Transnet board behind R17m payout to Siyabonga Gama may face civil claims
Gama was reinstated and received R17m payout after Zuma intervened
State capture commission chair Raymond Zondo said on Monday he might consider recommending to President Cyril Ramaphosa that the government institute civil claims against all Transnet board members who supported a R17m settlement to Siyabonga Gama.
Zondo made the comment as former Transnet board chair Mafika Mkwanazi wrapped up his three-day testimony on Monday.
At the centre of the testimony was Transnet's payment of R17m to Gama after he was reinstated in 2011, though he had been fired for “serious misconduct” a year earlier. Misconduct claims against Gama included that he had signed a multimillion-rand contract without reading its terms, insulted his colleagues and ignored board instructions.
The R17m payment was for salary back pay and full benefits as well as legal costs that the Transnet board approved when Gama was reinstated.
Transnet had sought to suspend Gama and institute disciplinary proceedings against him in 2009 when he was CEO of Transnet Freight Rail. But Gama went to court in an attempt to block the move. The court dismissed his application with costs, and Transnet fired him in June 2010.
Gama then declared a dispute, which went all the way to the state-owned company's bargaining council. He also lodged a complaint against Transnet with the then-public protector Thuli Madonsela.
While the bargaining council dispute and public protector processes were unfolding, then-minister of public enterprises Malusi Gigaba and former president Jacob Zuma intervened.
The Transnet board made a U-turn and reinstated him.
Mkwanazi — who was the Transnet board chair and acting CEO at the time — led negotiations with Gama that resulted in the R17m payout, despite legal advice to the contrary.
Mkwanazi admitted that Transnet was wrong to reinstate Gama and pay him R17m when, by his own admission, he had conceded that the charges against him had been substantiated.
Asked why he and his board were determined to bring Gama back, even when it was to the detriment to Transnet, Mkwanazi said it was because of Gama's “value”.
“A value of a CEO who signs documents without reading them, a value of a CEO who defied the board, is that the value you are talking about?” Zondo asked.
Mkwanazi later conceded the point, saying: “In retrospect, the two matters do indicate that this individual was not the best to be brought back to the company.”
Mkwanazi also ran into trouble over the legal costs paid to Gama.
“I am also seriously confused. I would need to sit with an accountant to explain these payments. They do not sound right,” Mkwanazi said.
Zondo corrected him: “No, you do not need an accountant — you need common sense.”
Zondo said that after hearing all the evidence related to the saga, he might recommend that the government institute civil claims against all Transnet board members who supported the R17m settlement.
“What this means is a lot of taxpayers' money went to Mr Gama and his attorneys. The back pay for nine months, legal costs for the high court and unfair dismissal matter which should not have been offered,” said Zondo.
“Would there be anything unfair if at the end the commission were to recommend to the president [Cyril Ramaphosa] that steps be taken to recover this money from members of the board who supported this settlement, which we agree should not have been offered to Mr Gama?”
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