State Capture allegations: process; Department of Mineral Resources Quarter 1 performance

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Mineral Resources and Energy

12 September 2018
Chairperson: Mr S Luzipho (ANC)
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Meeting Summary

The Committee was briefed by the Department of Mineral Resources (DMR) on its first quarter performance report for the 2018/2019 financial year, and deliberated on the progress made on its inquiry into allegations of corruption in the DMR.

The DMR said its overall expenditure up to 30 June 2018 had amounted to R517.2 million, or 27.4% of the annual allocated budget of R1.891 billion, resulting in an under-spending of R17.6 million (3.3%) against the projected expenditure of R534.9 million. The variance was mainly attributable to outstanding salary adjustments, and delays in the procurement of goods and services. Revenue collection amounted to R12 million against projected revenue of R10.3 million as a result of revenue collection from prospecting fees being higher than anticipated. The overall performance of the Department was 75.31%, which was an improvement over the previous year’s 72%. Achievements with the implementation of the shale gas action plan were described.

Members asked about lengthy delays in the appeal system stemming from mining house inspections. They wanted to know how many officials suspected of corruption had been suspended, and whether they came from the regional offices or the main office. They asked why the Department had finally accepted after many years that their cadastral system was not working and needed replacement. How, with Vision 2019, was the DMR going to be able to gauge the industry was meaningfully transformed?

A Parliamentary legal adviser briefed Members on the status of the Committee’s inquiry into matters of state capture within the Department. While the inquiry had started, the request for authorisation of funds to go and interview witnesses had not generated any response, and accordingly the team had not been able to travel. As a result, the inquiry had stalled. However, in the last three months there had been significant developments. Firstly, the Minister had told the Committee that the DMR had taken steps to address corruption, including shutting down two regional offices, and appointing investigators in July to look at corruption allegations in the granting of licences, as well as instituting disciplinary processes against officials. The Zondo Commission had also started looking into allegations of state capture which would be related to former Minister Zwane. The Commission, of course, enjoyed the benefits of sufficient resources, technical expertise and investigative capacity. However, Parliament as an arm of government, may conduct its own investigative processes and inquiries, regardless of the fact that there might be a duplication with other entities.

A Member of the DA commented that having the Committee conduct oversight in terms of the national oversight mechanism was a “senseless exercise.” He questioned the impact of the Zondo Commission, as it had a very wide scope (including what happened at ESKOM), so it was not only focused on the minerals issues. He asserted that the Committee was trying to close down its inquiry. The Chairperson emphatically rejected this, and said it was up to the Members to agree on the best way forward. A major concern was the time factor, as the Committee was going into recess, and there was a tight third term schedule.

After lengthy discussion on which approach to adopt, Members were advised that their first option was to continue with what they were doing. In the meantime, they could to seek information from the Minister on the four broad issues they had raised. The first one was whether there had been any action or investigation undertaken by the Minister with regard to the corruption allegations. Other matters of interest included the transactions between Glencore and the Gupta-owned Tegeta, a reported trip to Dubai by former Minister Zwane, allegations of abuse in the Department's licensing divisions, and mining operation rehabilitation funds which had changed hands between institutions, including the Bank of Baroda. If any other matters arose in the process, including the question of the approval of the budget, the Committee was at least doing something. It could also deal with any outcomes of the Zondo Commission which might have implications for the Committee. A DA member said that whatever course of action was be taken, he would be supportive and would participate, but he believed this to merely be a cosmetic exercise that would make the Committee look better. He added that he believed the Committee had “missed the bus” to find out what had truly gone on.

Meeting report

Chairperson’s opening remarks

The Chairperson said land ownership statistics had been released yesterday, and they had been quite shocking. It was most important to tackle this issue as South Africans, as it posed a challenge for the whole country. There were also illegal mining matters which affected the country and the Department of Mineral Resources (DMR), amongst other things. There were also other issues related to mining, be it miners’ rivalry and issues of metals in Limpopo -- these were all real issues which should not be politicised. When one listens to the responses from the political parties, there was still a long way to go.

He hoped a time would come when one could say these problems have been dealt with. The problem was not just a political problem -- it could be a serious societal problem so problems should be viewed from all sides, and not just one. People were unwilling to provide solutions if it was not their problem. In his view, these issues were broad and could not be covered by one solution or one intervention. In order to succeed, solutions that engage all our communities had to be found.


