NAC on: allegations of governance challenges, resignations of council members, state of readiness to disburse PESP funding

Sports, Arts and Culture

02 September 2022
Chairperson: Ms B Dlulane (ANC)
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Meeting Summary

Video

In a virtual meeting, the Committee was briefed by representatives of the Department of Sport, Arts and Culture (DSAC) and the National Arts Council (NAC).

The briefings covered resignations of some council members and steps taken to replace them, the appointment of an acting chief executive officer (CEO) and the process of recruiting a permanent one.

Members were briefed on a dispute with a former council member who had been seconded from council duties to act as an interim CEO for a short period and who was challenging the termination of her employment.

Another dispute involved a former council member who applied for a senior staff position. Members heard that the appointment proceeded despite concerns raised about council members being part of the NAC staff. The Committee was told that the appointment process was not fair and transparent and that it was orchestrated by a few members of the council in contravention of a council resolution that the appointment be put on hold until the Minister had been consulted.

The Committee was also briefed on progress in allocating grants under the Presidential Employment Stimulus Programme (PESP). The NAC  said it was processing 4 810 applications for funding from the PESP out of a total of 9 455 that had been registered. Of these, 4 465 were submitted online and 345 manual applications.

Committee Members asked why so many of the registered applications had not been finalised. The NAC said steps were taken to assist applicants included a call centre and provincial workshops.

Members raised numerous questions about the issue of members of the council applying for NAC staff positions and expressed concerns about governance of the NAC.
 

Meeting report

Opening the meeting, the Chairperson said that the Department of Sports, Arts and Culture (DSAC) would be represented at the meeting by an acting Director-General (DG), as she had received correspondence that the contract of the former DG came to an end on 1 September 2022. She praised the former DG for his work in ensuring that meetings with the Committee ran smoothly and with due diligence. The Chairperson asked that a letter be written to the former DG to wish him well with his new journey. She welcomed the acting DG.

She said that the netball team would be playing and the Committee usually committed to watching the team every Friday. She also indicated that Banyana Banyana would be playing during the weekend, and wished them well. Information about the male netball team had not yet been shared with her. She wished all the national teams playing abroad and locally well.

DSAC Overview

Mr Vusumuzi Ndima, acting DG, DSAC, introduced his colleagues from various departments. 

The chairperson of the National Arts Council (NAC), Ms Celenhle Dlamini, introduced her colleagues. She noted apologies from Dr Celiwe Ngwenya, Dr Sipho Sithole, and Advocate Eric Makhosini Nkosi.

The acting DG said his presentation would focus on the mandate of the NAC, resignations from the council, the appointment of the chief executive officer (CEO) and an issue involving the appointment of a council member to a staff position.

He said the mandate of the NAC was derived from the National Arts Council Act of 1997. The NAC was mandated to allocate funds to artists, cultural institutions, non-governmental organisations and community-based organisations. The funds were to promote the creation, teaching and dissemination of literature, oral history and storytelling, music, dance, theatre, opera, design, visual arts, and crafts which fully reflected the country’s diversity. The NAC was also mandated to provide study bursaries in the fields of arts and culture to practitioners, administrators, and educators.

Two provincial representatives on the council - from Gauteng and the Western Cape - had resigned. A  representative from the Eastern Cape Province was relieved of his duties. Two ministerial appointees, Ms Marion Mbina-Mthembu and Ms Linda Mvanana had resigned. The Minister appointed replacements for them from the list of recommended candidates. The Western Cape representative had been replaced, while representatives from the Eastern Cape, Gauteng and the Free State remained unreplaced.

The issue of the appointment of the CEO was a historical matter discussed in previous meetings with the Committee. The NAC settled with the former CEO, Ms Rosemary Mangope. She was paid the equivalent of six months’ salary and disciplinary proceedings against her were dropped.

A council member, Ms Marion Mbina-Mthembu, was appointed interim CEO. The Department concurred on the basis that the acting CEO was on sick leave for one month. When the council member continued in the interim position, the Department wrote a letter to say this was a breach of the NAC Act. The interim CEO resigned from the council. The council asked her to stay for a month to do a handover report. The interim CEO demanded three months' notice and questioned the reasons for her acting appointment's termination.  

