of the NAC were contradictory and did not make sense. She asked the NAC to work on rebuilding that trust, as the public was watching.
Minister Mthetwa thanked Mr Mkiva for his honesty and for taking responsibility for the mistakes made. This would make it possible to learn from these mistakes and avoid them in future. He also asked for the previous meeting's minutes with the NAC to be corrected, to show that he had said he had received a commitment from the Council, instead of saying he got satisfaction from the Council.
The meeting was adjourned.
- PSC: Appointment of Senior Officials of Public Entities
- DAC: First Quarter Performance Report
- DAC: Update on National Arts Council
- NAC: DAC Investigative Accounting (Pty) Ltd Forensic Investigation into alleged conflict of interest and irregular award of funding Final Report
- NAC: Remedial Action After the Gobodo Report
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