The Department of Transport firstly presented on the three options for the Civil Aviation Authority (CAA). Although some Members did express some reservations, it was generally agreed that the meeting would proceed on the understanding that the clauses in the Bill would be considered against the Option 3 model, which was the closest to what had been proposed in the original Bill, although the Chairperson noted that the rights of Members to raise further objections would be reserved. In terms of this model, there would be a Board, consisting of seven permanent members and the Director. The Director would have two separate functions; the first was administration and corporate governance, on which he would report to the Board, and the second related to safety and security issues, on which he would report directly to the Minister. The Minister would not become involved in administrative issues. Members questioned whether any functions of the current Authority would be removed, how the Board must comply with the Public Finance Management Act, the difference between the models, the role of the Director and how he would be supported, and whether the current lines of reporting were effective. They noted that the Memorandum of Agreement in respect of the roles and responsibilities of the Director; and the position of the industry must be included in the Bill.
The Department then tabled a new draft of some of the Bill’s provisions. The provision for emergency situations was contained in a new Clause 147A. Members did not raise any comments on Clauses 70, 74, 78, 80, 81, and 83. In respect of Clause 71, compliance with international protocols was to be specified as one of the objects. Repetition between Clause 100B (p) and 72(2) (g) was highlighted. Members raised questions of clarity about the funding mentioned in Clause 73. The Department was asked to redraft subclauses (1)(a) and (b) of Clause 75, dealing with functions and responsibilities, to make it clear that the CAA must achieve the objects of corporate governance, that the Board must set corporate governance objectives, monitor service excellence and customer satisfaction levels and report to the Minister on any matter concerning such issues. The prohibition on the Board compromising or obstructing the execution of safety and security oversight functions was discussed at length. In Clause 76, it was decided that the Department must reword the clause to separate out the special position of the Director on the Board and the other appointed Board members, and to specify that one of the two industry representatives must have financial competence and the other aviation operational experience. Under Clause 75(3)(c) it must be specified that the extension of appointment must be for conclusion of a process and only for six months. The Committee felt that the Department should also look to cross-referring the functions, skills and competencies, and factors to be taken into account when appointing, rather than drawing slightly different lists across different clauses. It was agreed that the shortlist should be reduced to ten, and that the shortlist must be published, with a minimum of 30 days for comment, before the Minister made the final appointments. Members debated whether provision should be made for special meetings under Clause 77. Under Clause 79, Members discussed whether the Board should have a dual responsibility for removal of Director, but decided against this. Clause 80 was to be amended to delete the requirement for consultation with the Board on Board remuneration. The date of 31 December should be deleted from Clause 82(1). Clause 84 would be amended to reflect that individuals did not have to be nominated, but could make individual application. The wording relating to the particular skills required of directors under clause 84 should specifically include aviation safety skills. Members also expressed the view that in view of the competencies and importance of the job, these required to be more strongly worded. They asked if there was a danger of including the Director’s powers or duties in clause 84. Sub-clauses 84(2)(c) and 84(2)(d) were deleted.
Members also discussed at length the remuneration of the Director of the CAA, with regard to who was consulted on setting the salary scale and who would be responsible for the actual payment. Other related issues included how the remuneration of the Director would be separated from that of the other CAA employees, and how the CAA would account for the Director’s salary. The members asked why the Minister of Finance needed to be involved in the Director’s appointment. The security clearance required for the Director was raised an issue, as it was felt that it was impractical to have the provision envisaged in sub-clause 84(7). The members wondered if the performance monitoring of the Director should not go under the functions of the Board. Under Clause 84(9)(a), the description of efficiency and the criteria used to determine efficiency were questioned.
The funding model of the CAA was discussed, as an amount from Parliament was included in the model. Sub-clause 84(9)(b) was noted as being discriminatory to persons with disabilities and was debated at length by the Committee. Under sub-clause 84(10), the Committee agreed to reverse sub-clauses (b) and (c). The delegation was asked to clarify the meanings of Clauses 86(2)(d) and 87(5). Members queried who issued licences and permits, and whether this was an independent function of the Director, or one performed on behalf of the Authority. The appointment of the Acting Director of the CAA was queried insofar as the actual conditions of appointment and the powers and duties assigned once appointed were concerned. The Committee agreed that the sequence of clause 89 was jumbled. The Committee discussed whether or not the performance agreements should be published, the registration of the name, the power of the Director to make appointments, the wording of “good faith” in Clause 98, and whether Clause 99, relating to Ministerial Orders, should have been deleted. Members also asked why the CAA needed the Public Service Commission involvement if they had their own employment policies, and whether it was necessary for the CAA to have liability insurance, which would be further discussed at the next meeting.
Draft Civil Aviation Bill: Continuation of Deliberations
The Chairperson summarised that on the previous day there had been some progress on the National Aviation Security Policy, but the issue remaining outstanding was what kind of Board, if any, there should be for the Civil Aviation Authority (CAA). He had therefore asked the Department of Transport (DOT) to give a presentation on the options available so that the Committee could decide where it wished to go.
Department of Transport presentation on options available for Civil Aviation Authority (CAA)
Mr Anwar Gany, Chief Director, Department of Transport, noted that various models had been prepared as options. Diagrams were made available to Members. Model 1 showed that the Board would be accountable in terms of the Public Finance Management Act (PFMA). The full Board would still have oversight in terms of the core business, being the safety and security. Model 2 showed that the Head of the Civil Aviation Authority would be the authority accountable for reporting to the Minister. Model 3 was more in line with he original Bill, which catered for the queries that had been raised about what would happen in cases of urgency. The Director would have two lines of reporting; one to the Minister, and one to the Board. The Board would be responsible for providing oversight in terms of the PFMA, and be responsible for full compliance with that Act and for corporate governance. The Committee could ask that certain actions be followed, with reconsideration to be given after 90 days. Page 4 of this Model showed that consideration would be given to the submissions of stakeholders, but this was quite a radical shift in policy. Models 1 and 3 both called for a Board and gave a clear indication of what the Board set out to achieve.
