Questions and Replies

Reply:

The Parliamentary question has been forward to the State Owned Enterprise and the Ministry of Public Enterprises awaits their urgent response. Further information will be conveyed to Parliament as soon as the response is received.

Reply:

The Parliamentary question has been forward to the State Owned Enterprise and the Department and the Ministry of Public Enterprises awaits their urgent response. Further information will be conveyed to Parliament as soon as the response is received.

Reply:

1)(a)(b)(c)(d) 

Table 1 below provides responses to contracts relating to supply, delivery and offloading of industrial gasses:

Table 1: Details of gas contracts

Name of Supplier (1)(a)	Price (R) (1)(b)	Amount of gas supplying (1)(c)	Ownership structure (1)(d)	Length of contract (1)(e)
WASAA	The price is commercially sensitive, therefore cannot be disclosed.	Contracts are on an as and when required basis	Wasaa is 100% owned by Mampo Trust, with the following shareholding: N.Qonde 20%; T.Manala 20%; A.Qonde; 20%; Q.Manala 20%; P.Manala 20%	One (1) year.
African Oxygen			It’s a listed company with the following shareholding: Public shareholders 38.94% Linde Group 61.06%	Two (2) years.

 

 

Name of Supplier (1)(a)	Price (R) (1)(b)	Amount of gas supplying (1)(c)	Ownership structure (1)(d)	Length of contract (1)(e)
Air Liquide	The price is commercially sensitive, therefore cannot be disclosed.	Contracts are on an as and when required basis	99.93% owned by Air Liquide Afrique; Anne-Marie Lemaire 0,02% Martine de Royer 0,02% Gerard Delorme 0,02% Stephen Jampol 0,01% Craig Jampol 0,01%	One (1) year and six (6) months.

                                       

(2)(a)(b)(c)(d)(e)

Table 2 below provides responses relating to contracts for the supply, delivery and offloading of diesel:

Table 2: Details of deisel contracts

Name of Supplier (2)(a)	Price (2)(b)	Amount of diesel supplying (2)(c)	Ownership structure (2)(d)	Length of contract (2)(e)
PetroSA	Prices are commercially sensitive, therefore cannot be disclosed.	Contracts are as and when required basis	PetroSA is South Africa’s National Oil Company; & reports to the Department of Energy	Ten (10) year contract.
Afric Oil			71% owned by EFORA Energy and 29% owned by PIC (Public Investment Corporation).	Ten (10) year contract.
Various Emergency Supplies		Eskom was granted approval by National Treasury to source diesel from Refineries in the event that contracted suppliers (PetroSA and Afric Oil) are unable to meet Eskom’s demand.  The refineries are BP; Engen; Sasol; Astron and Shell.

Reply:

The Parliamentary question has been forward to the State Owned Enterprise and the Ministry of Public Enterprises awaits their urgent response. Further information will be conveyed to Parliament as soon as the response is received.

Reply:

The Parliamentary question has been forward to the State Owned Enterprise and the Ministry of Public Enterprises awaits their urgent response. Further information will be conveyed to Parliament as soon as the response is received.

Reply:

According to the information received from Eskom

(1)(a)(i)(aa)(bb)(ii)

Annexure A provides group headcount per financial year including fixed-term contractors, the number and percentage of employees per occupational category by race and gender as well as the aggregated percentage of Africans, Coloureds and Indians.

Eskom Company workforce profile is for FY2005/6 to 2017/18 and subsidiary, Eskom Rotek Industries (ERI) is from FY2013/14 to 2017/18. 

Eskom is not in a position to provide data prior to the date mentioned (from 1 January 1994) due to the following reasons:

(i) Eskom submitted the first compliance Employment Equity report for FY2005/6 to the Department of Labour (DoL);

(ii) SAP was only configured in line with the DoL reporting requirements in 2006;

(iii) Eskom Rotek Industries only started using SAP in 2013.

Further, it is to be noted the variances in headcount reported in Eskom Integrated Reports vs headcount reported in Annexure A is due to definition of temporary employees in line with Section 57 of the Employment Act, Act 55 of 1998. 

According to Section 57 of the Act an employee whose services has been procured for a temporary employment service, is deemed to be the employee of the client when the employee’s employment is for three months or longer. 

To that effect Eskom started to align with the guidelines provided by Section 57 of the Employment Equity Act, Act 55 of 1998 in the FY2009/10.

(2)(a)

Eskom does not use the term ‘key strategic positions’ but instead uses the term core, critical and scarce skills.

Annexure B depicts core, critical, and scarce skills for the period 2014/2015 to 2018/2019 since these were tagged from 2014 onwards on the SAP system.  The numbers provided exclude Eskom Rotek Industries.

(2)(b) 

Annexure B depicts core, critical and scarce skills by race groups for the period 2014/2015 to 2018/2019, since these were tagged from 2014 onwards on the SAP system.  The numbers provided exclude Eskom Rotek Industries.

(2)(c)

As with all recruitment at Eskom, the appointment of individuals in possession of these skills is informed by Eskom’s Employment Equity plan, in compliance to Section 19 and 20 of the Act.

(3)

Yes, Eskom workforce profile has transformed substantially.  Between financial years 2005/6 and 2017/8 there is a 22% change on racial equity and 14% gender equity change, across senior management and professionals.  The table below provides details.

 

Measure (Unit)	FY 2005/6	FY 2017/8	Change
Racial equity in senior management (% black employees)	47%	69%	22%
Racial equity in professionals and middle management (% black employees)	54%	76%	22%
Gender equity in senior management (% female employees)	24%	38%	14%
Gender equity in professionals and middle management (%  female employees)	25%	38%	13%

 

Eskom views transformation as a strategic imperative and within this context, strives to ensure that its workforce demographics reflects the Economically Active Population (EAP) profile of South Africa. 

(3)(a)

At no stage did Eskom compromise its mandate to focus on the transformation agenda. 

Eskom is cognisant of its mandate which is to provide electricity in an efficient and sustainable manner through its generation, transmission, distribution and retail value chain.  Eskom is also mindful of its developmental role namely to promote transformation and economic development. 

Eskom remains a critical and strategic contributor to government’s goal of ensuring security of electricity supply to the country, thereby enabling economic growth and prosperity.  Eskom will always strive to ensure a balance between its core business versus the transformation imperatives of the country.

(3)(b)

Eskom continually seeks to deliver transformation through recruitment and retention using targeted employee value proposition.  Essential to this is attracting and retaining critical skills. 

Eskom uses internal talent boards at managerial and leadership levels to aid with succession planning for critical workforce segments and actively manage talent pools and careers to achieve transformation objectives.

However, there is no doubt that during the “State Capture” period, skilled professionals with integrity – both black and white, were sidelined, victimised or left Eskom. A climate of fear and intimidation was created to ensure that corrupt practices were not challenged or exposed.

This is the damage that is now being remedied. Even these efforts are being subjected to a “fightback” by a coalition of ex-employees and their fellow travelers in various organisations.

In the interest of future generations, South Africans from all walks of life must support the endeavours of the Eskom board and management to restore Eskom, in accordance with the proposed restructuring and new business model, to sustainability.

Reply:

This response is according to information received from the SOC:

(1)(a) The companies in the Department of Public Enterprises portfolio have requested the following financial assistance for consideration during the 2018 Adjustments Budget and 2019 Budgeting process:

	Alexkor	Denel	Eskom	Safcol	SAX	SAA	Transnet
Requested financial assistance	R100 million	R2.8 billion	R100 billion	R0	R1.74 billion	R15.5 billion	R0

The SOCs, with the support of government, are in the process of negotiating the rollover and refinancing of existing debt as well as seeking to secure additional funding to meet the companies’ liquidity requirements. The exact amount, or even whether assistance will be forthcoming from government will be determined by the National Treasury, after consultation with the department of Public Enterprises, and subject to approval of cabinet.

