CCMA boss stalls over critical report

Sitting still: The report called for disciplinary action to be taken against the director of the Commission for Conciliation, Mediation and Arbitration, Nerine Kahn, among others. (Muntu Vilakazi)

Sitting still: The report called for disciplinary action to be taken against the director of the Commission for Conciliation, Mediation and Arbitration, Nerine Kahn, among others. (Muntu Vilakazi)

The Commission for Conciliation, Mediation and Arbitration has allegedly ignored recommendations contained in a forensic report that found evidence of maladministration at the CCMA.

It has been sitting on the report, which advised that disciplinary action be taken against its most senior officials, including its long-serving director, Nerine Kahn.

The report was compiled by Gobodo Forensic & Investigative Accounting, which said disciplinary action should be taken against Kahn for failing to act against employees implicated in irregularities in the procurement of services and the appointment of staff. She was aware of the wrongdoings, according to the report, that was submitted to the CCMA in December last year.

The report said the CCMA had failed to follow proper supply-chain procedures when it procured services relating to the development of its 2020 strategy from Stellenbosch University and the Mapungubwe Institute for Strategic Reflection (Mistra).

Although the report shows the CCMA paid a combined amount of slightly less than R500 000 to the two institutions through its travel management agency, Travel With Flair (TWF), sources in the commission claim the total amount paid could be well over R1-million.

TWF, which is partly owned by a former Miss South Africa, Basetsana Khumalo, and her sister, Johanna Mukoki, is contracted to the CCMA to provide conferencing services.

The report recommends a full forensic investigation into the use of TWF to facilitate payment to service providers that were appointed in contravention of the CCMA’s supply-chain management manual and those that were not part of TWF’s contracted service providers.

“When considering the contract and SLA [service level agreement] concluded with TWF and the nature of services rendered by the University of Stellenbosch, we submit that the research on strategic planning and hosting of workshops do not, in our view, constitute either a conference or event management as provided for in terms of the contract,” the report reads.

“This is exacerbated by the lack of evidence to support TWF’s involvement in any way or manner in assisting with logistics relating to and/ or managing the conference or event, and that their only role was to facilitate payment to a service provider whose services were in fact procured directly with CCMA.”

TWF, according to the report, invoiced the CCMA for more than the 8% provided for in terms of the service-level agreement for fees relating to conference and event management.

“With reference to the involvement of officials in the approval of the purchase requisition and purchase order and any subsequent payment, we record that such transpired subsequent to the director [Kahn] having become aware of the fact that the services of the University of Stellenbosch and Mistra had been procured by not following normal SCM procedures and could only have been undertaken with the knowledge of the director [Kahn] and or at least with the reasonable expectation that the director was aware thereof,” the report states.

The report also reveals that:

  • CCMA officials acquired artwork for more than R75 000 without following proper procurement procedures;
  • The CCMA appointed a senior manager for strategic management on a fixed-term contract without advertising the position; and
  • A CCMA official, who was part of a panel to interview candidates for a strategy specialist position, failed to disclose she knew the successful candidate, as required by the CCMA recruitment and selection policy.

Contacted on Wednesday, Kahn reacted angrily, pointing out that the report was confidential. “How did you get the report? It’s confidential.
It has not been discussed by the board,” she said.

  She then asked the M&G to email her the report before she would respond to further questions. On Thursday, she replied through the public relations company Meropa Communications, but appeared to have changed her tune. She said the CCMA’s governing body was considering the report.

“The report remains internal, it has been addressed by management and the director, and is still being addressed by the governing body of the CCMA. Those actions that have been agreed have already been implemented,” she said.

Responding to recommendations that disciplinary action be taken against her, Kahn said: “The recommendation for any action against me are made on the basis of having to account otherwise to the governing body, which I have systematically addressed and taken action against each item.”

The chairperson of the CCMA’s governing body, Daniel Dube, was not available for comment by the time of publishing. Gail Smith, Mistra’s head of communications, said the organisation assumed clients had followed proper procurement processes. “If there are any violations on the part of employee(s) of the client, Mistra is available and will co-operate with the investigation,” she said.

She added that Mistra was paid an amount of R127 255.92 by the CCMA through TWF.

Mary-Ann Kirrane, the TWF operations administrator, denied that the travel agency was charging the CCMA more than the agreed and contracted amounts. She added that TWF was never contacted to provide any explanations, clarifications and answers to any questions or issues.

  “I am sure you are aware of the well-established principle of audi alteram partem [hear the other side] that ought to apply to any investigation and consequent findings by any investigative authority. TWF conducts its business with integrity and within the ambit of the law and any existing agreements with our clients,” she said.

Stellenbosch University’s spokesperson, Martin Viljoen, could not respond to questions before the M&G went to print.

Matuma Letsoalo

Matuma Letsoalo

Matuma Letsoalo is the political editor of the Mail & Guardian. He joined the newspaper in 2003 and has won numerous awards since then, including the regional award for Vodacom Journalist of the Year in the economics and finance category in 2015, SA Journalist of the Year in 2011, the Mondi Shanduka SA Story of the Year award in 2008 and CNN African Journalist of the Year – MKO Abiola Print Journalism in 2004. Read more from Matuma Letsoalo

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