DMR performance report

Adv Thabo Mokoena, Director General (DG): DMR, said the Department’s overall expenditure up to 30 June 2018 amounted to R517.2 million, or 27.4% of the total allocated budget of R1.891 billion for the 2018/19 financial year, resulting in an under-spending of R17.6 million (3.3%) against the projected expenditure of R534.9 million. Although the variance was higher than the 2% target, the Department would be able to spend its budget allocation resulting in variances falling in line. The variance of 3.3% was mainly attributable to salary adjustments for levels 1 - 12 which had been outstanding at end of quarter 1, and delays in the procurement of goods and services. The Department continued to monitor expenditure throughout the financial year on a monthly basis to ensure that spending was within the acceptable variance, which was the 2% target.

Departmental revenue collection for the period ended 31 June 2018 amounted to R12 million against projected revenue of R10.3 million. The variance was as a result of revenue collection from prospecting fees being higher than anticipated. As for the predetermined objectives for Quarter 1, the overall performance attained by the department was 75.31%, which was an improvement in comparison to the same period in the previous financial year, where the reported performance had been 72%. Timing differences had meant a significant number of measureable objectives had been “partially achieved” during the first quarter, thus lowering the overall performance. It was, however, worth noting that the partially achieved measures were cumulative in nature, and that the affected branches had committed during the last performance review to make a full recovery on measures that were behind, during the second quarter.

Ms Patricia Gamede, DDG: Corporate Services, said a 95% target had been set for providing adequate facilities aligned with business needs, and this had been achieved. Only 70% of the target for the implementation of a facilities management strategy had been reached. The goal to develop, review and improve internal processes, guidelines/procedures and the number of policies had been only partially achieved. The provision of professional legal support and advisory services to the Ministry and the Department had fallen just 3% short of the targeted percentage of timeous responses to opinions, appeals, inquiries, agreements and litigation. Defined turnaround times had all been met, as had the processing of all pre-employment screening requests. Gender equality strategic plans had been implemented and this too was achieved according to plan.

The targeted four actions to ensure submission of financial disclosures had all been implemented, and there had been 100% achievement of human resources development plans, with work skills plans submitted to the Department of Public Service and Administration (DPSA), the Public Sector Education and Training Authority (PSETA) and the Mining Qualifications Authority (MQA).

The following were the branch highlights for the first quarter of the financial year (2018/19):

  • There had been 100% submission of financial disclosures by senior management service (SMS) members;
  • all initiatives under submission of Performance Agreement for SMS members and lower levels were achieved;
  • A Workplace Skills Plan (WSP) had been developed and approved by the DG and submitted to both SETAs before the due date of 30 April;
  • The Human Resource Development (HRD) plan was approved by the DG and submitted to the DPSA;
  • Five career exhibitions were achieved against a target of three;
  • In partnership with the Council for GeoScience (CGS), a youth day event had been held for school children in Beaufort West on career opportunities in geoscience and specifically on shale gas development.

Ms Irene Singo, Chief Financial Officer (CFO), DMR, said the compensation of employees (CoE) had amounted to R143.7, or 23.3% million of the total allocated annual budget of R617.6 million. The variance at the end of the first quarter had been due to outstanding salary increases for salary levels 1 - 12 which had since been paid. Notwithstanding the challenges on the budget for COE employees that persist, the Department would continue to monitor expenditure to ensure that the budget ceiling was not breached at year end. Spending on transfers and subsidies had amounted to R313.2 million, which was 31.3% against the budget of R1 001.4 billion. The transfer payments for the Mine Health and Safety Council, the South Africa Diamond and Precious Metal Regulator, the Petroleum Agency South Africa, the Council for Geoscience and Mintek, were processed during the year as anticipated.

Capital payments had amounted to R372 000, which was only 3% of the allocated budget of R12.4 million, resulting in a variance of R1.7million. The process to appoint a service provider was already under way. Goods and services stood at R59.3 million, or 22.9% of the allocated budget of R259.2 million. The procurement of services would be expedited to correct the variance, and the budget would not be under-spent by year end. There had been 100% achievement of the implementation of the Management Action Plan (MAP), which was by internal audit. There had also been an external audit on the implementation of the Map. The compliance framework had been fully adhered to. 50% of the risk management plans had been achieved.