On the issue involving the appointment of a council member to a staff position, the Committee heard that the DG received a letter from the interim CEO indicating that councillor Tshepo Mashiane had applied for the vacant post of programme manager: capacity building. He had scored the highest points of those interviewed for the post. The interim CEO sought guidance from the DG’s office regarding whether the NAC could appoint him when he was a sitting councillor appointed by the Minister.

The DG’s response was that a council member could not serve on the council and as a staff member, as it constituted a conflict of interest. The council member concerned should have declared his interest and resigned from the council. The DG advised the interim CEO to study the NAC’s recruitment policy and the council charter. 

See overview presentation for further details

NAC presentation

Before the presentation started, the Chairperson remarked that the NAC had been in a very bad state for quite some time. In the past, the NAC had attended meetings without adequate preparation. The NAC had been cautioned by the Committee on how it was being run, and they anticipate an improvement in the current presentation.

Ms Celenhle Dlamini, Chairperson, NAC, said she appreciated the opportunity to engage with the Committee. 

The Chairperson said that the NAC needed to keep the Committee updated on matters concerning the council. Information should be provided when it is requested.

Ms Dlamini responded that questions from the Committee were channelled through the DSAC. All the questions had been responded to. The council was aware that they had to respect the Chairperson’s requests. 

Ms Dlamini began by touching on the resignations of council members. Ms Linda Mvanana resigned because she had been appointed to a senior role within her organisation, which prevented her from sufficiently fulfilling her duties at the NAC. The issue of Mr Tshepo Mashiane would be addressed by the DSAC. Ms Marion Mbina-Mthembu sent a resignation letter and indicated that she intended to apply for the position of CEO at the NAC when it was advertised. The resignation of the former deputy chairperson, Ms Phumzile Zitumane, would also be addressed by the DSAC. Ms Bernedette Muthien was appointed as the Western Cape Council representative.

Ms Dlamini said that Mr Mashiane’s appointment was facilitated through an unfair and non-transparent process. The process to recruit, select and appoint him was implemented by a few council members. The appointment was carried out by circumventing an approved council resolution stating that Mr Mashiane would not be appointed until the Minister had been consulted. He was appointed without the knowledge of the full council, and evidence had emerged indicating how the position would be funded, advertised, and interviewed to ensure that he was appointed. The council had been alerted of the appointment during an executive committee meeting. A legal opinion was sought on the validity of the appointment of Mr Mashiane since the council resolution had been deliberately circumvented. The legal opinion confirmed that the appointment was deemed invalid.
 
Upon learning that a council resolution had been circumvented, the interim CEO issued a letter to Mr Mashiane to not report for work pending the finalisation of the matter. Mr Mashiane opted to secure legal counsel to respond to the NAC. Evidence that proved the orchestration of the appointment of Mr Mashiane had been sent to the DSAC for reviewing and processing. On 6 August, Mr Mashiane sent a letter to the State Attorney seeking intervention. The State Attorney referred Mr Mashiane to his labour relations office.

The Minister appointed Ms Mbina-Mthembu as an NAC councillor in May 2021. She was then seconded by the council to the position of interim CEO of the NAC on 12 September 2021, following the medical leave of the then-acting CEO, Ms Julie Diphofa. The appointment was for a minimum of two weeks, subject to a maximum of six weeks or a period that the council considered necessary for operational requirements. The council resolved that during her tenure as interim CEO, she would suspend her duties as a council member, and return once she stepped down as interim CEO.

On 7 July 2022, the NAC issued a request for quotation (RFQ) for a recruitment agency to assist with recruiting a CEO. The NAC was currently reviewing some of the responses.
 
On 20 July, Ms Mbina-Mthembu advised the Minister of her resignation as a council member in writing. She also wrote to the chairperson of the NAC advising her of her interest in applying for the vacant CEO post.
 
The council met and resolved, on 31 July 2022, to terminate the short-term appointment of the interim CEO. The termination notice stated that Ms Mbina was to be given one calendar month’s notice. The notice period would commence on 1 August 2022 and end on 31 August. Ms Mbina-Mthembu was requested to prepare a handover report during the notice period, to be submitted no later than 31 August. 

