Cross-Border Road Transport Agency (C-BRTA) governance

Meeting report

Opening remarks

The Chairperson said that in October, when the Cross-Border Road Transport Agency (C-BRTA) was presenting its annual report, some members of the board were apparently not happy with some of the statements made by its chief executive officer (CEO) and the chairperson. They had requested to come before the Committee to clarify some of the incorrect statements that had been made.

Mr C Hunsinger (DA) sought regarding the issuing of licences, as he had been receiving a lot of complaints following applications for new car driving licences, and there had been no response about the turn-around times. One could apply for a temporary driving licence, but there was no clear indication of when the delays would be addressed. He emphasised his concern about the number of the complaints, as they were increasing.

The Chairperson said that the query would be responded to after the matter on the agenda had been deliberated on.

Concerns on governance matters: CBRTA Board members

Ms Ignatia Sekonyela, Non-Executive Board Member: CBRTA thanked, the Committee for providing the opportunity to come and present their side of the story regarding governance issues within the Agency. All four signatories of the letter sent to the Committee were present -- Mr Lucky Thekiso, Mr Raymond Baloyi, Ms Keitumetse Mahlangu, and herself. All of them occupied specialised portfolios and each would hopefully be granted an opportunity to present on the matters of governance in their portfolios.

She said that the CBRTA had started off on a rough patch, and upon the appointment of the current CEO Mr Sipho Khumalo, many changes had materialized, and for the first time the Agency had received a clean audit and had done so for three consecutive years because profitable systems had been put in place. It was also under the leadership of the CEO that the members had seen the “Linking Africa” dream, which was a dream that the CEO had repeatedly said was a dream he was prepared to die for.

In October, the CEO and the chairperson of the Board had appeared before the Committee and told it that they did not want to sign off on the financial statements. These were the financials that apparently had a clean audit. However, amongst the members that did not want to sign off on the financials was the chairperson of the audit committee. If the audit and risk committee was satisfied with the financial statements, the chairperson of the audit committee would have signed off on the financials. Clearly, this was not the case, and this had been raised sharply during the board meeting.

It had been said that they were members who were often absent from meetings; that we did not contribute in meetings, according to the deputy chairperson of the Board; that they were frustrating the chairperson to a point where the chairperson wanted to resign; and it was also said that the CEO, via the chairperson, had written to the Minister that the three of them should be retired.

There was a time where the instructions, and even information from the Minister, would come through the CEO. The Board was uncomfortable with this practice and had taken a resolution to have the Minister communicate with the chairperson of the Board. When the new members of the Board commenced their directorship at the Agency, they had requested a strategic meeting from the human resources (HR) remuneration committee (Remco) side, and the CEO had brought an organisational structure that he wanted to be approved. There were a few issues we had not agreed on, and the Board members indicated that the organisational structure came after the strategic structure.

An incomplete structure was presented by the CEO, and Remco had a problem with the structure including the the chief operating officer (COO) and an executive in his office. The structure was also not costed, and at that stage as an agency we were expected to relieve employees because we did not have enough money to pay for remuneration. The structure was not supported by Remco, and it was voted into being a structure when a few Members abstained. The then structure was concentrated only at the executive level. They had then asked questions regarding the resignation of Ms Nkomo, the then deputy chairperson of the Board. This was because in her lette, she stated that Professor Jan Havenga, current deputy chairperson, was being introduced as the deputy chairperson while she was the deputy chairperson at the time. Ms Nkomo had then decided to resign to avoid conflict. The Board had felt uncomfortable, and they also did not know the process that had been followed in appointing the current chairperson and deputy chairperson. The meeting ended, and there were a few other unpleasant events at the next board meetings.

At a following meeting, the chairperson of the audit and risk committee reported that the Agency was sitting on a contingent liability which was very high, and it was increasing every month. The liability was at around R400 million, and the Board felt that this was a risk and a threat. Therefore, they had wanted the matter to be open for discussion. This had not occurred, because the chairperson of the Board had said that they were not accountants and did not know what a contingent liability was. Needless to say, they had put on record about how they felt.

The Board members had also found themselves with a report on the travelling which had been undertaken by the CEO, the chairperson and other staff members who had gone to Mauritius. The Board had not been informed about the travel, even prior to the travel taking place, but members were expected to ratify travelling expenses which they were not comfortable about. They asked for a travel policy to be made available, and expressed their dissatisfaction with this. To date, both the CEO and the chairperson felt that they did not have to inform the Board. An unpleasant e-mail had then been sent out, encompassed by some other issues.

Looking at that letter and the e-mail, and how the Board was run, the members had agreed that they needed some training as board members. A procurement process had been initiated through the office of the CEO, and a service provider by the name of Dr Connor had been appointed. Dr Connor came and provided the service and from the training session, the issue of the letter was brought up, and as a result a relationship-building session was recommended because the letter revealed that the relationship amongst the board members was unpleasant. Unfortunately, Dr Connor had come to the session having been misinformed, having been told that they were not fond of, nor did they want to, work with the chairperson of the Board, and in that session they had told their side of the story, but that report had not yet been furnished by Dr Connor. We also felt very uncomfortable that Dr Connor was subsequently appointed as the audit company for the Agency.

