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Johannesburg - Transnet paid Siyabonga Gama in excess of R4m during its past financial year - despite Gama being at work for only five months, according to the logistics group's latest annual report.
The former CEO of Transnet's largest revenue earner, Transnet Freight Rail, was fired by the parastatal in June after he was found guilty of financial irregularities concerning - among others - security contracts he awarded to a firm owned by Communications Minister Siphiwe Nyanda without due process. He was initially suspended on September 2 2009.
Gama's salary package in the year to end-March amounted to R4.06m, an increase of nearly 7% on the R3.8m he took home in 2009. That translates to about R812 000 for each of the five months he spent at work. Calculated over the whole year, Gama received R338 333 per month, including the seven months he was suspended.
The salary package includes R184 000 titled "other payments". Gama did not receive any bonus in terms of Transnet's short- and long-term incentives. He also remained in Transnet's payroll in its new financial year until the end of June, when he was found guilty of three charges and dismissed.
In addition to the charge relating to awarding tenders costing well above his authorised limit, Gama was also found guilty of a "complete breakdown" of his relationship with the company and for ignoring the board's resolutions concerning the refurbishment of 50 locomotives.
R800m loss on locomotive revamp
Whereas the board had directed that the engineering and refurbishment of the 50 "like new" locomotives be conducted by Transnet's Rail Engineering division, Gama awarded the contract to outside companies.
"That cost Transnet in excess of R800m to do a job that it already had the infrastructure and skills to perform," a Transnet source told Fin24.com.
The source said the board again directed Gama to allow Transnet Rail Engineering to perform the refurbishment. "He ignored the resolution twice," said the insider.
Other than Gama's reward, Transnet's basic executive remuneration bill dipped 10.6% in the year to R40.6m, with incentive payments amounting to R60.2m.
Acting group CEO Chris Wells' basic R4.1m increased to a total R10.2m package after Transnet paid him long- and short-term incentive bonuses. That amounts to a 49.7% increase on his 2009 package.
Pleading unaffordability, Transnet settled with its employees in May for salary increases of 11% following a violent strike that cost the economy an estimated R7bn.
"Payments in terms of the long-term incentive scheme has for the first time occurred in the 2010 financial year, after the scheme was approved by the remuneration committee and implemented for the financial year ended March 2007 based on financial performance of the company in that year," said Transnet in the annual report.
Transnet said the "substantially better" 2010 financial results meant higher short-term incentive payment to its executives for "talent retention purposes".
- Fin24.com
The former CEO of Transnet's largest revenue earner, Transnet Freight Rail, was fired by the parastatal in June after he was found guilty of financial irregularities concerning - among others - security contracts he awarded to a firm owned by Communications Minister Siphiwe Nyanda without due process. He was initially suspended on September 2 2009.
Gama's salary package in the year to end-March amounted to R4.06m, an increase of nearly 7% on the R3.8m he took home in 2009. That translates to about R812 000 for each of the five months he spent at work. Calculated over the whole year, Gama received R338 333 per month, including the seven months he was suspended.
The salary package includes R184 000 titled "other payments". Gama did not receive any bonus in terms of Transnet's short- and long-term incentives. He also remained in Transnet's payroll in its new financial year until the end of June, when he was found guilty of three charges and dismissed.
In addition to the charge relating to awarding tenders costing well above his authorised limit, Gama was also found guilty of a "complete breakdown" of his relationship with the company and for ignoring the board's resolutions concerning the refurbishment of 50 locomotives.
R800m loss on locomotive revamp
Whereas the board had directed that the engineering and refurbishment of the 50 "like new" locomotives be conducted by Transnet's Rail Engineering division, Gama awarded the contract to outside companies.
"That cost Transnet in excess of R800m to do a job that it already had the infrastructure and skills to perform," a Transnet source told Fin24.com.
The source said the board again directed Gama to allow Transnet Rail Engineering to perform the refurbishment. "He ignored the resolution twice," said the insider.
Other than Gama's reward, Transnet's basic executive remuneration bill dipped 10.6% in the year to R40.6m, with incentive payments amounting to R60.2m.
Acting group CEO Chris Wells' basic R4.1m increased to a total R10.2m package after Transnet paid him long- and short-term incentive bonuses. That amounts to a 49.7% increase on his 2009 package.
Pleading unaffordability, Transnet settled with its employees in May for salary increases of 11% following a violent strike that cost the economy an estimated R7bn.
"Payments in terms of the long-term incentive scheme has for the first time occurred in the 2010 financial year, after the scheme was approved by the remuneration committee and implemented for the financial year ended March 2007 based on financial performance of the company in that year," said Transnet in the annual report.
Transnet said the "substantially better" 2010 financial results meant higher short-term incentive payment to its executives for "talent retention purposes".
- Fin24.com
