funds?
Hazel Friedman
Pact employees are adamant that Arts and Culture Minister Dr Ben Ngubane was fully aware that staff members who had received generous “severance pay packages” were still employed by Pact. But the minister denies it.
The Mail & Guardian revealed the “slush fund” scandal on March 1. Ngubane responded by saying he was first aware of the secret fund when he received a letter from the Arts and Culture Alliance (ACA) accusing Pact of giving “golden handshakes” to senior staff. He then said that he was made aware of the existence of these funds in November 1994, but that he was completely unaware that the “retrenchmanet payouts” were paid to employees who remained on Pact’s staff.
Two mysterious trust funds — one called Pact Employer’s Fund, worth R14 275-million and established in May 1995, and a Pact Senior Fund worth R714 333, set up in August 1993 — – were uncovered by members of Pact’s new board soon after they took office in November last year. They were told by acting director Eghard van der Hoven that it had been a small investment made in the late 1980s by Pact management and the unions from Pact’s existing fund-pool as a retrenchment payout, or in the event that there were no available funds to pay staff salaries.
A confidential document detailing Pact’s special and trust funds, sent to the M&G, reveals the Employer’s Fund and the Senior Fund were signed by Pact’s then-CEO, Louis Bezuidenhout, representatives from the Performing Arts Staff Association of South Africa (Pasasa) and the Paper, Printing and Allied Workers Union (Ppawu), as well as by Pact heads of department and a board of trustees composed of Michael Cook (former chairman of the Pact Board), Bezuidenhout, Gabu Twala (Secretary of Ppawu) and Sandra Laubscher (chairperson of Psasa).
The Senior Fund was established for “heads of department who resigned after more than 10 years’ service”. But until recently, few of the intended recipients of the funds were aware of its existence, except for 11 department heads whose contracts were amended in accordance with the provisions made by the fund.
In August 1995, artistic director of opera George Kok, and Jean Claude Laurent, head of the Pretoria State Thetare, resigned and received substantial severance packages.
But Kok and Laurent remained on Pact’s staff at Ngubane’s request, they say. Kok, who resigned from Pact opera after receiving a “grim picture” of the future of opera, says: “The minister phoned me in August 1995 and asked me to remain with Pact. I agreed on three conditions: that no-one would be retrenched from Pact, the council would not be unbundled and that a national opera company would be maintained.”
The minister also met with Bezuidenhout and Cook. Cook claims that Ngubane knew that both Kok and Laurent had been paid their severance packages from the two special funds. In September Ngubane placed a moratorium on all retrenchments at Pact.
Both Kok, who has worked at Pact for 30 years, and Laurent insist that prior to their resignations they did not know about the severance packages.
They also deny receiving about R240 000 each in severance benefits, as alleged by the ACA, and have offered to make public the details of their packages. Newly-appointed Pact CEO Alan Joseph has agreed to release the amounts once Pact auditors have investigated the origin of the funds. As a public company, Pact is obliged to account for and disclose the source of all its funds.