SABC Board Memo on Irregular Expenditure & Misconduct

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MEMORANDUM
TO THE BOARD OF THE SOUTH AFRICAN
BROADCASTING CORPORATION
FROM M.MOHLALA ( DEPUTY CHAIRPERSON
OF THE BOARD)
DOCTOR SOCIKWA (BOARD MEMBER)
DATE 09 SEPTEMBER 2019
SUBJECT BOARD CONSIDERATION OF
INCREASING IMPROPER
CONDUCT/IRREGULAR
EXPENDITURE/FRUITLESS AND
WASTEFUL EXPENDITURE/BREACH
OF BOARD CHARTER
INTRODUCTION
We herein address this memorandum to our fellow
board members because we believe that it is our duty to
address the issues that we believe are critical and
important for the Board to deal with and address. Over
the past few months we have noted that there have
been mounting transgressions that the GCEO and the
GCFO have been bringing to bear on the SABC.
However for some reason the board have failed and /or
neglected to address these transgressions. We have
therefore felt that we as Board members have a duty to

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raise these concern with respect to the executives
failure to discharge their duties in part and in full.
The two areas we believe the executives are failing to
discharge their duties is in the context of firstly the
governance and breach of statutory duty and disrespect
to a Head of State and secondly in the context of the
manner in which he is addressing the Human resource
issues and procurement of consultant services. The
effect of the failure on the part of the executives to live
up to their mandate has resulted in both the of us as
Board members being attacked repeatedly by the
executives and also in the media. We were also
subjected to a very serious attack by some Board
members in the course of the meeting held on the 31
July 2019. This attack we believe was perpetrated
against us as an act of bullying aimed at making us
surcome to pressure and keep quiet whilst we watch the
unfairness of proceedings at SABC. We will not sit by
and let this happen.
We believe that we as Board members have a joint
responsibility to not only advance the interests of the
SABC in the public interests , but also in line with the
Broadcasting Act and other relevant pieces of
legislation.in view of this obligation we therefore believe
that we have a duty to firstly put issues of concern to the
Board for consideration and decision. The issues are as
follows:

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1. The incorrect Broadcast for the Presidential address
to the Nation.
2. Mounting unfavourable labour case outcomes;
3. The letter from Cliff Dekker personal claims against
Board members’;
4. SIU report discrepencies
The Broadcast for the incorrect Presidential
address to the Nation.
The first and most worrying and shocking issue with
respect to the questionable behaviour by the GCEO was
when presided over the public broadcasters broadcast
of the incorrect address by the President of the
Republic. The GCEO is the editor in chief of the the
Public Broadcaster. This conduct has had serious
consequences on the reputation of the Broadcaster and
the integrity thereof. This has never happened in the
history of the SABC. This also makes one wonder if it’s
a coincidence that it happens the day after the Zondo
commission presentation which was supposed to be
restricted to the security contract and other state capture
issues on the breakfasts but was then extended to
issues around funding or the lack thereof without Board
approval.

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The consequences of this incorrect broadcast are
among others as follows:
1. breach of our public mandate which is to keep the
South African public informed with accurate and
factually correct information;
2. the competition is seen as more reliable and
efficient because they broadcasted the correct
information
3. perceptions of the public and in turn third party
advertisers is seriously affected about our
efficiencies and this has an impact on revenue
4. again affects staff moral and the ability to attract
and retain new talent.
5. This is a direct undermining of the Head of State.
The Board can not ignore this conduct unless we
condone it. We should demand both written and verbal
account on record which must be accompanied by
appropriate consequence management . Should the
argument be that it is not the fault of the GCEO alone.
We have noted in the media that four staff members
have been charged and there is belief that there was
sabotage. This needs to be investigated fully. Then
there must be consequence management must be
escalated and applied through out the value chain.

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We must also not loose sight of the contents of the letter
from CWU where they raise concerns around the
suspension of the four staff members. They argue that
the fault must be brought to the door step of Ms
Magopeni and the GCEO.
We therefore urge that the SABC at board level must
with immediate effect apologise to the Presidency and
make assurance on measures will be put in place to
prevent a recurrence.
We therefore call on the Board to resolve that there will
be the following:
 Written apology by the entire Board of the SABC
directed to the Presidency and an assurance that
measures have been put in place to prevent
recurrence.
 A full investigation into the circumstances leading to
the incorrect broadcast.
 Full consequence management of all role players
including the Executive responsible for news and
current affairs and the GCEO.
Mounting unfavourable labour case outcomes
Colleagues and fellow Board members the number of
labour cases against the GCEO are continuing to grow.

