Outcomes of forensic investigation at Alexkor and progress made in implementing turnaround strategy: DPE briefing

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Public Enterprises

11 November 2020
Chairperson: Mr K Magaxa (ANC)
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Meeting Summary

The Department of Public Enterprises briefed the Committee in a virtual meeting on the outcome of the forensic investigation into the Alexkor diamond mining company, a state-owned entity (SOE) operating in the Richtersveld area of the Northern Cape, and the progress that the Department had made in implementing a turnaround strategy.

The Committee was given a history of the events dating back to 2007, when there had been a government agreement which had created a deed of settlement specifying how the surrounding communities would be compensated for having to endure many years of displacement, and for having minerals from their land utilised for the benefit of everyone else but their own. However, outside interference and internal divisions had led to the collapse of the Communal Property Association, leading to the misuse of funds intended to uplift the community. Subsequent events had led to various interventions to remedy the situation in the Richtersveld community and at the Alexkor mine. However, evidence of “state capture” activities and allegations of intimidation and dishonest reporting of diamond revenue, had resulted in a forensic investigation being instituted in the middle of last year. 

Based on the recommendations arising from the investigation, the Department had terminated the contracts of employment of members of a pooled shareholder joint venture board that had been formed to resolve the conflict between the mine and the community structures. A new board had been appointed, and the Department had revived a government-wide committee to ensure that there was a coordinated effort to address not only the matters related to Alexkor, which were nearly at the stage of implementation, but also to ensure that related issues were addressed.

The Department was currently looking at consolidating the state’s mineral assets in order to optimise and align its participation in the mineral sector. A task team had also been established to conduct further studies on the proposed option to transfer Alexkor’s mineral rights to the African Exploration Mining and Finance Corporation (AEMFC).

Members expressed concern over the time that the Department had taken to investigate the irregularities and to hold the perpetrators accountable. Although the issues affecting Alexkor had been part of the state capture activities, giving the forensic report to the Zondo Commission for further investigation had also time been consuming. The Committee also wanted to be informed of the actual monetary value that had been lost due to diamonds being sold at below their market value. Members were of the view that the decision to transfer mineral rights from Alexkor to AEMFC was premature, as it was still in its infancy, and it was therefore unfair for it to be burdened with the responsibilities and problems of Alexkor.

Meeting report

Chairperson’s opening remarks

The Chairperson said the apologies received from the Members of the Portfolio Committee set a very bad precedent. He said every Member came from a political party, and the by-elections were being contested by all the parties. Everyone was taking part very strongly, but Members of the Committee had to focus their attention on the Committee’s mandate, as there were responsibilities that had to be handled. It was only when the Committee had no business that Members were free to go and participate in party activities. As such, the apologies were a bit “over the board.”

Alexkor turnaround progress

Challenge of “state capture”

Mr Kgathaso Tlhakudi, Director-General, Department of Public Enterprises (DPE), said the Alexkor issue had been difficult and protracted over many years. He recalled that in 2003, the courts had agreed that the land had been taken from the Richtersveld communities in 1928 to extract diamonds. The diamonds had saved the country during the many dark years, often paying for some of the acquisitions that the country was making. These communities had been displaced to areas known today as reservations all over the Richtersveld area. In 2007, there had been an agreement with the government, which had created what was called a deed of settlement on how the communities would be compensated for those many years of displacement, and for having minerals from their land utilised for the benefit of everyone else except the Richtersveld community.

The implementation of the deed of settlement had been made difficult by some of the challenges that the Department had faced. There were many people from outside the Richtersveld community inserting themselves into the community affairs, thus sowing division. The divisions in the structures had led to the collapse of the Communal Property Association (CPA) which had been established by the Department of Rural Development.

The collapse of the CPA structures had led to the misuse of some of the funds that had been made available to the communities. Alexkor assets that had been left behind were destroyed, and some were deteriorating, or had disappeared. He gave an example of the orchards that had been planted to produce fruit for Alexkor and the communities. These orchards had been left unattended, and the trees were currently being used for firewood instead of producing fruit.

