Tuesday, 27 September 2011

SABC board's indictment of Chairperson Ben Ngubane (From 2010)

SABC board's indictment of Chairperson Ben Ngubane

SABC Board
24 August 2010

Memorandum to the minister of communications, June 8 2010

Memorandum to the Minister of Communications
The purported appointment of the Group Executive: News and Current Affairs of the SABC related matters

June 8 2010

This memorandum addresses the circumstances under which the purported appointment was made, and under which the Board of the SABC has resolved that (the trust and relationship of the Board with the chairperson has been irrevocably broken as a consequence of the actions of the chairperson

Purpose of the memorandum to the Minister of Communications, General Siphiwe Nyanda

This memorandum sets out the details of and background to a purported appointment of a candidate the vacant post of group executive: news and current affairs (GE News) of the South African Broadcasting Corporation (SABC) on 20 May 2110. It also sets out the background to and circumstances leading up to decisions by a special sitting of the Board of directors of the SABC on 22 May 2010. It's divided into four sections:

1 The purported appointment of the GE News by the chairperson and events leading up to and consequent upon the purported appointment.

2 Other material breaches by the chairperson of statutory requirements and governance protocols of governance protocols of concern to the Baard, including attempts to breach the Public Finance Management Act, and by the Group Chief Executive Officer (GCEO), including actions which the Board is advised constitute dereliction of duty.

3 Decisions of the Board on 22 May 2010:

3.1 The purported appointment is nuIl and void 
3.2 Unanimous decision by non-executives that their relationship with and trust in the chairperson have irrevocably broken down.

4 Initiatives by the Board to integrate the chairperson into Board, and to consult its statutory stakeholders (the Executive authority and Accounting Authority).

As is clear from the memorandum, the chairperson has

• Engaged in a consistent pattern of behaviour through which he has sought to usurp the proper authority of the Board 
• Materially breached his statutory obligations under the Public Finance Management Act (PFMA), the Broadcasting Act (the Act), and the requirements of the SABC Memorandum and Articles of Association (the Articles). In doing so he has placed the Board in broach of nine of the 12 duties set out in the Articles which are collectively binding on directors 
• Placed both the SABC and individual directors at risk of serious financial liability and of potential civil litigation or criminal prosecution 
• Delayed and prevented the development and implementation of coherent and statutorily-compliant process of turning the SABC around and re-establishing it as a financially sustainable entity.

The Board has taken all reasonable steps to attempt both to integrate the chairperson into a system which operates in a consistent and compliant manner, and to enlighten him as to the obligations of the Board collectively and of directors individually.

It has also repeatedly attempted to advise and inform the GCEO of his obligations and responsibilities.

1.       The purported appointment

The purported appointment of a candidate to the vacant post of GE News of the SABC on 20 May 2010 is the most recent in a series of actions and attempted actions by the chairperson of the Board, Dr Ben Ngubane which other non-executive direct ors ate advised materially breach the SABC's and the Board's statutory obligations and as prescribed in the Articles.

Events leading up to it are set out below.

The GE News post has been vacant since Q2 2009, following the expiry of the contract of Mr Snuki Zikalala. Mr Phil Molefe, head of SABC international relations department, has been acting GE News since then, and continues to act in that capacity.

The current Board took office on 10 January 2010 and held its first formal meeting on 29 January 2010. Among its immediate concerns was to normalise the situation in the SABC news division, which plays key roles both in fulfilling the SABC's statutory obligations under the Act and in underpinning the SABC's revenue-generating activities by attracting audiences to its radio and television services. SABC news audiences have been in steep decline both under Mr Zikalala and under Mr Molefe, a factor which has contributed to its declining revenues.

The procedure for appointment of the GE News as set out in the Articles prescribes that the Board shall ... appoint Group Executive Members".

"Group Executive Members" are members of the Group Executive Committee, which is defined in the Act as "consisting of the Group Chief Executive Officer, Chief Operating Officer, Chief Financial Officer and no more than 11 other members". The GE News is one of the 11 other members referred to.

