/ 4 March 2011

Gama’s return reeks of political meddling

The circumstances surrounding the reinstatement of Transnet executive Siyabonga Gama suggest a political solution to overcome the sidelining of a man senior ANC figures had punted to head the parastatal.

Last week Gama was reappointed to a position in the chairman’s office following “a review of his dismissal”, conveniently sidestepping an appeal process at a bargaining council due five days later.

The appeal was halted on the orders of chairperson Mafika Mkwanazi, who headed the review committee and confidentially settled with Gama, a spokesperson said.

Gama, the former chief executive of Transnet Freight Rail, was summarily dismissed last June after an independent arbiter found him guilty of “negligence” over the award of two contracts, including an R18,9-million security contract awarded to a company, GNS, part-owned by his golfing partner, former communications minister Siphiwe Nyanda.

Gama has long enjoyed high-level ANC support in his campaign to head the parastatal, including from Justice Minister Jeff Radebe and Nyanda himself.

He was dismissed under the watch of former public enterprises minister Barbara Hogan, who faced heavy political pressure over the action, and acting Transnet group chief executive Chris Wells.

Hogan was later fired in President Jacob Zuma’s November Cabinet reshuffle and replaced by Malusi Gigaba, who immediately appointed a new board headed by Mkwanazi.

Wells announced he would resign by March 31, or as a soon as a permanent GCE was found.

On December 15 Transnet’s board announced Mkwanazi would assume the role of acting GCE, doubling as chairperson, which clashes with good governance principles.

Spokesperson Mboniso Sigonyela acknowledged that “combining the two positions is not ideal”, but said it was a board decision “to facilitate a smooth handover to a new GCE”. Last month Gigaba appointed Brian Molefe to the position. A week later Gama was reinstated.

Transnet has not explained why the current board overturned the previous board’s dismissal of Gama. Sigonyela said the board’s corporate governance and nominations committee “dealt with the matter” and that Mkwanazi was asked to finalise it.
Sources close to the process told the Mail & Guardian that Gama, who was appealing his dismissal, was to have a hearing via Transnet’s bargaining council last Monday and that the previous week there was to be a sale in execution of his assets, worth

R1-million. This was in terms of a costs order against Gama, who had launched several challenges to the disciplinary process in the South Gauteng High Court. Transnet had been awarded judgement to recover the costs by attaching Gama’s assets, but had not yet proceeded to do so.

According to a source familiar with the matter the Transnet board sub-committee dealing with the disciplinary process received advice from attorney Chris Todd indicating that the prospects were good of having the disciplinary findings and dismissal of Gama confirmed.

Todd is a partner at Bowman Gilfillan, the firm representing Transnet against Gama.

But an 11th-hour order came for these processes to be halted, according to two of the sources.

It is understood that Transnet’s legal department wrote to Bowman Gilfillan to say that on instructions from the chair and acting GCE — which in this case was the same man, Mkwanazi — the hearing and sale of assets should be put on hold to allow for negotiations.

It is understood that a review of Gama’s disciplinary process and its outcome was ordered and advocates Dumisa Ntsebeza and Kameshni Pillay were consulted. It is not clear what advice the advocates gave, but almost immediately after this, Gama’s reinstatement was announced.

Neither Sigonyela nor Gigaba would say what the cost implications of the Gama settlement would be for Trans­net, whether it would pursue the legal costs owed by Gama, or whether Transnet would back-pay the executive’s salary and outstanding bonuses.

The 200-page disciplinary report on Gama describes serious negligence, a failure to carry out duties and dishonesty on his part.

It did not find evidence that he was “wilfully” negligent, but said both contracts were signed under “highly suspicious circumstances”.

Gama was found guilty on a third charge of causing “irretrievable breakdown” of trust between himself, Transnet and senior executives, who he accused of “malicious skulduggery” aimed at prejudicing his ambition to become GCE, which was found to be without basis.

The findings revealed that Nyanda and Gama played golf together and phone records showed they talked regularly. Notably, they had a conversation just days before Gama authorised the GNS contract and Nyanda called him to commiserate after he was suspended last year.

Gama initially implied that he knew of Nyanda only “as any member of the public would”, but when confronted with the phone records, conceded this was incorrect.

Transnet is still pursuing a multi-million-rand civil suit against the Nyanda-linked security company, GNS.

Molefe will decide on the composition of his executive — and Gama’s new job — within two weeks.