Ramokgopa to fast-track new Necsa board, executives face misconduct allegations

The board of the Nuclear Energy Corporation of South Africa (Necsa) has been left unable to function after a wave of resignations in a governance crisis that Minister of Electricity and Energy Kgosientsho Ramokgopa says forced him to accelerate plans to appoint an entirely new board. 

“Despite all the efforts of the minister to ensure that we get to appreciate what the issues are, we couldn’t get the board to [be] quorate,” said Ramokgopa, referring to himself, on Thursday night.

He was briefing members of Parliament’s Portfolio Committee on Electricity and Energy on “governance matters” at Necsa, which has not been quorate due to an internal governance crisis in which numerous board members resigned. 

Ramokgopa announced that since the current board’s term was due to end in January 2026, the ministry had already initiated a call for expressions of interest for new board members. In light of the resignations, he said the process would be fast-tracked, with the new board expected within three weeks.

The full monty

The minister explained that he has opted not to fill the existing vacancies but to “go the full monty” and pursue a complete replenishment of the board. 

In the meantime, Necsa CEO Loyiso Tyabashe will “steer the ship”.

Daily Maverick previously reported that disciplinary notices and an internal audit showed that top executives at the state-owned nuclear company allegedly misrepresented finances and misallocated millions.

Read more: Multiple resignations leave nuclear board paralysed after failed attempt to suspend CEO

Responding to questions about the resignations, the minister explained that once he had sight of the notice of intention to suspend the executives, he called for a meeting to say, as an authority legally competent to do the suspension, to “please come and explain how we we arrive at this decision to suspend”. 

In the minister’s recap, he said before that happens “there’s a flurry of resignations”. 

“There’s no other way of explaining it other than people not being confident of their ability to substantiate why they’ve taken a decision that they’ve taken and that it’s what led to the board being inquorate,” said Ramakgopa.  

Allegations

Allegations revealed in documents Daily Maverick has seen alleged that Tyabashe, as well as Necsa CFO Precious Hawadi, allegedly misrepresented the company’s financial position to the board to justify salary increases for executives, while other employees received below-inflation pay increases.

The documents show that Hawadi asserted, in an official letter, that the salary adjustments, totalling R1,774,323.15 for 2024/25 and R3,548,646.50 for 2025/26, were funded by savings and budget reductions within the CEO’s cost centre.

However, an independent audit commissioned by the board found this to be false.

The audit concluded that the CEO’s cost centre had overspent by about R1.7-million, and its budget for the following year increased by R6.4-million (24%), directly contradicting the CFO’s claims.

About R5-million in executive salaries was also processed outside the CEO’s cost centre. Management admitted this was a “misallocation” while the audit labelled this an “accounting control failure”. 

This audit became contentious because, as interim Director General in the Department of Electricity and Energy Subesh Pillay explained on Thursday, the internal audit team failed to follow the “Audi alteram partem” rule, meaning; they did not afford management the opportunity to respond or reflect their views.

This was the case because, as Pillay explained, this internal audit coincided with the end of the financial year when the management team was interacting with the Auditor General (AG) and requested the space to conclude their work with the AG. 

Whistleblower complaint

Additionally, a whistleblower complaint, seen by Daily Maverick, alleged that Tyabashe had made statements regarding Ramakgopa and the future of the existing board. Specifically, the whistleblower reported that the CEO openly boasted about having a good relationship with the minister, even stating that the current board will not be getting a second term.

Read more: Activists raise concerns as nuclear site close to Cape Town given go-ahead

Ramokgopa’s announcement to Parliament appears to confirm that prediction. 

Speaking to Daily Maverick in a committee meeting room on the sidelines of the Department of Energy and Electricity’s presentation of its strategy to the parliamentary committee on electricity and energy on Wednesday, 23 April, Pillay told this journalist: “There’s a research reactor (Safari-1), and it’s reached end of life. It’s got about 10 years left, so they’re moving to closing Safari down and simultaneously, we’re now building the next iteration of research generator, and that’s why you had this big jump, because National Treasury has allocated R1.2-billion for that build programme over three years.” 

It is this context, against the backdrop of an expensive and complex technical infrastructure project, that makes the allegations against the leadership at Necsa particularly corrosive.

New board ‘silver lining’

Ramakgopa, hoping to strike an optimistic note on Thursday, suggested that the crisis, however, offers a “silver lining” as the new board will likely feature a greater presence of scientists and experts who will focus on the strategic direction of Necsa rather than “petty” issues like executive remuneration. 

“If you look at the profile of the Necsa board, you have a board that is charged with running one of the three active reactors in the country, with only one member of the board who’s got the knowledge of the nuclear industry, that being the chairperson of the board. 

“So invariably what you’re going to have in the board meetings is not about the strategic direction of the organization, but ‘what does the nuclear energy complex look like and what are the opportunities going forward’. You will be discussing salaries because that’s an issue where people have got comfort to discuss,” said the minister. 

“But if we discuss the kind of reactors, what is the kind of technologies that we are seeing, those conversations will not happen because you have a collective body that does not possess the knowledge in relation to that industry.” 

“So you’ll see that the board that’s going to be appointed is going to have a presence of scientists, people who are going to help us to steer this in the right direction. What they will do, they’ll spend little time on salaries because they’ll look at what the policies say, whether they can afford that and make that decision and spend their time on the strategic direction of the organisation, not petty issues.” DM