More nuclear fallout at Necsa

In another week of high drama at the state-owned Nuclear Energy Corporation of South Africa (Necsa), the board has attempted to “summarily dismiss” chief executive Phumzile Tshelane for allegedly “withholding information” from the auditor-general.

The board majority wrote to Tina Joemat-Pettersson, the energy minister, last Friday to complain that Tshelane’s conduct towards government auditors had resulted in the auditor general provisionally disowning Necsa’s 2014-2015 financial statements with a “disclaimer”.

Read:
Nuclear storm brews as board tries to oust energy chief

But Joemat-Pettersson ignored their pleas this week by extending Tshelane’s contract “on [a] month-to-month basis … until further notice”. Tshelane’s three-year contract as Necsa chief executive was set to expire on Friday July 31.

Looming large over these latest developments is government’s R1-trillion nuclear new-build ­programme led by the energy department. The department had said that it would launch the procurement ­process by the end of July.


Billed as the most expensive project in South African history, it has  raised concerns among energy experts for its perceived unaffordability and potential to saddle the country with enormous debt and above-average electricity prices for decades to come.

Justifying her decision to retain Tshelane, Joemat-Pettersson wrote to the board on Tuesday, saying that, “in light of the pivotal role Necsa is playing in the nuclear new-build programme, it is important to maintain stability and continuity in this organisation during the … procurement process”.

Suitability questioned
But the board members are similarly mindful of the impending nuclear programme, and question Tshelane’s suitability to perform a key role.

They wrote to the minister: “The nuclear industry is one that prides itself in transparency, especially when it comes to compliance, safety and financial accounting.

“The very future of nuclear in South Africa depends on these pillars to assure that nuclear energy should not be feared, but embraced.

“The actions and conduct of the CEO … have trampled these very values and made a mockery of the government’s efforts to ensure a world-class nuclear industry, in preparation of the planned nuclear new-build programme.”

But Joemat-Pettersson strengthened Tshelane’s position this week by also recalling one of her nominees to the board. Department official Jeetesh Keshaw had fallen in with the small but vocal board majority that has been gunning for Tshelane, and has now been replaced.

This is not the first time that Joemat-Pettersson has shielded Tshelane.  AmaBhungane has reported how, in December last year, she told the board to open disciplinary proceedings against him on several charges but later recanted and instead launched her own inquiry into the board.

‘Applying her mind’
Joemat-Pettersson’s inquiry is now complete. She told the board this week she is “applying her mind” to its findings.

The board may also have overplayed its hand by issuing Tshelane and chief financial officer Zakes Myeza with letters of summary dismissal over the annual audit.

However, following the minister’s intervention, the letters were never delivered.

The Nuclear Energy Act gives the minister the power to hire and fire chief executives of state-owned companies allocated to her and she is likely to contest the board’s power to exercise this right concurrently.

The audit trail Tshelane wrote to auditor general Kimi Makwetu this week to protest about his auditors’ handling of the audit.

It remains to be seen whether Makwetu will now modify the disclaimer.

The board audit committee’s concerns, which amaBhungane has seen in writing, included:

  • Allegations, apparently made by the auditor general’s team working on the corporation’s accounts, that Tshelane and Myeza had granted them “only limited access” and had “with[e]ld information”;
  • Necsa’s financial position has “deteriorated in the past two years”. It is now R147.8-million in the red, and many of its income-generating subsidiaries are no longer going ­concerns; and
  • Necsa cannot quantify the future cost of “decommissioning and decontaminating” its facilities.

But in his letter to the auditor general, Tshelane complained that “basically the auditors have not had time to audit and apply their minds sufficiently to arrive at a well-considered audit opinion”.

The chief executive took issue with the “inconsistent treatment [by the auditors] of the liabilities associated with decommissioning and decontamination” and the “enormous amount of time and effort spent unnecessarily in this area”.

Flatly denying that Necsa had refused the auditors access to information, he lectured Makwetu: “It is inconceivable that auditors can spend more than three months applying resources to audit and not be able to satisfy themselves with audit evidence.”

* Got a tip-off for us about this story? Email [email protected]

The M&G Centre for Investigative Journalism, a non-profit initiative to develop investigative journalism in the public interest, produced this story. All views are ours. See www.amabhungane.co.za for all our stories, activities and sources of funding.

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Amabhungane
Amabhungane
Developing investigative journalism in the public interest. Digging dung. Fertilising democracy.

Related stories

‘New dawn’ clouds nuclear’s future

But struggling Necsa must get back on its feet before it contemplates its future strategy

Nuclear power ‘will cost SA just $1bn’

South Africa will make a $49 billion profit on a $50 billion nuclear power station fleet, if a utopian report is to be believed.

Nuclear storm brews as board tries to oust energy chief

Necsa faces a leadership crisis at the precise moment the government is on the cusp of issuing the main tender for the nuclear build project.

Right of reply: Necsa dismisses ‘wilful myths’

The South African Nuclear Energy Corporation claims "some myths have been deliberately perpetuated about the company".

Jobs for pals at state nuclear firm

A whistle-blower has claimed that the South African Nuclear Energy Corporation created a job for the chief executive's wife, Ngeniswa Tyobeka.

Energy minister shields ‘key Zuma nuclear ally’

An ugly battle over the suspension of Necsa's chief executive has split state nuke company down the middle.
Advertising

Subscribers only

Dozens of birds and bats perish in extreme heat in...

In a single day, temperatures in northern KwaZulu-Natal climbed to a lethal 45°C, causing a mass die-off of birds and bats

Q&A Sessions: Frank Chikane on the rainbow where colours never...

Reverend Frank Chikane has just completed six years as the chairperson of the Kagiso Trust. He speaks about corruption, his children’s views and how churches can be mobilised

More top stories

Eusebius McKaiser: Mpofu, Gordhan caught in the crosshairs

The lawyer failed to make his Indian racist argument and the politician refused to admit he had no direct evidence

Corruption forces health shake-up in Gauteng

Dr Thembi Mokgethi appointed as new health MEC as premier seeks to stop Covid-19 malfeasance

Public-private partnerships are key for Africa’s cocoa farmers

Value chain efficiency and partnerships can sustain the livelihoods of farmers of this historically underpriced crop

Battery acid, cassava sticks and clothes hangers: We must end...

COMMENT: The US’s global gag rule blocks funding to any foreign NGOS that perform abortions, except in very limited cases. The Biden-Harris administration must rescind it
Advertising

press releases

Loading latest Press Releases…