(b) The National Assembly and the National Council of Provinces (NCOP) recently approved the Adjustments Appropriation Bill and the Special Appropriation Bill, which included amongst others an appropriation of R1.249 billion for South African Express SOC Limited (SA Express) and R5 billion appropriation for South African Airways SOC Limited (SAA) respectively.

As the 2019/20 budgeting process has still to be concluded, there is no clear indication of further funding to be provided to the SOCs.

(c) In line with conditions set by the Minister of Finance, these amounts allocated to SAA and SA Express will be used exclusively to settle the airlines’ guaranteed debt.

 (2)   Based on the information received from Transnet, the settlement discussions between the legal representatives of the pensioners and Transnet are continuing and it is hoped that these will be concluded early in 2019. At this stage, due to the confidential nature of the discussions, it would not be in the best interests of any of the parties to disclose the details, until a decision is taken on the proposed offers and counter offers.             

(3)    No further statement is required at this point

Reply:

DPE RESPONSE

(a) For all the tenders invited in 2018, there we no tender briefing for them.

 

ESKOM SOC

This response is according to information received from Eskom

(a)(ii) and (b)

Eskom complies with its Procurement and Supply Chain Procedure (32-1034) which prescribes the process of managing tenders including records required.  Although Eskom maintains records of tenders issued, our reports are not configured to provide records of which tenders had briefing as well as which briefings were compulsory.

Eskom has records of tenders issued, however to check each and every record of the approximately 1974 tenders advertised for the period 01 January 2018 to 31 December 2018 is an extensive manual exercise which will take several weeks to conclude and verify.

TRANSNET SOC

This response is according to information received from Transnet:

Time Period: January 2018 to December 2018
Operating Division	1.(a) How many tender briefing sessions were held	1. (b) How many of these briefing session were compulsory
Transnet Freight Rail	502	493
Transnet Port Terminals	51	41
Transnet Group Capital	91	91
Transnet National Ports Authority	260	207
Transnet Engineering	82	81
Transnet Pipelines	15	15
Group Strategic Sourcing	6	6
Transnet Corporate Centre	99	17
Transnet Property	90	60
Total	1196	1011

 

This response is according to information received from South African Airways:

a) Number of tender briefings held in 2018

1. GSM001/18 -  Auditor General South Africa finding and recommendations
2. GSM050/18 – Recycling and Waste Disposal
3. GSM051/18 – Catering related services
4. GSM048/17 -  Design, Publication and Production of In-flight Magazine (Sawubona)
5. RFQ186/18 –  Office furniture for SAAT and SAA
6. GSM022/18 – Fixed Asset ManagementRFQ147/18   –WATER Proofing (A  Block )
7. GSM022/18 – Fixed Asset Management
8. GSM047/18 – National Aviation and security services
9. GSM049/18 -  Chauffer Services for Voyager member in RSS, Germany, UK and USA

(b) Number of compulsory tender briefings held in 2018

1. GSM001/18 -  Auditor General South Africa finding and recommendations
2. GSM050/18 – Recycling and Waste Disposal
3. GSM051/18 – Catering related services

4. GSM048/17 -  Design, Publication and Production of In-flight Magazine (Sawubona)

5. RFQ186/18 – Office furniture for SAAT and SAA
6. RFQ147/18 – Water Proofing (A Block)

This response is according to information received from SA Express:

SA Express did not hold any tender briefings in the 2018/19 financial year

Reply:

According to the information received from Eskom

(a) and (b)

The smart meters installed do allow for checking when not being used and whether these are being bypassed.

The details are:

Fully-fledged smart meters (but not all functions are enabled, as the system to manage these will only be finalised during the course of the next financial year) are installed in Sandton and Midrand and split meters with communication are installed in Soweto.

The fully-fledged smart meters do provide a signal when bypassed but these meters go offline and staff are then sent out to investigate, as there is no real time monitoring systems.

The installations in Soweto only provides a signal if there is tampering with the meter but the system has to be interrogated on a regular basis to check for tampering as there is no real time monitoring.

Meters in Soweto are installed in cubicles however these are continuously vandalised and in many cases, staff are not allowed/prevented to attend to the repair of the faults. This then prevents information been sent via the communications network to the system for fraud detection.

There are plans to install a Meter Data Management System (MDMS) that will have full control of the smart meter that will allow the customer to purchase electricity online, customers to view their usage, enable Eskom to see usage patterns, disconnection for non-payment and notification to the customer to reduce usage in case of low capacity. This system will provide real time monitoring.

Reply:

According to the information received from Eskom

Yes, Eskom has measures in place to address non-payment of electricity by municipalities.

Eskom has an electricity supply agreement (ESA) with each of the municipalities that it supplies electricity to in bulk. This agreement specifies the terms and conditions and obligations of the parties. On 01 July 2017 Eskom implemented a concession to the municipalities that allows them to pay their Bulk electricity account in 30 days from the date that it becomes due and no longer 15 days as per the original agreement (except for Metro’s). This was done in an attempt to allow the municipalities more time to collect their revenue from their customers before they have to pay Eskom.

Should the municipality not pay their account on time Eskom implements credit control measures that could end up in the municipality’s electricity supply been disconnected. The Eskom process also makes provision for negotiations to enter into a repayment plan over a period of time.

Should the municipalities fail to enter into such an agreement and/or fail to honour the terms of such agreement Eskom initiates an administrative process in line with the Promotion of Administrative Justice Act (PAJA) before the supply to the municipality can be terminated.

In terms of the ESA Eskom may disconnect the supply to the municipality completely however due to the impact to the customers and the economy Eskom opted to interrupt supply for limited hours of the day only.

Unfortunately, municipal customers, customer groupings, business chambers or even the municipality are getting interdicts against Eskom that prevents Eskom from interrupting the supply and thus from implementing its credit control measures. An escalation of the debt is very noticeable when this happens as the municipalities seem to take a payment holiday as soon as the interdict application is successful.

Notwithstanding the above, government continuous, through the Inter-Ministerial Task Team, Chaired by Minister Mkhize, developing and implementing plans to increase the capacity of municipalities to collect revenue.

Reply:

According to the information received from Eskom

1. Eskom cannot provide a financial estimate for the cost of load shedding. The last relevant study was conducted in 2008, where Deloitte was commissioned by Eskom to look at the economic impact and how to reduce the short-term economic losses. Various key assumptions used in this study are no longer applicable e.g. GDP contributions by various industries have changed drastically. The study indicated that the cost of load shedding was R9 515/MWh for all industries. However, this study is outdated and cannot be used to estimate financial impact of load shedding in 2019. The 2008 study is provided as Annexure A.

Eskom can confirm that for the period 01 January 2018 to 12 February 2019 there was a total of 316 030.33 MWh (over certain periods of the day over 18 days) that were impacted by load shedding.

Reply:

DPE response

a) The Department has decided to grant the request by Mr IE Lebelo for a copy of the Sale and Purchase Agreement.

b) No provision is made for Aventura employees to receive shares in the agreements entered into between the Department, Aventura and Forever Resorts Siyonwaba Consortium.

Reply:

The Parliamentary question has been forward to South African Airways and the Ministry of Public Enterprises awaits their urgent response. The information will be conveyed to Parliament as soon as the response is received.