Lastly, there was no target in Q1 for the implementation of information communication technology (ICT) governance initiatives, as they were not due yet. The branch highlights for the first quarter of the financial year were the 2017/2018 year end closure; submission of annual financial statements; the procurement plan and budget for the New Year; the payment of suppliers within 30 days; and phase one of the integrated system

Mr David Msiza, Chief Inspector of Mines, briefed Members on Programme 2, which dealt with the Mine Health and Safety Inspectorate. The set target for the reduction of occupational fatalities had been 20%, but what had actually achieved was a negative 27%. A target of 20% had been set for a reduction in occupational injuries, and the Department had exceeded this, reaching 25%. 33% had been achieved against a set target of 10% for a reduction in occupational diseases. The number of investigations initiated had been 155, and the number completed was 131 (85%), which was better than the 80% target. The number of inquiries initiated had been 14 and only three were completed, the reason being the unavailability of witnesses and awaiting responses from legal representatives on inquiry dates.

The number of health and safety inspections conducted had been 2 019 against a set target of 2 000. The number of audits conducted, with individual audits included, had been 112 against a set target of 99. The number of tripartite workshops conducted had been 20 against a set target of 15. On the implementation of service level agreements (SLAs), there had been 100% adherence. This was the same case for the development and review of internal processes, where all had been achieved. There had been 100% of adherence to prescribed timeframes for medical and Chief Inspector of Mines (CIOM) appeals, and for Mineral and Petroleum Resources Development Act (MPRDA) applications.

Adv Mmadikeledi Malebe, DDG: Mineral Regulation, briefed Members on Programme 3 (Mineral Regulation), and said the DMR had handed over the Sunrise View secondary school and Platinum Village primary school to the Department of Education in Rustenburg on Friday, 13 April 2018. The schools were part of Impala Platinum’s social and labour plan projects, built in partnership with the North West Department of Education and Sport Development and the Impala Bafokeng Trust.

Minister Gwede Mantashe had handed over the ninth Path Out of Poverty (POP) Youth Centre in Porterville in the Western Cape on 13 June. The construction of the POP Centre formed part of Pretoria Portland Cement De Hoek’s social and labour plan commitment. The Youth Centre aims to provide children and youth from the Porterville community with opportunities to break the generational cycles of rural poverty by taking part in a range of activities which include educational support, school holiday programmes, youth life and leadership training, youth work preparedness training and a bicycle empowerment initiative.

Ms Faith Ngcwabe, DDG: Mineral Policy and Promotion, briefed Members on Programme 4 (Mineral Policy and Promotion), and said it had issued five publications instead of just the one that was planned, and had completed all six planned investment promotion events/forums/workshops. The Oceans Economy Operation Phakisa plan had been fully implemented, and 31 small, medium and micro enterprises (SMMEs) had been supported – 11 more than the target.

On the implementation of shale gas activities, an initiation meeting with the Beaufort West Municipality had been held to discuss plans to commence with community advocacy on the status and progress of the project. A baseline study on the drilling area had been completed. The drilling of 700m deep monitoring percussion boreholes had commenced in June. Continuous seasonal groundwater monitoring was carried out in May from five shallow observation wells drilled last year. Pump tests for the five wells were also completed in May, but the results were inconclusive. A Broadband Magneto Telluric (BMT) survey had been done over Zandfontein and Beaufort West.

The highlights for Q1 included the finalisation of mining charter stakeholder consultations; publication of the draft mining charter for public comment on 15 June; and the hosting of a mining charter summit where all stakeholders had been invited to engage on the charter proposals. All the mining summit proposals had been consolidated and would form part of the input to be considered by the Department when finalising the charter. The submission of public comments on the draft mining charter had closed on 31 August. By the closing date, 126 written submissions had been received and the Department was currently considering them.


Mr H Schmidt (DA) stated that last week, Members had questioned why in the Departmental structure at the lower end, all of them were in acting positions. The Department had not answered that then and should explain why this was so, and why until recently there were all these acting positions. The other issue was on employing experienced commercial lawyers. These lawyers needed practical experience and also knowledge of mineral law. It was a combination of these two that was needed. It did not help if a lawyer who had just finished an LLB thought he was going to understand what mining law was all about. Mining fatalities had spiked up from the last year, and he wanted clarity on whether there was a problem in this quarter or if it was for the last financial year.

Complaints had been received about the mining house inspections on the appeal system from those who had lodged appeals that the system was not time efficient. Very often the time period was exceeded. What was the current position on this? This was because these appeals normally took years instead of months. There appeared to be a problem in determining appeals arising from mine health and occupational safety matters. The Department had reported that compliance by the mining industry had not yet been measured. However, the Department was in serious trouble if they expected Members to believe that compliance was not yet measured.