The situation had not improved, and the Department had placed the Richtersveld community structures under administration. The Department of Rural Development had appointed an Administrator, and there was hope that there would be a new CPA structure in December which would have representatives from the communities that had the interests of the communities at heart, and was intent on ensuring that development was brought to Richtersveld.

Mr Tlhakudi highlighted that as far as Alexkor was concerned, there was a pooling and sharing joint venture (PSJV) with the community -- the Richtersveld Mining Company having a 49% interest, and the government a 51% interest.

He said the Department had had its fair share of problems, to put it mildly. The state capture scenario which had been unfolding in many state-owned enterprises (SOEs) in the country had seen the PSJV board taking over the assets and ensuring that people who would be complicit in ensuring that the state capture activities succeeded, were appointed to the board. This had resulted in a company called Scarlet Sky Investments being given the right to market and sell diamonds from the Richtersveld.

The state capture project had been picked up during the Gobodo investigation, and was part of the presentation, including the progress that the Department had made in that regard. The Department had also been informed that Alexkor would be making an appearance before the Zondo Commission, which in fact was a good development.

Mr Tlhakudi said the Department had revived a government-wide committee to ensure that there was a coordinated effort to address not only the matters related to Alexkor, which were nearly at the stage of implementation, but also to ensure that related issues were addressed. The government-wide committee was also being set up to ensure that the incorporation of Alexander Bay into the Richtersveld Municipality was carried out successfully.

The Committee included representatives from the Department of Mineral Resources and Energy (DMRE), the Department of Agriculture, Land Reform and Rural Development (DALRRD) and the Department of Cooperative Governance and Traditional Affairs (COGTA). The Director Generals of those departments would be meeting during the course of the day on 11 November.

Outcomes of forensic investigation

Ms Morongwa Mothengu, Director: Mining Unit, DPE, presented on the outcomes of the forensic investigation at Alexkor, and progress made in the implementation of the turnaround strategy.

She said the Department had received numerous complaints from the contractors about their unfair exclusion from the procurement cycle at the PSJV. The Department had engaged the contractors and uncovered allegations of intimidation and dishonest reporting of diamond revenue, among other problems. The allegations were put to the PSJV leadership, to which they had failed to adequately respond.

The Department had recommended that a senior counsel be appointed to carry out further investigations into the allegations. Subsequently, Gobodo Forensic and Investigative Accounting had been appointed in July 2019. The investigations by Gobodo had uncovered irregular activities that had been committed by the board of PSJV in the management of the diamond operations.

The findings and recommendations by Gobodo had been submitted to the Department, and the report was shared with the Zondo Commission for further investigation. Some of the findings included improper procurement processes, unlawful awarding of contracts, and undervaluation of diamonds. A case had been opened in the Western Cape, where there were looking at the National Environmental Management Act (NEMA) before the implementation of the turnaround strategy.

The Department had terminated the employment contracts of the PSJV members who were implicated in the corrupt activities, and a new board had been appointed. It was also looking to consolidate the state’s mineral assets in order to optimise and align the state’s participation in the mineral sector.

A formal technical task team made up of four departments had been established to conduct further studies on the transfer of mineral rights from Alexkor to the African Exploration and Mining Finance Company. The DPE would seek approval from Cabinet on the implementation of the preferred option before the end of the current financial year.

Mr Tlhakudi said the work continued on Alexkor to ensure that the mine was brought to optimum operation. From the options available in dealing with Alexkor, the Department preferred to have the mine combined with African Exploration and Mining Finance Company (AEMFC). This option had been put before the DMRE for advice. The issue had been taken through the cluster system within government, and the economic cluster, to seek their consensus on the option.

The Department was hoping that the other departments that made up the government-wide committee would help in addressing the issue.

Discussion

Ms J Mkhwanazi (ANC) thanked the Department for its comprehensive report, and asked it to elaborate on the six options that had been proposed.