The Board is thus required to appoint to the post and has at no stage considered delegating this responsibility, nor is it entitled to under the mandatory terms of the Articles.

Under these circumstances, the chairperson stated in a Board meeting that the Board's subcommittee on governance, remuneration and nominations (the Governance Committee) would oversee the process of selecting a candidate for the vacant GE News post. The Board accepted this.

On 2 March 2010 the two directors explicitly recommended to the President by Parliament for their experience in broadcasting news operations prepared and submitted to the Governance Committee a memorandum in which they argued that the management arrangements in the news division should be restructured. The memorandum argued that existing management arrangements were such that they would inhibit the prospects of success by any candidate appointed to the position. The chairperson, who also chairs the Governance Committee, overrode objections of other directors on the committee and refused to consider the memorandum, implying that the authors were motivated by racist considerations. This is a matter of record and will be attested to by the directors present.

The Governance Committee thereafter agreed to instruct the group chief executive officer to prepare for consideration by the Governance Committee an advertisement for the vacant post of GE News.

On or about 6 March 2010 staff acting on behalf of the SABC's Chief People's Officer ( who is responsible for these matters) presented to the chairperson an advertisement to the chairperson which he approved without seeking the requisite approval of the Governance Committee. The advertisement is inaccurate in several aspects regarding the responsibilities, mandatory obligations and skills required by the GE News.

On 11 March 2010 directors questioned the chairperson's unilateral approval of the advertisement. He stated that he had relied upon the advice of management and exercised his discretion.

The advertisement was placed and approximately 17 applications submitted. The chairperson received a short-list prepared by staff acting on behalf of the SABC Chief People's Officer, which he presented to the Board. The Board objected to the process.

Instead it appointed, by resolution of the Board and from among its members, an interviewing panel (the Panel) comprising the Governance Committee and other directors. On 17 April the Panel considered the applications and prepared a short-list of candidates to be interviewed.

The chairperson unilaterally cancelled interviews on the day on which they were initially due to take place. He did so without consulting other members of the Panel, on the basis that two members of the Panel were not available and that the interviews could not therefore be properly conducted. He rescheduled the interviews to 11 May 2010. Although three members of the Panel were unavailable, he insisted on proceeding with the interviews, which duly took place.

Following the interviews but before the Panel had convened to consider the merit of the candidates, the chairperson stated informally to other members of the Panel that he had ‘scored" the candidates and was satisfied as to who should he appointed.

He made disparaging remarks concerning at least one other candidate.

Shortly thereafter, as two of the panellists were leaving the SABC by car, Dr Ngubane stopped them in the street, leaned into the window of the car and berated them for what he claimed was a subjective approach to the candidates. He asserted that only he from among the Panellists was objective in his assessment arid threatened them that he would go to court if necessary to ensure the appointment of his preferred candidate. Both directors have informed the Board on the record that they felt threatened by the chairperson's behaviour. At that stage the panel had not ... [considered] the merits of the candidates, and had planned to reconvene on Monday 17 May.

It is to be noted that on other occasions, and prior to the short listing process, the chairperson has stated to other directors, Individually, that he was operating under the direct instructions of the President of the Republic and that he was resolved to appoint his preferred candidate, whom he identified by name. He has also been quoted in a newspaper as stating that he was operating under political instruction when making the GE News appointment.

Directors to whom the chairperson spoke will attest to his statements. They and other directors have no doubt that the President would not directly interfere with the authority of an independent accounting authority or try to improperly influence its decisions. The legality of such interference, if indeed it were made, would be particularly problematic for the presidency.

The Panellists reconvened on 17 My to consider the merits of the interviewed candidates. The meeting was initially acrimonious, with Panellists questioning the chairperson's actions in threatening and berating two directors following the interviews. The chairperson asserted that he had done so as part of his commitment to ensure an "objective" decision.

