Sentech Annual Report 2009/10 & Strategic Review and Business Plan

Meeting report

Sentech: Annual Report 2009/10 briefing
The Chairperson welcomed the Sentech Board to its first meeting with the Committee.

Mr Quraysh Patel, Chairman: Sentech Board, thanked the Chairperson wanted to give an overview and background so that the documents handed out could be placed in its proper context and circumstances, in order for Members to fully understand some of the decisions that were made as well as the status of Sentech.

He noted that over the last few months the media had painted a picture of Sentech being on the verge of a crisis, which seemed to suggest to the public that no radio or TV signals would be provided to the public. Those reports, however, were incorrect, as would be seen from his outline of the background and context.

He reminded Members of the core business of Sentech – namely, to deliver broadcast signals for TV and radio. Sentech had other businesses as well, and this would be expanded on later, and its businesses were determined by the licences it held, which included licences for multimedia, satellite gathering and broadcasting – which clearly demonstrated that it was more than a signal distributor. Sentech could do video on demand and pay-per-view, including the possibility of a myriad of other services.

Keeping in mind that its core business was signal distribution, he placed on record that Sentech had no complaints in regard to this service. Sentech provided an excellent signal distribution service about which no one could complain. Its future should be defined by its core business, but not as a signal distributor, but rather as an operator of a network. If that was understood as the point of departure, then it must also be understood that perhaps there was a need to review, and even close down, some of the businesses it owned. The analogue system was ageing but it was being maintained regularly, and would continue to be maintained until at least 2015, when there would be complete Analogue Switch Off (ASO). By that time Sentech should also have a full Digital Terrestrial Television (DTT) network. Sentech was on track to roll-out coverage of DTT to 60% of the population by 31 March 2011. When Sentech had sought funding earlier in the year, the Minister had encouraged Sentech to set that 60% target, and it believed that it could reach it.

Mr Patel noted that the media had also reported that Sentech had a cash crisis. Although this had been true at one point, the situation had changed, and Sentech had R232 million in the bank at the end of September 2010, as a result of the positive way in which the business had been managed in the interim. Sentech did not want to approach the shareholder for operating expenses. It had been suggested by National Treasury and the external auditors that Sentech was unlikely to be able to continue in business beyond November 2010, but he denied emphatically that this was the case. He noted that the same parties had forecasted a shortfall of R17 million by November 2010, but this was clearly incorrect, in light of the R232 million cash reserves at end September. The business had, in fact, grown its operating profit by 300%, against a budget of R40 million over a period.

Mr Patel said that an analysis of the Annual Report would also show that the net profit grew by 30%, while the operating profit grew by 29% in that financial year. He wished to demonstrate that the stabilisation of Sentech, especially from a financial point of view, was virtually complete. He pointed out that these results did not even include interest earned from ring-fenced funding from government. The evidence and trends proved that Sentech had a sustainable business plan, although this was a short-term plan. The objectives set out in June 2010 had been met. Consideration needed to be given to the fact that Sentech was still bound to loans and leases and other financial commitments, due to poor decisions taken in the past. The bloated headcount also worsened the situation. He stressed that Sentech was nonetheless striving to provide a social dividend without having to approach the State for funds.

He noted that the Board of Sentech had issues with top management, and was effectively being damned for whatever it tried. Since the new Board had taken over, it had been faced with a management team that was not reliable and could not provide the Board with credible information. Because of this, several mistakes were made. For example, when the State had awarded R160 million, the VAT portion should have been noted at R21 million, but, because of poor information, was only noted at R3 million. In addition, for three years Sentech had not paid VAT, believing, incorrectly, it did not have to, and this resulted in a VAT debt of nearly R170 million. The VAT was settled from funds from the State that had been intended for the DTT rollout, which meant that these funds were now short of requirements. He had cited this as but one example of the top management difficulties. This indicated that there was, at the time of the Board appointment, a business that was in distress, senior management that was dysfunctional, and an unfocused business operation. These circumstances should be recognised and taken into account by the Committee when it made decisions around the Board.