Reply:

The expenditure incurred by the Ministers, Deputy Ministers and their spouses in relation to the travel privileges contained in the Ministerial Handbook is as follows:

UNIT	2013/14	2014/15	2015/16	2016/17	2017/18	2018/19
MINISTER	2 138 218.88	729 629.20	440 533.08	372 689.32	706 540.29	1 400 826.41
DM	877 493.70	609 614.22	747 054.59	803 611.07	2 861 619.29	0.00
TOTAL	3 015 712.58	1 339 243.42	1 187 587.67	1 176 300.39	3 568 159.58	1 400 826.41
UNIT	2013/14	2014/15	2015/16	2016/17	2017/18	2018/19
MINISTER	1 977 244.49	726 936.05	440 533.08	372 689.32	706 540.29	1 176 109.62
SPOUSE	160 974.39	2 693.15	0.00	0.00	0.00	224 716.79
DM	359 238.73	520 610.20	607 131.48	640 361.46	2 506 030.87	0.00
DM SPOUSE	518 254.97	89 004.02	139 923.11	163 249.61	355 588.42	0.00
TOTAL	3 015 712.58	1 339 243.42	1 187 587.67	1 176 300.39	3 568 159.58	1 400 826.41

Reply:

According to the information received from Alexkor

(1) The PSJV agreement is still operational and adhered to within the law.

(2) (a) On average the PSJV’s operational costs are R152m per annum;

(b) The Initial Capital Contribution of R200m as a loan and a short-term loan of R4.8m was provided to the PSJV. The loans were provided in terms of the Deed of Settlement.

(3) Alexkor has not withdrawn any funds from the PSJV;

(a) The only amounts paid by the PSJV to Alexkor was R11m in 2017/18 financial year as repayment of a portion of the Initial Capital Contribution loan and R4.6m in 2017 as profit share contribution.

Reply:

According to the information received from Eskom

(a)

Eskom Group, which includes Eskom Rotek Industries (ERI), as at the end of September 2018 had a headcount of 47 972.

(b)

Annexure A provides each person’s position.

Reply:

According to the information received from Eskom

(1)(b) Eskom has never had a contract with Bosasa (now known as Africa Global Operations) for the period in question.

(2) Due to Eskom not having a contract with said company no verification is

Reply:

DPE Response

The Department of Public Enterprises has not awarded any contracts to the mentioned companies.

According to the information received from Eskom

(b)

Of the list of companies provided, Eskom awarded contracts to DCD Group and Vox Telecommunications.

Eskom did not award contracts to Afrit; Elgin Brown and Hamer; Elgin Dock; Diesel and Turbo Service Centre; Afrit prop Co; Vox Holdings; Interpair Services; Siminglo (RF); Cancerian Investments; Hulisani Consortium and Phuma Finance

(b)(i)(ii)(aa)(bb)(iii)(iv)

Annexure A provides details of services provided, value of the contracts, and length of the contract, the committee that approved the contact and whether the contract is in line with National Treasury.

Although Eskom did not award contracts to Hulisani Consortium, there were dealings with Hulisani Consulting and 52 payments totaling to R4.4 million were made since 2016. All the payments to the supplier were made against once off purchase orders except for two payments valued at R18 000 which were condonation.

Alexkor, Denel, Safcol, SAA, SAX and Transnet responses not received.

Reply:

According to the information received from Eskom

(a)

As at September 2018 there have been 1067 disciplinary cases initiated since the tenure of the new Eskom Board of Directors.

(b)

Of the 1067 disciplinary cases, 977 have been finalised.

The outcome of the finalised disciplinary cases is as follows: 64 Dismissals; 288 Suspension without pay; 233 Final warning; 321 written warning; 69 not guilty and 2 Counselling.

Reply:

DPE RESPONSE

The Department of Public Enterprises did not borrow any money from any entity in the People’s Republic of China in the past three financial years to date.

According to the information received from Eskom

(a)(i)

The Department of Public Enterprises did not borrow any money from any entity in the People’s Republic of China in the past three financial years to date.

(a)(ii)

Annexure A provides amount borrowed from China Development Loan (CDB) in each of the past three financial years and since 1 April 2018; the name of the lender of each loan, conditions attached to each loan and the repayment periods for each loan.

Eskom wishes not to disclose full terms and conditions of the loans as this information is commercially sensitive and would constitute breach of confidence.

Response is according to information received from South African Airways:

South African Airways has no loan agreements from any entity in the People’s Republic of China.

Response is according to information received from South African Express:

South African Express has not raised any loans with the People’s Republic of China in the past three years.

Alexkor, Denel, Safcol and Transnet responses not received.

Reply:

DPE response

a) There were in total fourteen (14) public resorts that were managed by Aventura. Six of those resorts, which were seriously loss making were the first to be disposed of to different purchasers.

Then the remaining and better performing eight (8) situated at Badplaas, Blydepoort, Loskopdam, Swadini (Mpumalanga) Tshipise, Warmbath (Limpopo), Plettenburg Bay (Western Cape), Gariep (Free State) were sold to a single purchaser named Forever Siyonwaba Consortium.

b) Government had in 2001 as part of its restructuring policy taken a decision to dispose all the Aventura resorts. Hotel and leisure was regarded as non- core to Government. The decision to dispose was further underpinned by the fact that some of the resorts were seriously loss making. Aventura was disposed through a normal purchase and sale process however difficulties were encountered in concluding the process all together. The process was beset by land claims in some of the areas (e.g Blydepoort, Swadini and Tshipise) where the resorts were situated, incorrect description of the Aventura properties, e.g there were discrepancies in Aventura property description set out in the Deeds office and the inventory/schedule of those properties laid out in the Overvaal Resorts Limited Act 127 of 1993. These difficulties caused the disposal of Aventura to be protracted. Thus, against the background that the Aventura resorts were already sold even though difficulties in transferring some of them were encountered, in 2013 an optimal route to bring closure to the purchase and sale process was considered and liquidation was found to be appropriate. The Shareholder (Minister of Public Enterprises) then passed a resolution to liquidate Aventura.

(c) (i) the eight(8) resorts were sold to a company called Forever Siyonwaba Consortium

(ii) the Purchase Price for the eight was R200m.

 

Reply:

The Department does not have artwork assets.

 

 

Reply:

DPE RESPONSE

(i) The total number of employees that have been outsourced from private companies and / or total number of employees that have been outsources from Private Companies.

Three Employees (excluding SOC’s employees)

(aa) Department of Public Enterprises

(bb) Each entity reporting to DPE

(aaa)

Financial year	Number of employees
2015/16	0
2016/17	0
2017/18	1

(bbb) Since April 2018

Department of Public Enterprises

Three Employees

(i) Name of each contractor

Financial year	Name of contractor
2015/16	None appointed
2016/17	None appointed
2017/18	Kelly Group
Since April 2018	Kamo Placement Fempower

 

(b) What amount is each employee paid?

Payments were / are made directly to the company and the company is responsible for paying their own employees.

