Gordhan tells why he fired Transnet boss
• Director’s action, or lack of it, ‘amounted to dereliction’
Public Enterprises Minister Pravin Gordhan has spelled out the reasons for firing Transnet director Seth Radebe, saying he plainly ignored evidence of state capture that cost the parastatal billions of rand.
In court documents seen by Business Day, Gordhan said Radebe’s actions — or inaction — amounted to “dereliction” and were “indefensible”.
The minister also rejected Radebe’s accusations that he was racist in his decision to keep Lana Kinley, who has since resigned, on the Transnet board while he fired Radebe.
Gordhan said he had axed Radebe because of his failure to take action in response to a probe of Transnet’s dodgy procurement of 1,064 diesel and electric locomotives from four equipment manufacturers.
Gordhan said evidence contained in a December 2017 report by Werksmans attorneys made it clear there were grounds for further investigation of several former and current Transnet officials in relation to the locomotives deals.
Transnet commissioned the Werksmans report in July 2017 to investigate the deals.
The report said group CEO Siyabonga Gama, former CEO Brian Molefe and Transnet engineering CEO Thamsanqa Jiyane, as well as “the entire board appointed during the period 2013 and 2014”, needed to be investigated further.
The leaked Gupta e-mails contain claims that Gupta-linked companies received multibillion-rand kickbacks as part of that R50bn locomotive deal.
“Not a single employee of Transnet was to be suspended, investigated, reported or even informally questioned, notwithstanding multiple incidents of noncompliance [at best] in connection with Transnet’s procurement policies having been highlighted in the report,” Gordhan said in court documents.
“I regarded and still consider this failure on the part of the board to be indefensible.”
Gordhan was responding to Radebe’s court bid to challenge his dismissal and reverse the removal of the Transnet board, which will be heard in the High Court in Pretoria next week.
“It is clear that Mr Radebe does not comprehend the enormity of the irregularities committed over a sustained period and which in turn required any new board member to commit himself to deal therewith decisively, expeditiously and with a resolve of putting this SOE [state-owned enterprise] back on a footing that can serve the greater interests of South Africa, or, alternatively, Mr Radebe had a remarkably high tolerance for malfeasance,” Gordhan said.
He said Radebe, who is chairman of the Transnet audit committee, “unsatisfactorily performed his functions”.
“He breached his fiduciary duties, in not motivating the board to commence disciplinary proceedings against the very people identified in the Werksmans report as having caused irregularities resulting in enormous losses to Transnet…. Nor did [Radebe] in his aforesaid capacity initiate any steps to cancel the tenders which are permeated with corrupt practices and has resulted in unauthorised and wasteful expenditure,” Gordhan said.
Radebe maintained he was only appointed in December 2017 and “the allegations of impropriety occurred before my tenure and appointment”.