She recalled that the presentation had stated that implementation of the preferred option would be done by the end of the financial year, but questioned whether they were going to make it by then, judging from her observations on the day to day operations of the Department.

Mr S Gumede (ANC) said it was unfortunate that the Director General was taking the Committee beyond the context of the report when he had mentioned the land issue, which was very controversial.

He wanted to find out from the Department if there was a way for some of the issues to be speedily resolved, as the processes were at times too expensive. He expressed doubts about Alexkor’s financial position to sustain the challenges that were currently being faced.

He also asked what other issues could be holding the Department or PSJV back from finalising the land settlement. Could it be funds, divisions within the community structures, or governance itself?  Was the board not strong enough to address these matters? It would be prudent for the Committee to know, because delays would cause the processes to take a long time  

Mr Gumede observed that the Department was seemingly taking a long time to respond. It was only now that the Alexkor matter was before the Zondo Commission. The investigations had not taken longer than expected, and the Department should have acted when the matter was first reported.

One of the Gobodo recommendations had been that the chief executive officer (CEO) should be disciplined, and the Scarlet Sky Investments (SSI) contract should be terminated. However, the report had not shown the monetary value attached to the CEO’s behaviour. Everyone suspected that there had been some form of benefit, but the Committee was not sure to what extent the CEO and SSI were benefiting. What was the CEO’s benefit in terms of conducting irregular proceedings? SSI was selling diamonds at a low price, so what was the benefit? 

He said that some Members might not understand the logic of selling diamonds at a low price, so the Department needed to explain more about those processes.

Mr Gumede raised concerns over the time frame that had been given for the implementation of the recommendations. How could the Committee and the Department quickly finalise the situation? Looking at March, and taking into consideration what was happening at the Zondo Commission, was the time sufficient for the Committee and Department to finalise these outstanding matters relating to Alexkor?

He asked about the status of the “zama zamas” (illegal miners) in the Richtersveld, as they might be a contributing factor to what was taking place.

He indicated that there would be further delays in taking the options to Parliament. What was the role of the Committee? Could it not look at the options that had been presented, assess them, synthesis them, amend them if there was a way of amending them, and then instruct the Department to implement, rather than wait before the options were taken to Parliament?

The Department could not sit doing nothing, while waiting for Parliament to take action. The Committee and the Department did not seem to be responding quickly to the matters happening on the ground, and this was delaying all the processes.

Mr Gumede reiterated the need to attach a value to the loss that had been incurred. If the Department was saying the diamonds were being sold at low prices, what was difference between the price that the diamonds were being sold at and the standard price? Was it in a position to recover all this difference from SSI?

Ms J Tshabalala (ANC) recalled from the report that the contractors had raised allegations of intimidation, unfair exclusion from the mining procurement cycle, and dishonest reporting of diamond revenue. Also, upon assessment of the accounts given by both contractors and PSJV leadership, the Department had recommended that a senior counsel be appointed to carry out further investigations, and the PSJV had not been able to provide a clear explanation. She asked the Department to clarify that.

The turnaround strategy had mentioned the PSJV, and also that there was going to be a new CPA structure. She therefore wanted to find out what had gone wrong, and who should assume the accountability role.

She was finding the shared joint venture problematic, mainly because the gross mismanagement of the company was happening under the watch of the PSJV, yet the government had a responsibility as a shareholder.

She conceded that PSJV had a duty, and one could not have a structure outside the PSJV, but there was a problem. The problem might not be with the entire structure, so the Department had to educate the Committee further on the structures. What was the problem? Who was the problem?

She referred to the part of the presentation which stated that investigations had uncovered irregular acts that had been committed by the executive board of the PSJV. The Department was saying that the PSJV board had committed some irregular acts, yet the recommendations were saying PSJV must direct and act on the findings of Gobodo. She asked the Department to explain the logic behind that, as it was not making sense.