This response is according to information received from Transnet and South African Express:

Transnet:

(bb) (aaa) (bbb)

Transnet SOC Ltd 2015/2016, 2016/2017, 2017/2018 per Operating Division

Transnet Freight Rail
Financial Year	Nature of the Outsourced Service	Name/s of service providers	Number of workers undertaking the outsourced service
2015/2016	Cleaning Services, security services; horticultural services, waiters	A number of different service providers were procured throughout TFR’s business units and depots. The names of the service providers are too numerous to list here but are available on request.	Cleaning services: 256
			Security services : 4172
			Horticultural services:25
			Waiters: 20
2016/2017	Cleaning, security, waste management, horticultural services, occupational health, cafeteria services, cafeteria, transport, pest control		Cleaning services : 501
			Security services : 4290
			Horticultural services: 25
			Waiters: 20
	Cleaning Services, horticultural services, waiters		Cleaning services: 568
			Security services : 4384
			Horticultural services:25
			Waiters: 20

Transnet Engineering
Financial Year	Nature of the Outsourced Service	Name/s of service providers	Number of workers undertaking the outsourced service
	Cleaning, security, waste management, horticultural services, occupational health, cafeteria services,	A number of different service providers were procured throughout TE. The names of the service providers are too numerous to list here but are available on request.	Cleaning services: 256
			Security services : 47
			Waste Management: 23
			Horticultural services:22
			Waiters: 12
2016/2017	Cleaning Services, horticultural services, waiters		Cleaning services: 273
			Security services : 47
			Waste management: 29
			Horticultural services: 53
			Occupational health: 12
			Transport: 11
			Pest Control: 6
	Cleaning, security, waste management, horticultural services, occupational health, cafeteria services, cafeteria, transport, pest control, rail line maintenance		Cleaning services: 406
			Security services : 47
			Waste management: 37
			Horticultural services: 113
			Occupational health: 12
			Transport: 13
			Pest Control: 21 Rail line maintenance: 4500

Transnet Port Terminals
Financial Year	Nature of the Outsourced Service	Name/s of service providers	Number of workers undertaking the outsourced service
2015/2016	Cleaning, security, waste management, occupational health, transportation of manganese and iron ore, transportation of employees; ICT, stevedoring, driving services, materials handling	A number of different service providers were procured throughout TFR’s business units and depots. The names of the service providers are too numerous to list here but are available on request.	Cleaning: 312
2016/2017 2017/2018			Security: 320 Occupational health: 40 ICT: 20 Materials Handling: 431 Employee transport: 37 Stevedoring: dependant on operational demand Transportation of manganese and iron ore: dependant on operational demand

Transnet Pipelines, Group Capital, Property
Financial Year	Nature of the Outsourced Service
2015/2016	Cleaning, security, ground maintenance and gardening, Helicopter and aviation services; dredging, pest control, ground and garden maintenance, fire services, mobile crane services, driving services, steel work and general maintenance; occupational health
2016/2017 2017/2018

(b) Transnet SOC Ltd is accordingly not responsible for the remuneration and other conditions of service of the contractor. The fees for service rendered by the service provider is regulated by the applicable commercial agreement between Transnet and the service provider.

South African Express:

South African Express Airways has not outsourced employees from private companies and/or contractors.

Alexkor, Denel, Safcol, Eskom and SAA responses not received.

Reply:

According to the information received from Eskom

The amount owed by Kwadukuza Local Municipality and iLembe District Municipality for financial years 2017-18 and 2018-19 is presented in the table below. It is to be noted that both municipalities currently have no overdue debt.

Table 1: Amount owed by Kwadukuza Local Municipality and iLembe District Municipality

Name of Municipality	As at end of March 2018 (i)	As at end of October 2018 (ii)
	Total Debt	Overdue Debt	Total Debt	Overdue Debt
Kwadukuza Local Municipality (a)	R48 418 494	-	R54 049 387	-
Ilembe District Municipality (b)	R696 579	R490 001	R438 070	-

Reply:

According to the information received from Eskom

(1)

As at 31 March 2018, Eskom’s total installed renewable energy capacity is 161 MW: Sere Wind Farm is at 100MW and the four hydroelectric stations total 61MW.

(2)

Currently Eskom has no plans to increase renewable capacity because there are no determinations in terms of section 34 of Electricity Regulation Act made by Minister of Energy for Eskom to build new renewables.

Reply:

According to the information received from Eskom

Eskom is currently in the process of reviewing its long term strategy. The strategy will inform Eskom’s future structure and positioning, taking into account various scenarios of future IPP capacity. Energy from IPPs is only one of many factors that will influence Eskom’s future.

Reply:

According to the information received from Eskom

Yes, the Group Chief Executive (GCE) of Eskom received a letter from Martin Kingston, Chief Executive Officer of Rothschild.

Yes, the GCE responded to the letter. In the letter the GCE appreciated the interest shown by Rothschild in assisting with the challenges faced by Eskom and mentioned that the Eskom’s Executive Management Committee was in the process of developing its own strategic map for the organisation. The GCE undertook to advise Rothschild on next steps once there is internal alignment.

It must be noted that the said letter did not result in any business deals between Eskom and Rothschild.

Reply:

This response is according to information received from South African Airways:

The calculation was based on SAA’s balance sheet as at March 2017 calculated on a liquidation basis (calculation attached as Annexure “B”). A determination of the likely proceeds of the assets was made together with the value of liabilities, which includes loans, trade and other creditors and the liabilities associated with the aircraft leases. The greatest cost of the amount is related to settlement of contractual liabilities and settlement of loans.

Reply:

Based on information received from Denel SOC Limited:

Yes. The facility was lawful.

The facility was approved by the Board of Denel on 04 September 2012. Government (National Treasury and the Department of Public Enterprises) had approved the Domestic Medium Term Note (DMTN) in 2007/2008 for R2 200 000 000, which provided for both secured and unsecured components. The Regiments Capital R290 million loan (which funds turned out to be that of Johannesburg Metropolitan Municipality’s), was part of the unsecured component of the DMTN programme. This loan, like all the other loans under the DMTN programme, was duly registered with the Johannesburg Stock Exchange Securities. The identification and contracting of the up-takers of the facility would be the responsibility of the Board without further involvement of the Ministers of Finance and Public Enterprises.

 

Reply:

Based on information received from Alexkor SOC Limited:

	CONTRACTORS:	2012/13 FY	2013/14 FY	2014/15 FY	2015/16 FY	2016/17 FY
(a)	SHALLOW WATER MINING	R68 940 143	R90 887 459	R87 228 846	R133 120 377	R129 427 373
(b)	NEW INNOVATIVE TECHNOLOGY	-	-	-	-
(c)	BEACH MINING	R23 879 407	R1 425 687	R17 245 950	R2 133 092	R268 825
(d)	COFFER DAM MINING	-	R25 993 234	R51 290 985	R43 865 772	R44 949 244
(e)	MID-WATER MINING	-	-	-	-	-

	DESCRIPTION:	2012/13 FY	2013/14 FY	2014/15 FY	2015/16 FY	2016/17 FY
(i)	VOLUME OF GRAVELS TREATED:
	(aa) BEACH	13 292	17 671	12 042	9 889	12 147
	(bb) SHALLOW WATER MINING	4 807	5 321	5 196	12 159	13 331
(ii)	CARATS OF DIAMONDS PRODUCED	28 267	26 726	26917	29086	36081
(iii)	NUMBER OF DIAMONDS PRODUCED	58 313	53 809	45 717	48 908	48 508
(iv)	TOTAL INCOME GENERATED	R154 757 620	R195 925 590	R241 107 055	R314 499 408	R308 145 577

Reply:

Based on information received from Alexkor SOC Limited.