To avoid deadlock, the Panel did not consider the merits of the candidates, but reopened the discussion on restructuring the management of the news division and engaged the possibility of recommending to the Board that three of the four interviewed candidates be considered for various positions in a reorganised news division management structure.

On this basis, they instructed the GCEO to assess the news division management structure and to report back to the Panel before the end of May, upon which the Panel would consider the report, consider the merits of the candidates, and prepare a recommendation to the Board for consideration at a special Board meeting to be convened on 3 June 2010, This was unanimously accepted by the Panellists, who included the chairperson and the GCEO.

On the morning of 20 May 2010, the chairperson and the GCEO met without informing the other Panellists of their intention to do so. Following that meeting the chairperson instructed the GCEO to initiate the process of appointing the chairperson's preferred candidate. The chairperson made no attempt to inform other directors of his decision, either then or later. Directors, including the other Panellists, learned of the purported appointment directly or indirectly via the media.

The deputy chairperson became aware of the purported appointment when she received a telephone call at approximately 11h30 on the same day from a journalist asking for her comment Acting in good faith and believing at the time that the journalist had been misinformed she asserted that no appointment had been made and that she would have been aware of such appointment which was the exclusive prerogative of the Board.

She attempted unsuccessfully to contact both the GCEO and the chairperson immediately thereafter.

She also consulted other directors, who agreed informally both to seek to delay any announcement of the purported appointment - to give them time to clarify the situation and avoid a public perception of conflict within the Board over the appointment - and to confirm, if approached by journalists, the deputy chairperson's statement.

Various directors attempted to contact the chairperson and the GCEO to confirm the purported appointment, also unsuccessfully.

The chairperson has refused to answer the telephone calls of any directors since issuing the instruction for the purported appointment or to meet them (other than the meeting he attended at the request of the Acting Minister of Communications).

The directors agreed on the need for an urgent meeting to receive reports on the purported appointment, to take legal advice on the matter, and to decide on an approach by the Board. The meeting was attended by 10 of the 12 non-executive direct ors. The chairperson, another non-executive director and two executive directors apologised for their absence. The GCEO failed to attend without apology, despite receiving an instruction from the deputy chairperson to do so.

A meeting was duly called in the manner specified in the Articles, and took place on 22 May 2010.

After receiving legal advice and discussing the purported appointment, directors agreed: that no appointment had taken place; that the selection process must continue and that it was a matter of public interest that perceptions created by the announcement authorised by the GCEO be corrected. An 11th non-executive director has since endorsed the decision.

The Board therefore instructed the company secretary to release a statement to this effect and to inform the purported appointee in writing that he had not in fact been appointed.

The Board also took a decision on the relationship of trust between itself and Dr Ngubane. This decision flows from a consistent pattern of behaviour by Dr Ngubane of which the purported appointment is only the most recent example. It was taken unanimously and subsequently endorsed by the 11th non-executive director. It thus reflects the unanimous view of the directors recommended by Parliament and duly appointed by the President, with the exception of Dr Ngubane himself.

Discussion leading up to the resolution addressed in greater detail elsewhere in this memorandum. So too are initiatives taken by the Board at all material times following the purported appointment to keep its statutory stakeholders (the executive authority and the appointing authority) informed of developments.

The Board has sought to arrange to formally meet Dr Ngubane both directly and, because he has refused to engage directly with other directors, through intermediaries. A meeting was scheduled to take place on 26 May 2010. The intention of the Board in convening this meeting was to inform Dr Ngubane of the views of the Board and to attempt to persuade him to work with the Board as required by statute and to comply with the Board's, and individual director's, fiduciary and statutory responsibilities and obligations. Dr Ngubane undertook to attend and the meeting was duly called using the established email procedure. Dr Ngubane did not attend. He has subsequently been quoted by two newspapers as stating that he was unaware of the meeting.