She wanted to know exactly at what point the unlawful awarding of contracts had been discovered, and whose responsibility it had been to award the contracts. The Companies Act provided guidance on the issue of boards, yet there was a problem with the PSJV board. The unlawful acts had been happening under their watch. When the unlawful contracts were awarded, the board had been there, and it had not been dissolved. Whose role exactly was it to make sure that there was accountability, and who oversaw the smooth running of Alexkor?

Ms Tshabalala said the Department had furnished the Zondo Commission with the report for further investigation.  She agreed with the Department that the Commission’s role was to investigate state capture projects, and Alexkor was part of that. The Department had appointed Gobodo to investigate the matter from July to October 2019, and four months after the report was issued, the Department had said they wanted to give the report to the Zondo Commission for further investigation. She asked what the role of the Fusion Centre, tasked with the investigation, prosecution and recovery of assets, would be.

She highlighted that there were government institutions that had been put in place, such as the Hawks, the Public Protector, the National Prosecuting Authority (NPA) and the Competition Commission. Why were these institutions being overlooked by the Department, which had chosen to give the report to the Zondo Commission?

She said the Zondo Commission was involved with many matters, and no one knew when it would be able to conclude them. However, the Department had the power to institute, recommend or take the matters to the NPA or Hawks for further processing. It had therefore been unfair for the Department to give Gobodo the mandate to investigate the matter, and when the report was issued -- which provided for a possible way forward – it had chosen to give the report to the Zondo Commission for further investigation. The Department was not utilising the Fusion Centre.

The Gobodo recommendations had stated that the contract with SSI must be terminated, which had been done. However, there was an issue with regard to recovering the money that had been lost. The company had been given a duty to market the diamonds, but had ended up selling the rough diamonds at a price that was ostensibly lower than the market price. What the company had done was against the law and the question was, what were they doing about it? How were they using this Fusion Centre?  

She implored the Department to open a case, apart from the internal disciplinary proceedings.

She said the Department was terminating the contracts, but without getting the value for money from SSI. The presentation had given only a short version of the Gobodo report, and the Members of the Committee had not been given the actual forensic report. The Department was supposed to have shown the Committee how much had been paid, for what services, how much was lost to whom, and why and how it happened.

The report had made reference to the tender committee, so the Department had to brief the Committee on who those people were. Who were these people involved in the tender committee? What was being done to them?

She said that the Committee had been reduced to a “corruption watch,” and the Alexkor matter could not be left as it was. The Committee needed to be able to say what the structure was like, the personnel involved, the options to consider, and then deal with the matter before it.

The Presidential SOE Council had the mandate to deal with all the SOEs in the country, so when the Department said it would take the Alexkor situation to the Cabinet, what did that mean? Did it mean something different, because the understanding was that the Department still had the mandate for oversight and accountability?  When the Council looked at the SOEs, Alexkor should be first in line because of what was happening.

The Department had put a turnaround strategy in place, so the Committee wanted to be able to speak of a company that was self-sufficient and able to provide revenue through its business activities. The problem at Alexkor was about governance -- the whole management, people not doing their work, corrupt activities -- and the Committee could not fold its hands and wait for other processes to happen.

She urged the Department to adopt a good plan and take action. 

DPE’s response

Ms Mothengu said Alexkor’s governance structures and community challenges were delaying the proper functioning of the PSJV. The CPA was a structure that had been established after the deed of settlement, and within the CPA there were about eight companies that were involved in various economic activities such as mining, agriculture and property. The Richtersveld Mining Company, which was part of the CPA structure, was required to appoint three members to the PSJV board so that they could represent the interests of the company. However, the community had been divided, leading to their under-representation in the PSJV.

The Department of Rural Development had made several attempts to regularise the structures, but had failed. It had appointed the CPA Administrator early in 2020, who started to work in June. The collapse of the structures had delayed some of the actions that the Department would have liked to implement. Nonetheless, elections were planned for January. An annual general meeting (AGM) had also been planned for December, at which the community would be briefed on what was happening in the PSJV and the way forward for the elections, so that the community could be represented in all the committees, including the PSJV. The Department was hoping that once the committees were properly structured, this would resolve some of the community’s challenges.