	CONTRACTORS:	2012/13 FY	2013/14 FY	2014/15 FY	2015/16 FY	2016/17 FY
(a)	DEEP WATER MINING	*	*	*	*	R294 647 577
(b)	TAILINGS MINERAL RESOURCE REPROCESSING	**	**	**	**	R741 286
(c)	BEDROCK SWEEPING	***	***	***	***	***

	DESCRIPTION:	2012/13 FY	2013/14 FY	2014/15 FY	2015/16 FY	2016/17 FY
(i)	VOLUME OF GRAVELS TREATED: m3	-	-	-	-	769 200
(ii)	CARATS OF DIAMONDS PRODUCED:	0	616.96	1 521.43	1 623.70	113 792.40
	(aa) TAILINGS MINERAL RESOURCE REPROCESSING	0	616.96	1 521.43	1 623.70	1 745.40
	(bb) International Mining and Dredging SA (IMDSA)	0	0	0	0	112 047.00
(iii)	NUMBER OF DIAMONDS PRODUCED:	0	985	5 127	5 520	530 702
	(aa) TAILINGS MINERAL RESOURCE REPROCESSING	0	985	5 127	5 520	2 127
	(bb) International Mining and Dredging SA (IMDSA)	0	0	0	0	528 575
(iv)	TOTAL INCOME GENERATED	-	R2 086 007	R10 156 765	R7 444 997	R362 470 919

Notes:
*	DEEP WATER MINING	:	Operations only commenced during the 2016/17 FY
**	TAILINGS MINERAL RESOURCE REPROCESSING	:	No information available prior to the 2016/17 FY; during 2016, the XRT Diamond Recovery technology was used to do exploration on some of the old tailing dumps. The exploration was stopped in 2017 as the operations were not viable.
***	BEDROCK SWEEPING	:	There has been no Bedrock Sweeping Contracts for the period under review.

 

Reply:

 

Based on information provided by Alexkor SOC Limited:

	VETTING OF STAFF FOR:	POLYGRAPH POLICY IN PLACE:	POSITION:	DETAILS:
(a)	SECURITY	Yes, as per the Employment Agreement Clause.	Pre-employment vetting; there after every 12 months.	Within the Security contract between PSJV and the contractors, there is a clause on polygraph testing.
(b)	TREATMENT PLANT	No, Security Check only	Normal security check routine	N/A
(c)	SALES	No, Security Check only	Normal security check routine	N/A
(d)	MARKETING	No, Security Check only	Normal security check routine	N/A
(e)	OTHER STAFF MEMBERS	No.	N/A	Alexkor and Alexkor RMC PSJV applicants are vetted before any appointments made. These include Police Clearance and Credit Checks

Reply:

DPE RESPONSE

a) The Department of Public Enterprises (DPE) and National Treasury participated in the process of awarding a tender of R12.1 million to Bain and Company after a tender process and evaluation. The two departments entered into a Memorandum of Understanding where National Treasury contributed R10 million and DPE R2.1 million respectively towards the project to develop an optimal group corporate structure for the state owned airlines.

(i) (aa)(bb) On which year was the contract awarded and ended

The contract was awarded in October 2016. The work undertaken by Bain commenced in November 2016 and was completed in March 2017. What was the monetary value of the tender?

The monetary value of the tender is R12.1 million

(ii) For what purpose was the tender procured

The tender was procured for the development of the optimal group corporate structure for the state owned airlines.

ALEXKOR SOC LIMITED:
(a)	Not applicable
(b)	(i)	(aa)	No tender has been awarded to Bains (2003 to current)
		(bb)	Not applicable
	(ii)	Not applicable
	(iii)	Not applicable

DENEL SOC LIMITED:
(a)	Not applicable
(b)	(i)	(aa)	No tender has been awarded to Bains (2003 to current)
		(bb)	Not applicable
	(ii)	Not applicable
	(iii)	Not applicable

ESKOM SOC LIMITED

(a) Not Applicable

(b)

Yes, following Eskom’s procurement process, a tender was awarded to Bain and Company.

(b)(i)(aa)

Eskom awarded a tender to Bain and Company in 2010.

(b)(i)(bb)

The tender ended in the same year, 2010.

(b)(ii)

The value of the tender was R100 000.

(b)(iii)

The purpose of the tender was to provide consulting services to review the Eskom strategy and provide recommendations to Eskom’s executive committee.

SAFCOL SOC LIMITED:
(a)	Not applicable
(b)	(i)	(aa)	No tender has been awarded to Bains (2003 to current)
		(bb)	Not applicable
	(ii)	Not applicable
	(iii)	Not applicable

SOUTH AFRICAN EXPRESS SOC LIMTED:

South African Express Airways has never had relations with Bain & Company.

SOUTH AFRICAN AIRWAYS SOC LIMITED:

South African Airways has not awarded any contracts to Bain & Company in the past 15 years.

TRANSNET SOC LIMITED:

Transnet has not awarded a tender to Bain & Company in the last 15 years.

Reply:

This response is according to information received from Transnet:

Since 2014 Transnet has trained 1,891 Protection Officers at its School of Security as part of a Learnership Program.

The learnership program formed part of the overall Transnet Skills Development program aimed at training individuals in the security sector for release into the broader national market thereby empowering them to seek employment opportunities in one of the largest and industries in the Republic of South Africa.

 

The learners who completed the learnership program, are not eligible for permanent employment as a result of the learnership program. They may, however, apply for any suitable vacancies that they qualify for. As part of the recruitment process, Transnet advertises vacancies internally as well as externally.

Transnet is committed to the fair implementation of the Recruitment and Selection Policy. Principles contained in the Policy guide the recruitment and selection process and create the framework for the fair implementation of the Policy. These include that all applicants meet the inherent requirements of the job, ensure that the process is open to all suitably qualified applicants and is free from arbitrary or discriminatory requirements. It also ensures that the policy and process for recruitment and selection is rigorously applied to all vacant positions.

All learners are subject to the Transnet Induction program where terms and conditions of the learnership program are communicated. Therefore, the learners who received training at the Transnet Security School are not prioritised in the allocation of new openings for security personnel as it is handled on a case by case basis as vacancies arise in accordance with the Recruitment Policy. These persons are required to apply for suitable vacancies and were informed of this fact during their induction and training process.

 

Reply:

(1) – (4) The Department of Defence is responsible for President’s air travel, including logistical arrangements and costs, for both domestic and international official trips.

The Presidency assists with the logistical arrangements when the President travels commercially.

Reply:

According to the information received from Eskom

Details of the interest rates on all outstanding Eskom loans that are being repaid are published on pages 82 and 83 of the 2017/18 Annual Financial Statements.

Annexure A is an extract of pages 82 and 83 of the 2017/18 Annual Financial Statements.

Reply:

According to the information received from Eskom

Yes, Eskom has launched investigations into the incidents of violence and intimidation, the destruction of property and acts of outright sabotage during the current Eskom wage dispute.

(a)

The investigations are in progress.

(b)

Eskom has undertaken to ensure that all matters of a disciplinary and criminal nature are duly subjected to investigations as necessary. Identification of all the employees, through video footage and information from victims, who participated in acts of intimidation has commenced.

Table 1 provides criminal cases on Eskom’s records to date that have been reported to the South African Police Services (SAPS) for further investigation.