Mr S Farrow (DA) suggested that the Model 3 seemed to be extracting, from the CAA as currently set up, a competency of the Director. At the moment the Director reported to the Board but did have direct access also to the Minister. He asked what functions of the CAA that it currently performed would be taken away. He also asked for the rationale of having a Director reporting in two lines, and on what terms that would apply. He would have thought that the Board had a PFMA responsibility in any event, so he did not see much difference between Model 1 and Model 3.
Mr E Lucas (IFP) said that if the Director was able to go directly to the Minister he maybe given inappropriate powers and be in an unusual position.
Mr B Mashile (ANC) said that there must be compliance, but over and above that the Director should not be fettered by positions that had to be taken by the Board, particularly in safety and security issues, when immediate action might need to be taken. He did not think that there should be a requirement that the Director must wait for a Board meeting and he agreed that a "hotline'" to the political head would be useful.
Mr Gany noted that the principle objective of the CAA was to achieve safety and security in civil aviation. The CAA presently had a Board, reporting directly to the Minister of Transport. The Director of Civil Aviation, in terms of this Bill, would be appointed to have responsibility for day to day management in a wide range of more technical issues. The Director needed to retain the function of reporting on safety and security. It was appropriate that the Director report to the Minister on this function, because the Minister made the regulations. However, on a day to day management basis, he would report to the Board, which would be bound by the PFMA requirements.
The Chairperson asked what the difference was between Models 1 and 3.
Mr Gany said that Model 1 suggested that the CAA must provide oversight on safety and security in civil aviation. Model 3 was based more on the PFMA’s corporate governance requirements. It was similar to the
Mr Farrow asked again what the role of the Director would be, what he would take with him from the present CAA and what current operations of the CAA he would continue to hold.
Mr Gany noted that presently the Commissioner must have the technical competency and do the technical work. The Director would perform the same functions of the Commissioner. He would also do the day to day functions. He must have technical and management expertise, to oversee both requirements of his position.
Mr Farrow noted that currently there was a CEO and a Commissioner. If the roles were to be separate, he enquired if the Commissioner would become the Director and what would he take out of CAA to support that post.
The Chairperson said that it was important to see an organogram
Mr Mashile had understood that the Director and Commissioner had been joined into one position.
Captain Colin Jordaan, Commissioner and CEO for Civil Aviation Authority, noted that at present there were two functions, performed by one person. The CEO reported to the Minister and the Board.
Mr Farrow said that there was already direct access by the CEO to the Minister, and the Model 3 seemed to be a repetition of this.
The Chairperson explained that in the past the Commissioner had existed in name, but there was not a separate person performing his functions. Recently the functions had been combined. Models 1 and 3 proposed a Director with two key functions. One would be technical and professional, relating to safety and security, and the second would be the CEO-type function of managing the finances, appointing staff and taking responsibility for managing the organisation. Model 3 proposed that in respect of the CEO-type function, the Director’s line of communication and responsibility must lie through the Board. However, in regard to the safety and security function, the line of communication and accountability was to the Minister. In his opinion, Model 1 had confused those two lines and confused the functions of the Board and the accountability to the Minister, because the line of reporting to the Minister was not limited to contingencies.
Mr Mashile noted that the ANC Members supported Model 3.
The Chairperson thought that Members were not quite yet at the point where there could be acceptance of this model as a resolution, but he thanked Mr Mashile for the indication.
Mr Farrow said that he appreciated the modelling. However, the question was whether the dual role would achieve what was intended. In the current model, there was a Commissioner, and a CEO, yet both functions were being carried out by one person. He asked what the difference would be between this and Model 3..
The Chairperson explained that there was previously one person “wearing two hats”, but the new model proposed one person doing two related tasks. There was also currently confusion as to the status of the Board.
Capt Jordaan said that it was necessary to look into the history of the matter. The Federal Aviation Administration (FAA) and the CAA had found that
As a result of these comments, in December 2007 Capt Jordaan had been appointed to serve as both CEO and Commissioner, for a period of three years. The Minister was empowered to appoint to both positions. The Civil Aviation Commission was committed to keeping the positions unified. However,
Mr Farrow then referred back to the first organogram. He asked Capt Jordaan to explain whether the current lines of reporting were working. If so, there was no point in restructuring. He did not know still what the actual difference was.
Mr Gany said that there were currently two pieces of legislation, one speaking to appointment of a Commissioner and one speaking to appointment of the CEO. The FAA comment related to the need to harmonise and consolidate everything and that was the core purpose of this Bill. He said, in answer to Mr Farrow, that the present structure was working, as confirmed by a revalidation exercise by the FAA this year, but it was not ideal that the functions were not contained in one piece of legislation.
The Chairperson summarised that Members seemed to be satisfied with the post of Director, but the powers and roles were fundamental.
Mr Farrow said that the full findings of the FAA were contained in a confidential document, which he had not seen, so that the Committee was trying to deal with the matter without all the facts. He was not sure whether the whole process was not creating a position for someone who was already in a post. Each of the departments of the CAA had a series of sub-departments and linkages. He still did not know where the Bill would leave these nor where the responsibility would lie.
The Chairperson said that none of these sub departments would disappear as the Director would have responsibility for managing the whole spread. Under Model 1, the Board would oversee technical and corporate management and the line of reporting for all matters would lie from the Director to the Board. However, there was some confusion as to what he would report on directly or indirectly to the Minister in cases of expediency. Under Model 3, the Board would oversee corporate governance and report to the Department. In respect of the more technical safety and security nothing was to be abolished but the lines of accountability were to be cleaned up, and one piece of legislation would ensure that one person was charged with all functions.