Following this, in light of “Linking Africa,” they had a seminar with various stakeholders for three days and during the sessions they learned that there was a letter written by the CEO via the chairperson, and the letter requested that they retire from the Board. This was not done through a discussion in a Board meeting. They had then received a copy of the letter through an anonymous individual. When he received the letter, they had written to the Department to intervene, and had held a meeting with the advisors and the Chief of Staff of the Department. They had then been told at that meeting that the letter had been received and Mr Hlabisa would investigate the matter. However, this did not occur, and the matter was left unresolved.

Regarding the activities of the HR committee, they now had to review the bonuses, and at that stage the Agency had managed to achieve only a 67% performance, according to the annual performance plan (APP). The CEO, who was on a different appointment condition, did not achieve 100% of his performance agreement, and he was then compensated 80% of his salary and an agreement was made that he would receive the remaining 20% once he had achieved 100% performance. When they discussed the matter of bonuses, a resolution was reached that performance bonuses would be approved for employees, but on conditions. This did not exclude the policy framework, and the proposal came to Remco, and they had questioned the policy framework. The policy of the Agency stated that there was a threshold that needed to be achieved before employees received performance bonuses. The CEO had not achieved a 100% performance, but the executives had exceeded their performance levels. Remco had requested evidence on how the executives had over-achieved their performances. The executive key performance areas (KPAs) were not supportive of the organisational mandate, some of which were administrative in nature and did not feed into the CEO’s performance. Therefore, Remco felt that it should decline granting the bonuses. Subsequently, at a following board meeting, the company secretary presented the bonuses allowed by the Chairperson, even though this was against the Remco decision. This had happened again at another board meeting, and this time the presentation was done by the CEO. Unfortunately this was approved, despite their advice.

Ms Sekonyela said she had received anonymous e-mails from employees about corruption, implicating the chairperson of the Board in matters of various appointments, as well as the unfair distribution of bonuses. At that time, she had sent a message to the CEO which had then been distributed to all the board members. Subsequent to that, a number of unpleasant e-mails were sent to them by the chairperson of the Board, and various threats were made. In October, the chairperson of the Board came to Parliament and they had been receiving phone calls and been threatened with legal action from the CEO’s side, indicating that they needed to close the matter. They did not even know what they would be closing, as employees had raised issues and it was going to be difficult to close the matter. They were still waiting for the Minister to get back to them, but he was taking too long.

Mr Hunsinger thanked the Board Member for disclosing information that was very disturbing about what had been transpiring in the organisation. He indicated that this was one variation of two variations, and suggested that the Chairperson should not open the floor for more variation but rather take a stance on what needed to occur going forward. The Committee could request verification of the information that had been submitted, and said an investigation should be encouraged to take place.

The Chairperson submitted the proposal from Mr Hunsinger, and asked if Members agreed with the proposal.

Discussion

Mr L Ramatlakane (ANC) acknowledged the proposal, but was uncertain whether it spoke to the opening up of the floor for more variations from the rest of the Board members, or if the Minister should be opened up for investigation for fact finding on the matters that had been raised. His difficulty was that there were allegations, and some of the matters raised required serious attention. Therefore, something definitely needed to be done. In all fairness, these variations needed to be entertained so that Members could come to an understanding of what needed to be done going forward. If the board was divided, that was an untenable situation and Members needed to understand whether the Board was fit to continue functioning in light of the division.

Mr M Sibande (ANC) said that before the meeting commenced something very strange happened. For example, the presenter had indicated that under the CEO’s tenure, the organisation had received clean audits for three consecutive years. However, he wanted to know whether all internal procedures had been undertaken to resolve these matters. The Committee needed to receive factual information about what had been transpiring before acting or taking a resolution on incomplete information, because the matter was deeper than had been reported by the Board member.

Ms S Xego (ANC) said what had triggered the meeting had been information that had been presented by the CEO and the chairperson at the meeting that took place in October through the Parliamentary channel. What had been presented then was different from what was being said now, and the Committee should allow other people to respond. They were hearing that the Board was dysfunctional. She asked what had happened from the date of the meeting when the board was here, and up to this point.

Mr M Seabi (ANC) said that the proposal by Mr Hunsinger could be parked so that the Members could receive input from other Board members, and so that the Committee could make an informed decision.

The Chairperson said she would hand over to Mr Ramathe to submit his input of response.

CBRTA chairperson’s response

Mr Moss Ramathe, Chairperson of the CBRTA Board, said referred to the letter written to the Committee, and said the presentation that had been made today had not been disputed. A number of new issues had been raised, and he would rather not get into them because the information presented to the Committee had been complete lies. If allowed, the Committee could have another session with a response regarding what had been said here.

