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#EskomInquiry: Gigaba defends board appointments

Mar 15 2018 17:47
Lameez Omarjee

Cape Town - Home Affairs Minister Malusi Gigaba told the Eskom inquiry that he had no crystal ball to tell which board members of SOEs would be caught up in allegations of state capture at the time their appointments were made.

He was responding to a question by chair Zukiswa Rantho about board appointments which happened during his tenure as public enterprise minister between 2009 and 2014.

“At the time of appointments there were no allegations against them,” he said. Gigaba added that it was unlikely that one person on a board would have enough influence and power to sway an entire board.

“A network was being created which tried in different areas, beyond public glare to influence certain decisions, that network became evident at a later stage,” he explained.

“There were also many very strong board members who would have prevented wrongdoing form happening. Be it Eskom, or Transnet, they were able to take decisions and ensure the companies are able to function.”

Gigaba said that things only really started to fall apart in 2015. “Without casting aspersions, the real significant, difficult, problematic decisions seem to start in 2015. Why and how I cannot speculate. I know in 2010 I was not aware of such allegations,” Gigaba said.

“Had one been aware, we would have acted.” He said some of the people appointed on boards were highly regarded by media and the investor community.

“No one back then would directly or immediately associate them with any allegation.

“As the minister back then, like anyone else I was not aware of the links to the Gupta family and I did not have a crystal ball to know the problems they would do in later years.”

During his testimony he also defended board appointments at Eskom, Transnet and Denel which took place under his watch.

Eskom board

He said that the board reappointments at Eskom in 2011 came about as he saw a need to comply with good governance principles under the King Codes. Some members had been serving for as long as nine years.

Gigaba also spoke on the appointment of Riaz Saloojee as Denel chief executive and the extension of his term.

Gigaba approved the decision by the board to appoint Saloojee given his expertise and experience. Saloojee’s appointment has been questioned in subsequent years, Gigaba noted. “He had the expertise which we thought were needed for CEO of Denel,” said Gigaba.

He added that he did not “willy nilly” approve the extension of Saloojee’s contract as requested by the board. He informed them that guidelines had to be abided by, and Cabinet had to be informed on the reasons for the extension before approval was granted.

As for the Transnet board, Gigaba said that when he arrived at the department of public enterprises, the Transnet board at the time was an acting board, operating on one-year appointments.

The department conducted a review which revealed that Transnet had the same problem as Eskom in that most of its directors had been serving for a longer term than permitted.

 “We certainly attempted to appoint strong and competent boards,” said Gigaba. “We welcome any lessons in this regard, which will emerge from this inquiry. It is important, however, that the inquiry concern itself with what we could have known at the time when making appointments,” he said during his testimony.

“If people we appointed went on to do wrong things later, we cannot be held accountable unless there is something about their profile which could have been detected at the time we appointed them, which showed they were likely to do wrong things.”

When asked if Anoj Singh’s appointment as Transnet CFO would have been reversed with knowledge of what has happened in the past few years, Gigaba said that it is a difficult question because he does not have the powers to read the future.

“In hindsight, yes I will say it was not the best decision,” he said. “If the facts available in 2017 were available in 2011 when the decision was taken six years earlier, I am sure we would have taken a different decision.”

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transnet  |  denel  |  eskom  |  malusi gigaba  |  eskom inquiry
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