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We have repeatedly been raising them at the Board as
they have been presented but have been repeatedly
informed that these are administrative issues. We
believe that looking at the numbers and the gross
irregularities but most importantly the court judgments
that have beset us there is now a need for the Board to
pay specific attention . Should we fail to pay the relevant
attention we are afraid we will find ourselves caught in
the middle of the administrative failures that are besting
us in this matter. Due to these growing numbers of
cases we have an obligation as a Board to make
decision to either provide guidance on the way forward
or alternatively directly intervene in these matters
The cases are principally the following :
UNFAIR TREATMENT OF STAFF RESULTING IN
RESIGNATIONS
NOMSA PHILISO
This specific matter related to the General Executive of
Television who was charged initially prior to our tenure
and she was then able to clear her name through a
disciplinary hearing. This process was undertaken at
great expense to the employee. Subsequent to the
assuming office by the current Board again She was
charged. Due to the pressure and this continued
charging and media attention and pressure she then
had no option to resign. This matter was grappled with
briefly by the Board but was subsequently abandoned.

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This was the first case that the Board had to deal with
respect to victimisation of a Black Woman who had been
in the employ of the SABC for a long period of time and
was a repository of s substantial amount of institutional
knowledge.
The Chairperson and later the Board protected the
GCEO by stating the this is an operational issue and
there Board could not interfere. This is disputed and
looking at the seniority of the employee and the impact
on the skills pool of the SABC , this is a matter that the
board should have intervened to resolve.
The legal costs associated with pursuing this disciplinary
case will have to be determined in due course. However
from our understanding the costs of this process was in
excess of R 300 000.00.
JAMES SHIKAMBANA - STATION MANAGER IN THE
WESTERN CAPE
This employee has as a consequence of being a whistle
blower with respect to the conspiracies that the
Chairperson and the GCEO had orchestrated has been
placed under immense pressure such that he ended up
resigning.
However he has lodged a grievance and such grievance
has now been referred to the head of human resources

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who is the very person that reports to the person that is
being complained about. The deputy Chair and Doctor
Socikwa have cautioned the Chair from referring this
matter for investigation and determination by the Human
Resource department. We have recommended that this
matter better sits at a board level or at the very least at
the level of the sub committee of the board.
In this context we again believe that the Chairperson is
actually again protecting the GCEO unduly to the
detriment of the affected employee.
We as board members have a fiduciary duty to ensure
that employees receive full protection and are not unduly
exposed to unbecoming behaviour by the executive
especially the GCEO in this context.
FAILURE TO ADD EMPLOYEE TO SHORT - LIST–
UNFAIR TREATMENT
NOMAZULU MDA
This employee was subjected to an unfair labour
practise . There was a failure to short list her for a
position that she had applied for. The basis for such
failure was not justified in view of the fact that she is a
Black Female, has vast experience and meets the
minimum criteria for the position .
She addressed a letter to both the Chair and the Deputy
Chair. Again the Chair unilaterally made a decision that

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this matter be referred back to executive management
even though they are the direct cause of such
unfairness.
It is incumbent on the Board to addresses this matter
because the matter has been referred to the Board and
it has an impact on not only unfair treatment of Black
Women but affects upward mobility of loyal staff
members within the institution.
LABOUR PRACTISES CAUSING FINANCIAL LOSS
TO SABC
CUPIDO (salary payments in the region of R 300
000.00)
With respect to the Cupido matter. The Sunday world
published an article in terms of which it was understood
that despite the fact that the outcome of the disciplinary
hearing was that she be released from her duties as
CEO of the SABC Pension fund with immediate effect
the GCEO had nonetheless continued to retain her on
the payroll and pay her salary for a further few months.
Again in this matter the Chairperson and later the Board
stated when the Deputy Chair asked for an explanation
to be presented to the Board by the GCEO was accused
of attempting to commence a disciplinary hearing
against the GCEO. This was incorrect at the time but

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was a pre- emptive step to prevent against unfair labour
practises that would be costly to the SABC.
The amount of the salary would have to be calculated
and quantified but it is estimated to be in the region of R
300 000.00.
PHASHA (costs in the amount of R 2 million)
The next labour case that we were confronted with was
the one in terms of which there was a costs order that
was granted against the GCEO and the GCFO for their
failure to effect reinstatement of an employee even
though there was an order from CCMA. What the GCEO
instead of undertaking a cost benefit analysis and
complying with the court order took a decision rather to
appeal the decisions.
Again herein the GEO is not only taking a decision to not
comply with the court order but also resolved to simply
add to the existing legal costs.
We are currently ae faced with a court order against the
SABC to the tune of R 2 000 000.00 , as opposed to
settling and cutting our losses as an institution that is
financially cash strapped, we took the matter on appeal.
When one looks at the legal costs one can easily add
another R 250 000.00 in the very least.