Table 1: Details of criminal cases that have been reported to the SAPS for further investigation

Site	SAPS station and Case No.	Nature of crime	Status
KZN region – Distribution sites	Richmond SAPS CAS V72/06/2018 Wartburg SAPS CAS 2069/06/2018 Umkomaas SAPS CAS 290/06/2018 Margate SAPS CAS 216/06/2018	Housebreaking with intent to damage equipment Sabotage x 4	In progress
	Alexandra Road SAPS CAS 403/7/2018	Bomb Threat	In progress
	Empangeni SAPS CAS 27/08/2018	Bomb Threat	In progress
Generation division – Mpumalanga Matla PS	Kriel SAPS CAS 108/07/2018	Theft	In progress
Generation division – Mpumalanga Matla PS	Kriel SAPS CAS 134/08/2018	Sabotage	In progress
Generation division Hendrina PS	Hendrina SAPS CAS 01/08/2018	Malicious damage to property	In progress
Generation Division- Mpumalanga Duvha PS	Witbank SAPS CAS 21/08/2018 Witbank SAPS Enquiry no. 01/08/2018	Bomb threat	In progress
Generation Division- Mpumalanga Tutuka PS	Standerton SAPS CAS 17/08/2018	Malicious damage to critical infrastructure	In progress
Generation Division- Mpumalanga Kusile PS	Phola SAPS CAS 50/08/2018	Arson	In progress
Generation Division- Mpumalanga Grootvlei PS	Balfour SAPS CAS 02/08/2018	Public Violence	In progress
Generation Division- Mpumalanga Arnot PS	Details TBC by complainant	Intimidation and malicious damage to property	In progress
Generation Division- Mpumalanga Arnot PS	Victim refused to prefer criminal charges	Intimidation and malicious damage to property	Closed

Reply:

This response is according to information received from South African Airways:

(1)(a) 2000 learners and 8 exhibitors participated in the summit.

(1)(b) The summit is aimed at making previously disadvantaged learners aware of various career opportunities within the aviation sector. SAA currently has an apprentice in SAA Technical who applied after attending the summit in the past.

(1)(c)(i) The institutions that participated in the summit are: Ekurhuleni East College TVET; Ekurhuleni West TVET College; Ratanda and Lesedi-Khanya High Schools both in Lesedi, Heidelberg; Fumana High School in Katlehong; Siyabonga High School in Soweto and Umqhele High School in Tembisa.

(1)(c)(ii) SAA with other organisations in the aviation sector are members of the Department of Transport’s Joint Aviation Awareness Program (JAAP) which works closely with the Department of Education and Transport Education Training Authority (TETA) in taking aviation to previously disadvantaged schools. The institutions and schools invited during the June summit are selected through the JAAP process, based on proximity, and to cover schools that have never been reached during the JAAP country-wide visits as SAA strives to cover all disadvantaged learners.

(1)(d) The summit is aimed at commemorating National Youth Month, and to make it relevant, SAA only hosts the summit during the final week of June when grades 9 – 11 learners have concluded their exams and before the June holidays, as the learners are not available during the holidays.

(2) No cash was disbursed to any suppliers for either transport, catering or materials as these costs were covered by TETA and other partners. There were no accommodation costs as learners are from Gauteng. The material used and distributed during the summit was printed at SAA Technical and also brought by the exhibitors.

(3)(a) The following were contracted to render services for the summit:

- TETA sponsored transport for learners;

- Birchwood contributed food packs;

- MTKR contributed sound;

- Airchefs contributed refreshments for exhibitors;

- Material provided to learners was printed internally for SAA, and provided at own cost by exhibitors.

(3)(b)(i) There were no cash disbursements; Birchwood Hotel and MTKR were offered 20 non-revenue tickets and 12 non-revenue tickets respectively as a token of appreciation.

(3)(b)(ii) SAA requested sponsorship from various companies and these were the ones that responded positively.

(3)(b)(iii) TETA provides funding for the SAA Technical Apprentice Program and one of SAA’s Technical officials, Mr. Saki Tlou, serves on the TETA board.

Reply:

(1)(a)(i)(ii)(aa)(bb)

DPE	TOTAL No.	Permanent	Acting DDGs	Acting CDs	WOMEN
DDG	3 1 male 2 females	3 1 male 2 females	4 4 males 0 females	0	2 (67%) 0 Acting
CD	31	31	0	1 1 female	5 (16%) 1 female acting
TOTAL	3 DDGs 31 CDs	3 DDGs 31 CDs	4 male acting DDGs 0 female DDGs acting	1 female Acting CD	2 female DDGs 6 females CDs

(2)(a) (i) (b): The details of the total number of Directors on the State Owned Company (SOC) Boards of the DPE portfolio, namely Alexkor, Denel, Eskom, Transnet, SA Express and SA Airways are listed on the table below. Note that the Chief Executive Officer (CEO) of the entity is a member of each Board. Hence, the total number of Directors on each Board includes Non-Executive Directors (NEDs), the CEO and CFO, with the exception of SAA, where the Interim CFO is not a member of the Board. In addition, the composition of the SAFCOL and Alexkor Boards are under review. The vacancies listed in the column for Directors refers only to NED vacancies.

SOC BOARD	CHIEF EXECUTIVE OFFICER (CEO)	CHIEF FINANCIAL OFFICER (CFO)	DIRECTORS	WOMEN
ALEXKOR	1 male	1 female	7 (3 vacancies)	3 (42%)
DENEL	1 male (Interim)	1 male (interim)	16 (no vacancies)	6 (37.5%)
ESKOM	1 male	1 male (Interim)	14 (1 vacancy)	6 (43%)
SAFCOL	1 male	1 male (Interim)	10 (2 vacancies)	3 (30%
SA EXPRESS	1 Female (Interim)	1 male (Interim)	12 (no vacancies)	5 (42%)
SA AIRWAYS (SAA)	1 male	vacant	10 (4 vacancies)	2 (20%)
TRANSNET	1 male	1 male (Interim)	14 (no vacancies	6 (43%)
TOTAL	6 Males and 1 Female	6 males and 1 female	83 (10 vacancies, 12%)	31 (37%)

Reply:

This response is according to information received from South African Airways:

1. The aircraft was delayed due to delays in insurance approvals. The Defence training similators also required cargo permits from OR Tambo and not Waterkloof as was in the permit documentation.The similators were initially authoritised and permit issued to depart from Waterkloof Airport in Pretoria.

Once the departure point for the flight changed and was scheduled to depart from OR Tambo, the place of departure on the permit was not in complaince with insurance approvals and regulations.

This resulted in the delay. However, the simulators were no longer transported by SAA.

(2) The cargo on the flight was passenger luggage.

(3) Once insurance was obtained, SA2952 - Charter left on the 27th July and had passenger luggage/cargo.

Reply:

Response according to the information received from Eskom

As at the end of April 2018 Eskom had secured approx. R13.6bn of the approved R72bn funding for 2018/19 financial year.

(a)

The names of the various lenders that provide funding are confidential as per the relevant facility/loan confidentiality clauses.

Eskom can however provide a high level breakdown of the R13.6bn funding as follows

• R9.8bn is from agreements with Development Financing Institutions; and
• R3.8bn raised through various domestic instruments issued to several different investors and financial intermediaries, under the Eskom Domestic Medium Term Note Programme.

(b)

The rates (cost of funding) were market related (refer to the yields quoted on the JSE for Eskom bonds) and comparative with Eskom’s overall cost of funding.

Reply:

The response is based on information received from Alexkor SOC Limited.

(1)	(a)	Scarlet Sky Investments 60 Pty Ltd
	(b)	Yes the company complies in terms of the requirements of the South African Diamond and Precious Stones Regulator as the premises is licensed as a diamond tender house as prescribed by legislation.
(2)	(a)	The Supply Chain Management policy of the Alexkor PSJV does not make provision for companies to disclose details of any of its individual shareholders.
	(b)	The tender was advertised in terms of the PSJV Supply Chain Management Procedure.
	(c)	i) FDTH 2 Pty Ltd (Flawless Diamond Trading House) ii) E Diamonds iii) DDA Trading iv) Carbon Black Solutions v) Laser Cleave Pty Ltd

Minister: The Department has instituted a forensic investigation into some of the above

matters.

