/ 12 November 2018

Zuma interfered in Transnet CEO pick – Hogan

Before recounting the events at Transnet
Before recounting the events at Transnet, Hogan spoke at length about the role of the presidency in making appointments at state-owned entities. (Oupa Nkosi/M&G)

Former president Jacob Zuma attempted to strong-arm the Transnet board into appointing Siyabonga Gama as its chief executive in 2009, the commission of inquiry into state capture heard on Monday.

In her testimony before the state capture inquiry — chaired by Deputy Chief Justice Raymond Zondo — former public enterprises minister Barbara Hogan detailed how Zuma began meddling in the appointment of board members and executives of state-owned enterprises shortly after his election in 2009.

Hogan told the commission how — in a meeting with Zuma during which she presented the board’s recommended candidate to take over the helm of Transnet from Maria Ramos — the former president would not hear of anyone other than Gama.

READ MORE: Gama lobby guns for Maria Ramos

Gama was a Transnet executive at the time.

The matter of appointing Ramos’s successor at the end of February 2009 “became the site of an ugly protracted battle between President Zuma and I, in which he thwarted all the legal and legitimate procedures that I took to obtain Cabinet approval for any appointments whatsoever to Transnet, including the appointment of a CEO”, Hogan said.

Gama had already been eliminated as a candidate after it emerged that there had been allegations of misconduct against him regarding procurement irregularities.These relate to a R847-million tender in 2007 to supply 50 “like new” diesel locomotives, which was overseen by Gama, who was Transnet’s freight rail chief executive. There was also a R20-million security tender to a company owned by former Cabinet minister Siphiwe Nyanda.

Gama allegedly had no authority to sign the security contract.

Sipho Maseko — who is currently the chief executive of Telkom — was the candidate chosen by the Transnet board. The board had written a glowing report on Maseko’s qualifications for the position.

“It actually shocked me,” Hogan said of Zuma’s insistence that Gama be appointed.

Hogan informed Zuma that it would not be in the interest of Transnet to appoint a chief executive who would be spending his times dealing with the allegations of misconduct against him, she told the commission.

Zuma suggested to Hogan that no one was to be appointed the chief executive of Transnet until all disciplinary hearings against Gama had been ventilated, Hogan said.

“It was just: ‘This is my candidate’,” Hogan said about Zuma’s preference for Gama over Maseko. Zuma did not raise any concerns regarding Maseko’s qualifications, Hogan said.

Hogan said she was under the impression Zuma had been given Gama’s name prior to her meeting with him. Though she has no evidence of this, there were rumours that Gama was supported by a faction within the ANC, Hogan said.

Hogan also recounted how theories started to emerge at the time, suggesting that acting Transnet chief executive Chris Wells had attempted to sideline Gama’s candidacy.

Regarding the locomotives tender, Gama was found not to have fully complied with the board resolution on the contract and was dismissed after a disciplinary hearing in June 2010. But he was rehired two years later after he appealed his dismissal and also complained to the office of the public protector that he was treated unfairly.

Before recounting the events at Transnet, Hogan spoke at length about the role of the presidency in making appointments at state-owned entities.

Hogan said that, while a minister might consult the president regarding these appointments, any interference in this regard would be an act of usurping the executive authority of the minister in question.

Hogan was ultimately axed by Zuma in October 2010 and replaced by Malusi Gigaba.

Cabinet eventually approved a list that was submitted by Gigaba for a new Transnet board in December 2010.Two months later, Cabinet approved the appointment of Brian Molefe as the new chief executive of Transnet. When Molefe was seconded to and then appointed chief executive of Eskom in 2015, Gama became chief executive of Transnet.

In October this year, Gama was axed from the position. His future at Transnet had been uncertain for some time after his role in alleged maladministration, along with those of other senior executives, was questioned by separate investigations into the workings of the state-owned entity.

Acting on behalf of Transnet, Terry Motau SC attended the commission on Monday. Transnet board chair Popo Molefe was also in attendance.