On 1 August 2022, the chairperson sent Ms Mbina-Mthembu the notice of termination. She also called a meeting with her, which was also attended by the company secretary, to discuss the terms of the termination. The interim CEO said that she would consider a two months notice pay period as opposed to the one month offered by the NAC. She reported that she had been approached by a journalist early that morning informing her of the council's decision to terminate her appointment as interim CEO. The chairperson apologised for the unfortunate leak and requested her to communicate her counter-proposal in writing.

Ms Mbina-Mthembu wrote to the chairperson on 2 August to request confirmation that there was pressure from the DSAC and senior officials to expedite the termination. She requested written reasons for expediting the termination of her appointment as interim CEO. She wrote a follow-up letter on 4 August in which she lamented the delay in providing her with the reasons for expediting the termination of her appointment. She advised that she would be escalating the matter to relevant state authorities.

The council met on 5 August and formulated a response to Ms Mbina-Mthembu’s letters. It was resolved that Ms Mbina-Mthembu should be requested to serve her notice period from home and not be involved in any NAC activities.

Ms Mbina-Mthembu had since taken the NAC to the Commission for Conciliation, Mediation and Arbitration (CCMA) to challenge her termination.

Mr  T Mhlongo (DA) reminded the Chairperson of the Committee that in the previous meeting, Ms Dlamini had been told that such information should be shared with the Committee. He proposed that the Committee should hear from board members if they were aware of these issues. Board members should be allowed to present and the chairperson should not present alone.
 
The Chairperson noted Mr Mhlongo’s proposal.

Ms Dlamini said she would gladly incorporate some of the other council members as proposed.

She then addressed allegations of wasteful expenditure. On 16 August 2022, Ms Mbina-Mthembu wrote a letter to the council stating that she was reporting wasteful expenditure incurred by the council to relevant authorities. The chairperson of the council responded to the email by reminding her that the wasteful expenditure she alleged was never incurred because the NAC took legal advice and never proceeded with the action that would have caused the wasteful expenditure. Ms Mbina-Mthembu was also advised to ensure that wherever she was reporting the alleged expenditure, she should also provide the response given by the NAC disputing allegations of wasteful expenditure, as she had been party to the decision to not proceed with the action.

Ms Dlamini addressed questions about NAC funds held by the South African Reserve Bank (SARB). Media questions had surfaced shortly after the termination of Ms Mbina-Mthembu's employment. The NAC could confirm that the funds were transferred based on a National Treasury directive, and all funds had been accounted for. The funds also appeared in the NAC’s annual financial statements. The Auditor-General audited the bank account during the audit of the 2021/2022 financial year, with no findings related to these funds.

She gave an update on the recruitment of the NAC CEO. After the departure of Ms Mbina-Mthembu, the council appointed Ms Julie Diphofa as acting CEO until the process to appoint a permanent CEO was concluded.

To ensure the independence of the process, the NAC was evaluating bids for the appointment of an executive recruitment firm. The NAC was confident that the advertisement for the position of CEO would be issued in the following weeks. Members of the interview panel would come from inside and outside the council. 

The acting CEO would be looking into the matters related to the appointments of the human resources manager and the graphic designer and should provide feedback during the current committee meeting.

Ms Dlamini referred to media articles that were based on leaked confidential information. She also presented feedback received from artists. However, due to time constraints, the Chairperson of the Portfolio Committee advised that there would be no need for that. 

See attached for further details

Presidential Employment Stimulus Programme

Ms Julie Diphofa, acting CEO, NAC, briefed the Portfolio Committee on the status of the Presidential Employment Stimulus Programme (PESP).

She said the call for applications to the PESP  was released on 20 June 2022 and closed on 29 July 2022. Traffic on the grant management system (GMS) around the closing time slowed down the system and led to numerous requests to extend the closing time. It was extended to midnight, instead of the original time of 17h00.

The NAC received a total of 4 810 applications for funding from the PESP. A total of 9 455 were registered. However, only 4 465 were submitted online. There were 345 manual applications.

The presentation outlined the number of applicants across the various arts disciplines and according to provinces. The highest number of applicants were from Gauteng. 

The Portfolio Committee was taken through the timelines. The NAC had signed a memorandum of understanding (MOU) with the DSAC. Funding deadlines were approved by the council. A human resources (HR) plan has been approved. A call centre had been set up to assist applicants. A stakeholder engagement plan and communication plans are currently being implemented. Virtual roadshows had been undertaken in all nine provinces. Physical roadshows took place in the North West and KZN provinces, organised by the provinces.