He noted that the Sentech Board had therefore taken the decision, based on advice both from external auditors and Senior Counsel, to become an operational board. He acknowledged that the past situation would haunt the Board for several months, but it could also be the defining element in its work. He noted that Section 51(1)(b)(i) of the Public Finance Management Act (PFMA) stated what the requirements were, and noted that if management was not up to performing the tasks, then the Board believed that it should do what was required from a public entity. The Board had set up a committee to monitor the cash in Sentech on a daily, weekly and monthly basis. The Board instructed this committee to increase the cash collections against billing, from 70% to 80%. He reiterated that this was done against the background of an unreliable Exco, consisting of a Chief Executive Officer who failed to give information, and a Chief Operating Officer who was newly appointed and did not have any historical knowledge. The person holding the post of Chief Financial Officer was clearly also not reliable, since that person had failed to pay VAT, had allowed collections at 70%, well below the norm, had sent reports to National Treasury without submitting them to the accounting authority for finalisation, had been fined for failing to pay the fees due to the Independent Communications Authority of South Africa (ICASA), had paid on invoices without contracts being in place and who had given purchase orders without contracts in place, and without the necessary consent. For these reasons, an expenditure committee was set up by the Board in place of the CFO, who was not permitted to perform these tasks.

The Board was also faced with unprofitable business, when it took over. For example, the exit strategy for MyWireless placed an enormous financial strain on Sentech. The international gateway CoC had been unprofitable, as had the businesses VSAT, because of the high costs. He added that the VIVID business should be discarded because Sentech was not mandated to deal in the content delivery sector.

A further problem was that Sentech had had no business plan. When the Board was appointed, it had drawn up the business plan in the absence of those who were tasked with it having performed the task, despite the fact that they had held their positions for three or four years. The one-year plan that was submitted to the Committee was drawn up by the Board, with some external assistance, which had resulted in negative coverage in City Press, in respect of which the Board had instituted action.  

Sentech had R500 million locked by National Treasury, and needed the funds, yet National Treasury had failed to approve the transfer to Sentech despite submission of two plans. The plans were in respect of broadband roll-out, and would provide Sentech with a great opportunity to enter that field. He noted that this opportunity would be lost unless Sentech could come up with a credible plan that would be approved by the Minister and National Treasury.

Sentech also had an excessive headcount. In respect of MyWireless, new staff with telecommunications expertise had to be appointed, whilst the cash-cow of signal distribution was being neglected. A risk assessment by an analyst appointed by the previous Board had found that the levels of risk were extreme in most cases, especially in the finance department. There was no revenue assurance and no risk mitigation plan in place.

He hoped that this background would help the Committee to understand the difficult circumstances in which the new Board found itself. The new plan was put together in only six weeks, and whilst it was not perfect, it was working. This plan was also merely an interim step towards the corporate planning process planned for November 2010. The new Board had not been privileged to receive appropriate handover, because there was no continuity, with the one member from the former Board being with the new board for two months, but being unable to assist with the handover process. The new Board had had to learn the business itself, and, although it still had much to learn, it had realised that Sentech had phenomenal potential to remain the supplier of choice in signal distribution in this country. This was largely due to the monopoly position, but it should also be so in a competitive environment. Sentech should concentrate on its strengths and should avoid peripheral businesses that merely drained it of resources.

Mr Patel summarised that the Board had intervened operationally because senior management was unable to act satisfactorily. The position of Chief Executive Officer should soon be filled, and he noted that when the former Chief Executive Officer was suspended, he had tendered his resignation. The post of Chief Operating Officer would soon be advertised. The post of Chief Financial Officer could not yet be advertised, as charges of gross negligence against the present incumbent were still pending. The current CFO was also involved in the Rentworx matter, and the Board was taking legal advice considering whether to lay criminal charges in that regard, against the CFO and all previous board Members, as well as discussing this matter with the shareholder. However, the salary of the incumbent CFO had been suspended. The only member of the management team then remaining was Mr Dube, who could clearly not run the organisation on his own. Mr Dhlamini, for instance, was heading up the turnaround committee.

The November 2010 Corporate Planning Session would focus on continuing to provide a network operation service and lowering the costs involved for the public. Rural delivery and delivery to schools would receive special attention. Hospitals and clinics in provinces, and the broader citizenry, would all benefit from cheaper communications costs.

Mr Patel noted that the Board had asked the external auditor whether it would now be prepared to revise its comment that Sentech was not a going concern, after evaluating the new business plan, had asked the Board to make a presentation, but had then advised that in its view, there was still a risk that the business could not turn a profit and that the shareholder might refuse to bail Sentech out. On that basis, the auditor had then issued an emphasis of matter. However, he pointed out that having a risk was different from the business not being a going concern. He reiterated that it was the view of the Board that Sentech was indeed a going concern. The situation should return to normal with appointment of the Chief Executive Officer, hopefully at the end of the month, and appointment of the Chief Operating Officer and head of finance.