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This again opens the Board to the risk factor as created
by the conduct of the GCEO. We can not ignore it
because it flies in the face of our fiduciary duty as
members of the Board.
MULAUDZI TSHIFIWA (suspended with no charge –
R 900 000.00)
The employee herein is the General Manager for
commercial services. This employee has been
suspended with full pay for the past five months. He has
however never been charged. To date the services of an
forensic auditor have been procured however there is
still nothing that has been identified that can result in a
valid charge against him.
The costs associated with this continued salary payment
to the SABC is in the region of R 900 000.00.
The legal costs again even if conservative are in the
amount of R 120 000.00.
THANDEKA NDLOVU (suspended with full pay- R 2
400 000.00)
This employee similar to the case of Mulaudzi has also
been on suspension for the past twelve months. She is a
chartered accountant and is therefore not able to

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continue with her occupation. This is another Black
Woman that is being victimised. This creates a stigma
against her . She has been at home for a longer period
of time which a period of twelve months and she
similarly she has not been charged.
The costs associated with the continued salary payment
to the SABC is in the region of R 2 400 000.00.
CONTRACTS FOR FREELANCERS AND
CONTRACTORS CANCELLED
SHIRDIKA PILLAY VS SABC
In this matter the SABC was compelled to settle at a
cost of R 268 896.00. in the case of unlawful
cancellation of an agreement the SABC is facing a cost
order of R 11 722 863.03.
PETER VAN DEN BERG VS SABC
The freelance contract was unlawfully terminated and
the costs amount to R 989 408.00. the SABC was also
ordered to pay cost to Sekele Xabadiya.

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TOTAL COST ESTIMATE FROM LABOUR CASES
TODATE.
Based on the above analysis and on a educated cost
estimate it is clear that the costs are sitting at an amount
in excess of R 6 000 000.00. this the amount that is
excessive in view of the financial challenges that the
SABC is currently facing.
We as the Board have a fiduciary duty to ensure that we
not only restore the entity to financial viability but also to
ensure that there is responsible and proper use of the
funds of the cash strapped broadcaster.
SIMON MOLAUDZI AND AYANDA MKHIZE
These two employees were employed in the SCM
division. They were both dismissed as a consequence of
the concerns raised in the context of the security tender.
However with the findings of the SIU report on the
security tender these employees have written to the
Chairperson and the Deputy Chairperson of the Board to
express the unfairness associated wit their dismissals

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and they are requesting intervention. They are
proposing that their dismissal be reconsidered.
These cases are mounting . The Chair and deputy chair
need to acknowledge this email by the former staff
member and inform him and her of the propose
wayforward.
BEMAWU LETTER
The continued failure by the Board to bring the GCEO
and GCFO to account for the human resource
challenges the union BEMAWU has sent out a
communique that staff moral is at an all time low. Most
importantly the GCEO has created a culture of fear in
the broadcaster.
The Board must apply its mind to this letter. Most
importantly the Board must take into account that the
GCEO could be meting out unfair treatment to staff
members under the auspices of consequence
management . The issue of consequence management
should not end up being abused.
The Board has to apply its mind and communicate with
the staff to deal with the issue of the fact that this labour
cases are causing staff unhappiness and affecting staff
moral.

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We therefore urge the Board to make a determination
whether we will blindly ignore the challenges that the
staff are facing and the fear that is being wielded or will
we step in and address the challenges being presented
about the GCEO conduct and discharge our
responsibility as Board members.
The letter from Cliff Dekker personal claims against
Board members’;
The second consequence of the Boards failure to
address the GCEO indiscretions with respect to the
labour matters has resulted in the attorneys of some of
the disgruntled staff addressing a letter to the Board.
The letter is clear that they have every intention to force
the Board to act in line with our fiduciary duty to call the
GCEO to account on these staff matters. They have
indicated that our continued failure will result in them
instituting legal proceedings against each board member
individually and in their personal capacity.
This is very concerning because as professionals this
kind of court action will have serious consequences on
our continued professional conduct. This could also
result in judgment being taken against us in our personal
capacity. This I believe has to be avoided at all costs.