Mr Farrow pointed out that this one person would have responsibility for certain activities associated with the PFMA, including looking at financial controls and expenditure. However, safety and security might also carry financial implications. The Board, under Model 3, was not to examine strategic objectives.
The Chairperson said that he would imagine that this would be covered in the performance agreements. The Minister’s performance agreement would presumably require a certain number of inspections to be conducted on a regular basis. The Board’s performance agreement would be linked to the Director’s duty to report monthly on financial statements, to ensure that vacancies were filled and other administrative tasks. The Board would not deal with safety and security issues, which mostly arose from international conventions to which Government was the signatory, making it most appropriate that the Minister be responsible for oversight. It would add delays and undue complexity if safety and security issues were to travel down to the Board.
Mr Farrow noted that the Memorandum of Understanding would have to be legislated for, both in respect of roles and responsibilities of the Director and the position of the industry. The industry must have some recourse in terms of inclusion and services, and this would carry financial implications.
The Chairperson said that the Committee could not get to that detail until it was sure which model would be used. He did agree that it would be necessary that sufficient protection was built in to guard against the possibility of a “rogue Minister” or “rogue Director” trying to exercise undue control. That would be in the detail, once the Model was agreed upon.
The Chairperson asked Members if the meeting could proceed on the assumption that Model 3 was being applied, to form a basis for further discussion.
Mr Mashile reiterated his support to adopt Model 3, and he encouraged other parties to support it as a basis upon which to craft a workable solution.
The Chairperson said that Members would reserve their right to comment, during the debate, on Model 3, but it was closest to what had been presented to the Committee initially. He suggested that the Committee, in its report on this Bill, should recommend to government that there must be a comprehensive review of the governance structures of regulatory entities, and possibly a White Paper process on this during the next Parliament. He did not feel that there was yet enough clarity around these issues. For the moment, he would like the Department to take Members through the text, and deliberate whether the text of the Bill was in line with the general principles.
New Draft: 5 November
Mr Gany noted that the DOT now had prepared a new draft document, which was handed out.
Mr Gany noted the new provision for emergency regulations under Clause 147A.
Mr Mashile indicated his support, saying that this was in line with principles discussed earlier.
Mr Gany tabled Clause 70, which set out the establishment of the CAA, comprising of the CAA Board, the Director and staff.
Mr Gany noted that the CAA's objects were set out in this clause.
Mr Mashile asked if the international protocols were mentioned, or whether they were built into the objects.
Mr Gany noted that this was covered in Clause 4(4) of the Bill, which he read to the Committee. This clause noted that the Minister was to be designated as the appropriate authority under the International Civil Aviation Organisation (ICAO) Convention.
The Chairperson asked whether compliance with international protocols should not also be made one of the objects.
Mr Gany agreed that this could be done by adding another subclause.
Mr Farrow said that Model 1 spoke of strategic aspects, but this was excluded in Model 3.
The Chairperson pointed out that the aviation authority would deal with this. The Board would monitor only corporate governance.
The Chairperson said that although he would not generally be taking comments from stakeholders and the industry, he would nonetheless allow Mr James Davies, Partner of Webber Wentzel, to speak to the wording.
Mr Davies drew attention to Clause 100B(p), setting out the Department’s functions and commented that this appeared to duplicate what was contained in Clause 72(2)(g). He asked that all the references should be checked back.
The Chairperson suggested that these points be conveyed in writing to the Department.
This clause set out the functions of the CAA, including monitoring, implementation and enforcement of the National Aviation Security Programme (NASP), reviewing of its adequacy, offering comprehensive safety and security education and training programmes, and promoting communication on safety and security issues.
Mr Mashile asked if there was not repetition between subclause (3) and other clauses.
The Chairperson noted that there were references to performing functions outside
Mr Gany noted that there were provisions in respect of other air spaces.
Mr Gany noted that this clause related to the funding of the CAA. The funding came both from levies and moneys appropriated by Parliament
Mr Farrow asked who funded activities outside
Mr Gany noted that the aviation authorities within a country would normally carry the costs of accident investigations within the country. The DOT would charge for foreign consultancies. This was provided for in the Accident Investigation Board matters. Subsection (e) was a catch-all that referred to “money lawfully accruing from any other source"
Mr Mashile asked what was meant by the interest on invested cash balances.
Mr Gany said that this would refer to levy charges that would accrue interest. No money was being put into loans.
This dealt with the establishment of the Civil Aviation Authority Board (the Board). Members did not raise any queries.
This clause set out the functions and responsibility of the Board. A new subclause (b) had been drafted.
Mr Farrow said that Model 1 had said that the Board was responsible for providing oversight, and he agreed with this. However, he was not sure how the strategic plan was to be dealt with.
The Chairperson said that he felt that 75(1)(a) and (b) were still fudging the issues.
Mr Gany noted that the Bill did make reference to strategic goals and there would be agreement as to how and what needed to happen.
The Chairperson still felt that there was a need to be more specific. Under (1)(a) and (b) there should be wording along the lines that the CAA must achieve the objects of corporate governance,. He pointed out that under Model 3, the Minister must ensure that the CAA was attempting to do so. This was worded from a slightly different perspective.
Mr Farrow said that whatever the powers of the Board were, it must comply with the PFMA.
Mr Gany said that subsection (2) would speak to the Board's responsibility.
The Chairperson still wanted clearer wording under (1)(a) and (b).
The State Law Advisers then produced a draft of (a) that read: "To oversee the corporate governance of the CAA in order to attain the objects of this Act", and suggested that there was then not a need for a subclause (1)(b).
The Chairperson was not satisfied with this, and noted that the Board must still set corporate governance strategic objectives. He suggested that Members should discuss subclause (2) and then revert to (1).
Mr Gany read out the wording of subclause (2).
Mr Farrow asked if the Board must ensure that the CAA provided excellence of service. He pointed out that at the moment its current operations meant that it had a wider responsibility to the community, beyond the “normal” course of aviation business.