The NAC website and social media infographics guided applicants on the contracting process and the requirements for tax compliance. 

A panel had begun the process of reviewing the applications. The council envisaged that the advisory panel meeting would commence on 2 September to finalise recommendations. Outcomes would be released on 30 September 2022. The grant notification letters and contracting phase would be released in October.

See attached for further details

Discussion

Mr M Zondi (ANC) asked for clarity on the processes that followed after the DSAC responded to the Mashiane matter and stated that he could not serve as a council member and staff member simultaneously. He asked when Mr Mashiane was informed that his application was successful. Since Mr Mashiane’s resignation was tendered in late June, were there any records at the NAC that he did indeed resign?

Did the NAC have any insight into why only half of the applicants registered on the GMS managed to submit their applications? What support was given to applicants by the call centre?

Mr B Madlingozi (EFF) asked for clarity on the settlement that the Department reached with Ms Mangope and why the settlement was necessary when she was found to be on the wrong side of the law. He asked if any contract was signed to have Ms Mbina-Mthembu as the interim CEO. Why had she made demands?

The NAC stated that council members may not serve as both council members and as a member of staff. He asked if the appointment of Mr Bongani Thembe as both the chief executive and artistic director of the Mzansi National Philharmonic Orchestra (MNPO) had gone through a transparent public participation process.

He asked for the council to state the exact amount of funds that they received for the MNPO, and he asked for clarity on how the funds were channelled.

Why was Ms Mbina-Mthembu’s letter not documented in the presentation? Who was responsible for the leaks that were compromising the NAC? 

Why were large sums of money being held at the SARB, while there were artists who required the funding? 

Mr T Mhlongo (DA) said that the NAC did not adhere to good governance. He asked who authorised the shifting of money to the SARB and if the acting CEO and the chief financial officer (CFO) were aware of the transaction. He also asked if there was a council resolution and requested a copy.

He asked if the Minister and the chairperson of the NAC were involved in human resources issues and the reasons for the involvement.

He asked for clarity on the legal status of the Mashiane issue. What were the dates of his appointment and resignation? When was Mr Mashiane advised to resign? The presentation did not indicate this clearly. The position of programme manager was part of the NAC’s organogram. It had been suggested that it was a new position created for Mr Mashiane, although it was advertised. The closing date was 22 May 2022, as indicated in the documents.
 
He asked why the Minister needed to be involved in the recruitment process. He asked if the Minister induced the chairperson to ask Mr Mashiane to resign, and which law was applied by the NAC to establish that the appointment was unlawful. He asked for the audio recordings of when the council made the decision.

Who authorised the appointment of the legal firm Moodie and Robertson and were any council members involved? He requested the council resolution minutes and recordings of the meeting if they were available.

The chairperson of the council was alleged to have a conflict of interest in the Mashiane issue. Councillors had resigned because the chairperson was allegedly a dictator. He had been told that the chairperson was dealing with Mr Mashiane because there had been an issue that they disagreed on when he was still a member of the council.

He asked for clarity on the appointment of Mr Tembe and for the minutes of the meeting where the NAC gave the National Orchestra money.

The evidence and the presentation to the Portfolio   Committee were contradictory. He proposed that the entire council should be put under administration. The council did not adhere to any rules.

He asked about a theatre and dance conference and who authorised the funding of the indaba. What were the terms of reference? 

The Chairperson said there would not be enough time to answer some questions.

Ms R Adams (ANC) asked for the exact amount of funds targeted for the PESP and the targeted number of beneficiaries. How had the DSAC been promoting its support for artists? There had been some complaints from artists about inadequate support.

Was the NAC reviewing its policies and legislation? How was the DSAC strengthening governance across all entities? Was there a need to amend the NAC Act to improve corporate governance and fill any possible gaps? The NAC should indicate which areas specifically need to be improved.

The NAC noted that they received a total of 4 810 applications for PESP funds. The NAC should provide a breakdown of the funding per application threshold.

She asked DSAC to supply the Portfolio Committee with a list of the former council members who had been relieved of their duties. She asked who the Western Cape replacement was.