She indicated that a number that had not been put before the Department to quantify the monetary loss that had been incurred as a result of the corrupt activities at Alexkor. However, it was looking into the selling of the diamonds, together with the current CEO, in order to find ways of maximising the current prices for the benefit of the contractors and the PSJV.

Ms Mothengu said the zama zamas were a big challenge and a security concern in the Richtersveld area due to the violent events that had taken place. A committee representing the police and the Department of Mineral Resources and Energy was also involved in trying to resolve the issues with the zama zamas. The Richtersveld area was quite vast, and that was challenging for security. However, a committee had been established to look into the situation, particularly on how the zama zamas could be regularised and brought into the formal activities, rather than having them steal from the mines. According to the DMRE, though the actions of the zama zamas were criminal, regard also had to be given to the socio-economic challenges that were faced by the community.

She pointed out that the PSJV was an unincorporated entity in terms of the deed of settlement, which made it difficult for the Department to involve itself to any extent. According to the court order, the running and management of the pooled operations rested with the interim joint board, which was the PSJV board. The joint board also had control over litigation of any nature, thus limiting the actions of the Department.

The Departments of Public Enterprises and Rural Development were looking into the new role of Alexkor, which would mean revising some of the terms of the deed of settlement to ensure that they had some control over the activities of the PSJV.

Ms Mothengu said that in September 2019, the Department had appointed an Administrator to look into the allegations of Gobodo, and in February 2020, the Administrator had suspended the CEO of the PSJV so he could do proper investigations. Though the process had been slow, cases had been opened at the Kimberley police station for further investigation.

Mr Tlhakudi said that in principle, it would be possible for the Department to meet the targets set before the end of the financial year through the committee that would be set up, based on the six options presented. It was important for the Department to finalise everything before the end of the financial year, because the funding set aside for Alexkor was running out and the PSJV had not been operating at a level that could contribute to the funding.

He stressed that the CPA could not move without the support of the communities, and the state of CPAs across the country had not been satisfying. The Department had raised that issue with the Department of Rural Development, suggesting there should be an the amendment to the legislation that regulated CPAs. He understood the frustrations of the Portfolio Committee Members, but it was difficult for the Department to move forward without CPAs.

The Department had been involved with many cases from the Richtersveld community since 2017. The government and Alexkor had had to respond to various groupings claiming to be the legitimate leaders of the community, and therefore entitled to lead some of the structures put in place, including the Richtersveld Mining Company (RMC), which was a shareholder in Alexkor.

The Department of Public Enterprises could not move alone, and needed the support of other departments to implement the recommendations. If the Department bypassed some of the processes within the government in the intention of concluding the matter expeditiously, it would run afoul of the same findings it was trying to address. Unfortunately, the processes were responsible for the long timelines that had been put before the Committee.

He indicated that the land settlement process had been completed. The State Attorney in Cape Town had registered the land, and what remained was to transfer the properties to the trust. The challenges that had been highlighted in the presentation had also had a direct impact on the transfer of property, because the transfer was supposed to have been made to the Richtersveld Property Trust. However, the trust had not been properly constituted, and that had been a big obstacle which the Department of Rural Development would hopefully solve.

The calculations on how much the community and contractors had lost due to the selling of diamonds at a low price could easily be done. Incidents had been reported to the Department of diamonds that were sold below market value when they should have received very good prices. The 8-11% under-valuation ratio that had been reported was an average, and that there were incidents in which the contractors were convinced they should have got really good returns from the stones they had produced. According to some calculations, the estimated loss could go up to R250 million, which was money that could have been used by the government, the contractors and the community. Those responsible for the losses had to be pursued by the law, and these were issues that the authorities would have to deal with.

The Zondo Commission had had to deal with these issues because they had to be made known to the public, and through that some of the recoveries could be made.