The Chairperson asked if these were services provided to operators. He also noted that the supervisory functions were not included, and he asked where that would be located.
Mr Gany said that the performance was covered under Clause 93, which related to the performance agreement between the Minister, the CAA and the Director. Efficiency in financial performance and achievement of objectives were specifically included.
The Chairperson wondered if the Board needed to be empowered to have a role in the service functioning and monitoring.
Mr Farrow said that if this was not done, then it would have to be excluded from its current objectives.
The Chairperson asked who would bring problems with service delivery to the attention of the relevant parties.
Mr Farrow asked that the Department must check the objectives, as set out in the current CAA Annual Report, and try to include these in the Bill. For instance, the CAA currently bore roles in relation to trust and satisfaction and responsibilities for safety and security at airports should there be administrative problems.
Mr Gany said that CAA had a duty to ensure that regulations were upheld stringently, and that role by its very nature did not always ensure customer satisfaction so he was not sure how this could be measured. He said it was not the responsibility of the Board to become involved in operational issues.
The Chairperson noted that the Board was representing a range of stakeholders. He still thought that perhaps some kind of Advisory Committee would be preferable to a Board. However, he felt that the Board should be able to report to Parliament in the event that there were high levels of satisfaction or dissatisfaction, or corruption. The Minister would be focusing on safety and security issues that might exclude these matters.
Mr Mashile agreed. However, he noted that the Director would be a member of the Board.
Mr Gany then reverted to the wording of subclause (1). Subclause (1)(a) would follow the version put forward by the State Law Advisors. This would be followed by (1)(b), reading: "(b) to monitor service excellence and customer satisfaction levels and to report to the Minister on any matter concerning such issues".
Mr Farrow indicated his satisfaction.
Mr Gany then proceeded to read out subclause (3). Members indicated they had no questions.
Subclause (4) noted that the CAA Board may not compromise or obstruct the execution of the safely and security oversight functions of the Director under the Act.
Mr Farrow commented that it was possible that the Director, having this dual function, might find himself in a situation where he was giving all his time to safety and security issues, to the detriment of the administrative tasks. This might leave the CAA effectively rudderless on a day-to-day basis. He noted that the Board would be powerless to intervene as this could be viewed as compromising the safety and security functions.
The Chairperson said that this clause was simply saying that the Board could not compromise or obstruct such functions. However, the Board could express its objections if the Director was spending all his time on one aspect only.
Mr Gany said that in practice there was allowance made for appointment of a deputy, and this situation was unlikely to arise.
The Chairperson asked if Mr Farrow had any specific proposal. He pointed out that the Minister could not undermine operational independence. The Board could still express the view that good governance was being compromised if the Director was only focusing on safety and security. The Board could comment that the way in which matters were being handled overall was compromising management and good governance, but they could not tell the Director how to handle safety and security matters, nor comment on his competence in the handling of these matters.
Mr Gany read out subclauses (5) and (6).
Mr Mashile asked for, and received confirmation that the Director would be sitting on the Board. He then questioned the rationale behind subclause (6), that the Board of the CAA would not be personally liable for anything reflected in the CAA report, since the Director must surely take responsibility for safety and security. He asked if there would be collective responsibility.
The Chairperson said that this subclause referred to the report by the Board to Parliament. This might say that Airline X was culpable for something. No individual member of the Board could be sued in a personal capacity for this, although Airline X might sue the Board as a whole.
Mr Gany read out the clause, which dealt with the appointment of the CAA Board.
Mr Farrow noted that perhaps there were too many requirements listed for each of the Board members.
The Chairperson said that it was quite difficult to be generic.
Capt Jordaan asked that there should be provision for more people with financial competency.
Mr Farrow asked whether the official from the Department would be acting ex officio or full time.
Mr Mashile noted that this person was included by virtue of holding an office.
Mr Gany confirmed, in answer to Mr Farrow’s question, that this official would have a vote.
The Chairperson asked why someone with a pilot's licence was required.
Mr Gany said that this followed a submission by the Cape Bar Council. He took note of the proposal made in respect of financial experience, and suggested that perhaps (e) should be changed to reflect two persons from the civil aviation industry, at least one of whom should have financial experience, so that there would be one person representing the civil aviation industry, and two with financial management experience.
Capt Jordaan thought it might not be necessary to have an airline pilot. He suggested that of the two industry representatives, one should have “aviation operational experience” and one should have financial experience.
Mr Mashile said that subclauses (d) and (e) then both referred to financial expertise.
The Chairperson agreed that it was a bit clumsy, but that it should be left as it was.
Mr Farrow said that the Departmental official's position must be clarified. He pointed out that recent changes made under the General Laws Amendment Bill had noted that the departmental official was nominated to be the link, ex officio, for money voted and appropriated and management issues. However, under that Bill no voting rights attached.
Mr Mashile agreed that the rationale was to try to create this linkage, but he was not worried about the wording as the person nominated would invariably be the Director responsible for aviation.
Mr Farrow suggested that perhaps this must then be specified. He said that the Board would then consist of eight Members, including the Director.
The Chairperson suggested that the wording should be changed to “The CAA must consist of the Director and seven members nominated by the Minister, of whom… “ so that subclause (2) could fall away.
Mr Gany proceeded to read through sub-clause (3). This set out that the Board members were part-time and were appointed for three years.
Mr Mashile noted that, now that subclause (1) had been amended to include a reference to the Director, then subclause (3)(a) must be amended as not all “the members” would thus be part time.
The Chairperson agreed, and asked the DOT to find wording that excluded the Director as a part time member.
Mr Farrow suggested that the other option was to leave the wording as it was, but then refer to the Director as "an additional member".
The Chairperson said that it was not necessary to make the decision now as to how it would be amended. The drafters must simply check for consistency.
Mr Mashile commented that subclause (3)(c) allowed the Minister the option of extending the appointment for an unlimited time. He would not like to see such an extension continuing indefinitely and suggested that perhaps six months might be appropriate, as this had been used in another piece of legislation, for conclusion of the process.