2. Other material breaches by the chairperson

As stated, the purported appointment of the GE News is the latest example of a pattern of behaviour by the chairperson. The Board is not aware of the full range of actions by the chairperson, but is satisfied from those examples of which it is aware that his actions constitute a pattern which materially undermine director's ability to fulfil their fiduciary responsibilities to the SABC and their statutory responsibilities. It is also satisfied that his actions undermine the directors' ability to re-establish good governance procedures at the SABC and to reorganise the SABC on a sound financial and operational footing. The Board was recommended to the President explicitly to achieve these objectives, because of the state of the SABC at the time, recognised by the Department of Communications, National Treasury, the Auditor General of South Africa and the Interim Board of the SABC as being in a state of financial crisis precipitated by simultaneous and deep rooted governance and capacity crises.

In most of these actions of which the Board is aware, the chairperson has cooperated with the GCEO, in his capacity as an executive manager and in his capacity as a director.

This section of the memorandum provides examples of the chairperson's actions which demonstrate their range and the potential impact on the SABC. They include:

2.1 Withholding information on the Ministerial request for a bilateral meeting

The chairperson and the GCEO withheld knowledge from other non-executive direct ors of a request by the Minister of Communications (the Minister) for the first quarterly bilateral meeting between the Minister and the Board an 16 April 2010. At a Board meeting on 14 April 2010, the GCEO and the chairperson acknowledged that they had intended to attend the meeting in the absence of other directors.

The Minister originally issued a formal invitation to the entire Board, in a faxed letter to the chairperson, copied to the GCEO. Neither informed the company secretary nor other directors.

The Board became aware of the invitation by accident in the course of a conversation between an individual director and an official of the DOC on 9 April 2010. The director requested the company secretary to inquire and establish the nature of the meeting and what was required of the Board.

The Board eventually considered the invitation only on 12 April 2010, just two days before the meeting. It was unable to adequately prepare for the meeting, and akthough the GCEO had prepared reports for submission to the meeting, he failed to distribute these to directors either for consideration or discussion, or to enable them to prepare for the meeting. He also refused to provide directors with copies of his reports.

As a consequence, both the Minister and officials of his department found the reports inadequate and criticised both the GCEO and other directors for the inadequacy of their reports and of the failure of the SABC to prepare and implement a turnaround strategy as required under the Government Guarantees provided by National Treasury and in terms of their fiduciary and statutory responsibilities more generally.

Directors have subsequently established from the company secretary the dates of future quarterly bilateral meetings, the next of which is scheduled to take place on 22 June 2010. The Boards next ordinary meeting is scheduled for 23 June 2010, a day after the next scheduled Ministerial bilateral. Dr Ngubane has refused to schedule a meeting prior to the bilateral, ignoring repeated requests by directors, submitted orally and in writing, to do so. He has also refused to consider a change to the corporate calendar to align Board operations with future bilateral meetings and other reporting and accounting cycles.

At its meeting of 22 May 2010 the Board therefore agreed to initiate a process, in the absence of the chairperson, of preparing for the next bi-lateral; of ensuring that the operational processes are initiated on which it is required to report; and of preparing for other budgetary and reporting cycles to be integrated into its work programme. This is addressed in greater detail n the next section. Directors have experienced similar difficulties with regard to its reporting obligations to Parliament.

2.2 Corporate plan

The Board was unable to properly approve the SABC's first annual, MTEF cycle corporate plan prepared under the oversight of the current Board. It was signed by the chairperson before its general distribution to directors.

2.3 SportFive contract unauthorised variance

At a special Board meeting on 14 April 2010 the Board authorised the GCEO to offer €17.3-million (approximately R161-miilion at the time) to the SportFive agency to secure the broadcasting rights for various Fifa-recognised African football events. In doing so it was aware of the statutory reporting and approval requirements for a transaction of this magnitude. It did not approve any variation from this figure. The Board made the approval conditional upon submission of a written business case for its consideration. It has not, in its view, yet received an adequate business case.

