Minister and Lottery board ‘at war’ over new chair

First published by GroundUp.

Relations between Minister of Trade and Industry Ebrahim Patel and the board of the National Lotteries Commission (NLC) are now largely reduced to exchanges of lawyers’ letters and official correspondence.

This became evident on Wednesday when the minister addressed the Trade and Industry Parliamentary Portfolio Committee, which has oversight responsibility of the Lottery, at a virtual meeting.

The battle between Patel and the NLC has also involved briefings to selected media, as well as leaks of letters and documents.

Patel had requested a meeting with the portfolio committee to discuss the extension of the term of Zandile Brown, his representative on the NLC board and its acting chairperson. Brown, whose term as acting chair was due to end at midnight on 31 March, was appointed in the acting position after the 11-year tenure of the NLC’s former scandal-ridden chairperson Alfred Nevhutanda.

The NLC board and the minister have been at war over the appointment of Brown. Four members of the board wrote to Patel claiming that he did not have the authority to appoint an acting chairperson, and it was their responsibility to make the appointment.

Patel struck a cautious note, telling the committee that he had sought legal advice and was told that he had the authority to appoint an acting chairperson until such time as a full-time appointment was made.

According to Patel, he now has three options: to appoint an outsider as chairperson of the board, appoint another member of the NLC, or extend Brown’s acting term “for a short period” until a new permanent chairperson is appointed.

Dean MacPherson, DA shadow minister for trade and industry, said, “This is not even a low-grade civil war taking place between the minister and the NLC. It is a full-scale nuclear war that is unfolding. This is for obvious reasons … there is entrenched patronage and access to millions of rands that is at play here.”

Patel declined to identify the four board members who had written to him. But there are currently only five NLC board members and it seems highly improbable that Brown, as the minister’s representative on the board, is one of them. The other members are Advocate William Huma, who applied for the vacant chairperson post but did not make the final shortlist of three, Ms Doris Dondur, Ms Yaswant Gordhan and Dr Muthuhadini Madzivhandila, who was placed third on the shortlist. (GroundUp recently reported that R5-million was paid towards Huma’s house by an organisation that received an NLC grant.)

“It would be very helpful to remove uncertainty by getting any thoughts that the portfolio committee may have,” Patel said. “I hope that … as soon as we have the process completed for a permanent chairperson, the NLC will be able to have this governance issue fully resolved, and that we are all working to ensure that, in fact, the NLC is able to serve the people of South Africa in terms of the Act and within the framework of our Constitution.”

DA MP Mat Cuthbert said, “We would like to ask the minister what action he is going to take against those four board members who have not only launched a fightback campaign against him in the media through strategic leaks but have also threatened legal action against the minister, and have constantly sought to undermine him, even though he has given them sufficient rope.

“We have long called for the NLC … board to be sacked considering the fact that they have all failed to act while the looting continued unabated at the NLC.”

ANC MP Zolile Burns-Ncamashe said, “What I pick up is that the engagement and the communication with [the NLC] or the board, is that they are communicating through letters and so forth, and it shows that there are serious challenges.”

ACDP MP Wayne Thring called on Patel to ensure that “any and every allegation that has been levelled against board members of the NLC must be dealt with so that we have an NLC that is credible, that is transparent, that has the respect … of citizens of South Africa.”

A previous attempt by Patel to appoint a chairperson was derailed after Parliament’s chief legal officer questioned the legality of the process being followed. The process had to be restarted with members of the portfolio committee compiling a shortlist of eight from the 39 candidates, who were then interviewed for the post.

The new shortlist of three names has been submitted to Parliament, which is currently in recess. The National Assembly must first debate and adopt the parliamentary committee’s report on the shortlisting before it is submitted to Patel, who will then appoint one of the three shortlisted candidates as the new permanent NLC board chairperson.

When he extended Brown’s acting appointment to 31 March, Patel said his legal advice was that there was no reason that he should not extend her term for two more months.

Patel previously clashed with the Board when it sent him a lawyer’s letter demanding that he hand over an independent forensic report into allegedly corrupt Lottery-funded projects. The board threatened to drag the minister to court if he refused to hand over the dossier, which had been handed over to the Hawks to investigate.

The Special Investigations Unit (SIU) is also investigating the NLC.

The dossier dealt with four projects involving suspended Lottery COO Philemon Letwaba and members of his family, as well as lawyer Lesley Ramulifho, who has profited from Lottery grants.

The number of projects being investigated by the Hawks and the SIU has swelled to over 20, with new ones “being added to the list all the time” a well-informed source said. DM



Update on 1 April 2021:  Brown's term expired at midnight. A decision about the way forward had not yet been announced.