Mr Mesuli Dhlamini, Board Member, Sentech, dealt with some of the financial matters. He reiterated that all fundamentals of a going concern were in place. The income statement reported a profit of R105 million. However, since most of this consisted of interest earned, the auditors believed that the business was just breaking even. The Board therefore decided on a turnaround strategy, including cost-cutting measures, and had instituted an expenditure committee to scrutinise all expenditure very closely, applying the value for money principle. This had now resulted in improvement in the cash position.

The assets of all discontinued businesses were being decommissioned. The irregular expenditure reported included the Rentworx matter alluded to by Mr Patel. The figures reported for Plant and Equipment included the equipment used for the World Cup.  R74 million was owed to Sentech by various government departments, some community radio stations as well as some private concerns. The loan to Development Bank of Southern Africa (DBSA) was linked to Rentworx, and Sentech was committed to the repayments until 2014. Sentech still had to deal with the liability of employees taken over from SABC. The poor cash flow situation had been caused by the VAT settlement referred to earlier on, and the Sentech Board had also insisted that all future business plans must clearly make provision for the VAT payments. Sentech was now focused on revenue assurance, avoiding cash haemorrhaging and improved collections.

Mr Dingane Dube, Acting Chief Operations Officer, Sentech, drew Members’ attention to page 15 of the Annual Report, which clearly spelt out that the one-year business plan had been approved by the Department of Communications (DoC). Everything reported upon at this meeting was based on that approved plan. He confirmed that he had had difficulty, as the only remaining active member of Exco, to run operations and interface with the Board and therefore it had been necessary to work closely with the Board in operational terms. He too confirmed that a number of austerity measures had been introduced (see attached documentation for details). The stabilisation of Sentech was a prime concern, and several strategies were implemented to facilitate this, including an instruction to all departments and divisions to do an internal audit of their precise position, in order to then stabilise, turn around and proceed to success. A record of all interventions had been kept, and would be kept into the future, to hand over to the new Chief Executive Officer on his or her appointments.

In respect of incorrect expenditure in the past, Mr Dube noted that the staff implicated had been subjected to disciplinary procedures and were dismissed.

Mr Dube noted that Sentech, amongst other interventions, had to correct its supply chain management, not only to ensure fair value for money but also to focus on Small, Medium and Micro Enterprise (SMME) development. Revenue was increased both by insisting upon payments due, and by cutting those entities and broadcasters who did not pay. Retention bonuses were being paid on an ad hoc manner, and in future a policy would be formulated, whilst all other policies would be reviewed. Further restructuring of the businesses would take place during the November corporate review. He summarised that Sentech was stabilising well, and was focused on successfully migrating the country from analogue to digital.

Mr Dhlamini added that the turnaround strategies were integrated seamlessly into the operational processes.

Discussion
Adv J De Lange (ANC) said that Sentech should give the Committee more credit for understanding the situation, since Members appreciated that what was in the media might well be based on staff leaks from Sentech, and knew where the lines of credibility should be drawn.

Adv de Lange said that he was hugely encouraged by this report, because it reflected very decisive actions based on sound principles. He was concerned that the Board had taken on the functions that, according to the PFMA, were to be done by Exco, but it was clear that Exco had not acted, and felt that the PFMA was setting out the situation that should pertain when matters were running smoothly, but did not cater for a meltdown situation. Although he understood why the Board had acted as it did, he cautioned that this practice should not be encouraged. He urged that healthy corporate governance must be restored quickly, in order for the necessary checks and balances to be in place. In light of the lacuna in the PFMA around meltdown situations, he suggested that the Committee should endorse the work the Sentech board had done up to that point, and should support the work of this new Board, which was clearly doing its best to revert to the core business of signal distribution. However, he did also ask that all future restructuring and acquisitions of new businesses should be done with full consultations with the Department and the Committee, to ensure the Committee’s support.

