Eskom CEO goes to court over suspension

Update

President Jacob Zuma must explain why he instructed Eskom’s chairman to launch an inquiry into the utility’s performance, which led to the suspension of top executives, DA leader Helen Zille said on Thursday.

“The president’s personal intervention begs the question — what could his motives have been?” she said in a statement.

The answer perhaps lay in the fact that the suspensions “followed shortly after the Eskom executive’s attempts to appoint an audit committee to oversee procurement processes for major contracts”.

Zille said industry insiders believed this move “may have upset political interests benefiting from lucrative diesel and coal supply deals”.

She called on Zuma to explain exactly who’s interests he was protecting by intervening at Eskom.

A fortnight ago, Eskom suspended four of its top executives, with chairman Zola Tsotsi announcing at the time that the parastatal’s poor performance would be investigated.

Business Day reported on Thursday that Zuma was directly involved in advocating the controversial inquiry into Eskom, initiated by Tsotsi two weeks ago.

The newspaper said individuals with direct knowledge of events had said that in the days preceding the board meeting at which the decision was taken, Zuma had contacted public enterprises acting director general Matsietsi Mokholo suggesting that the department support the idea of an inquiry.

The Democratic Alliance on Thursday launched a position paper on ways to solve South Africa’s electricity crisis.

The document outlines several interventions, including bringing an end to Eskom’s monopoly on power production.

Zille said her party believed management of the grid needed to be taken away from Eskom and placed under an independent state-owned entity.

“This will enable IPPs [independent power producers] to compete with Eskom on a level playing field for supply of electricity to the grid.

“A necessary first step in this process is the passing of the Independent System Market Operator (ISMO) Bill.”

The position paper also calls for the Integrated Resource Plan to be updated, and the Gas Utilisation Master Plan (GUMP) to be published.

“There is immense potential for gas turbines to be brought on stream within a few years. Policy certainty is urgently needed, however, through the publishing of GUMP, which will provide clarity to the market on South Africa’s contemplated investments in the gas sector over a 30-year period.”

Among other things, it also calls for the completion of the Medupi and Kusile power stations to be fast-tracked.

“The completion of these projects is a national priority and must be backed by a similar approach to the 2010 World Cup infrastructure needs.”

Original article

Eskom CEO Tshediso Matona challenged his suspension in an urgent application in the Labour Court in Johannesburg on Thursday, as the power utility announced more blackouts.

“The application is essentially asking this court to set aside the suspension,” his counsel Andrew Redding SC said.

He told Judge Benita Witcher that Matona, who was in court, had submitted a complaint to the Commission for Conciliation, Mediation, and Arbitration (CCMA).

He wanted the suspension set aside so that the CCMA could deal with the fairness of it.

Redding said Matona was suspended on March 11, less than six months after starting on October 6, 2014.

Presenting the timeline, he said there was to have been a meeting in the last week of February at which Matona was to present the chief executive’s report and make a presentation on initiatives.

This was part of an attempt to deal with problems in the organisation.

Cabinet had already established a “war room” committee, chaired by Deputy President Cyril Ramaphosa, to deal with problems at the power utility.

On February 25, Matona was told the meeting was postponed at the request of Public Enterprises Minister Lynne Brown, who represents Eskom’s shareholder, the government.

The following day, the company secretary was asked to convene an urgent meeting. Attached to the notice of the new meeting was a proposed resolution calling for an independent inquiry into the parastatal’s affairs.

Redding said it was not an inquiry into misconduct by any person, nor an inquiry into dishonesty.

The meeting went ahead and board chairman Zola Tsotsi proposed that a resolution for an inquiry be adopted. But, submitted Redding, the board disagreed on the resolution.

Tsotsi closed the meeting and said he was going to report to the minister.

On March 10, there was another urgent board meeting. Brown attended that one, although the legal basis for her attendance was not entirely clear, said Redding.

At a certain time in the meeting Matona and other executives were asked to leave. There was some discussion on whether there were listening devices in the boardroom or not. It was not clear if there was an investigation into this.

Later, the chairman told Matona the board had resolved to institute an independent inquiry and Matona was asked to recuse himself as chief executive.

Matona asked the chairman if he was being suspended and whether he should report for work the next day.

“He was not saying I must not report for work the next day, and he avoided the word suspension,” said Redding, referring to what Matona was told.

Matona had explained that a recusal was different to a suspension. A suspension implied wrongdoing.

Matona said the new board had not had time to properly consider the company’s problems.

In light of Matona’s refusal to recuse himself, on March 11 he was suspended.

On March 12 Tsotsi said four senior Eskom executives were asked to step aside as the power utility embarked on a fact-finding inquiry.

At the time he told reporters: “To ensure that this process is as transparent and uninhibited as possible, the board has also resolved that four of its senior executives, including the chief executive, should step down for the duration of this inquiry.”

Redding said at the time news reports quoted Tsotsi as saying there was no suspicion of wrongdoing against them.

The other three are finance director Tsholofelo Molefe, group capital executive Dan Morokane, and commercial and technology executive Matshela Koko.

Redding said: “Absent is any statement to Mr Matona that he is guilty of misconduct… or that there is any suggestion that he is guilty of misconduct. Not one statement.”

He said it was fundamental to a fair hearing that a person knew what they were alleged to have done.

“But they didn’t do that.”

Redding said on Wednesday between 6pm and 11pm “remarkably the notice of suspension appears to have been typed up… and signed… It is the fastest that Eskom has worked in many, many years”.

He was given no time to deal with the representations and was in fact “confused”. He was not given the relevant information on what he was supposed to have done.

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Eskom CEO goes to court over suspension