Reply:

According to the information received from Eskom 

The Department of Environmental Affairs (DEA) has a National Climate Response White Policy Paper in place and has currently released the Climate Change Bill for public consultation. 

To ensure full alignment with the National Climate Change Response White Paper, Eskom has a climate change policy and a strategy in place in line with overall government policy. Eskom Climate Change Strategy provides an overview of Eskom’s initiatives in terms of the following: 

1. Adaptation to the adverse impacts of climate change;

2. Green and climate finance opportunities;

3. Innovation through research and development; 

4. Diversification of the energy mix to lower carbon technologies;

5. Energy efficiency; 

6. Advocacy and Partnerships at national and international levels on climate change response.

Lastly, the most effective way to reduce greenhouse gas emission from the electricity sector is to diversify the electricity supply. To date, all low carbon supply options determined through the IRP process have been allocated to Independent Power Producers by the Department of Energy. 

Given that coal-fired generation has a negative impact on greenhouse gas (viz. carbon dioxide, nitrous oxide and methane) emissions, any addition of coal generation plant will negatively impact on climate change.

South Africa’s commitment to reduce these emissions was taken into account in the 2010 IRP by way of a cap on carbon emissions. It is expected that the new iteration of the IRP is cognisant of South Africa’s commitment to the Paris Agreement to reduce greenhouse gas emissions

Eskom has a plan in place to manage local air pollutants such as sulphur dioxide. This however is not a greenhouse gas and technologies such as the FGD technology only removes sulphur dioxide emissions. In the absence of end-of-pipe technology, there are little opportunities to reduce the carbon footprint of existing coal-fired power stations.

Currently, the most effective way to reduce greenhouse gas emissions from the electricity sector is to diversify the electricity supply away from coal towards lower-carbon technologies (nuclear, hydro, renewables and gas). Unfortunately, to date, all lower-carbon supply options determined through the IRP Planning process have been allocated to Independent Power Producers and not to Eskom.

In the absence of a low-carbon supply allocation, Eskom has proceeded with delivering demand management savings, the New Build programme (Medupi and Kusile power stations employ supercritical designs) as well as Ingula Pumped Storage Scheme.

Further initiatives include the roll out of photovoltaic (PV) plants to supplement generation at existing coal-fired power station sites, the construction and operation of Sere (100 MW windfarm) and many research initiatives, from an operating rural microgrid and smartgrid applications to wave energy to electric vehicle testing.

Eskom Transmission has also enabled the connection of over 3 000 MW renewable energy projects to the national grid.

In this respect, Eskom is well-prepared to manage the transition away from carbon intensive electricity production and participates extensively in Department of Environmental Affairs processes to report and limit future greenhouse gas emissions.

Further, Eskom has undertaken detailed studies with the CSIR on climate impact modelling in Southern Africa. This work will inform plans on how to prepare Eskom’s infrastructure and people for impending climate change and extreme weather events. The country’s (and by inference Eskom’s) vulnerability to climate change is cause for concern and we want to ensure we deal with this proactively.

It is critical that there is a “just transition” from carbon intensive electricity production. The transition should be able to address the pressing socio-economic challenges of poverty and inequality. The workers and communities, especially those in the sectors and areas that will be most affected, such as coal plants, coal mines and coal transportation will need alternatives to secure their well-being. Options such as re-skilling for new jobs and community based programmes are vital to ensure that those most vulnerable to the development are protected

Reply:

The response is based on information received from Alexkor SOC Ltd.

(1)	The company, namely Scarlet Sky Investments 60 CC (SSI) itself, had no track record, until, Mr Daniel Nathan, with twenty years’ experience within the diamond industry, was appointed as a Director of SSI in November 2014.
(2)	(a)	Beneficiation is currently taking place at the offices of Scarlet Skye Investments (SSI) based in Houghton, Johannesburg, Gauteng. SSI currently employs learners from the Richtersveld Community. Beneficiation has been taking place since 2015.
	(b)	Beneficiation contributes an additional 9% (NINE PERCENT) income to the Pooling and Sharing Joint Venture (PSJV) to income after the tender process.
(3)	(a)	The Alexkor PSJV followed its Supply Chain Management policy. The process included:
		(i)	the “Request for Proposal” (RFP 03/14) was advertised in the Government Tender Bulletin dated 31 October 2014 as well as the Business Day on 25 October 2014;
		(ii)	7 (SEVEN) Companies expressed their interest in RFP 03/2014 and submitted proposals
		(iii)	Gamiro Advisory Services were appointed by the Alexkor PSJV Board to evaluate the proposals received;
		(iv)	The top 3 companies, according to the evaluation scores, were invited to present to the Alexkor PSJV Board Tender Committee; and
		(v)	Following the presentation and assessment of the SSI bid proposal, the Alexkor PSJV Board was satisfied with the prices and proposals submitted by SSI. The Alexkor PSJV Board appointed SSI with effect from 01 March 2018.
	(b)	The independent valuator process was stopped after some of the contractors’ complained about beneficiation and it was decided that the diamonds selected for beneficiation process will be paid based on the tender price of the goods.
	(c)	The decision was taken by the Management of the Alexkor RMC PSJV
	(d)	It did not have any impact on the diamond sales as the diamonds are sold to the highest bidder and not on the reserved price.
	(e)	There are about between sixty and eighty companies attending the diamond tenders. It is not always the same companies attending the tenders; this varies from sale to sale. Since inception approximately 200 license holding companies participated in the tenders. These tenders take place at the offices of SSI in Johannesburg,
	(f)	The diamonds are not sold to one specific company but to various participating license holding companies that has the highest bid on any specific range or category of diamonds on tender. Since 2015 approximately 200 companies participated in the tenders. The sales are very competitive and there is at least 15 to 20 winning companies at every sale. (This number depends on how many carats are on sale).
(4)	In terms of the South African Diamonds and Precious Metals Regulator (SADPMR) prescripts, a license is issued to an individual “Diamond Dealer” or to a company “Diamond Trading House”. In this instance, Mr Daniel Nathan is the holder of the required Diamond Dealer license.

 

Minister: The Department has initiated a forensic investigation into these matters.

Reply:

(a) (i), (ii), and (iv) In terms of the Board appointment process, names of potential candidates for the database may be submitted through various means, including:

1. Submission by the individual of his or her Curriculum Vitae;
2. Nomination by another person; or
3. Application or nomination to the annual advertisement to update the database.

From the records it would appear that there are no specific nominations by another person of Mrs Matseke (Chairperson) and Messrs Haasbroek, Matona and Bansi, respectively. These names came through the Ministry during the Board review process. They were appointed as Non-executive Directors (NEDs) of the Board of Alexkor by former Minister of Public Enterprises, Ms Lynne Brown, at a Special General Meeting held on 14 August 2015. The appointments (with the exception of Ms McMaster who was never appointed as a Director to the Alexkor Board), were done in accordance with clause 13.2 of the Alexkor Memorandum of Incorporation (MOI) which provides that the Shareholder (the Minister of Public Enterprises) shall appoint the Directors of the Company, as well as in accordance with terms 13.11 of the Alexkor MOI which provides for the rotation of Directors and the filling of vacancies on the Alexkor Board.

Ms Matseke was appointed as Chairperson and NED of the Board, while Messrs Haasbroek, Matona and Bansi, respectively were appointed as NEDs at the SGM with effect from 14 August 2015, for a period of three years, subject to annual review by the Minister.

(iii) Ms McMaster was not appointed as a Director to the Alexkor Board.