Mr Tlhakudi said the Portfolio Committee was welcome to make recommendations that could help the executive to deal with the issues that had been raised. There was also the option of having a joint meeting with the four Departments that were involved, at which the Committee could demand answers as to why progress had not been made.

The Portfolio Committee and the Departments were in positions of authority, and were therefore accountable for the situations that existed. However, the problems with Alexkor and the Richtersveld community had been going on for many years, and the leaders that were causing divisions in the community were equally responsible for the situation.

He commented that from the all the contention that was happening, it was the people from the community that were suffering the most. He recalled being approached by locals making pleas for the compensation money that they had been promised. He still received text messages from the community asking for updates on the finalisation of the compensation fund.  However, without proper structures as instructed by the deed of settlement -- which was law by virtue of the court order that had been issued -- it was difficult to process and distribute the money to the community. There was a R49 million payment that had to be processed, but there need to be legitimate structures that were able to receive and distribute the proceeds.

The Richtersveld community was supposed to be the richest in the country because of the value of minerals on their land. However, the lack of proper structures had prevented that from happening. The matter had been to Parliament several times, and it had to be finalised.

Mr Tlhakudi said that the board members who had been implicated by the Gobodo report were no longer part of Alexkor. The executive team of Alexkor had also left, either because they were dismissed or had run away. When reference was made to the board in the presentation, it had meant the newly elected board of the PSJV, and the newly appointed CEO for Alexkor. That was the board that should implement the Gobodo report and recommendations.

Follow-up questions

Ms O Maotwe (EFF) recalled from the presentation that there were 16 people being investigated, and about four people, including the CEO, had been dismissed. Though the Department might have terminated the contract with Scarlet Sky Investments, but the question remained how the money lost was going to be recovered. Was the Department going to pursue SSI legally for them to take full responsibility and pay whatever would be due to Alexkor?

Though the CEO had been dismissed, what was the Department going to do about the construction of the coffer dam which had apparently been started without proper authorisation?

Ms Maotwe referred to the part of the presentation that said there was an establishment to conduct further studies on the proposed plan to transfer mineral rights from Alexkor to AEMFC. She said AEMFC was a small company and its revenue was not that good, although it was doing well financially. However, it had not managed to meet its objectives that were tabled for the past financial year. It was an entity that was still establishing itself and trying to find its feet, yet there was an option to transfer the rights of a company that was struggling, to an infant company. Was the Committee not going to burden AEMFC with the responsibilities of Alexkor? Would it not be better to fix Alexkor first? She agreed that the rights were to be transferred to a mining company owned by the state, but felt it was premature to burden AEMFC with such responsibilities.

She asked how far the proposed options that had been tabled and awaited the Cabinet were. What had been the response from the Minister? How far was the process, because it was almost the end of this financial year, and the Department had planned some of the activities to be dealt with in the financial year, so how far was the Department with the approval of the options that had been put forward to Cabinet?

Mr Gumede reiterated that there seemed to be too many confusing structures and that was one of the reasons why the Committee and the Department could not put things together. There was therefore a need to consolidate the issue of governance, and perhaps some of the things may improve.

Ms Tshabalala said the Committee needed to be furnished with the financial position of Alexkor and PSJV over the months so that it could understand at what stage the community had been losing. She also wanted to know about the drastic austerity measures that were going to be initiated, such as retrenchments, to contain operating costs.

With regard to financing, where was the money going to come from and how much was needed? She reiterated the importance of having sight of the Alexkor financial statements and reports, as failure to do so might result in the Committee being told of the liquidation of Alexkor some day.

From the six options that had been presented, she would support the suggestion that said the Portfolio Committee should have a joint meeting with the four sister departments – and the sooner, the better.

She emphasised that although everyone was accountable for the situation at Alexkor, there were people who were running the institution, and the question was, what they were doing. As such, it would be prudent if the Portfolio Committee had a joint meeting during which it was doing oversight, especially on matters involving the Richtersveld community. This was mainly because the Committee was responsible for representing the interests of the community and, by extension, the state. As such, the accountability authorities had to do their job.