Mr B Mamabolo (ANC) said that the issue of NAC leaks to the media was quite worrisome. He asked for clarity on the matter. He also asked for an update on the progress of the recruitment process in the entity.


What was DSAC doing to ensure that all its entities were run sufficiently? The NAC seemed to only be funding projects in the urban areas and there was no visibility in the rural areas.

Ms D Sibiya (ANC) expressed her confusion with parts of the presentation. On 4 August, Ms Mbina-Mthembu wrote a letter to the chairperson regarding her termination, and the council met on 5 August. She asked for clarity about whether Ms Mbina-Mthembu continuously wrote letters to the council while she was at home and not working.

The Chairperson welcomed the presentation. However, there were issues of concern within the NAC. The Committee would like to see the NAC succeed as an entity. The matters discussed in the presentation should not escalate to a level where they affect the functioning of the NAC.

She asked for clarity on the criteria used by the NAC to balance the different disciplines and ensure equitable distribution of funds to all provinces. She asked how the entity monitored the support it provided to various artists and the effect of the previous PESP.

Ms V Van Dyk (DA) welcomed the presentation. She asked for clarity regarding a figure of R65 million mentioned in the presentation. She asked who signed over the money to the SARB and whether the information had been clearly stated in the financial statements. She requested that the council make these available to the Portfolio Committee.  
 
When was the council resolution on the appointment of Mr Mashiane taken and was the chairperson aware of it? She requested that the council should make the minutes of the resolution available to the Portfolio Committee. She asked for the exact amount of legal fees spent on the Mashiane matter thus far. She requested a copy of the letter of resignation that Mr Mashiane submitted.

The Chairperson also asked for the exact amount spent on legal fees this far in resolving the Mashiane matter. She also asked whether the former interim CEO was paid an honorarium in addition to her salary as interim CEO.

Ms M Khawula (EFF) said there seemed to be issues within the NAC, and she proposed that there should be investigations into how it had been functioning under the leadership of the Minister. The Portfolio Committee had not received sufficient updates from the DSAC about what went on in the different entities. She said that it was important that the Department was visible on occasions such as the coronation of traditional leaders, for example, the new Zulu king.

Ms V Malomane (ANC) asked whether the NAC should not change its policies to prohibit members from applying for positions that they were not allowed to apply for. She asked about the progress on the issue of the resignation of Ms Mbina-Mthembu after the Department had responded to their request for advice on the issue. She asked for an update on the progress of the investigations within the entity.

Mr Mhlongo advised that although the Chairperson of the Portfolio Committee had indicated that some questions were not allowed in the current meeting, he wanted to state that Ms Mpho Molepo was part of the advisory panel to the NAC. Therefore the question should be allowed.

The Chairperson noted the point.

Ms Van Dyk asked for clarity on who advised on the letter written by Advocate Morrison (sp) that the previous CEO had to sign. She asked how much was charged for the letter.

Mr Madlingozi asked about a former NAC employee working in an arts development discipline who called an applicant under the guise of being an NAC official.

Mr Mhlongo asked if the former NAC member, Mr Mashiane, was still being paid. If that was the case, could this not be viewed as wasteful expenditure? Could the NAC confirm whether there had been an abuse of power and had any public funds been used for personal gain? He reiterated his proposal that the NAC be put under administration. The NAC had not been performing adequately.

The Chairperson said that the motion needed the support of all the Committee Members. She therefore noted the Member's proposal. The meeting certainly showed that work was being done.

Responses - NAC

Ms Dlamini responded on the Mashiane matter. The first date she would like to note for the committee was 13 June 2022, when a special human resources committee (HRC) meeting was convened to consider his appointment. It was indicated that he had resigned already. Mr Mashiane would have been appointed into an administrative position within the NAC. The interim CEO was to finalise recruitment by appointing him as soon as the office received the confirmation of resignation.

After the HRC meeting, a resignation letter was received from Mr Mashiane. The council met on 15 June to discuss the letter. The resolution was that his resignation as a member of the council was noted and the Minister would be consulted before a final decision was made. Since they were dealing with a council member, a letter had to be written to the Minister and a meeting held with the Minister to discuss the matter. The council also sought legal advice on whether any legal provisions might preclude a council member from applying for a position within the organisation.

