While a normal process to recruit a group chief executive officer (CEO) of a large company was expected take about six months, the state-owned enterprise (SOE) Passenger Rail Agency of South Africa (Prasa) took a full two years to fill the void left by CEO Lucky Montana.
Testifying before Deputy Chief Justice Raymond Zondo at the Commission of Inquiry into State Capture, former transport minister Dipuo Peters and former Prasa chairperson Popo Molefe, saw Molefe blaming his former political boss for the debacle in a company that lost billions of taxpayers’ money – unscrupulously siphoned from the SOE, through questionable tenders.
Contradicting earlier evidence given by Peters on reasons why a replacement for Montana could not be timeously found, Molefe told Zondo that the Prasa board began the recruitment process for the CEO as far back as 2015.
The board, said Molefe, asked Montana stay on at Prasa and helped in the recruitment process.
He explained: “Miss Peters’ earlier testimony was disingenuous and false, because the board wanted the CEO in place within six months.
“We agreed that Montana would work with the board in helping us identify a new CEO, working with a recruitment agency on talent search. We considered the post of the CEO as being very critical because we needed a captain of the ship.
“Montana gave us an earlier notice to leave the company, despite an undertaking to help us find a replacement. At the time of our persuasion, we were not aware of the malfeasance at Prasa, which happened under his watch as CEO.
“It was when we earnestly started to look at governance that was flouted, as well as the Auditor-General and Public Protector reports, that we saw him leaving much earlier.
“Montana had apparently played a similar game before, by threatening to leave the company, because of a better offer elsewhere, with an increase in renumeration – leading to his package being largely increased. But that did not help with our board.”
Asked by Zondo why it took much longer to appoint a CEO at Prasa, Molefe shifted the blame to Peters.
“By May 2016, we wrote to her (Peters), saying the appointment of the CEO was urgent. Whatever she says, she cannot justify a failure to appoint the CEO,” said Molefe.
While she took full responsibility for a failure to appoint a Montana replacement during her tenure at the department of transport, Peters blamed the delay on several factors, which included the 2016 local government polls and a tight political programme.
“It was important to keep the president (Jacob Zuma) abreast of what was happening within Prasa.
“There were local government elections in August 2016, several consultations and meetings, I was also in meetings with the deputy president and was not only looking into the Prasa matter.
“I take responsibility for not having taken the three recommended names for the post of CEO to Cabinet at the time,” said Peters.i
The hearing also heard how Werksmans Attorneys, contracted by Prasa to conduct an investigation into corruption at the SOE, saved the company up to R6 billion by reversing tenders illegally awarded to Swifambo, Siyangena and Siyaya – through high court challenges.