In negotiations with SportFive in Europe on 27 April 2010, the GCEO sought to vary the SABC offer to €19,5-million (approximately R183-million). He sought approval to do so by telephone from the chairperson.

The chairperson approved the upward variation, at the tune the equivalent of approximately R21,237,000. This variation is within the delegated authority of the Board, but approval for this level of expenditure may not be delegated. The chairperson had not been mandated by the Board to act on his own in this matter.

The chairperson has at no stage informed the Board of his actions.

By improperly authorising the GCEO to vary the offer, the chairperson has demonstrated his willingness to take potentially reckless decisions on financial matters in breach of the requirements of the PFMA and to render his co-directors, the Board and die SABC vulnerable to prosecution and to a finding of incurring fruitless and wasteful expenditure.

It is to be noted that the Board authorised the GCEO to enter into these negotiations conditional upon his provision to the Board of a business case for the acquisition of the broadcasting rights. He has, to date, not provided any business case.

2.4 Travel authorisation

The GCEO visited China from 22 to 27 May 2010. The trip was authorised by the chairperson and was primarily for the purpose of presenting a paper to a conference of media executives in China on the Chairperson's behalf. The GCEO was accompanied by his partner on the trip.

The chairperson was the original recipient of the invitation and passed it to the GCEO without consulting other directors.

The chairperson authorised the GCEO's trip under the following circumstances:

• Neither he nor the GCFO made provision for the appointment of an acting GCEO in the GCEO's absence.

• Three days before the GCEO's departure, the Chief Financial Officer was booked off for emergency medical leave to undergo a major abdominal operation from which he is expected to return by 1 June 2010 at the earliest. He was thus not physically present and unable to stand in, even informally, for the GCEO:

• The Fifa World Cup 201 0 tournament for which the SABC is the official domestic broadcaster was, at the date of the GCEO's departure, 19 days away and required consistent and comprehensive executive oversight. It is potentially the SABC's major broadcasting event of the year;

• The SABC is currently undertaking its financial audit under circumstances in which it is recovering from a major financial crisis and the presence of the GCEO is required;

• The trip provides no particular benefit to the SABC other than to raise the SAD C's diplomatic profile in the Far East.

In respectively making and authorising the trip under the circumstances set out above, the GCEO and the chairperson respectively placed the SABC at significant risk and acted recklessly. By absenting himself without ensuring the appointment of an acting GCEO, the GCEO has been derelict in his duty.

Directors are currently seeking to establish f if the chairperson has the properly delegated authority to approve the trip, which he did so in breach of a resolution from the previous Board in terms of which all international travel was prohibited unless it was for the purposes of financially benefitting the SABC. This resolution remains in force

2.5 Refusal to discuss non-compliance

Directors have for several months been concerned at what they perceive as noncompliance by the corporation and by the Board with respect to its practices and accounting obligations.

On 6 May 2010, three directors circulated a memorandum of 15 pages, setting out specific failures of compliance and proposing urgent remedies to achieve compliance. It proposed that the Board meet urgently to approve implementation of these remedies.

In written response the chairperson described the memorandum as an "excellent document", but refused to convene a meeting as in his view "there has been just too many meetings which have been taking place in the absence of well prepared documentation". Instead he stated his intention to have the matter discussed by the Board at some future but unspecified date. He has since taken no action to arrange such a discussion.

Although several of the issues raised in the memorandum were among those identified during the bilateral meeting of 16 April 2010 by the Minister and the DOC as matters of concern to them, the chairperson has refused to schedule a meeting prior to the next bilateral scheduled for 22 June 2010.

Among the activities pushed off the Board's agenda as a consequence of the chairperson's refusal to accept an amended Board calendar, and of the Board's need to put other matters on hold to address the problems of the purported appointment and other initiatives by the chairperson has been a comprehensive series of briefings on all governance-related instruments and guidelines: the Act and other statutes affecting the SABC's broadcasting activities, the PFMA, the Articles, the King rep orts and so on. The Board has nevertheless scheduled this event to take place in time. A briefing to Board members on the Companies Act and the implications of the new Companies Act once it is implemented, has already taken place.