Five days later, the deputy chairperson signed the legal brief to obtain the legal opinion that would accompany the letter to the Minister. On 24 June, a legal opinion was obtained. The council resolution was not completed. Instead, the deputy chairperson contacted the interim CEO and advised her to go ahead with the appointment of Mr Mashiane. On 30 June, the interim CEO signed an offer letter to Mr Mashiane, as per the following terms: programme manager, capacity building, with a total cost to company of R763 935 per annum and a start date of 11 July 2022.
 
On 5 July, an executive committee (exco) meeting was held and the interim CEO indicated that she would like to update the exco that she had appointed Mr Mashiane. TMs Dlamini said the update came as a surprise to the members of the council, and she recused herself as chairperson when the Mashiane matter was deliberated. When the council began inquiring how the appointment had happened, many matters began unfolding and it was evident that a lot was happening behind the scenes. The matter was reported to the Minister and his office, and they were currently dealing with it.

She referred to the question about why council members had an interest in joining the staff. When the interim CEO, a council member, was appointed, it was meant to be a short-term appointment due to the acting CEO taking medical leave. They needed to stabilise the entity and ensure they would be able to continue the work of the PESP. The work of the PESP had been done successfully, as artists received their money and were on course. When the matters started unfolding, there was, unfortunately, nothing in the council charter about policies about council members wanting to be part of the staff. She confirmed that the current council was considering the policies to ensure there were clear processes for handling such matters.

There had been a letter from the interim CEO seeking guidance on the scheduled interviews for the position of programme manager. It indicated that Mr Mashiane was a candidate and was at the time part of the accounting authority. It asked whether they could interview a person senior to them and where to draw the line in terms of governance as it had the potential to be complicated. Her response to the CEO at the time was that she was uncomfortable with the appointment being continued, and that the DSAC needed to provide guidance. Unfortunately, the interim CEO seemed to receive pressure to go ahead with the interview before involving the DSAC. The letter was written, but after the interview had taken place. The DG had indicated clearly in his response that a council member may not serve as a member of staff of the organisation. It was indicated that Mr Mashiane should have disclosed his interest in applying for the position to the council and thereafter resigned from the council.

Mr Mhlongo raised a point of order. He said Ms Dlamini was the only one responding to the questions.

The Chairperson said that Ms Dlamini should be given an opportunity to speak and thereafter hand over to her colleagues if needed.

Ms Dlamini said it was very concerning to see council members wanting to join the NAC staff. The DSAC had been playing a good role in exercising oversight of the matter.

The interim CEO post was not permanent and was given to Ms Mbina-Mthembu as she was a council member who understood the struggles in managing the PESP. The DSAC was consulted and agreed to hire her for a short period as they were uncomfortable with council members being in operational positions.
 
She confirmed that the former interim CEO was not being double paid, as she suspended her duties as a council member when she took up the position.

The media leaks were quite a concern to all members of the council. The leaks only came after the departure of former councillors Mashiane and Mbina-Mthembu. The council was not aware of who was behind the leaks and what the issue might be. There could be current council members who were aggrieved that Mr Mashiane was no longer a member of the council. Council members were cautioning one another to ensure that discussions of the council were not exposed prematurely. The council would have liked to come before the committee to report on these matters before they were leaked in the papers.

The NAC had three bank accounts, two ABSA accounts and one with the SARB. It was the procedure that funds could be used from one account to cover funding that needed to be paid over a couple of days. The funding was authorised in terms of the financial management of the NAC, and there were authorised signatories who transacted on these bank accounts. All funds had been audited and accounted for.

The one wasteful expenditure that could have happened was an urgent court application. However, it was never incurred. The former interim CEO was a part of the decision not to take the route of the court application.

Mr Mashiane was currently being paid as per the signed offer letter.

She referred the questions on Mr Tembe to the DSAC.

The acting CEO, Ms Julie Diphofa, responded to the questions about the grant management system (GMS). It was a norm that applicants registered late on the system and were unable to complete their applications. When the NAC monitored the applications on the GMS, they noted that two days before the closing date, 7 000 additional applicants had been registered. Some applicants missed important documents and were unsuccessful in their applications.

She spoke on the role of the call centre staff. Lines were open to assist in the application process. An email service has also been made available to assist PESP applicants. A question and answer option had also been made available on the GMS.