The four members of the Board who had come here were often absent from Board meetings -- that was the first point that Members of the Committee needed to understand. These Board members were grossly incompetent -- they hardly ever contributed any sound inputs at Board meetings. These Board members had been behaving like they did not understand what it meant to be a Board member, and to conduct themselves accordingly.

Professor Jan Havenga, deputy chairperson of the Board, said that he had been just as surprised when he heard about him getting the deputy chairperson vacancy, as he had not lobbied for it. Secondly, he was hearing about a lot of the letters that were mentioned earlier by Ms Sekonyela for the first time today. He would rather not delve into the details of everything else that had been said earlier on.

Mr Baloyi, Board member, said that he regretted that things that should have been said in the Board, had been said on national television. He said that when he had asked Mr Ramathe about the visit to Mauritius, the response had been that it was not necessary for the Board members to know. Board members were not trying to investigate anything, but needed to understand the objective of the trip. The Board was facing simple problems which had significant ramifications -- matters that should be discussed and resolved in Board meetings.

Mr Thekiso, Board member, said that he would not sit here and listen to the chairperson of the Board sulking.

The Chairperson politely asked him to withdraw the statement that the chairperson of the Board was sulking.

Mr Thekiso withdrew his statement. He said the chairperson of the Board was acting like the school principal, and the challenge was that one did not have to raise anything on issues that had been discussed at a particular meeting. He wanted things to go his way. Their issue was more about corporate governance, and they always raised this matter. If the chairperson of the Board accused members of not attending board meetings, then the board meeting minutes could be scrutinised to verify those claims. The Chairperson was always protecting the CEO. When it came to the investigation, they just wanted it to be completed so that they could move forward with this, but he always protected the CEO as though they had a problem with the CEO, while they were pushing for good governance. Even when the company secretary was appointed, due processes had not been followed; in fact, even the appointment of the CEO had been conducted in a similar fashion. However, when they raised these issues, the chairperson of the Board always attacked them and protected the CEO. Members were arguing that the Chairperson could not be the board alone and continue behaving like a school principal. If they could have the investigation and scrutinise the transcripts of what had been transpiring, it would be found it was not true what the chairperson had said about them.

Ms Mahlangu said that the reason she did not sign off on the financials was because they had come during the board meeting, and she had received them late. The audit committee had also battled to add up the numbers, as well as being furnished with proper documentation for verification. When the chairperson of the audit committee had refused to sign the financials, why would she go ahead and sign off on them? They had been appointed by the executive to occupy a certain committee, and this had not been done by the chairperson of the Board. If she did not attend a board meeting, she would always read up and submit her input on the matters that had been raised. She had proof to support that, so it was not true that she did not make any input.

Discussion

Mr Sibande said that it was worrying that the Committee was dealing with professionals who had failed to deal with their internal matters internally. There were legal prescripts that provided sufficient guidance in dealing with certain matters. So without wasting any time, he proposed as a way forward that this matter should be taken to the Department or Ministry with a deadline to check on where the problem lay, because Members would now be entertaining internal matters. These matters needed a thorough investigation.

Mr Ramatlakane said that from what had been presented today, it was unfortunate that the organisation had been running without the oversight of the Board, because it appeared to have been divided or grossly dysfunctional. Even the expressed body language amongst the Board members suggested that the relationship between them was irreparable. Perhaps they could agree that what they had heard should not have been presented here, and that it should have been resolved as well. Members did not take pleasure from hearing what had been said during the meeting, as it was very embarrassing. Also, the CEO had not said anything, but it was alarming how he could have allowed something like this to occur under his watch. Perhaps this was something that should be referred to the Minister, but he was uncertain whether the relationship amongst the Members could still be repaired.

Ms N Nolutshongu (EFF) said she was very disappointed about what had transpired in the meeting. Members of the Board should come up with proposals in terms of what needed to be done in order to remedy the situation, because if each member wanted to really serve the country, that should be put above personal egos.

Mr T Mpanza (ANC) said that time was money, and today the Committee’s time had been grossly wasted. The right place to direct these matters for resolution was the Minister, because he appointed the Members of the Board.

Ms Xego agreed that this matter should be taken to the Minister. Perhaps, the Committee could take a decision to inform the Minister about this matter on the Board’s behalf.

Mr Chris Hlabisa, Acting Director General, Department of Transport, agreed that the matters were supposed to be handled elsewhere, not in the Committee meeting. He had advised the chairperson personally when various issues had been raised by numerous members of the Board. He suggested that the CBRTA chairperson should convene a Board meeting and deliberate and produce a report for the Minister to make a decision.

The Chairperson said that resolving these matters was possible, but members needed to work on their relationships. There was a need to look into policy imperatives and put a policy in place, and perhaps an annual plan of travel, and if there had been a deviation from that policy, it would be easier to deal with the problem. She encouraged the Board members to try and work together to serve the country, and deliver the service through working on a harmonious environment.

The meeting was adjourned.