Mantashe undermined, ignored us – why nuclear SOE board resigned

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Minister Gwede Mantashe. Picture: Everson Luhanga.
Minister Gwede Mantashe. Picture: Everson Luhanga.

The remaining board members of the Nuclear Energy Corporation of South Africa (Necsa) have called it quits.

They handed in their joint resignation letter on Tuesday, saying that Mineral Resources and Energy Minister Gwede Mantashe undermined and ignored their work.

In the letter addressed to Mantashe, the remaining four members – Pulane Kingston, Matlhodi Ngwenya, Pulane Molokwane and Bishen Singh – said that they had not received the support from the government department despite their efforts to ensure that the organisation was not run into the ground.

The letter makes reference to the minister’s public utterances that there is “no board” at Necsa, including that he would also exclude the board in meetings between his office and the state-owned companies falling under the department.

“A clear lack of support includes your public utterances that ‘there is no board of Necsa’ while continuing to interact with us as board members, including summoning us to meetings at your office. It also includes you holding critical strategy-related workshops for all state-owned enterprises falling within your purview and specifically refusing to invite the board,” the letter read.

They also highlighted what they believed were attempts by the executives in the department to “relegate” and “degenerate” their oversight role, which they believed was illegal, while explaining that their pleas to the Mantashe regarding the matter were futile.

“Your unavailability and non-responsiveness as a shareholder is concerning. This together with the above stated overreach by your officials, which undermines the responsibility and the authority of the board members, renders it untenable for us to continue serving as directors of the board,” the letter continued.

It also revealed the company’s ongoing financial woes, adding that the board had been trying to shed light on since October 2019.

The cashflow problem could possibly have led to the non-payment of salaries, however, ring-fenced funds were used to pay salaries from December 2019 until March 2020. Necsa is only expected to receive its government grant in April.

“In order to avoid a bleak festive period for Necsa employees, the entity managed to pay its employees their salaries for the month of December. This was made possible by various austerity measures, delaying the payment of creditors and placing non-key projects on hold,” read the resignation letter.

In order to mitigate years of losses amounting to as much as R554 million‚ the former board members said‚ Necsa had extended debt through loans‚ overdraft facilities and even dipping into emergency funding.

“Necsa has been technically insolvent since 2016 and has survived using ringfenced funds which has cumulatively had an impact on the going concern status that the new board faces.”

City Press previously reported about a mysterious letter that stated Mantashe’s decision to halt the mandatory powers of the board at Necsa, which had landed on the desk of the company’s acting chief executive, Ayanda Myoli, at the end of November 2019.

The document, which the Necsa board handed over for legal opinion, purported to grant Mantashe far-reaching powers over the corporation.

Although the letter was undated and not signed, it cited Thabane Zulu, director-general of the department of mineral resources and energy, as the document’s author.

Meanwhile, Mantashe was asked about the board’s resignation on Wedneday morning. He said that he had not yet recieved the letter but he would not stop them if they wished to leave.

In a statement released after that, the department confirmed receipt of the resignation letter and clarified Mantashe’s intentions regarding entities in his portfolio stating that the minister’s key priorities include stabilising of entities and ensuring good governance.

“The board of Necsa is therefore being replenished at present, to ensure that it is properly constituted, and also has the requisite mix of skills,” the department said.

A list of proposed names for the Necsa board has been finalised for submission to Cabinet for concurrence.

The department stated that it would like to see a “stable Necsa in the current financial year”.

Necsa conducts research and development in the field of nuclear energy, radiation sciences and technology. It is also responsible for uranium enrichment. – Additional reporting Fin24

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