Mr J Lorimer (DA) referred to the Department’s staff shortages, asking whether more officials were at the regional offices or at the main office? How many were on suspension due to suspicion of corrupt activities? Had this impacted on the DMR’s capacity to conduct inspections? Were the officials who were there lacking in capacity or training?

Regarding the one year unfunded plan for an ICT system, he still believed that the Department was failing to see the biggest problem that was related to this, and that was lack of a working, efficient and transparent catastrophe system. Three or four years previously, every time in a budget debate, he had stated that that system was not working. Every year without fail, he had been told by the Deputy Minister that the system was fine. Finally, there had been an admission early this year that the system was not working. It was now accepted wisdom that that system was outdated. There was a cadastral system that was being used by around 50 countries in the world that worked perfectly and could be installed in less than six months for a fraction of the budget that the DMR was proposing. This could be done by a company in Cape Town. When he mentions it, people look at him as if he had shares in the company. The only interest he had was that it was a South African company that had good knowledge of the system that was used around the world, and that it was cheap. Why were we not using this company, or one like it, and why did we have to have a five-year roll out when this could be done in six months? Either the DMR was not seeing the problem or somebody was looking for a big contract so that they could shovel it to their friends. Forgive his skepticism!

Regarding Vision 2019, how did one gauge if the DMR had meaningfully transformed the mining industry? Of the 131 investigations completed, how many had resulted in any action against the mining companies or employees involved? Talking of shale gas, it had been mentioned that the pump tests had been inconclusive -- what had those tests been for?

DMR’s response

Mr Msiza responded to the concern on the appeal process, and said the Department would look into it, but it strived to make sure that all appeals were finished early, especially medical appeals. Regarding the investigations, most were incident related, and to determine the cause of an incident was lengthy and consumed time. The DMR was implementing measures to increase efficiency. If the incidents were serious, after the investigation it made enquiries, and if evidence was unearthed that implicated a company or employee, that was when the Department took action by making prosecutorial recommendations.

Ms Singo stated that she would talk about the integrated system. This was the system that the Department used to administer all its functions, including the handling of complaints. Originally there was a manual system. It was not that the system was not working then, but the number of its users had increased steadily. The DMR had decided to look at where potential sources of investment were. It needed to be able to press a button and provide instantaneous information about its potential investment area. It had looked at issues, like big cadastral systems, and had received proposals and submissions. It had done analyst sourcing and looked at what it needed for the cadastral system. it was only because of a lack of funding, otherwise the Department would have already implemented it. If the Committee could assist the DMR to get the funds so as to complete the integrated system, it would approach anyone who could provide the solution -- and this included anyone who might be available in Cape Town.

Ms Gamede added that there were no suspensions currently in connection with allegations of corruption. There were dismissals that had been effected.

Ms Ngcwabe referred to the transformation of the industry, and said the Minister had set up a task team on sustainable growth and which specifically looked at the question of transformation. The task team would come up with a definition of the term “transformed,” but the DMR was saying it was a mining industry that was responsive to what they needed in terms of sustainable growth, job creation and, of course, addressing the questions of demographics and property. The DMR was also looking to have a mining industry that continued to contribute positively to the gross domestic product (GDP), and that was safe to work in. It was considering the challenges and putting in place measures necessary to anticipate the occurrence of these challenges.

Regarding the testing, the testing itself was done by geologists. As they sampled, they look at whatever trace element is there in the sample to draw conclusions about whatever it was they were looking for. The DMR was yet to get the report, and that was why it was indicated as inconclusive. As soon as it got the report, it would inform Parliament accordingly.

Further discussion

Mr A Pikinini (ANC) wanted to ask about shale gas. How many provinces were being looked into? He said that when Members had been introduced to shale gas, it had been one of the most interesting times. There had even been a public hearing and commitments had been made in all these areas that the Department had presented on. Now when it is spoken about, there is no conclusive evidence. The situation is stagnant. A future update on how far shale gas had progressed was needed.

Mr M Matlala (ANC) had a concern regarding the performance against targets. In some areas, one could see that there was really good progress, but in others the Department was performing abysmally. What was the cause of this? On mining health and occupational safety, there were too many lives lost. If here was a target of 20%, it meant the DMR was making an allowance for fatalities. Why could there not be a target of 100% -- no fatalities? Perhaps there was a need to look at how targets were set. Also on finances, it had been stated that programmes would be undertaken on the availability of funds -- what was meant by that? Did the request for additional funding for compensation mean that the current allocation was inadequate, or did it mean that there was compensation that the DMR would not be able to handle because of the funding? What staff skills were lacking in the Department?