Adv De Lange asked that a more detailed report be made available on all the transgressions that had occurred at Sentech, as he thought that only some of the instances had been highlighted in this report. He also said that the situation should not be allowed where staff committed serious offences in one organisation, were permitted to resign and might then move to another organisation without the necessary penalties being imposed. A stronger message should be sent out. He was referring to the R31 million spent by Rentworx without proper permission, the issues raised in relation to the former Chief Executive Officer, and why it had been possible for Exco to alter employment contracts, to award themselves huge salary increases. He asked what permission had been sought before the loans were taken.

Mr S Kholwane (ANC) was pleased that there appeared to be some light at the end of the tunnel. He needed clarity as to what regulations ICASA still had to amend, in order for Sentech to roll out the DTT, noting that this had been raised in April, yet ICASA did not appear to have acted.

Mr Dube explained that ICASA had provided a frequency plan but that Sentech needed some amendments to that plan because it would not have sufficed. ICASA should still come back with an updated frequency plan.

Mr Kholwane failed to understand why ICASA was dragging its feet on the frequency plan. The implication for Sentech was that it could not finalise its submission to National Treasury. The funds would therefore not be released for the roll-out to be completed on time. He felt that the Committee should perhaps engage ICASA at a later stage.

Mr Dube explained that Sentech had submitted its DTT plan with its own frequency plan to government. By that time ICASA had not finalised its frequency plan. There was also a Cabinet decision that migration would start at the end of 2008. He mentioned that Sentech had already demonstrated its seriousness by sourcing equipment for the roll-out, based on its own frequency plan. However, once the 80% coverage mark had been reached there would be a deadlock with further expansion because of the inadequacy of the current frequency plan of ICASA, which did not make provision for the required expansion.

Mr Kholwane needed clarity on precisely when the other executive management team staff would be appointed.

Mr Kholwane asked what feasibility studies had been conducted for all the businesses that Sentech had started.

Mr Kholwane said that connectivity in rural areas remained of major concern.

Mr Patel indicated that the use of satellite as the backbone for internet services in remote areas was not cost effective. It came at a huge expense for the provider which then would be passed on to the customer. There was the question of providing schools with the services, at the e-rate, but even in that regard the cost would border on prohibitive, due to the satellite backbone. Schools should get connected via alternative terrestrial platforms, as it would be cheaper. This meant that Sentech’s VSAT business was not sustainable. This had an effect on the headcount challenges. He was not, however, sending out a message to the VSAT staff that they were about to be retrenched imminently. He personally believed that satellite was not the way to go in this country.

Mr Kholwane enquired whether Sentech saw its core business as that of a network operator or a signal distributor, and asked what the difference was.

Mr Patel said that feasibility studies of its current businesses were all being done and some of these businesses had already been closed down or earmarked for closure. Sentech remained committed to shedding businesses that did not conform to its core mandate. He wished to clarify that Sentech was at this stage still only a signal distributor and not an operator of a network. By November’s corporate planning session, Sentech hoped to take a firm decision that it would be a network operator. This was dependent on whether its broadband plan was accepted. If it were to be accepted, then Sentech would have two networks – a signal distribution network and a broadband network. Only then could Sentech operate as a network operator. He urged that the State not take spectrum away from Sentech, and urged that government agree that Sentech be given one further chance to submit a plan that would demonstrate a winning formula for the broadband roll-out.

Mr N Van Den Berg (DA) felt that the tone of the presentation had been open and trustworthy, and hoped that the Board would not leave any negative “baggage” at the end of its term

Mr Van Den Berg asked what the extent and nature of the relationship was between Sentech and the DoC, also between Sentech and ICASA. He specifically asked about the kind of support Sentech received from those two entities. He also enquired what the relationship was between Sentech and the private sector.

Mr Patel said that the relationship between Sentech and the Department was a healthy working relationship. The Department fully understood that on technical matters it should not attempt to interfere with Sentech, whilst in respect of policy, Sentech would leave this to the Department. The Minister had written to Sentech urging that the Board have a much closer contact with the Department and Ministry.

Mr Van Den Berg said that the presentation had not set out clearly what Sentech was doing on risk management, nor was it clear whether Sentech would meet its targets against the timelines set, and what the risks would be in meeting those targets from the rollout of DTT.

Mr Van Den Berg felt that the opportunities presented by spectrum needed to be harnessed, and he asked how far Sentech was down that line.

Ms M Michael (DA) needed more information on the total costs incurred in the disciplinary proceedings, as well as the result of procurement fraud.

