Western Cape Gambling and Racing Board Vacancies: Provincial Treasury on shortlisting process; Outcomes of the Probity Report

Meeting report

The Chairperson made brief opening remarks and welcomed all present in the physical venue, and those on the virtual platform.

Mr R Mackenzie (DA) asked that part of the meeting be held in camera, given the confidential nature of the information the Committee would receive, and out of respect for the candidates.

The Chairperson said this would be done for the probity report.

Shortlisting of candidates to fill vacancies on Western Cape Gambling and Racing Board

Ms Claire Horton, Economist, Western Cape Provincial Treasury, made a presentation to the Committee outlining the process and regulations for shortlisting candidates to fill the vacancies on the Western Cape Gambling and Racing Board.

(See presentation for details)

Discussion

Ms N Nkondlo (ANC) asked about page 2 of the slides, in Section 3 of the Act, where it was stated that the eligible persons should have appropriate knowledge or experience. She asked if there was a set context of what this meant, and whether there were standard criteria for the basis for measuring what “appropriate knowledge and experience” meant? On Slide 3, referring to what was considered a point of disqualification and a conflict of interest, how was this managed with the initial component of the experience, because surely here one looked at people who may have knowledge of the same industry. Slide 9, bullets 2 and 3, made an interesting reference, as the Gambling Act legislation looks at gender sensitivity as one of the important elements, but there was a relationship in the shortlisting criteria which she believed was correct, because the Gambling Authority operated within that governance environment. It went beyond gender sensitivity, which came first. Was the Committee provided with the benefit of the list of applicants versus the ones shortlisted so that Members were able to see those who had been excluded from shortlisting?

Ms Horton replied that the Act did make reference to gender sensitivity, but they considered representivity of the population group on a broader scale in terms of gender, social background, experience and skills set. They also look for a mix between younger people and those who were more experienced. They were cognisant and did try to draw out a diverse set of people for shortlisting.

Ms N Makamba-Botya (EFF) sought clarity on slide 9, relating to the shortlisting criteria applied to the shortlisted candidates and those who had been excluded. One of the reasons cited was an address outside of the province. She asked if a candidate needed to be specifically from the Western Cape.

Ms Horton said there was a restriction regarding the number of applications received. They had received only seven applications from persons who had submitted an application form. They were obliged in terms of the Act to exclude one candidate from shortlisting, as the candidate had indicated an address outside of the Western Cape. The Act, in its current form, was quite explicit on whether the person was ordinarily a resident. They had followed up on this with the candidate in question to confirm that he ordinarily resided in Gauteng. The candidate said that when he came to the Western Cape, he stayed in a hotel or a guest house. There were other criteria, where it became less clear about somebody’s ordinary status, in which case they asked where the person worked and where their possessions were left.

On conflict of interest, there was a need for someone with gambling experience or business experience. They were also cognisant of the mandate of the Board, which was involved in regulating gambling opportunities, gambling operators and products, while promoting responsible gambling and ensuring that no illegal gambling and over-stimulation of product took place. There was a broad mandate regarding various interests that must be served. There were questions on work experience and qualifications in the application form. A red flag was raised if a candidate may have shares in a gambling institution -- the Act was quite specific on this, as the candidate or his/her family members could not have a stake in gambling establishments. The probity also assisted with this.

Mr Mackenzie posed questions on the chatline of the virtual platform, which the Chairperson read out. He asked if the Department could provide clarity on whether any candidate was working for another level of government. Why had the position not been further advertised in other media, given the poor response rate? Were they able to headhunt? If another vacancy came up, did they have to repeat the process? Could the same candidates be used for the next vacancy that came up?

The Chairperson asked if Members had any questions related to the process, but they had none.

The Chairperson asked about slide 2 regarding “ordinarily resident in the province”. She said a legal opinion was applied, and asked whether the same opinion was applied for determining the shortlisting or whether a new approach was used. She referred to slide 6, regarding no comments being received, and asked whether more appropriate platforms could be used to target those in the industry, such as Business Day or Fin24.

She asked for clarity on why an external service provider was used in the probity investigations. Did the Department not have the in-house capacity, or did this support a more independent review? How long did the current board members serve? What was their term, and was it possible to share who would be stepping down, or was this information confidential?

Ms Horton said there had been a poor response for nominees, and the positions had been advertised on LinkedIn. More appropriate platforms, such as Fin24 and Business Day, could be considered, bearing in mind that applicants from the Western Cape were the target. She said the Provincial Treasury did not have the capacity to conduct the probities, and there was a need for it to distance itself and have a quality probity report. The service provider checked qualifications, criminal records and any other required checks. Those with fiscal policy links did not have access to this information, or the kind of skills set to conduct these investigations.