DMR’s response

Mrs Singo said there were four provinces -- Mpumalanga, Limpopo, Northwest and the Western Cape – where the DMR had started in Limpopo, and it had got all the available resources. That was why she was saying that it had now normalized, and was not like it used to be. The Department had now started in Mpumalanga, and it would also look into the other two provinces. This was because of the way the resources were situated, and the DMR could not afford to be in all provinces at once.

Ms Malebe also replied to the question on the availability of funds, and said that when the Department developed its plans, it identified what it was that they needed to do to achieve its vision. Based on the financial resources and capacity required, it made a plan. When it does the costing, it realises that it does not have enough, based on its allocation. It would then go and motivate and say that for it to achieve maximum benefit, it needed so much. That was what was meant by saying it budgeted in terms of resources that were available.

Ms Gamede added that in terms of scarce skills in the department, it was mainly electrical engineers, rock engineers and mining engineers.

Mr Msiza referred to the fatalities, and said the DMR did not want any loss of life in the industry, and that was why it was taking the necessary measures. There were people suffering from exposure to the mines, with diseases lasting up to 10 years even when those mines were not there. The Department was working together with workers and employers. At the same time, it was comparing itself to the performance of other countries in the world like Australia, Canada and also the USA, as they also had accidents, and look at the targets that they set. The DMR’s aspiration was to have zero harm, but while it agreed that the target should be zero fatalities, one had to reconcile this with the realities of the industry.

Adv Mokoena added that the DMR had taken the comment raised about progress on shale gas, and would give Members an update. It had noted the comment on the targets, and would look into that.

Progress on DMR state capture inquiry

Ms Fatima Ebrahim, Parliamentary Legal Adviser, said she had been requested to give an update on the Committees’ inquiry into matters of state capture within the DMR. She had appeared before the Committee on 30 May, when she had informed Members that her request for authorisation of funds to enable her to go and interview witnesses had not generated any response, and accordingly she had not been able to travel. The Committee had thereafter instructed her to prepare a draft budget, in consultation with the Committee secretary. They had done that, and up till now there had been no indication whether it had been approved. As a result, she had been unable to take up any further work on the matter.

However, in the last three months there had been significant developments into the matters that the Committee wished to enquire into. Firstly, the Minister had told the Committee that the Department had taken steps to address corruption, including shutting down two regional offices, and appointing investigators in July to look at corruption allegations in the granting of licences, and that in terms of application of section 54, disciplinary processes had been instituted against officials.

Further, the Zondo Commission had started looking into allegations of state capture, which she believed would be related to the former Minister, Mosebenzi Zwane. The Commission, of course, enjoyed the benefits of sufficient resources, technical expertise and investigative capacity. She had previously advised and maintained here position that Parliament, as an arm of government, may conduct its own investigative processes and inquiries, regardless of the fact that there might be a duplication with other working hemispheres. However, one had to be mindful that they were dealing with public funds and therefore take into account the expertise and resources available to the Zondo Commission.

The best approach was an outcome-based approach. In other words, what could the Committee do through its own processes to achieve an effective and positive outcome? As previously indicated, Parliament’s legal services could do whatever it was that was indicated to them by the Committee. However, it was her proposal that given the recent developments, the Committee may wish to review the terms of reference in particular, to narrow the issues down to those areas it felt were not being addressed by the current Minister and the Department.

Based on a narrowed version of the terms, the secretariat could now draft a programme and request an adjusted budget funding, as requested by the Committee. The Committee might also want to consider the format of the inquiry. She was not in a position to commit to a time frame, in the absence of that draft programme having been prepared as yet. However, in consultation with the Chief Legal Advisor, who was responsible for the allocation of work and resources, she could certainly give an input on the timeframe once that programme had been developed.

Regarding the budget and the necessary authorisations, the Committee must appreciate that that fell outside her scope and control as a legal adviser. Notwithstanding that, and not to delay the processes in any way, nothing was legally stopping the Committee from continuing with oversight and calling Minister Mantashe and the officials identified with allegations, to account on any matter relating to the DMR’s legal obligation in respect of allegations against Mr Zwane. Where the allegations lead to legal outcomes, this would involve a number of activities where the DMR would need to act further. Nothing prevents them from putting those questions to the Department immediately, but as indicated, she would do whatever it was the Committee asked of her.


