Briefing to the Portfolio Committee on Higher Education and Training

1. Briefing to the Portfolio Committee on Higher Education and Training The outcomes of the Independent Assessors’ reports on the Vaal University of Technology and Central University of Technology Department of Higher Education and Training 30 May 2012

2. Vaal University of Technology (VUT) Background • Historical difficulties since its inception in 2004 • Unending conflicts at the level of Council – exacerbated by the existence of “factions” within Council and Management • Allegations of race-based appointments (promotion and employment of white candidates to the exclusion of black ones) • Tension between the Vice-Chancellor and DVC: Finance which put the institution in a state of paralysis • Minister appointed Adv Muzi Shikhakhane as independent assessor on 10 Feb 2012

3. Independent assessor report- Key Findings The Independent Assessor presented the report to the Minister and made the following key findings: • Council has failed and is unable to provide strategic leadership • Finances are sound and well managed • The departure of Prof Mokadi still haunts the institution and must be addressed • Current VC has made significant improvements to the institution

4. Key Findings-cont. • DVC: Finance undermines the role and authority of the VC • Current statute is not effective and must be replaced to ensure that the Council is properly constituted to lead a University • Current Council’s composition must be addressed, vested interest and narrow political agendas have emerged in Council • Mismanagement of student residences • Bar the problems at Council, VUT is a stable institution

5. Recommendations • Dissolve the current Council and its committees • Retain the current VC • Appoint an Administrator to perform the functions of Council until a new Council is constituted • Resubmit a new statute to address shortcomings in governance • Review Council’s decision not to extend the VC’s contract for a full five year term • Establish a special forensic audit into procurement and management of student residences • Find mechanism to resolve the tension between the VC and DVC: Finance

6. Recommendations cont ... • Re-constitute the audit and finance committees based on skills and integrity • Develop and implement a risk management strategy • VUT should build its own student residences • VUT should increase infrastructural capacity of its campuses to adequately serve the numbers of students enrolled • All Council members must declare business and other interests

7. DHET - Response • The Minister published the IA Report in the Government gazette in terms of the HE Act, Section 47(2) • A copy of the Gazette was provided to Council • Director-General, delegated by the Minister i.t.o. of Section 68 (1)(c) of the HE Act, met with Council on 23 May 2012 to consider its views • Minister is considering the findings of the Assessor together with the views of Council • Minister will make an announcement once he has considered all inputs and made his decision on the matter

8. Central University of Technology:Background • Minister received an anonymous letter from concerned CUT staff making serious allegations of maladministration, corruption and human rights abuses • After queries by the department, Council initiated an investigation by KPMG, which was later aborted and replaced by a second investigation by Adv Lubbe - both investigations were prematurely terminated • The KPMG report was never made available to the Minister, despite several requests and promises • Adv Lubbe who was subsequently re-appointed found merit in most allegations • The Lubbe Report and the non-availability of the KPMG report prompted the Minister to initiate an Independent Assessment of the problems at CUT

9. Independent assessor report- Key Findings • Minister appointed Prof Julian Smith as an Independent Assessor on 24 Feb 2012; The Independent Assessor presented a report to the Minister and made the following key findings: • Council handled the anonymous memorandum inadequately. Minister has been misled concerning the existence of the KPMG Report • Adv Lubbe confirmed in writing that he has personally delivered the reports to the office of the Registrar • Whistle-blowing process may have been compromised

10. Independent assessor report- Key Findings ... • Council has shown poor adherence to good governance principles and fiduciary responsibility • General oversight of financial management is insufficient • Between 2008-2012 a significant increase in expenditure on external consultants, legal fees and management services • Concerns are raised in relation to overseas travel • The staff restructuring process took a heavy toll on staff confidence, loyalty and job security • The VC has been unable to follow through on the repositioning and reconfiguration of the university

11. Independent assessor report- Findings • Claims of unbecoming conduct of the DVC: Institutional Planning, Partnerships and Communication • Culture of fear based on submissions of several interviewees • Welkom campus does not get consistent and ongoing attention with regards to infrastructure development • Proximity of UFS is not formally exploited

12. Recommendations • Dissolve the current Council • Appoint an Administrator to perform the functions of Council until a new Council is constituted • Vice-Chancellor should be placed on special leave, pending the outcome of further forensic investigation • Investigation of the alleged conduct of the DVC: Institutional Planning, Partnerships and Communication • KPMG investigation be reactivated and expanded to include the Welkom campus • This investigation to include a forensic audit

13. Recommendations • Current investigations by the VC concerning staff and/or staff sector be placed on hold • Review by professional persons on past and present labour relations matters

14. DHET - Response • The Minister published the IA Report in the Government gazette i.t.o. of HE Act, Section 47(2) • A copy of the Gazette was provided to Council • Director-General, delegated by the Minister i.t.o. of Section 68 (1)(c) of the HE Act, met with Council on 28 May 2012 to consider its views • Council submitted a formal response to the Minister • Minister will consider the findings of the Independent Assessor together with the views of Council • Minister will make an announcement once he has considered all inputs and made his decision on the matter