The Chairperson agreed and asked that the necessary wording be inserted both to fix a time limit and to clarify that the extension was being used in order to finalise the process.
Mr Gany read through subclause (4).
The Chairperson said that the listing in subclause (4) was slightly different from the earlier list, and he suggested that simply making a reference to the skills set out in (1) might be a neater way of doing this.
Mr Gany agreed to attend to this..
Mr Gany read through subclause (5). He noted that, in compliance with suggestions made on the previous day, the shortlist now specified a number.
The Chairperson said that a shortlist of 14 was too large. There might be challenges in receiving that number of applications, and that a larger list did not make for as much transparency.
Members generally agreed that ten was a more appropriate number.
Mr Mashile noted that the calculation (of one and half times the number of Board positions) for the shortlist was based on subclause (1). However, subclause (7) now needed to be amended to take into account the position of the Director, and it was also necessary to note that this Director was in the full-time service of the State, so that the exclusion must not apply to that position.
The Chairperson said that he now thought it would be useful to use Mr Farrow's suggestion of appointing 7 members in subclause 76(1), and then mentioning the Director in a separate subclause. Then all the other clauses could refer to "the members referred to in subclause (1)” but excluding the Director mentioned in.(relevant clause).."
Mr Gany read through the new subclause (6), which now contained the requirement that the Minister would appoint the Members and notify Parliament.
The Chairperson pointed out that the shortlist must be published, and a specified time for comment allowed.
Mr Gany suggested that the words "publish for public comment within not less than 30 days of such publication" could be inserted in subclause (5), but he would work further on this wording.
Mr Gany read out subclauses (7) to (9). Members raised no questions.
Mr Gany noted that this clause dealt with meetings.
Mr Mashile asked where the functions of the Director appeared. He wondered if there was any need to allow the Director to request a special meeting with the Board, if there was a particular emergency, as it should not be necessary to wait for an ordinary meeting.
Mr Gany said that the Director would deal with safety and security issues, where there was no need for concurrence with the Board.
The Chairperson agreed that this would generally apply, but it would also be possible to arrange an emergency meeting with three members, of whom the Director and the Departmental representative would already be available.
Mr Farrow said that this was of concern to him. The role of the government employee had to be spelt out more clearly. This came back to the issue of whether he had a vote, in what capacity he was serving. He and Mr Mashile shared concerns, but these were based on different angles.
The Chairperson reiterated that emergency and safety and security matters were not Board matters. Something like massive corruption would be a matter for the Board. However, he felt that Members were now "shadow-boxing" and there was probably not a need to deal with this in the Bill.
Members raised no queries on this Clause
Mr Gany pointed out that this clause dealt with removal of Board members from office, but it was fairly standard wording.
Mr Mashile asked whether the references to a person having been sentenced without the option of a fine appeared throughout.
The Chairperson noted that this was mentioned under (2)(e). However, a person guilty of corporate governance offences, even if given the option of a fine, would be precluded from serving.
Mr Farrow raised a general comment on hiring and firing. He said that the Director was appointed by the Minister, but was also servicing the CAA in all aspects of governance. He asked what would be done if he / she failed to comply with governance requirements.
The Chairperson noted that this would appear under the provisions for hiring and firing a Director, as the Minister hired and removed the Director (Clause 84). Presumably the Board could make a recommendation for a Director’s removal.
Mr Farrow said that the Board should have the power to fire for certain reasons, and asked that a recommendation by the Board to fire should be included in the reasons for firing.
The Chairperson noted that the Board would set up performance agreements around governance, and would report to the Minister and Parliament about the performance of the Director under the Performance Agreement. The final decision to fire must rest with the Minister, but if he failed to do so when good cause had been shown, then the Minister must be held accountable.
Mr Farrow said that the duties of the Director showed two lines of accountability, and for this reason he wanted to see dual functions of the Board and the Minister in respect of firing.
The Chairperson noted again that the Board could make a recommendation based on a Director’s failure to perform. However, he would like to avoid the situation where co-responsibility allowed the Board and the Minister to run matters back and forth to each other.
Members raised no queries on this clause, relating to Committees of the Board.
Mr Gany read out subclauses (1) to (2).
The Chairperson questioned why the Minister must consult with the Board about their own remuneration, although he did note that this was not worded as “in consultation with”.
Mr O Mogale (ANC) said that he did not think this was appropriate.
The Chairperson was inclined to agree and asked that the provision around consultation be removed..
Mr Gany read out the clause, which was dealing with the corporate governance plan.
Mr Mashile asked why the date of 31 December was being used, since other strategic plans were received in September, and should be partly informed by the Board's Corporate Governance Plan. The difference in dates would not allow proper alignment.
The Chairperson thought that the Bill should specify only that the corporate governance plan should be submitted annually. The Minister could specify how and when this must be done under the provisions of subclause (2).
Mr Gany noted that this clause, dealing with conflict of interest, contained fairly standard wording.
The Chairperson noted that the "thirty days" could be left out in respect of the requirement for the Minister to notify Parliament. However, there must be mention of the thirty day period allowed for objection to the shortlisted candidates.
Mr Mashile noted that in subclause (1) there was mention of interested parties nominating, but not individuals applying. He felt that nominations could give rise to loyalties. He did not think that a person should be precluded from applying individually.
Mr Gany said that (1)(a) could be amended to read "either to apply or to nominate persons".
Mr Gany noted that subclause (2) set out the factors that the Minister must take into account.
Mr Farrow referred back to Model 3, which was tasking the Director with aviation safety oversight. That, however, was not mentioned as one of the factors that the Minister must take into account.
Mr Gany noted that the term "fitness for the efficient discharge of such duties" would cover this suggestion.
The Chairperson requested why, once again, there should not simply be reference made to the functions that the Director would have to perform.
