Johannesburg - Barely two weeks after suspending almost his entire executive, Eskom chairman Zola Tsotsi is facing a palace mutiny.
The Eskom czar could become the latest casualty as board members at the power utility have turned against him over the terms of reference and scope of the looming inquiry aimed at investigating the root causes of Eskom’s inability to secure constant power supply to SA.
To date Eskom has already shed four of its senior executives amid a clamour for an independent probe into the mess that has engulfed the parastatal.
African News Agency (ANA) has reliably been informed of plans to remove Tsotsi from the board following a meeting of the audit and risk committee, which is chaired by JD group finance director Chwayita Mabude.
The committee that has to sign off on any terms of reference for the probe into irregularities at Eskom comprises Vodacom executive Romeo Kumalo and Devapushpum Naidoo, legal counsel at Mpact.
Sources close to the developments told ANA the mooted inquiry has now stalled and could even be abandoned.
At issue seems to be whether or not the inquiry should be overseen by a retired judge and whether it should have the power to subpoena people to appear before it.
There are fears that a “watered down” inquiry could lead to a whitewash of the controversies at Eskom with little or no consequences for any wrongdoing.
The Eskom board met Public Enterprises minister Lynn Brown on Friday in Cape Town.
Colin Cruywagen, spokesman for the department, confirmed the meeting, saying it was at the board’s request on “an urgent matter.”
He did not want to answer questions about whether or not the minister had been consulted over the move against Tsotsi.
“The minister did not decide anything for the board, but told them whatever decision they take has to be in the best interests of Eskom and enhance its reputation.”
The minister appoints the board through cabinet.
For the removal of the chairman, the board has to recommend in writing to the minister, who makes the decision.
Such a decision has to then be conveyed to President Jacob Zuma.
ANA can confirm that Tsotsi was not part of the board delegation which met Brown. Mabude did not respond to messages left on her cellphone.
ANA can now reveal that after the audit and risk committee rejected the terms of reference the board on Thursday sided with them.
This left Tsotsi isolated.
The terms of reference were drawn up by consultant Nick Linnel, who was to co-ordinate the inquiry.
Linnel refused to be drawn into the detail of his work.
“I understood I was brought in to run an in-depth, unfettered inquiry. If the board wants something different, then maybe I am not the person they are looking for,” he said.
Another committee crucial to the process is the people and governance committee chaired in the interim by former Absa executive Venete Klein. Klein also did not respond to detailed messages sent to her phone.
Following the rejection by the audit and risk committee, the matter was set out to a full board on Thursday where, according to the source, Tsotsi was made the scapegoat as the board sided with the committee.
Tsotsi was then made to take responsibility for the impasse and was held accountable for drafting of the rejected terms of reference.
Sources at the board meeting told ANA that after Tsotsi was asked to recuse himself he was told the board would seek an audience with Brown, a move believed to form the basis of the recommendation to have him removed.
Tsotsi declined at least three requests for comment, finally insisting that he did not want to prejudice the inquiry.
The details of the inquiry, which ANA first revealed on Wednesday, included commercial, financial and technical forensic legs.
According to the draft recommendations, ANA understood that Eskom said a commercial forensic inquiry, to be led by a reputable and leading legal forensic entity, would among others, review all commercial transactions. ANA understands the commercial leg would have been undertaken by forensic entity Grant Thornton.
A financial inquiry would have been led by a large accounting firm, which would consider a “wide range of financial performance issues”, while a technical inquiry, led by an engineering team, would review the operational performance of the company and also inquire into some of the major failures that have occurred in recent years.
The inquiry was to have been overseen, not run, by a retired judge to ensure its independence and safeguard the integrity of forensics.
The statement, meant to have accompanied the release of the now ill-fated terms of reference, was brutally frank in its assessment of problems facing Eskom, which may have been a factor in the pushback by the board.
It starts by acknowledging the problems facing Eskom, saying they are maladministration, operational and financial inefficiencies, and poor decision-making.
“What has failed must be fixed. What is wrong must be put right. Where misconduct and inefficiency exists it will be rooted out,” the statement reads.
“We have recognised the need for independent assessment… To ensure this proceeds quickly and without hindrance or interference we have taken a number of steps.”
The inquiry was first announced on March 12 and was preceded by the suspension of four Eskom executives, including CEO Tshediso Matona. The other suspended executives are finance director Tsholofelo Molefe, executive for group capital Dan Marokane, and executive for commercial and technology Matshela Koko.
The decision to suspend the executives was so that space could be created for the inquiry, the board said.
The purpose of the inquiry is to provide the board and shareholders with an assessment of the current state of the utility and, in particular, to eradicate any misconduct and inefficiency that might exist.
It also needs to determine why the electricity supply is unreliable, causes for engineering failures, why there are delays and cost overruns, and look into Eskom’s financial solvency.
At the end of the probe, the board will be provided with recommendations and the required actions.
African News Agency