2.6 Undermining oversight

The chairperson has consistently, throughout the past four months, refused to authorise amendment to the corporate calendar to align Board meetings with extern al reporting cycles and internal reporting and planning cycles. He has done so in breach of several Board resolutions to this effect.

He has, in addition, repeatedly, routinely and without consultation, cancelled Board sub-committee meetings through which directors are required to exercise oversight over the activities of the SABC. His reasons for doing so are unclear, although on several occasions as they appears to have been as a consequence of his non-availability to attend those meetings, although he is not a member of the sub-committees whose meetings he cancelled.

in doing so he has hamstrung directors in the exercise of their fiduciary responsibilities and the Board in the exercise its statutory responsibilities and, in various cases, delayed sub-committees from making recommendations for Board consideration, thereby delaying implementation of decisions requiring Board approval.

2.7 Reporting failure

Since his appointment, the GCEO has consistently failed to report to the Board at times and on matters required of him in terms of his contractual obligations (which incorporate his reporting obligations in terms of the Articles and of the Delegated Authority Framework), and against the requirements set by the Corporate goals approved by the Board. A letter sent to the GCEO by the Board setting out his obligations and scheduling his failure to report against these obligations is attached to this memorandum as Appendix A.

The effect of this failure has been to substantially hamper the ability of the Board to exercise its mandatory oversight of the SABC and to provide it with strategic direction.

The cumulative effect of these and other actions by the Chairperson and the GCEO has been to:

• Seriously delay the development and implement of a turnaround strategy as r quired by the Guarantee Agreement with National Treasury;

• Delay the process of remedying the many faults in the SABC's activities;

• Delay re-establishment of compliant and functional governance procedures at the SABC;

• Sow disunity among directors and between directors and management;

• Undermine the credibility of and public respect for the SABC;

• Create uncertainty in the minds of the SABC's statutory shareholders over the capacity of the directors collectively; and

• Entirely undermine the ability of directors collectively through the Board either to exercise proper oversight or to provide strategic direction to the SAI3C

3. Resolutions of the Board on 22 May 2010

As a consequence of the events and developments outlined above, the Board met in formal, quorate session on 22 May 2010 and took the following resolutions (the accuracy of the text is attested as accurate by the company secretary.

The board of Directors RESOLVED that having due regard and consideration for the statutory documents and legislative provisions governing the SABC

(i) The appointment of Group Executive members remains a matter reserved for the Board in terms Article 14.4.1 of the Articles of Association of the Company

(ii) The Chairman and the CEO did not have the authority to act in the purported appointment of the GE News & Current Affairs and acted without authority and their actions in this regard are null and void and the position of News & Current Affairs remained vacant

(iii) The process of the interviews for the vacant position of Group Executive News & Current Affairs would continue until such time that the appointment process was completed

(iv) The interview Panel would present its recommendations to the Board in a duly constituted Board meeting for consideration

The Board of Directors RESOLVED that in the light of the irretrievable breakdown of the relationship of trust between the Board as a collective and the chairperson, the decision of the Board be communicated to the Share holder.

The Board further RESOLVED that the Chairperson of the Board be requested to attend a meeting of the Board wherein the Board members individually and collectively to inform the Chairperson of their feeling in respect of the behaviour of the Chairperson and its impact on the relationship with the Board.

The Board takes the unanimous view that these resolutions were necessitated by the improper behaviour of the chairperson, both with respect to the purported appointments of the GE News and more broadly with respect to the activities of the Board and of the SABC.

Thursday, 15 September 2011

SABC Wastage

The rot of fraud, corruption and waste at the SABC reaches all the way to the top, says a preliminary report by the Special Investigating Unit (SIU) into long-standing allegations of widespread graft at the public broadcaster. The ongoing SIU probe – covering the period September, 2007 to March last year – has unearthed a litany of abuses and financial shenanigans.