Mr Dube said that there were no ready figures for the cost of the disciplinary enquiries because some were still ongoing. The future report could include such costs.

Ms Michael acknowledged the need to reduce the headcount, but asked whether the company could afford vacant posts in critical areas. With regards to remuneration and staff rewards, she noted that the Human Resources division clearly had not done its job properly, and urged that those responsible should be disciplined.

Ms Michael suggested that community radio stations be cut off if they failed to pay. Some stations were claiming that the Department gave them assurances that Sentech could not cut them off, although Sentech had established that this was not the case, yet they were still not being cut off, and she failed to understand why. The same principles of services only on payment should apply to all.

Ms Michael asked for more information on Sentech’s equipment upgrade and maintenance programme.

Mr Patel said that it was a major challenge to find the correct balance between upgrades and maintenance. If certain old equipment had to be maintained the cost would just be too high and in those cases it would be cheaper to rather upgrade. This had other financial implications and needed input costs from National Treasury. The plant in Meyerton was viewed as a museum by many, yet it served a very crucial service to Sentech. The reason for it not turning a meaningful profit was the exorbitant maintenance cost for its old equipment.

Ms W Newhoudt-Druchen (ANC) needed clarity on what Sentech meant by its remarks that the headcount was “excessive”, asked how many people it needed, and what Sentech was doing about it.

Mr Patel responded that a company should realise that its headcount was excessive if it was spending 35% of its costs on personnel, which was way above the norm. The norm would be set by the nature of the business. Sentech was a hard skill company, and having 550 staff was excessive. When MyWireless was created, because it was a retail business and different skills were needed, a number of staff had to be recruited, but when this business failed, only some of these staff left, with others opting to stay on, but having to be moved out of their specific skill zones, because Sentech itself was not involved in selling, because it held a monopoly. Sentech did not have the cash flow available to retrench them. The matter of staff would be partly addressed in the upcoming skills audit. When the broadband business started to grow, it might be that Sentech found that the required skills for that were already in place, and staff could be shifted.

The Chairperson noted that it was clear that some Board Members were involved operationally in Sentech, and asked if they were being remunerated for this work, in addition to the Board stipend.

Mr Patel said that he would ask the finance department to compile a report of expenses incurred through the Board’s operational involvement. He could not speak on behalf of the other Board Members, but could confirm that he did not receive any additional rewards for getting involved operationally, except for reimbursement for cell phone costs. His own credit card was used six times when he, as the Chairman of the Board, had to host strategic guests like the MEC for Economic Affairs from the Free State Province. The total money he personally had received was exactly as reflected in the annual report.

The Chairperson asked for more information around the need to purchase World Cup tickets, to the value of more than R1 million, and why almost a third of the tickets were handed to Sentech staff.

Ms R Morutoa (ANC) said that whilst Sentech had attempted to persuade the Committee that some reports on it were inaccurate, it remained a fact that the auditor had issued a qualified report. This stated that fruitless and wasteful expenditure was done. The auditor also claimed that Sentech was not a viable business. She asked what Sentech was doing to recover the monies it had lost due to the mismanagement and fraudulent activities of the past years.

Mr Patel noted that Sentech took full responsibility for the VAT mess-up and undertook to settle outstanding VAT payments from the current budget and approached National Treasury to assist with any shortfall.

The Chairperson asked if this Board could provide an accurate report on all the instances of wasteful expenditure, failing which the Committee might need to summon the previous Board to this Committee. The amounts totalled R45 million in total, and the details were sketchy, and this Committee needed an accurate account of what happened, when it occurred and who was responsible.

Mr Patel stated that the Sentech board had to provide the Minister with a full account of the Rentworx debacle as well as the wasteful and incorrect expenditure. That report had already been developed and was with the Minister, and those details would be given to the Committee, after consultation with the Minister, to ensure that nobody’s rights were affected. Mr Patel added that the problems in procurement revealed fraudulent cases amounting to R120 million. Here again, the report which was with the Minister would be made available to the Committee.

Ms M Magazi (ANC) requested that the Chairperson withdraw his question about the World Cup tickets. She felt that the National Treasury and other Ministers were dealing with the issue and that the matter should not have been raised at this meeting.

The Chairperson responded that he would not withdraw the question because the matter was relevant and was referred to in the Annual Report. He also reminded Members that he had already made several oral and written attempts to obtain this information, without response.