Mr Mashile asked what was the precise meaning of (b).
Mr Farrow said that "such person's management and technical knowledge in the field relating to aviation safety" was not being mentioned. As currently worded (a) and (c) were repeating much the same matters, but still did not mentioned safety.
The Chairperson said that knowledge, experience and fitness were all needed. There was mention of management and technical skills and he thought that perhaps that combination must be mentioned. The current wording was rather broad. He would like to hone it more carefully and relate it also to what was " required for the objectives of this Act".
Mr Mashile thought that (b) was capturing most of the requirements. The others were merely putting in extra emphasis.
Mr Mogale asked what type of "fitness" was being referred to
The Chairperson suggested that perhaps the word could be changed to "suitability". He suggested that subclause (a) should relate to management, technical knowledge and experience in aviation safety. Then subclause (b) should refer to "suitable for efficient discharge of powers and duties under this Act". He cautioned that the requirements should not be so stringent that the correct person could not be found.
Mr Gany thought that the broader phrase "such person's suitability and competence for the efficient discharge" could be used.
Mr Farrow said that he did not want to harp upon the issue, but reiterated that safety was a key component of the Director’s role. He was not suggesting that other words be deleted, but merely that a reference to safety must be added into (a).
The Chairperson agreed that Members could look at the wording again over lunch. He was in favour of dropping (c) and (d). He cautioned against wording that could be interpreted to mean that the person must have been a field worker. It was difficult to find a balance, but he did not want to be so specific that it ended up becoming impossible.
Mr Farrow referred to sub-clause 84(2) and pointed out the seriousness of this appointment, which led him to question whether more detail was perhaps needed as to the competencies and importance of the job. He felt that this particular aspect had to be strongly worded. The second issue he raised was the differences between the appointment of the Board and the appointment of the Director; the former did stress the competencies as one of the factors to be taken into account. He could see no reason between the Minister appointing the Board or Director and suggested that stronger wording was needed.
Mr Gany suggested wording for the sub-clause 84 (2) to read: ”When appointing the Director in terms of subsection (1) the Minister must take into account the following factors:
such person’s management and aviation technical knowledge and experience; such person’s suitability and competence to effectively discharge the Director’s powers and duties under this Act, and any other law”.
The Chairperson responded that this wording was clear and that it surely addressed the concern.
Mr Farrow asked if there was any reference to the Director’s powers or duties and if there was not a danger in including it in this clause.
Mr L Mashile (ANC) suggested that perhaps Members should flag that query until they had dealt with the Director, to see if there were any other reservations. He referred to sub-clause 84(2)(b) and the use of “any other law”. He asked if that was not too clumsy as it created scope for some misunderstanding.
The Chairperson asked if the members wanted to retain sub-clauses 82(2)(c) and 82(2)(d).
Mr Gany suggested that they could be deleted, and Members agreed.
Mr Gany proceeded to read out sub-clauses 84(3) and 84(4)
The Chairperson asked, with reference to 84(4), what was meant by “conditions” and if there was something missing that could change that ability.
Mr Gany responded that the underlined change that read; “in consultation with the Civil Aviation Authority Board” was made with the intention to keep the Director in check.
The Chairperson replied that he had no problem with that but did not understand what else was meant. He asked if the clause was intending to say that the remuneration of the Director should be determined by the CAA Board.
Mr Gany suggested that sub-clause 84(4) be amended to include: “ as may be agreed between the Minister of Transport, Minister of Finance and Director, including the conditions for remuneration.”
Mr Mashile asked why the Minister of Finance needed to be involved in this appointment.
Mr Gany responded that this sub-clause dealt with the conditions of the appointment, rather than the appointment itself. The Minister of Finance would not pronounce on the appointment, but would consult with the Minister of Transport on the remuneration of the Director.
The Chairperson responded that this should be mentioned in the sentence, so that it was clear that when it came to remuneration both Ministers needed to be involved, according to the National Treasury’s established norms and standards.
Mr Gany agreed.
Mr Mashile noted his concern about the use of “may” in the proposed change to 84(4), which seemed to indicate that there was a choice as to whether the Director would be appointed or not at the point where the Minister of Finance was consulted.
Mr Gany replied that in this context, it referred to something different. It was intended to allow for negotiation (of the remuneration). He did not think it appropriate to use “must”
Capt Jordaan stated that it currently took nine months to get security clearance and that it was impractical to have the provision envisaged in sub-clause 84(7).
Mr Gany responded that Clause 84(7) was more a point of process, and that perhaps the drafters needed to find a different wording like “apply for security clearance” or “must undergo top security clearance”
The Chairperson agreed that the sub-clause should be reworded, similar to the formulation suggested by Mr Gany.
Mr Mashile noted a problem with the use of the word “top”.
Mr Kim Gorringe, CEO, CAASA, suggested that it could read: “must be able to obtain security clearance”
The Committee agreed that this formulation would be acceptable.
Mr Gany proceeded with the consideration of sub-clause 84(8) and (9)
Mr Farrow referred to Clause 84(8) and asked if the monitoring of the performance of the Director should not go under the functions of the Board.
Mr Gany responded that this was an issue that was best addressed through the performance agreement of the Director.
Mr Farrow, referring back to Clause 75, which concerned the functions and responsibilities of the CAA, noted that there was no specific reference to the CAA evaluating the Director and asked if the implication was sufficient.
Mr Gany responded that it was intended that the Board should monitor the corporate governance of the CAA in general, not just the Director of the CAA.
Mr Farrow responded that it was too general and needed to be more specific.
The Chairperson said that the Minister was to oversee all of the roles, and if there was no specific wording about the discharge (where the Board should be consulted) and the Board was not brought in, this might cause a problem. He thought that the Board could be brought in, in matters of remuneration and allowances. He referred to (b) of the conditions in relation to the Board, under Clause 75, pointing out that it had been changed to include: “monitor service excellence and customer satisfaction levels and report to the Minister”. This was the space for the Minister to be made aware of matters by the Board and take the appropriate action, bearing in mind that this action could be remedial and not necessarily be dismissal. He cautioned against setting up the Board and the Director on a collision course.