Department’s response

Mr Tlhakudi said the recovery of the money stolen by manipulating the processes was on the Department’s agenda.

On the issue of the construction of the coffer dam, the committee of Director Generals that had been set up on the Alexkor issues would help to expedite the process. The environmental authorities in the Richtersveld area were also looking into the matter.

He concurred that transferring the rights from Alexkor to AEMFC would potentially burden AEMFC. However, the Department and the government were currently not in a position to put more money into Alexkor. Over R1 billion had already been put into Alexkor and the Richtersveld structures since 2007, when the deed of settlement had been agreed. Part of the money had gone into modernising Alexander Bay into a town so that it could be transferred to the Richtersveld local municipality. Because the Department was not able to support the operations financially, it was counting on AEMFC and its commercial approach to help with the business subsidiary, particularly with how the community’s assets could be exploited.

The Department was going to give feedback on its work with the Department of Mineral Resources and Energy. It was hoping to get an agreement from the DMRE before the end of the financial year. The agreement would be based on the work that the Committees were doing, and the legal work would then be done in the next financial year.

Mr Tlhakudi said that the structures were a product of the deed of settlement, and agreed that they were confusing. Even the CPA was failing to manage them. Each structure regarded itself as independent, which could not be right because the CPA was supposed to be representing the interests of the whole community. The different structures had led to strife in the community and resources not being properly accounted for. These were some of the issues that the Department of Rural Development was expected to deal with.

He indicated that there was over R300 million in the investment trust, and its proceeds were questionable -- particularly how they were utilised. The Department of Rural Development therefore had to play closer attention to that.

He said the Portfolio Committee would be furnished with Alexkor’s financial reports. Alexkor was also going to appear before the Portfolio Committee to share the company’s annual reports, and both the Department and the Committee could then decide on the way forward for the business.

Mr Tlhakudi said what the Department wanted was unity in the community, which would help to put pressure on the authorities so they worked towards making the situation better.

He said it was important that mining and other services were sourced from the community, instead of from people in Johannesburg and Cape Town. That position had to change, because the wealth that was in the land had be for the benefit of the people of the Richtersveld. The Department hoped to achieve that goal, with the support of the Committee.

Chairperson’s closing remarks

The Chairperson thanked the Committee Members for engaging with the presentation and making a number of recommendations that the Department had noted.

The Committee still had an outstanding oversight visit to the community and Alexkor scheduled from 2 to 5 December. The oversight visit was important was to help Members relate to the issues that had been presented, and have gain their own experience by engaging the communities and stakeholders.

He said there were people who were in the virtual meeting claiming to be representing the community. The Richtersveld community representatives were not necessarily allowed to participate in the meeting, but would be engaged during the oversight visit.

The Committee did not want the liquidation of another company. The country had lost SA Express -- a company that it could not rescue -- and it had no desire to lose another entity.

He urged Members to try to maintain and improve the performance of the entities that were still standing, assisting them to make a profit so that they could contribute to the gross domestic product (GDP) of the country, and also create an environment where the state could improve the quality of life for the people of South Africa.

He emphasised that the SOEs were not there merely to contribute to the bourgeoisie and improve their profit, but were supposed to have a direct and indirect contribution to the improvement of the standard of life for all the people of South Africa. 

He appreciated the efforts by the Department, and urged the Members to improve on the work so that when the Committee received an update in the coming months, progress would have been recorded.

The Chairperson extended his appreciation to the Members that continued to attend the meetings. He raised concern over those Members who were absconding from Committee meetings. He noted that the entire DA team had been absent, the IPF had been in and out, and the UDM had disappeared a long time ago. Though it was not the mandate of the Committee to put its nose into the internal affairs of political parties, their attendance and presence in the Portfolio Committee was a Parliamentary responsibility for every appointed Member, and had to be honoured. Members were selected by Parliament and the political parties to serve on the Committee, and therefore had to honour that responsibility.

The meeting was adjourned.

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