Mr Schmidt said the problem with having the Committee conducting oversight in terms of the national oversight mechanism, was having to determine the facts by talking to a suspected party -- for lack of a better word -- who was the victim or the perpetrator, and one did not get information from other sources. One had to rely on only that one Department. An official of the Department who had been suspected of corruption at some stage may be cooperating with certain individuals like the Guptas, so it was a senseless exercise, with due respect. It was like going to an accused and asking if he was guilty of a-b-c-d, and he was going to say “no,” or he was going to give you the version that he preferred the most. So that was a senseless exercise.

The remaining question was what the impact of the Zonda Commission was. The Commission had a very wide scope, including what happened at ESKOM. It was not focused only on the minerals issues, but all issues, including what the Guptas were connected with, which the Committee had listed in its request for an investigation. It was well on its way until the matter of money arose, and it had come to a stop. They did not know why the request for funds by the legal advisor had not been approved. Had it been a political reason? Was it a financial reason? That needed to be taken up again. If it involved reframing the issues, this could be taken positively by the person who controlled the funding of this particular commission, or inquiry or investigation, or whatever it was one wanted to call it. The Committee could not say that it would close this matter down. It had to be taken on.

The Chairperson said that he wanted to make it clear to everyone that nobody had said that the programme was closing down. The last time the Member had blamed the ANC. He did not want the Committee to have a dialogue on the matter – it was discussing the Member’s views. If he was saying the Committee would close it down today, he would be wrong. The only person who had spoken so far had been the legal adviser. He himself had not commented yet, and would make his comments if it was necessary to do so.

Mr Schmidt replied that when he had used the word ‘you,’ he had meant ‘the Committee’ and not the Chairperson. If the Committee decided to close this down by virtue of its decision, the Committee would have to explain why it closed it down. That was a political decision, but he was not saying ‘you’ as a chairperson, but ‘you’ as a Committee.

Ms M Mafolo (ANC) corrected Mr Schmidt, and said that he was supposed to say ‘we’ as a Committee, not ‘you’ as a Committee. (Members started arguing and talking all at once)

The Chairperson stated that to make it clear again that the only person who had given their view had been from legal services, who had been invited them based on what the Committee had demanded. It did not know what they would say. He did not want to enter into a debate between the ANC and the DA. He suggested the Committee should deal with the issue on the table and then make an opinion. It should first deal the report of legal services.

Mr T Rawula (EFF) said the point was that there was a legal person involved, and the Members were politicians. They were being told that so far a response had not been received from the relevant authorities regarding whether they should proceed or not. The budgets that had been requested had not been authorised.

Ms Ebrahim replied that personally she had not received any indication in writing whether there was budget or not. It should be borne in mind that those requests were not done by legal services, as they were not involved in formulating the draft budget, but personally she had been expecting a response.

Mr Rawula said that from what she had said, he had gathered that for her office to assist the Committee with what would be seen as the terms of reference of the Zondo Commission, and what would be the Committee’s terms of reference, it had to be decided whether would it be a necessary, because now it would seem to be parallel processes. In terms of the Committee’s oversight objectives, would its objective be achieved if it gave up in favour of the current process that was taking place with the Zondo Commission? Or was the Committee likely to come up with a different determination in reference to its own terms of reference? The point that had been made was the Committee should proceed with the process, but what were the significant differences it was likely to achieve in terms of the outcome? He thought that was what the Committee was interested in, and it also had take into account that there were a number of recesses due to the elections next year, and it had not started the process yet. Did the Committee have the time to proceed with this?

Lastly, on the terms of reference, due to the time constraints, there would still be a responsibility to make recommendations as a Committee. Would they be more watertight than what the Zondo Commission would come up with? The Zondo Commission had teeth. Already, there had been people who had been suspended as a result of the investigations. The reason he was suggesting this was that the Committee did not want to become a rubber stamp, compared to a process that yielded better results. Should the Committee proceed, even if if it toothless?

Ms Ebrahim replied that from her own perspective, both Parliament and the Zondo Commission, as it was constituted, were not criminal processes. They did not constitute courts of law. The outcome was that immediately a person was found criminally liable, they would be sanctioned. It was important to bear in mind that notwithstanding that they have more resources and legal expertise, neither had that power. What could be done by Parliament, though, would be different from the Commission. The Commission’s mandate was to unpack the entire issue of state capture, on the basis that the matter was convoluted into several departments or several areas. On the other hand, the duty of this Committee was to satisfy itself on issues which related to the Department of Mineral Resources. The Committee could not cast their eyes wider than that, because they did not have a mandate to do that.