Mr M Moss (ANC) referred to the word “efficiently” as used in sub-clause 84(9)(a) and asked what the description of efficiency was, and what criteria would be used to determine it.
The Chairperson replied that presumably that would be determined based on the performance contracts between the Director, the Board and the Minister. It was perhaps dangerous to attempt to cover for every possibility and asked if that issue could be flagged.
The Committee agreed.
The Chairperson commented that as the issue had come up, that perhaps the tripartite referrals could be cross-referenced here. He asked if there was potential for a problem.
Mr Gany responded that “tripartite” in this context referred to the Minister, the Board and the Director. He suggested that sub-clause include: “if the Director materially fails to comply with conditions of the performance agreements entered into as contemplated in Section 93 of this Act’”
The Chairperson was satisfied with that wording and asked the Department to write that in.
Mr Farrow asked the State Law Advisors to check if that provision was not contrary to the Labour Relations Act.
The Chairperson referred to Clause 75(2)(d), stating that the remuneration process was different for the Director as opposed to other employees of the CAA.
Mr Gany replied that an exclusionary clause was needed under 75(2)(d) to exclude the Director from that remuneration process.
The Chairperson agreed that it would be easier to do that in 75(2)(d)
Mr Mashile referred to sub-clause 75(3)(a) in relation to salaries and queried the structure of the budget. He asked if they expected the Board to approve the salary of the Director.
The Chairperson responded that this was not the question. The Board dealt with the budget for the following. The Board must account for what was expended, including the Director’s salary. He suggested that the Committee flag that.
Capt Jordaan replied that the wording of sub-clause 75(3)(a) was taken straight from the Public Finance Management Act. Given the fixed expenditure, the Director’s salary would form part of that budget item. It came out of the normal budget as opposed to being a discretionary area.
The Chairperson clarified that the Board was not responsible for determining the Director’s salary scale but must account for what was spent on salaries, and what was received.
Mr Mashile stated that an appropriation by Parliament was one of the amounts listed in the funding model for the CAA.
Capt Jordaan replied that the only appropriation that came from Parliament was for the Accident Investigation Unit. All other funding in the model came from user and safety charges.
Mr Mashile noted that the Director’s salary was paid to him as an official of the CAA and it was a salary bill of the institution.
The Chairperson replied that the CAA Board had to account for the Director’s salary expenditure but the salary scale was set somewhere else. The Board did not set the Director’s salary. The funding model of the CAA was an institution that generated its own income.
Mr Mashile agreed.
Mr Moss pointed that sub-clause 84(9)(b) was discriminatory to persons with disabilities, and he suggested that the sentence relating to physical disabilities was not necessary and contrary to labour law.
The Chairperson replied that the condition was inserted so that if a person was disabled to the extent that he or she was unable to perform efficiently the Minister may consider discharge.
Mr Mashile asked if there was any harm in removing the examples, as there were many other things that could render a person incapable of performing the duties.
Mr Theo Hercules, Principal State Law Advisor: Office of the Chief State Law Advisor, responded that this was a standard clause in other legislation, and was not meant to discriminate but was intended to allow a mechanism for the eventuality where a person was unable to perform the duties.
Mr M Mogale (ANC) remarked that if it did not include “etcetera” or cover other instances, then he would concur that it was discriminatory.
The Chairperson suggested that the words “any other forms of disability” should be inserted.
Mr Mogale maintained that the work skills plan covered people with disabilities, and this clause was discriminatory because it excluded the disabled.
The Chairperson commented that if the dismissal was automatic, then it would be unconstitutional. This was not so, and he commented that it would be dangerous for all if the Director was unable to discharge the prescribed duties yet was not able to be replaced.
Mr Moss responded that if the words between the commas were deleted it would improve the sentence.
The Chairperson replied that he did not mind leaving that out, and asked if there was any harm in provisionally deleting that portion.
Mr Mashile added that the last section of the sentence was written in the negative and needed to be changed,
The Chairperson responded that this part of the sentence referred to two things, not one.
Mr Mashile turned his attention to the provisions concerning misconduct. He referred to the general conditions used under the Companies Act as to incapacity, and stated that they did not apply here as a basis on which the Director could be removed.
The Chairperson responded that he was not particularly keen to go into the Companies Act.
Mr Gany continued with the consideration of sub-clause 84(10)
The Chairperson asked if sub-clauses (b) and (c) should not appear in reverse order.
Mr Gany agreed.
Mr Gany continued with the consideration of sub-clauses 85(1), (2), (3), (4).
The Committee raised no queries.
Mr Gany read through Clause 86(1) and (2).
Mr Farrow asked what was meant by sub-clause 86(2)(d).
The Chairperson responded that this presumably referred to the technical side of a qualification.
Mr Gany replied that he would get back to the Committee with explanatory details on that sub-clause.
Mr Gany read through Clause 87.
Mr Mashile asked for clarity on what was meant by sub-clause 87(5).
Mr Gany responded that the Director would now issue the licences and permits, whereas before this was the duty of the Commissioner of the CAA.
Mr Mashile asked why it was the Director who was named as issuing the permits and licences, because he felt that surely this was done on behalf of the CAA, so that the licences were issued in the name of the authority. He asked if there were permits or licences not issued by the CAA.
Capt Jordaan replied that it was just normal practice that the permits and licences of the authority were issued by the Director. It was also international practice.
Mr Farrow remarked that the functions of the CAA then seemed to be duplicated.
The Chairperson asked if there was any harm in saying “on behalf of the CAA”.
Mr Mashile asked what would happen if the Director were to be suspended, and what would be done in that case around the issuing of licences and permits.