(b) Following the resignation of former Chief Executive Officer (CEO), Mr Percival (Percy) Khoza, during the Company’s restructuring process in February 2016, Mr Bansi was recommended by the Board and supported by the then Minister to Act as CEO and ex-officio Director of the Board of Alexkor on 1 March 2016, until such time that a permanent CEO was appointed by the Company. Mr Bansi subsequently submitted his resignation as Acting CEO, ex officio, to the Board effective 6 November 2017, before the new CEO took up office. At the time, Mr Bansi had indicated that he is not available for re-election as NED of the Board going forward.

Reply:

REPONSE BASED ON INFORMATION RECEIVED FROM ALEXKOR SOC LIMITED:

(1)	Alexkor were informed by Mr Korabie about the complaint he lodged to the Office of the Public Protector during 2015. The complaint was withdrawn by Mr Korabie subsequent to a meeting between DPE and the Alexkor-CPA during November 2015, to allow the Department to investigate the matter internally. The investigation was done by the ARC Committee of the PSJV and the outcomes have been communicated with the Department.
(2)	Alexkor is not aware that Ms Kellerman was appointed to investigate the internal matters of Alexkor SOC. However, Ms Kellerman, as Chief Legal Officer at the time was instructed by the then Board of Directors to institute the forensic investigation into allegations made against the then CEO, Mr Percy Khoza. SizweNtsalubaGobodo (SNG) was appointed as an independent entity to conduct the said forensic investigation. The technical nature of the irregularities were such that it was not obvious to the current Board whether it was appropriate, or not, to initiate any disciplinary action against the CEO. The Board subsequently commissioned Mkhabele Huntley Adekeye Inc. (MHA) to evaluate the SNG report in terms of the possible disciplinary actions available to Alexkor. The finding of Mkhabele Huntley Adekeye Inc was that the CEO took “a cavalier approach to financial management of the entity, which exposes the entity to risk”. The report continues that: “based on the evidence before us, we are of the view that the Accounting Authority has reasonable prospects of securing a dismissal at arbitration”. The Board considered the Mkhabele Huntley Adekeye Inc reports and decided that a “reasonable” prospect of a successful dismissal was insufficient to warrant further action. Furthermore, the Company had embarked on a restructuring process during which the CEO put himself forward for voluntary retrenchment, which offer the Board accepted, as a simpler and more cost-effective option to disciplinary action.

Reply:

This response is according to information received from the SOC:

(1)(a)(i) As per invoices received "Transaction Fees".

(1)(a)(ii) According to Regiments these payments were made for services rendered during the structuring of the transaction. It was found by

the TSDBF that no such fees were payable separately from the fee and cost structure agreed in the original investment management

mandate agreement and as such not allowed.

(1)(a)(iii) R 228millon.

(1)(b) The TSDBF Board of Trustees appointed Regiments Capital in terms of a detailed duly legal and approved investment agreement.

No blank mandate was given (supporting documents attached).

(2) The decision of the Trustees was in terms of the authority vested in terms of the Rules of the TSDBF.

(3) The decision of the Board of Trustees was not ultra vires but in terms of the authority vested in The Rules of the Fund.

(4)(a)(i) H Gazendam, Y Forbes, E Tshabalala,R Louw, V Naidoo,

C Fichardt, J Benwell, M Myburgh, J Grobler.

(4)(ii)(aa) No current directors of Transnet.

(4)(bb) H Gazendam,Y Forbes, E Tshabalala

(4)(b) The Transnet Board did not play any role in appointing Regiments

Capital as the investment advisor of the TSDBF.

(5) N/A

Minister: the dubious and problematic role of Regiments, Trillion and other entities in the state capture process will be investigated further by the respective SOC Boards – and presumably by the Zondo Commission.

Reply:

According to the information received from Eskom

(1)

Eskom understands that all future IPP programmes are on hold until such time as the Integrated Resource Plan (IRP) has been concluded.

(1)(a)

Eskom is obliged to implement Government Policy. Should Government instruct Eskom to continue with this programme Eskom will engage on the impact on Eskom and its requirements for the programme.

(2)

Eskom has not agreed to sign the IPP contracts and therefore the Regulation 9 requirements were not assessed by Eskom.

Should Government instruct Eskom to continue with this IPP programme, Eskom will then assess the Power Purchase Agreements against the Regulation 9 requirements of the New Generation Regulations 2011. A matter which requires further clarity and certainty is what constitutes a correct technical risk transfer to the new coal IPP in terms of Regulation 9 of the New Generation Regulations, 2011. 

The full regulation document is attached.

Reply:

According to the information received from Eskom

BACKGROUND

Eskom has not approved the signing of the coal independent power producers (IPPs) agreements. No approval nor instruction has been given by the Department of Public Enterprises to Eskom to sign such agreements.

Eskom understands that all future IPP programmes are on hold until such time as the Integrate Resource Plan (IRP) has been concluded. Eskom provided these IPPs with budget quotations for connection to the grid as is required by the Eskom transmission license, but has made no other allowances for these IPPs in the Eskom production plans and price applications.

(a)(i)(ii)

The impact of new capacity as well as the low greenhouse gas emissions scenario on the electricity system and the Eskom generators must be considered in the development of the IRP. The IRP also considers price impacts.

Eskom will provide comments on the IRP when it is given the opportunity to do so, and any impact on Eskom’s generators, costs and prices to consumers will be addressed in these comments.

(b)

Government together with Eskom and other key stakeholders are in the process of evaluating the socio-economic costs of decommissioning of mines that have reached their end of life. A transitional plan will be developed that will support the integrated Resources Plan (IRP).

Reply:

The response is based on information received from Alexkor SOC Limited.

According to Alexkor, Mr Carstens was appointed by the Board of Alexkor/PSJV following a recruitment process for the position in question. The process was as per the PSJV recruitment and selection process.
(a)	The position was advertised in the Sunday Times on Sunday, 27 May 2012.
(b)	The names of the candidates whom applied for this position have been disclosed to the Department. However, due to the confidential nature of this information, no further details will be disclosed.
(c)	The names of the candidates shortlisted or interviewed have been disclosed to the Department. However, due to the confidential nature of this information, no further details will be disclosed.
(d)	(i)	Mr Reginald Muzariri	Chairperson (at the time)
	(ii)	Dr Roger Paul	Member of the Board (at the time)
	(iii)	Prof Viola Makin	Member of the Board (at the time)
	(iv)	Mr Craig Matthews	Representing the RMC
	(v)	Mr Willem Diergaardt	Representing the RMC
	(vi)	Mr Melvin Duckitt	HR Manager (at the time)
(e)	According to Alexkor, Mr Carstens’ qualifications:
	(i)	National Diploma : Human Resources (Vaal University of Technology)
	(ii)	Industrial Relations Development Programme (University of Stellenbosch).
	(iii)	The Member is reminded that the decision to appoint would jointly have been taken between Alexkor and the Richtersveld Mining Company (RMC) representatives on the Alexkor PSJV Board. The Board members who appointed Mr Carstens no longer serves on the Alexkor PSJV Board. The names for the selection panel are detailed in (d)(i) to (vi) above. Therefore, the current Alexkor PSJV Board is limited in terms of its understanding of the process that led to the appointment of Mr Carstens, which at face value seems to be a deviation from the qualification requirements of the position as advertised. However, the current Alexkor PSJV Board can confirm that Mr Carstens has acquitted himself in line with their expectations in running the PSJV operations. The 30 years’ experience that Mr Carstens has garnered in the industry seems to have stood him well.

Minister: The Department is currently reviewing both the governance and operating model of Alexkor.