When she had said the Committee could use the normal oversight process, she could use the example of the allegation against Mr Zwane, that he had boarded a private plane belonging to, or procured by, the Guptas, and one of the consequences of that particular action had been that there had been fruitless and wasteful expenditure incurred by the Department. The Committee’s inquiry would be to determine whether there was any truth in that. Nothing prevents them from calling the current Minister or the DG, or any other officer in the Department, to ask what enquiries they had made in the Department. There was a legal obligation on the accounting officer, who was the DG, to prevent fruitless and wasteful expenditure and, if such expenditure was discovered, to take steps to recover those funds. So the Committee could summon him for this.

The other difference was that when one had more resources, particularly the type of highly specialised skills and resources that had been allocated to the Zondo Commission, it meant that they were able to test evidence. With the Committee, even if Mr Zwane was interviewed and he was able to produce evidence to the contrary, it could not test the evidence to prove otherwise, as it was not there to conduct a criminal investigation. The Zondo Commission had the resources to do a lot of things, including testing the authenticity of emails. That was lacking in the Committee’s space. Of course, nothing prevented it from taking any information that flowed from the Zondo Commission and using it as part of its oversight. She still maintained that nothing was stopping the Committee, legally speaking, from continuing with oversight.

Mr Schmidt said that if he understood the legal advisor correctly, there was nothing really stopping the Committee. It was about not quite sure what the budgetary position was, and this should be followed up. The ability to call witnesses was exactly the same as the Zondo Commission. The Committee could force people to come and testify. It could hone in on those allegations, as amended. It could fulfill its constitutional role to conduct oversight. It would be wrong for the Committee to stand back and say that it was not prepared to deal with these issues. It needed to explore to what extent state capture taken place. To summon the current Minister to come and testify, with all due respect, was meaningless as he was not the Minister at the time these matters took place. He could maybe ask people to come and testify, and that would make sense. The Committee was bound by the Constitution to investigate to what extent these activities took place, and to give recommendations to prevent this in future.

The Chairperson said that there seemed to be three suggestions, so that the Committee could make an informed decision. The first was continue with what it was doing, and await a decision on the funding. The second one said the the Committee’s inquiry and the Zondo Commission were separate issues, and the Committee should wait for the Commission to finish and then decide what to doThe third option was to identify those areas that required executive accountability that one could deal with according to normal procedure as a Committee, such as the issue of the flight. The Committee could also look into whether the Department had undertaken any investigation on their own and what options there were to recover any funds lost.

There was something that suggested that if the Committee took the first option, it might need to reconsider it, there were four issues which it had dealt with last week. It was not only the budget. The budget issue was not whether it was there or not, but if it had been approved – and if it was not approved, what should the Committee do? If the inquiries were dealt with as separate issues, one had to consider that practically speaking, the Committee was going to into recess. This meant that if it did not deal with the matter, it would be postponing it until after the Budget Review and Recommendation Report (BRRR) that the Committee would be doing when they came back, which could take them to November. Thirdly, it it had been pointed out that one would need expertise in regard to the Committee’s terms of reference. One of the expertise requirements was an evidence leader, because the Committee had initially said it would follow the procedure of an evidence leader. If the Committee decided to revise and draw up another programme, surely that would need a budget? The decision for any action rested with this Committee.

Ms Ebrahim stated that the options were not limited to just those alternatives, as the Committee could proceed through whatever basis they deemed fit and suitable to ask the questions that it was trying to get answered. She gave the example of Home Affairs, which was also looking into state capture, and in that Committee they were not using any evidence that was being relayed by any Members, but within the confines of the inquiry. When she had said that there was a need to look into the scope of the enquiry, Members would recall that terms of reference were really broad. They spoke about the handling of mines and rehabilitation of funds by the Department. The second issue had been whether the appointments and dismissals had been subject to any undue external influence.

In the interim, the Department seemed to be investigating some of these issues. She understood that the closure of regional offices may have been linked to the issue of certain officials exercising undue influence, and so on. If they were doing whatever work it was that they were doing, then certainly the Committee needed to try and narrow down those issues, because there was no point in spending time getting to the bottom of something, only to find out that the Department was on top of it. She still maintained it was all up to the Committee to choose the format to follow.

Ms Mafolo stated that unless her memory was not serving her well, Members had all agreed to focus on these issues of state capture due to the report made by the former Public Protector, which had already called for a commission of inquiry. She would go with the option for normal oversight on these allegations in the Department and the Minister, as Ms Ebrahim had advised as one of the routes that the Committee could take. Logistically, time was not in its favour. The Minister could come and account to the Committee. Normal oversight was the better way to handle this. The Committee had first interviewed the Minister here, and two weeks ago he had promised that he would account for everything, so one should give the Minister the benefit of the doubt to come and answer.