Mr Patel apologised to the Chairperson for not having responded to the several requests for information regarding the World Cup tickets, stating that he knew he had received the requests and could not understand how he had failed to reply. The purpose of the purchase of tickets was a customer relations exercise, and an attempt to get Sentech staff involved in the World Cup experience. He took two tickets for himself. However, he had been astounded that customers did not want to accept tickets, because they apparently did not wish to be named by the media as being associated with Sentech, and thus Sentech had allocated more tickets to staff.

The Chairperson noted that the guest list for the World Cup referred to “PCC” and wondered if that was meant to be a reference to this Committee.

Mr Patel promised he would clarify the matter.

Mr Kholwane asked about the progress, if any, Sentech had made in investigating the company Screamer, for using Sentech’s spectrum illegally.

Mr Patel reported that a company called Global Web Interact (GWI) had approached Sentech to use its spectrum. It was subsequently established that, in terms of the ICASA licence, this was illegal, and the contract was cancelled. However, prior to this cancellation, Screamer had purchased 100% of the GWI shares, on the premise that they themselves were applying for a spectrum license. Screamer was informed about the legal position and the cancellation of the contract, yet claimed that the contract was still binding and it could continue to use the spectrum. Shareholders had approached Sentech asking that the contract be continued, which was rejected. The Board of Sentech was now trying to obtain details of what revenue Screamer had earned from the illegal use.

Mr Patel also touched on his position on the Task Team appointed by the Minister. He said that the Task Team Members all signed a non-disclosure agreement. However, he realised that he had a duty to report to this Committee as well. He was therefore intending to ask the Minister to release him from that non-disclosure agreement. He believed that there was merit in Members hearing how the task team went about tackling the Sentech turnaround, and said that many of the items discussed at this meeting were also in the task team report, and the team had been instructed by the Minister to implement them.

The Minister had alluded, in a press conference, to the fact that the biggest risk at Sentech was one of leadership. More specifically, Mr Patel said it was the lack of leadership in the technical arena. The lack of those hard skills made it extremely difficult for Sentech to move faster on some of its key deliverables. For example, Sentech did not have the required number of riggers to erect the forty towers, in order to meet the DTT roll-out deadline of 2013.Overseas companies had realised the need and had offered to erect 49 towers at a cost of 28 million Euros. Sentech might therefore have to go and find riggers outside South Africa.

Mr Patel also wanted to correct the notion that DTT would provide a back channel and thereby enable people to get connected, which he described as “mischievous”. He explained that the back channel via DTT was based on a cache memory and not on live interactivity. However, once the broadband network was up, it would be much easier to make it talk to the DTT backbone, making the highway available to millions of people. This would need money and Sentech had approached the shareholder to request that all profits be re-invested in the roll-out. Once this was in place connectivity could be given to schools at no cost.

He then explained that the Development Bank of Southern Africa (DBSA) loan was taken for two reasons. In 2004 Sentech needed cash for the MyWireless experiment. If Sentech had not entered into those peripheral businesses it would have been able to fund its own broadband roll-out. The DBSA loan was completely employed to fund those new businesses including MyWireless.

Mr Patel said that he would also like to add some remarks about the World Cup. The legacy the World Cup should have left behind was a disaster recovery facility. This never happened. Although the building was erected at Nasrec for this facility, there was no equipment to set up the centre. Therefore there was no back up if South Africa should suffer a signal distribution disaster. There would be no radio or TV to the entire country. Establishing that backup remained a priority for Sentech. He added that the building was able to house the broadband equipment required. He spoke of the benefits of marrying the wire and wireless networks and how that would drive down costs, which was the reason why Sentech was in constant discussion with Telkom, in order to explore future developments.

Mr De Lange again commended the current Sentech Board for the manner in which it was going about turning the business around, and reiterated that the Committee should offer support. However, he also felt that Sentech should provide the Committee with a detailed plan of how it was going to meet the deadline for the expansion plan. This plan should include details of the cost implications and how the monies would be raised. The Committee could then regularly interact with Sentech on progress, because certain decisions would have to be made if the deadline could not be met; it was not possible to wait until 2013 and declare that targets could then not be met.

The Chairperson thanked Sentech team for its frank and honest presentation, and noted that the Committee Secretary would write to Sentech confirming the written reports that it should submit to the Committee.

The meeting was adjourned.