These include fraud and irregularities in the procurement of services, theft of assets, payments to fictitious companies, duplicate payments, fraudulent claims, and irregular appointments, promotions and pay hikes.

The SIU said only 10 of the 20 SABC current and former board members investigated had disclosed their business interests as required by law.

And even those board members who disclosed their interests – in 55 companies – failed to report that they had fingers in 1 106 other pies. It was the board itself that asked the SIU to investigate. Current board chairman Ben Ngubane said on Wednesday night the probe was launched after the auditor-general made damning findings in his 2009/10 report on the broadcaster’s finances. Responding to the findings on board members, Ngubane said: “I thought I had done all my declarations, but I don’t know about the other board members.”

The SIU also identified 20 SABC staffers who had personal interests in companies that conducted R1.2 billion worth of business with the broadcaster.

And of the 1 358 SABC employees investigated so far, only 178 had completed declaration of interest forms in which they declared 176 interests.

But further analysis revealed about 2 070 other business interests had not been declared.

The SIU found that the SABC wasted R150 million last year alone when a “senior staff member” bought high volumes of poor programming which later became “redundant”.

The employee accepted gifts from the company that sold him the sub-par content – a practice found to be “commonplace” at the broadcaster.

“The SABC also suffered revenue losses, because advertisers were not prepared to place their advertisements during the screening of these sub-standard programmes,” the SIU report stated.

More than R31m in payments to staff members were never recorded on the payroll system.

And R774 000 in third party payments “relating to personal protection” were made without the required fringe benefit tax being deducted, investigators said.

This means staff members were hiring bodyguards at taxpayers’ expense without declaring this benefit for tax purposes.

A second, similar case involving R411 000 was also uncovered.

Something of an embarrassment to the SABC is that staff apparently found the corporation’s programming so dull that they claimed R102 000 in “M-Net and DStv privileges”. They also failed to declare this benefit.

When investigators looked into “anomalies” in discounts and credit notes, they found the total of discounts, commissions and levies offered by the SABC made up 45 percent of its total revenue. The absence of industry benchmarks for discounts of this kind prevented investigators from making a specific finding.

It “appears that the appropriateness of the discount structures warrant further investigations by the SABC”, the SIU suggested.

Investigators also found that the broadcaster racked up a R29m fuel bill on its 843 petrol cards, of which 173 belonged to top and senior managers.

Further studies are under way to determine the extent of petrol card abuse at the SABC.

Between April, 2006 and August, 2009, the SABC paid R12.8m to 51 employees who were suspended. One “absent” employee was paid almost R1m in unearned salary.

Probing an allegation that a “senior SABC staff member abused his position to benefit his wife’s business partner”, investigators discovered the employee “promoted the services of his wife’s business partner in various ways which may have amounted to a conflict of interest (when) he had a duty to disclose them and failed to do so”.

“Offers of discounted airtime potentially would have resulted in a loss of approximately R12m to the SABC and would have benefited his wife’s business partner who would have been paid to produce the advertisements.”

The same person offered one advertiser a 48 percent discount despite the SABC’s discount policy limiting such discounts to 6 percent, causing a R838 000 loss.

The same staffer also swayed the SABC to invest about R2.2m in a Valentine’s Day campaign in which his wife’s business partner was involved. The return was only R18 352 – a 99 percent loss.

The SABC also lost R482 000 through double-invoicing and paid R1.6m for services not rendered.

Lisa Skinner, a co-ordinator for the Save Our SABC coalition, which includes labour and industry role-players, said the preliminary findings “point to a huge problem with financial systems and accountability”.

She also noted that the government was looking at a new funding model for the SABC which was expected to require greater public investment in the corporation.

“The SABC itself has also asked for more public funding, but you cannot justify this unless the SABC gets its house in order.

“The SABC has always said it wants to root out corruption. Now let’s see them do it.

“We need to see swift action,” she said.