The Chairperson suggested the legal services and the Committee researcher could construct the necessary questions on the four items. They would still have to write back to the House Chair, whatever they decided here. So first option was to continue with what they were doing. In the meantime, they could to seek information from the Minister on the four broad issues. The first one was whether there had been any action or investigation undertaken by the Minister with regard to the allegations. Other matters of interest included the transactions between Glencore and the Gupta-owned Tegeta, a reported trip to Dubai by former Minister Zwane, allegations of abuse in the department's licensing divisions, and mining operation rehabilitation funds which had changed hands between institutions, including the Bank of Baroda. If any other matters arose in the process, including the question of the approval of the budget, it finds the Committee at least doing something. It could take the matter further from there. These issues must not ground the process of the BRRR.

Mr Schmidt asked the Chairperson whether he meant that the Committee should continue with the normal oversight function.

The Chairperson responded that what they were talking about now was that if in the process there was something that said the Committee had a responsibility to outsource, then it must, because it could not continue with an uncertain process or period. Even when it came back from the recess, it would be dealing with the same situation and wondering what to do. Did it need to have the same discussion again – that it had not received a budget, that there was no approval of the programme, that there was no this or that? This would become another exercise of prolonging the matter. That why he was suggesting that these two options should go together simultaneously.

Mr Lorimer said that whatever course of action was taken, he would be supportive and would participate in it as a member of the Committee. However, he wanted it put on record that this Committee effectively took a decision on 30 May this year not to let the investigation be shut down. He believed that anything done now was merely a cosmetic exercise that would make the Committee look better. He believed the Committee had missed the bus to find out what truly went on.

Mr Schmidt added that to make sure he understood the Chairperson correctly, that the Committee would continue with a request for a budget, look at the mandate and narrow it down to those four issues. He suggested they should add issues connected therewith, such as cars being used, accommodation being paid etc. The Committee needed to take up the budget issue with Mr Frolick, as it could not proceed with an investigation without the necessary funds, and it needed to find out why the funds had not been made available.

The Chairperson expressed concern about the time available to the Committee, and said that if it did not take action now, it would have to take responsibility for postponing this matter to another period. The reason the legal advisor was here was because it could not take a decision on its own. If the Committee did not have a person who was an evidence leader, it would still be stuck here, because whether Members liked it or not, there was an element of mistrust amongst them. To go down that road it was going to be problematic, which was why the suggestion was that the Committee continue with the process and deal with things as they came up.

Mr Schmidt said he was not clear whether the Chairperson was suggesting the Committee should continue going on as normal, and what ‘normal’ meant. He also did not see any commitment that anyone had to write to Mr Frolick to ask what the position with the budget was, because that was what was needed.

The Chairperson stressed that there had to bee a determination today on what had to be done. Right now there was a proposal to take up the three options together. The Committee could continue with its normal process, with or without any money, without any evidence leader, and without any programme – but it had to deal with the issue. It could deal with any outcomes of the Zondo Commission which might have implications for the Committee. It was up to Members to make a determination.

Mr Schmidt expressed his dissatisfaction, stressing that the Zondo Commission would never finish its investigations within three years. Also, he had not heard the Chairperson say he was going to write to the House Chair, Mr Frolick, to establish whether there was a budget available for the Committee to continue. There was no problem with the Committee going into November or early December.

The Chairperson asked how he could make a commitment when there was no decision. He had repeated over and over again that this Committee had to decide. The Member kept attacking him as if he was the one making the decision. It was the Committee that had to make the decision, and as Chairperson whatever decision was made he was obliged to take carry it out.

Mr S Jafta (AIC) said that it seemed that the Chairperson and Mr Schmidt were not disagreeing in what they were both saying. The only thing was that he was proposing was that the Committee write a letter to the House Chair to ask for his response. His proposal was that the Committee carry on working on the issues it had raised, and if something else came up that it had not identified as a Committee, it would deal with it then.

The Chairperson asked for a seconder for the proposal.

Mr Schmidt said he would second it -- on the issue of writing a letter. (Members shared in laughter).

Mr Rawula said that he was seconding the proposal, that the matter must remain standing until the matter of the budget had been resolved.

The Chairperson said Members were proposing that the Committee write a letter requesting a decision from the House Chair on the budget to be given, while still continuing to seek clarity on the status of the four areas that it had requested.

The Members agreed.

The meeting was adjourned.

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