There had been an allocation of R180 million from the DSAC for the current financial year. The expected number of beneficiaries was 10 000.

Workshops were run throughout the provinces. The application process was presented and applicants were taken through the form they would need to fill out. Applications from the Western Cape and Northern Cape were low. The population in the Northern Cape was quite small, but submissions from the Western Cape were lower than in the previous call for applications. 

There were three levels of funding. The first had a threshold of a maximum of R3 million for projects that had a national footprint and were involved in capacity building and creation of employment. The second level had a threshold of R2 million and provided opportunities for venues and art centres with similar criteria. The third level had a threshold of R1 million. 

Recruitment for the current financial year has been finalised, and all advertised posts have been filled.

On the question about how the NAC ensured that funding reached disadvantaged areas instead of having an urban bias, she said the council had been cognisant of this and had approved a  framework for allocations.

Regarding aggregating funding across the different disciplines, the NAC used the baseline figures from the previous call for PESP applications to determine the demands of each of the arts sectors.

The previous PESP had two streams, one for job retention and another one for employment creation. In the first stream, 2 409 jobs were retained and 19 118 jobs were created in the second stream.

PESP investigations were concluded in the previous year, disciplining the former CEO.

The NAC was investigating the matter of a former employee calling applicants. 

Further discussion

Mr Mhlongo said some questions had not been addressed. He asked Ms Dlamini to provide evidence that board members were leaking information to the media. His question on the shifting of funds had not been answered. Ms Dlamini should not be the only one addressing the questions, as there were other board members.

The Chairperson said that it should be dictated who should speak. The leader of the delegation should make that call. 

Mr Mhlongo reiterated some of his questions were not responded to. He had asked questions about governance and the relevant members of the entity should be responding to them. He asked whether the chairperson, Ms Dlamini, was saying that indeed there had been no evidence of wasteful expenditure. He asked for the details of the legal status of the matters raised. His questions on Mr Tembe were not addressed. Was the Minister consulted on the matter? He asked why the chairperson, Ms Dlamini, recused herself from the Mashiane matter. She could not recuse herself as this would be a conflict of interest.

Mr Madlingozi said the appointment of Mr Tembe was unclear and he would like clarity on the matter. He asked who ran the Mzansi Philharmonic Orchestra, and what the contents of the MOA were.

Ms Malomane said that she did not mind who responded to the questions she had raised. The questions from Mr Mhlongo were follow-up questions rather than questions that had not been answered.

The Chairperson of the Committee said any board members present should feel free to add their voices to the meeting.

Mr Jones Chisekula, a council member, said that a notion had been raised that the chairperson, Ms Dlamini, was running the show alone. He would like to reaffirm that decisions taken in the meetings were collective decisions of the council, not those of the chairperson alone. The chairperson did not chair the meeting about the Mashiane matter. Red flags were raised, indicating that having her in the meeting would be unethical and not good governance. The council was not influenced in any way.

Ms Dlamini said it was exceptionally offensive to hear that the NAC was alleged to be run by the chairperson alone. The board members were professionals appointed by the Minister and MECs in the provinces. Decisions were taken in a meticulous, professional and mature manner. There were times when the board agreed to disagree on certain matters. It was unfortunate that individuals said the chairperson ran the show alone. This said that other council members were not capable of input in decision-making.

Mr Madlingozi raised a point of order that the speaker was debating rather than responding to the questions.

The Chairperson of the Committee ruled that Ms Dlamini had a right to defend herself before the Portfolio Committee.

Ms Dlamini called on other council members to respond.

Mr Mhlongo said that it could not be that only one member of the council responded to the questions being asked, and the rest of the members were quiet.

The Chairperson of the Committee said she would like to allow the board members to voice their opinions and defend themselves on the matters raised.

Ms Bernedette Muthien, a council member, said that there was a second tier of the NAC which consisted of the national delegates appointed by the Minister. She had heard that the Western Cape applications were quite low and as a new council member, she would work with the province to improve the numbers in the province.

She had joined the NAC with trepidation, given the wild ride that it had had in the media. As an artist, she saw the struggles artists went through during the Covid-19 pandemic. She had been impressed thus far with the work the NAC had done, regardless of the backlash it had received. The chairperson held everyone to account and was not dictatorial. She was assured by the level of professionalism with which the auditor, Ms Stephanie Dasilva, conducted her work. She was the only chartered accountant on the board. With time and support, the NAC could be turned around.

