The North West Provincial Legislature Portfolio Committee on Community Safety and Transport Management led by Mmoloki Cwaile has resolved to support the North West Transport Investment (NTI) to open a separate account that will ensure that all monies of NTI are spent accordingly and all workers be paid on time. The committee also resolved to support the department’s decision to terminate and not to extend the contract of the Business Rescue Practitioner (BRP) with immediate effect to safeguard monies of government.
This follows a joint meeting that the committee held with the Standing Committee on Provincial Public Accounts, NTI, the Department of Community Safety and Transport Management together with Provincial Treasury and the Office of the Premier.
The MEC for the Department of Community Safety, MEC Sello Lehari presented before the Committee the department’s frustrations and continuous misconduct of the Business Rescue Practitioner, Mr Thomas Samson.
“The Business Rescue Practitioner BRP is a law unto himself and does not respect me as the Executive Authority of this department,” said MEC Lehari
MEC Lehari stated that the BRP was “appointed by default, and suspects that he reports elsewhere higher than his office.”
“The BRP is regulated and can take decisions above the CEO. We never analysed the role of the BRP and the regulations that give him powers to easily do as he pleases, as well as to suspend and dismiss the former Group CEO of NTI without any cause,” said MEC Lehari.
The BRP was appointed by the Shareholder Technical Task Team on the 19 July 2022 to intervene on long standing challenges faced by the NTI. Amongst some of the challenges facing NTI was the failure to submit Annual Financial Statements (AFS), non-payment of statutory obligations and non-payment of licenses and permit resulting in daily threats of withdrawal of buses leased, due to amounts owed.
According to a presentation by the department the BRP had failed to, amongst others, submit Business Rescue plan as per terms of reference and extended his contract while not having adhered to terms of reference for his appointment. He also failed to follow supply chain management and PFMA even after being advised by Provincial Treasury. He allegedly transferred R2m into his account and continues to use funds allocated for NTI to fight his legal battles. The Workers were only paid 40% of their salary wages for the month of February and March whilst creditors are owed close to R1.2 billion in debt. The workers have not been paid for recent past months.
Currently the department filed a case for the removal of the BRP and are awaiting a court date to be issued. The BRP has appealed the case, which has slowed processes for his removal, which hinders on the daily operations of the business. Amongst others Gauteng Provincial Transport Investment has pulled back its subsidies due to the NTI until they can resolve the BRP issue and NTI gets its house in order. This has resulted in the delay of payments to workers and creditors at NTI as well as insufficient availability of transport to the users.
The South African Transport and Allied Workers Union (SATAWU) led by the General Secretary, Mr. Jack Mazibuko also opposed the extension of the BRP, stating amongst others that BRP breached the agreement by using his vantage point to advance personal and/ or business interests to supply the state-owned bus company with fuel.
“SATAWU is a recognised creditor of NTI, and we vehemently reject the appointment of BRP and believe that his intentions is to destroy and liquidate the NTI with his continuous misconduct. We are carrying the lives of almost 2000 employees who need to feed and take care of their families. It is not only about paying salaries but also the future of the NTI,” said Mr Mazibuko
Hon Cwaile questioned the validity of the appointment of the BRP and confirmed that he was erroneously appointed and that his appointment must be challenged.
“We are shocked to note that the Office of the Premier and then acting CEO of NTI appointed the BRP who was de-registered at the time of the appointment. His practitioner license was null and void at the time of the appointment .
“The department could have taken action against the BRP after failing to submit the business rescue plan that was expected within 25 days following his appointment in July 2022 in terms of Companies Act , 2008 and continued to fail despite extension of period of his stay at NTI and his prolonged stay is irregular and non-compliant., it cannot be allowed that 8 months later, they still have not terminated his contract,
MEC Lehari also confirmed that he was not part of the decision-making that appointed the BRP and that he was given a report of the handover of all affairs of NTI to the BRP by the Executing Authority.
The Committee did not appreciate the non-attendance of the Premier of the North West to the meeting to account on issues of NTI. Amongst other issues, the committee needed clarity on reasons and legal process taken for the BRP to open a separate bank account from the NTI account; details of the board meeting that resolved to put the NTI under Business Rescue; allegations of an existence of a court order revoking the licence of the BRP and a Comprehensive Business Rescue Plan.
Hon. Cwaile said the continuous absence of the Premier and his office to come and account before the committee, as the main shareholder of the NTI and the non-cooperation of the BRP to work efficiently with the NTI, cannot be left undealt with.
“We have the responsibility of protecting the interests of our people, and guard against the continuous abuse of funds being embezzled at NTI, the reliance on the assistance by the Business Rescue Practitioner has been fruitless as there is no comprehensive report on the progress registered thus far since its inception.
“We therefore instruct the Department of Community Safety and Transport Management to stop all payments made to the Business Rescue Practitioner with immediate effect until all relevant documentation and reports are submitted before the committee to ensure compliance,” said Hon Cwaile
The committee supported the initiated court proceedings, and recommended that the NTI needs to process opening a separate transitional account, that can ensure that daily operations of the NTI unfold whilst they are still awaiting court proceedings.
Ends.
Issued by: North West Provincial Legislature: Media & Communications Unit on behalf of the Chairperson of the Portfolio Committee on Public Works and Roads, Community Safety and Transport Management, Hon Mmoloki Cwaile
Regards,
Namhla Luhabe
Deputy Manager – Communications
North West Provincial Legislature
Tell: (018) 392 7000
Cell: 079 527 0628
Fax: 086 695 3784
Email: namhla@nwpl.org.za
Website: www.nwpl.gov.za
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