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We really should not have to wait for a court order to
compel us to comply with our fiduciary duty as directors.
I believe we need to apply our minds. The fair and
objective manner to apply our minds is to get a proper
report on all these matters and apply our minds to its
contents.
WAYFORWARD – LABOUR MATTERS
We therefore recommend that an independent inquiry by
a retired Judge be commissioned in order to investigate
the allegations that are levelled herein so as to advise
the Board. In order to prevent the GCEO from interfering
with witnesses he needs to be asked to take a leave of
absence for thirty days.
We believe that in order to demonstrate the fact that this
matter needs to be fully investigated and can not be
ignored we need to refer the Board to the findings of
Thuli Madonsela with respect to the conduct of the
previous Board. Therein she stated the following:
“The SABC has allegedly instituted disciplinary
proceedings against several staff members whose
services were either suspended or terminated. Most of
their disciplinary proceedings went before the CCMA for
the pre – dismissal arbitration …… I established that

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the SABC in a number of such proceedings had been
found to have acted improperly and was consequently
compelled to reinstate some of the said employee, while
others had to be awarded astronomical sums of money
for the settlement packages”. It is clear that this pattern
is continuing at the SABC with the GCEO at the helm.
The Advocate further advanced the following remedial
action amongst others” in future , there is strict and
collective responsibility by the SABC board members
through working as a collective and not against each
other, in compliance with relevant legislation , policies
and prescripts that govern the national broadcaster.”
Fellow Board Members please let us act before we are
compelled to act. We have a fiduciary duty to the SABC
and its staff. We have to hold the GCEO and the GCFO
to account.
RECOMMENDATION AND CONCLUSION
We therefore recommend that the Board adopt the
following resolution:

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 A commission of inquiry be commissioned to
investigate and recommend to the Board on the
way forward;
 In order to protect witnesses the GCEO be
instructed to take compulsory leave with full
pay;
 The investigation and report thereon be
presented to the Board within thirty days from
date of being commissioned.
OTHER SERIOUS TRANSGRESSIONS BY THE
GCEO
Appointment of a consultant at the rate of R 20
000.00 per day
There is an allegation that the GCEO offered Ryan Till a
contract that was excessively priced. Use of this
consultants services is priced at R 20 000.00 a day
There has also been a report that the GCEO presided
over the procurement of services of a service provider
that is charging the SABC an amount of R 20 000.00 per
day. The judgement of the GCEO again is highly
questionable as to how such services can be secured at
such a high cost for a cash strapped SABC.
This has be investigated for two reasons:

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1 The costs of using the services of this consultant
are excessive. We need an investigation into the
correctness of the figure and what level of expertise
and services that this service provider possesses to
justify this cost
2 We would need to understand on what basis the
GCEO has appointed this consultant who at a
glance clearly does not embrace the imperatives of
transformation.
We need to get clarity on this matter. The board has a
duty to fully investigate and make a determination
on this matter . we need to decide that if there is
indeed a transgression this must be remedied and
there must be consequences that must befall the
GCEO and any other executives that are implicated.
This again I reiterate is because the SABC is
financially cash strapped.
SUMMARY OF ISSUES TO BE CONSIDERED BY THE
BOARD
We call on the board to in summary consider all the
above issues namely the following:
1 That the SABC investigate and charge all those
involved in the incorrect broadcast and then as a

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Board render an apology to the Presidency and
what steps will be taken to prevent the recurrence
of a similar report.
2 whether an investigation should be commissioned
into all the labour matters that have been
presented to the Board ? Whilst this is being
undertaken the GCEO be compelled to take
compulsory paid leave ? the investigation be
completed in 30 working days.
3 That an investigation be undertaken as to
whether that GCEO has in fact contracted the
services of the service provider at the reported
rate and if so the contract must be cancelled and
the GCEO be compelled to refund to the SABC
the amount that he has contracted in excess of
the market related cost for the said services.
BOARD MEETING FOR DISCUSSION AND
RESOLUTION ON THE ABOVE MATTERS
We therefore will present each matter for discussion
and resolution at the Board meeting scheduled for 13
September 2019.