The board of state logistics entity Transnet has suspended Transnet Ports Authority (TNPA) CEO Pepi Silinga and two other managers over allegations involving an improper tender, the costs of which escalated from R80 million to more than R300m.
Silinga - who has survived calls for his dismissal from many quarters amid the exodus of executives, including former Transnet CEO Portia Derby and the parastatal’s chief financial officer, Nonhlanhla Dlamini - took a leave of absence in January at the height of the investigations against him.
In a statement on Friday, Transnet chairperson Sandile Sangqu said the Transnet board and TNPA board had been fully briefed and made the decision to place Silinga and two general managers on precautionary suspension while the allegations were investigated.
“Transnet will do everything to expedite these investigations, which are being conducted by an independent law firm and a forensic firm. Transnet will take any further action as necessitated by the outcome of the investigations,” Sangqu said.
Silinga was last year accused of irregularly appointing his former employer, the Coega Development Corporation, to build fences around the ports of Durban, Richards Bay and Saldanha Bay, which saw costs reportedly ballooning from around R80m to around R300m
Transnet at the time parried with a statement only referring to the flouting of procurement processes, stating that the matter had also been referred to the Special Investigating Unit.
Andrew Pike, the head of ports, transport and logistics at law firm Bowmans, said at the start of the investigations that the precautionary suspension of Silingacand his management would be a sensible move as it would give the market and customers confidence that investigations into corruption at the ports were taken seriously.
Pike said Transnet's ports of Cape Town, Durban and Ngqura, of 163 ports globally, had been been placed in the bottom 10 of the worst performers, according to a World Bank survey.
“The ports are performing appallingly and, ultimately, we have to ask where the management is failing. It all stops with the CEO,” Pike said in an televised interview.
South African Transport and Allied Workers Union (Satawu) spokesperson Amanda Tshemese said Silinga’s suspension indicated a positive move in the investigation.
“Yes, we are aware. There is a progress in the investigation indeed, but we will issue a statement soon," Tshemese said.
Satawu in December called for investigations into the ports authority citing billions of rand wasted in corrupt projects, including the R650m hydraulic shore tension unit project, which it said TNPA was advised against for various reasons.
Another project identified by Satawu for investigation is the procurement of 10 jib cranes for R800m, which they allege was awarded to a company that was second in the adjudication process.
This, while the preferred bidder to be awarded the deal, a black-owned company, was declared fake and removed from the list, never to be given tenders from Transnet.
Finance Minister Enoch Godongwana in November announced that the National Treasury would issue Transnet with a financial support package of R47 billion against which the entity would have access to an initial amount of R22.8bn to deal with immediate liquidity matters, such as settling maturing debt.
Transnet, which posted a R5.7bn loss in 2022/23 and is R135bn in debt, has also been forced to implement a number of urgent interventions to address the backlogs at the Port of Durban and to ease the congestion at Richards Bay.
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