The Chairperson asked the Department and legal advisors to address the cross referencing issues.
Mr Gany read clause 89.
Mr Mashile referring to clause 89, noted that there seemed to be a mix up of process in the situations an Acting Director was to be appointed. Sub-clause 89(2) was not a condition and he felt that 89(2) and 89(3) were misplaced.
The Chairperson commented that the difference between the Acting Director and a Interim Director should be clearer by being separated from each other. He suggested that perhaps in the Bill Clauses 89(5) and (6) should refer to an interim Director.
Mr Mashile stated that this was an issue of drafting, and that he felt the sub-clauses 89(1) to (6) were mixed up. There was a difference between the appointment of the Acting Director, the conditions of the appointment and the statement of powers of the Acting Director, once appointed.
The Chairperson remarked that Clause 89(2) covered both instances (appointing an Acting Director and Interim Director). There were two paths for appointing someone in the place of the Director, but there was a problem since both referred to the Acting Director. The sequence was somewhat jumbled.
Mr Gany replied that he understood the point and that the drafters would clean that up. He suggested that (3) could become (2) and (4) could move under (1).
Clauses 90 to 92
Mr Gany read clauses 90, 91, and 92. Members raised no comments.
Mr Gany read Clause 93.
Mr Mashile referred to the tripartite performance agreements between the Minister, Director and the Board. He clarified that the Minister had a performance agreement with the Board, the Minister had a performance agreement with the Director and the Board had another separate performance agreement with the Director. He asked where these were covered.
Mr Gany responded that there was a series of agreements between the three parties, as outlined. These were written agreements, and were listed in Clause 93(2)(a) to (e).
Mr Farrow pointed out the possibility of conflicts and added that it had to be stipulated that the agreements must be in writing, to safeguard the individuals.
Mr Mashile asked how the agreements were going to work if the Minister appointed the Director. He was not seeing a clear role for the Board. In respect of the corporate governance role of the Board, he commented that there seemed to be little room to manoevre where one of the partners was potentially crowded out.
The Chairperson responded that the items listed in Clause 93(2) (a) to (e) were all corporate governance issues. He asked if it should be stipulated that the agreements should be published.
Mr Farrow did not think that advisable, as there might be confidential clauses that should not be open to public scrutiny. He said that there must surely be a certain amount of discretion.
The Chairperson replied there was no business confidentiality, as these were all corporate governance issues, and this was implied by items (a) to (e) of the subclause. He felt that these should stay as worded, as he did not want a Board complication on other matters.
Mr Gany read clause 94. There were no comments.
Mr Gany read Clause 95. He noted that the word “executive” in Clause 95 (2) had to be deleted.
Mr Mogale stated that he did not understand sub-clause 95(2), and asked if it was not for the CAA Board to determine the remuneration, allowances and subsidies, except that it should be the Director only who was excluded.
Mr Gany replied that the subsidies were determined as directed by the CAA Board. The reference to remuneration and allowances could be deleted.
Mr Gany read Clause 96. Members raised no queries.
Mr Gany read clause 97.
Mr Farrow asked if the body being referred to was the “SACAA” or the “CAA: As it was going to be a juristic person, he commented that there could be confusion at the registration of the name.
The Chairperson suggested that perhaps both should be included as both were commonly used..
Capt Jordaan replied that there was a potential for a conflict of interest in sub-clause 97(1).
The Chairperson replied that the drafters had to strike a balance between giving the Director the ability to make appointments and having a guide with set conditions. There was the danger of being over-liberal.
Mr Mashile asked if the officials were not appointed in terms of the organisational organogram.
The Chairperson responded that there was a broad set of principles, within which the Director could make an appointment.
Capt Jordaan responded that appointments were done in terms of the employment plan, which was approved by the Board. This was normal corporate governance practice. He was not sure that the Bill needed this type of detail.
The Chairperson suggested that Members flag that issue for more discussion on the following day.
The Chairperson stated that Clause 97(1) should contain a reference that this be disclosed in writing – annually or as it might occur.
Mr Mashile referred to Clause 97(3) and commented that he had expected the punitive action to be outlined in that Clause, and he asked what steps would be taken in response to the non-compliance by an employee.
Mr Gany responded that the point was valid. The Labour Relations Act would apply, and so the drafters could reference it, as the steps were detailed in this Act.
The Chairperson asked if the responses of the Director could be more than that. He stated that he would like to consider again whether there was a need to reference this Act or how else this could be worded.
Mr Gany read clause 98.
The Chairperson asked if the wording should not say “personally liable” instead of just “liable”
Mr Gany replied that this was what was intended, and there was no problem with making the change suggested by the Chairperson.
Mr Gorringe added that the Clause was in fact referring to both the liability of the CAA and the employee.
The Chairperson added that the consideration of “good faith” was important here.
Mr Mashile responded that he had a problem with using the words “good faith”, considering that if a person was doing the work of the CAA, he should automatically be exempt from personal liability.
The Chairperson pointed out the possibility of actions taken in bad faith and added that the Bill had to provide for that possibility.
Mr Gorringe asked if it was necessary for the CAA to take out liability insurance.
The Chairperson asked if that should be in the Bill or the regulations.
Mr Gorringe responded that the Maritime Authority Act did contain an insurance clause. He asked if the drafters could check on this point.
Mr Gany pointed out that Clause 99 (relating to Ministerial Order) was not supposed to be deleted and Members would therefore need to consider it. He read the new clause 99
Mr Mashile asked why the CAA needed the Public Service Commission if they had their own employment policies.
Mr Farrow commented that, in his experience, secondment did not work.
Mr Gany responded that this clause did not have to be included. The intention was to make provision for interaction with the other entities.
Mr Gany read the new clause 100.
Mr Gorringe asked if the insurance was really necessary.
The Chairperson flagged that issue for further discussion on the following day and asked the Department to check on this point.
The meeting was adjourned.
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