From the CEO’s Desk

PROUD OF OUR EVOLVEMENT, CON­FI­DENT OF THE FU­TURE

Mmileng - - Contents - MR MASELAGANYE MATJI,

The Board of Di­rec­tors of Roads Agency Lim­popo SOC Lim­ited, un­der the lead­er­ship of Mr Matome Ralebipi, was ap­pointed in 2014. This was fol­lowed by the ap­point­ment of the Chief Ex­ec­u­tive Of­fi­cer in March 2015 and key ex­ec­u­tive man­age­ment there­after. Be­fore the ap­point­ment of the Board of Di­rec­tors and CEO, the Agency was be­sieged by a wide range of se­ri­ous chal­lenges which paralysed its op­er­a­tion and abil­ity to de­liver on its statu­tory obli­ga­tions. The Au­di­tor-Gen­eral gave the Agency ad­verse au­dit opin­ions, one of the worst au­dit opin­ions which in­di­cate a sham­bolic state of af­fairs, for the 2013/14 and 2014/15 fi­nan­cial years.

This was un­sur­pris­ing, given the state-owned com­pany’s fi­nan­cial and op­er­a­tional sta­tus quo at that time, which re­sulted in the Agency be­ing placed un­der ad­min­is­tra­tion in terms of Sec­tion 100 of the Con­sti­tu­tion. At the time of the ad­min­is­tra­tive in­ter­ven­tion, the Agency had in­curred R1 352 181 000 of ir­reg­u­lar ex­pen­di­ture and R5 104 000 of fruit­less and waste­ful ex­pen­di­ture since 2007/2008. There was paucity of lead­er­ship at the ex­ec­u­tive level due to huge va­cancy rate, with key busi­ness units such as en­gi­neer­ing re­ly­ing heav­ily on con­sul­tants. As a con­se­quence, there was a high road in­fra­struc­ture back­log, which in­cluded par­tially com­pleted roads - re­ferred to as “Ber­muda” roads.

The sys­tem­atic fail­ures in cor­po­rate gover­nance and weak­nesses in in­ter­nal con­trols, which con­trib­uted to the con­sec­u­tive ad­verse au­dit find­ings, in­cluded out­dated sup­plier data­base and as­set man­age­ment reg­is­ter. The en­tire lam­en­ta­ble state of af­fairs eroded trust and con­fi­dence of the pub­lic, in­clud­ing key stake­hold­ers and strate­gic part­ners, in the Agency’s abil­ity to carry out its statu­tory func­tion of ad­vanc­ing the so­cioe­co­nomic de­vel­op­ment of the Lim­popo Prov­ince.

When the new Board and the ex­ec­u­tive man­age­ment were roped in about four years ago, they did not have the lux­ury of time. A turn­around strat­egy was swiftly de­vel­oped and its im­ple­men­ta­tion drive vig­or­ously pur­sued to set the com­pany on the new tra­jec­tory of sus­tain­able clean cor­po­rate gover­nance and de­liv­ery of qual­ity road in­fra­struc­ture.

By the end of the 2015/16 fi­nan­cial year, ma­jor progress had al­ready been regis­tered – in­clud­ing the fill­ing of key man­age­rial posts, re­cruit­ment of highly com­pe­tent en­gi­neers; ap­point­ment of highly qual­i­fied char­tered ac­coun­tants to im­prove au­dit and risk man­age­ment; im­prove­ment of sup­ply chain man­age­ment sys­tems; strict ap­pli­ca­tion of cor­po­rate gover­nance prin­ci­ples; and res­o­lu­tion of in­ci­dences of mal­ad­min­is­tra­tion. This sig­nif­i­cant progress did not go un­no­ticed by the Au­di­tor-Gen­eral, who gave the Agency an im­proved au­dit opin­ion. Within a pe­riod of only two years, the Agency had rad­i­cally shifted from an ad­verse au­dit opin­ion to an un­qual­i­fied au­dit opin­ion – the best pos­si­ble au­dit out­come.

RAL has planned for a clean au­dit for 2017/18.

To aug­ment the in­suf­fi­cient trea­sury al­lo­ca­tion for the roll­out of the road in­fra­struc­ture, the new man­age­ment em­barked on a road­show to gal­vanise the pri­vate sec­tor to part­ner with the Agency through co-fund­ing con­struc­tion of some of the eco­nom­i­cally vi­able roads in the Prov­ince. Thus far, a num­ber of pri­vate sec­tor com­pa­nies have con­trib­uted al­most half a bil­lion to­wards con­struc­tion of new roads. This is a demon­stra­tion of trust and con­fi­dence in the Agency by its strate­gic part­ners.

In the last fi­nan­cial year, the Agency has up­graded a to­tal of 46km of the road net­work from gravel to tar, about 122.51 lane kilo­me­tres re­ha­bil­i­tated and two bridges com­pleted. Through the em­pow­er­ment of SMMEs and in­sis­tence that con­trac­tors em­ploy lo­cal labour­ers, we have cre­ated al­most 4000 jobs within com­mu­ni­ties projects are rolled out.

RAL is a ma­jor cat­a­lyst of so­cio-eco­nomic de­vel­op­ment in the Lim­popo Prov­ince. We are there­fore unapolo­getic in en­sur­ing that the na­tional and pro­vin­cial ad­min­is­tra­tions’ pro­gramme of rad­i­cal eco­nomic trans­for­ma­tion is ex­pe­ri­enced by all our peo­ple.

In the next three years, the Agency is plan­ning to spend more than R2.4 bil­lion in up­grad­ing, main­te­nance and re­ha­bil­i­ta­tion of roads spread across all the five dis­tricts of the Lim­popo prov­ince.

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