Mineral Resources and Energy Minister Gwede Mantashe has promised once again to restore governance at the troubled Nuclear Energy Corporation of South Africa (Necsa), despite the resignation of the remaining board members on Wednesday. Photo: Jacques Naude/African News Agency (ANA)
Mineral Resources and Energy Minister Gwede Mantashe has promised once again to restore governance at the troubled Nuclear Energy Corporation of South Africa (Necsa), despite the resignation of the remaining board members on Wednesday. Photo: Jacques Naude/African News Agency (ANA)

Gwede Mantashe vows to fix Necsa amid board members’ exodus

By Edward West Time of article published Jan 16, 2020

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CAPE TOWN – Mineral Resources and Energy Minister Gwede Mantashe has promised once again to restore governance at the troubled Nuclear Energy Corporation of South Africa (Necsa), despite the resignation of the remaining board members on Wednesday.

The department said it would prioritise new appointments to the board of the bankrupt company.

Mantashe said on Twitter that he had reviewed the names of possible new appointments on Tuesday already.

“It is the department’s intention to see a stable Necsa in the current financial year,” the department said.

The once-profitable Necsa is a leading producer of medical radio isotopes, manages the Vaalputs radioactive waste operation, and promotes nuclear research and development.

Former minister Jeff Radebe sacked its board in December 2018 amid two years of financial and operational crisis. Its chairperson resigned in mid-2019 after only six months. The board has subsequently pleaded for a R500 million bail-out from the government.

According to EE Business Intelligence, acting Necsa chairperson Pulane Kingston and four directors resigned yesterday due to frustration over inaction from Mantashe and his failure to address a liquidity crisis.

Mantashe said on Twitter that governance at Necsa was “dysfunctional”, and the government could not allow Necsa to continue to “corrode” ring-fenced funds for operational purposes that were originally established to fund decommissioning and other functions at Necsa in the future.

“We must appreciate that correcting governance is painful,” he said.

In August he said: “Stabilising the board and executive leadership at all entities reporting to the minister remains a priority.”

According to previous reports, the board in October had foreseen a cash flow crisis and had requested permission to use ring-fenced funds to meet financial obligations, including the payment of salaries between December 2019 and March 2020.

DA energy spokesperson Kevin Mileham said they would write to the chairperson of Parliament’s Portfolio Committee on Mineral Resources and Energy, Sahlulele Luzipo, to request that Mantashe appear before the committee as soon as Parliament resumed.

“Mantashe has provided a callous initial reaction to these resignations, as is evident by his comments on social media, indicating that he will just replenish the board of Necsa.

“There is no doubt that he has zero control over the entities he is meant to govern. Mantashe remains led by the nose by unions, instead of ensuring that our energy sector is able to run in a functional manner. While Parliament awaits Necsa’s new turnaround strategy, the entity remains a drain on the national fiscus and is simply no longer financially viable,” Mileham said.

BUSINESS REPORT

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