The Chairperson of the Committee thanked the new member of the council for her input.

Mr Bongani Tembe, a council member, said he would like to confirm the points raised by Ms Muthien. The NAC was a very robust council. He had been in and out of the NAC board for the past 20 years and had never seen a more professional and dedicated board. The chairperson was professional and gave everyone a chance to voice their views. The board often worked beyond the hours that they were expected to work. 

Mr Madlingozi said that it seemed that members of the board were singing the praises of the chairperson and not responding to the questions that had been asked.
 
The Chairperson of the Committee said that the board members had been provoked and were responding to the matters raised by Members. Patience should be afforded to the board members. She would like to be fair to everyone.

Mr Tembe said that before a portfolio committee meeting, the board convened and discussed the questions to be put to it. He thanked the Chairperson of the Portfolio Committee for how she was handling the meeting, as Members of the Portfolio Committee could not dictate to an entity.

Mr Mhlongo asked Mr Gamelihle Mbuyane, a council member, to respond to his question.

The Chairperson of the Committee did not allow him to proceed with that request. She appealed to other Committee Members to intervene. She tried her best to chair the meeting, yet some Members were taking over. She instructed Mr Tembe to go on with his inputs, as he was not wasting time but rather responding to questions and allegations put to him and the council.

Mr Mhlongo continued raising a point of order.

The Chairperson said that he was interrupting the proceedings and it was disrespectful.

Mr Tembe said that the NAC took the role of the Committee very seriously and they were more than willing to engage on the tough questions posed. The NAC had rights as an entity and those should be respected.
 
He responded to the issue raised about the orchestra, saying that they had received a letter from the Chairperson and the matter was going to be dealt with extensively on 16 September.
 
One of the Committee Members had intimated that the council might be involved in corruption. He stated that a forensic report did not implicate a single member of the board in any corruption. Issues were only around maladministration in the PESP. It was unfair that their integrity was disputed.

The Chairperson of the Committee allowed Ms Dlamini and anyone else on the board to respond to outstanding questions.

Ms Dlamini said that Mr Mhlongo had mentioned that he had papers from the NAC. She was not sure how he got hold of the information.

She said that colleagues from the DSAC should respond on the progress in the orchestra matter. She was aware of the upcoming meeting.

Mr Mhlongo raised a point of order. However, proceedings were disrupted by connectivity problems on the virtual platform.

Once it was restored, Mr Mhlongo reiterated his question about who had insisted that Mr Mashiane be interviewed. The names of the council members should be mentioned and the date and time of the meeting. He asked again who had authorised that R65 million be sent to the SARB. He had received documents from the website of the NAC, and he could provide video evidence of the documents.

Ms Dlamini said that the interim CEO did not mention any names but indicated that she received pressure from council members.

The issue of moving money around in the NAC was an operational matter dealt with by the CEO’s office, the CFO’s office, or the financial manager's office. It was the role of the finance department to move funds from one account to another.

She asked that she be allowed to return to the Portfolio Committee with an update on the issue of balance sheets. The documents would be sent through the DSAC.

Councilor Mbuyani had also lost connectivity and therefore was unable to respond to the questions posed to him.

 Ms Dlamini said that she could confirm that the NAC practised good governance.

Responses - DSAC
 

The acting Director-General, Mr Vusumuzi Ndima, responded to questions about efforts to strengthen governance in the NAC. All members of the council went through a screening process after they were appointed. The DSAC held inductions which focused on the legislative frameworks of the sector in which they were appointed. There was a focus on the Public Finance Management Act, corporate governance, and even matters of ethics were dealt with.
 
There were systems in place, such as a CEOs forum, a chairpersons forum and shareholder compacts where institutions held meetings with ministers. The system was not perfect.

A meeting on 16 September would deal with issues related to the orchestra matter.

Dr Cynthia Khumalo, Deputy Director-General, DSAC, said that the Department would be holding a national dance conference. It was the conclusion of a consultation process that began the previous year. The Department was currently developing a theatre and dance policy as a part of the implementation of the revised White Paper. There was documentation to show the process that was followed in terms of the supply chain management of the Alex academy.

The meeting was adjourned.



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