Mr A van der Westhuizen (DA) said he noticed that a number of applicants were serving, or had served, on other boards. This was particularly so in the Western Cape and on the Liquor Board. He asked whether this should be seen as a concentration of too many responsibilities on one person, or whether the Department was of the opinion that this was an asset in someone’s application, given that the person had been able to gain experience in serving on a board with fairly similar responsibilities? He noted that in some cases, the Committee was told the terms during which those persons had served, while this information was not provided in other cases. He proposed that a balance be struck between continuity and getting in new people with fresh ideas, to have a continuous process of renewal on these boards. He asked about the periods served where it had not been indicated.

Ms Horton said there was a small pool of people who had applied, and they were either people who had served on other boards or had previously served on this Board. She said Ms Venter had previously served on the Liquor Authority. Ms Arendse had previously served on the Western Cape Racing and Gambling Board. Mr Nicholls was a current member and had previously been a Board Member. Ms Fani and Mr Bassuday were on their second terms. She said there was a need to bring in some younger applicants for cross-fertilisation of the skills of existing members and new skills sets. They had actively tried to shortlist and consider such applicants. The Board sits once a month and a board member might be a board member of two committees. This responsibility worked out to be for approximately three days a month. If there was a gap in vacancies on the Board, some people would need to double up their duties and it might be a bit more onerous for them. The term of office for board members was three years, and could be extended for another year.

Ms Makamba-Botya asked about the board members having too many responsibilities.

The Chairperson interjected, saying that this information would be discussed in-camera, as it was very sensitive information.

Ms Makamba-Botya said she would just refer to someone who was managing more than enough companies. How would the Department create a balance with having such a person on the Board?

Ms Horton said it was a dual responsibility, as the Standing Committee also had the responsibility of ascertaining the suitability of candidates and determining whether someone did or did not have the time for such a responsibility. On the face of it, she agreed that 36 directorates did seem excessive, but felt this would answer the question on behalf of the candidate to determine whether they did or did not have sufficient time to fulfil their responsibilities.

Ms Nkondlo wanted clarity on whether there was room for the alignment of terms, given the Provincial Treasury’s experience in administrating the Act. Given the smaller pool of applicants, which was an industry challenge and whether the Economic Department was engaged on this issue was unknown, but she was aware that this may not necessarily be included in the mandate of the Provincial Treasury. She pointed out that if the pool of applicants remained small, achieving the necessary diversity would always be challenging. Feedback should be given to the industry so that transformation in the space could be achieved. Was head hunting done and had this been applied in any way? In the last process, many candidates were young. She asked whether the Provincial Treasury had perhaps approached these candidates again, because, despite their rating at the time of their interviews, they may still have been a better candidate when considering diversity. She referred to two young women, one of whom had global financial governance experience. If gender sensitivity was anything to go by, she pointed out that there were predominantly males and only one female among the shortlisted applicants. She asked what the gender profile of the current Board was.

Ms Horton agreed it was an onerous process and the Department had attempted to streamline the process as far as possible. Various legal opinions had been sought on whether candidates who had previously applied could be considered again. This was time-consuming and also an expensive process to run. They had sought legal advice and unfortunately, in terms of the way the legislation was crafted, each process must be considered individually. Applicants from a previous round could not be used in a vacancy which may emerge next. The Department did follow up with candidates from a previous round who had looked very promising. It would repeatedly approach the candidate to tell them to look out for what it would advertise in future, and it would go as far as to send a notice to the person and ask them to send their name as a nomination. The Department would like to fill as many vacancies in one process as opposed to going through numerous processes.

Regarding headhunting, they ask candidates to send in a nomination. They could also put up notices at universities where there were perhaps postgraduate students.

Mr Van der Westhuizen asked about the number of terms served and the appointment dates. Did this apply to the initial term, or could this still be extended for a year? Were some of the candidates already in their extended year? Have any existing board members already served more than one term on the Liquor Board? He regretted the small number of people who had eventually submitted the completed forms, but it was extremely onerous to complete them, as no other job he could think of required one to reveal such personal information. While he could understand why this was necessary in this case, he thought this served as a hindrance for many people, particularly busy, highly qualified people. This process might have to be reconsidered to broaden the list of applicants.

Mr Bassuday and Ms Fani were both on their second terms. Mr Nicholls was currently a board member and his term expired in December. Mr Nicholls had previously served on the Board and if successful, this would be his third term. Mr Arendse had also previously served on the Board. This was Ms Venter's first term on the Gambling Board. Up to now, they had followed the standard practice of appointing members for a three-year period, though the legislation provided a four-year candidacy. It did provide that one could repeatedly apply to be a board member. In terms of the scope, Mr Arendse and Mr Venter were in their first three years.

The Chairperson asked about the remuneration for board members and the sanctions for non-attendance. She asked whether the previous legal opinion was used, or whether another mechanism was used to determine what it meant to be “ordinarily a resident,” such as domicile etc. Did the Department have a rough idea of when the vacancy would need to be filled?

Ms Horton asked if the Committee could allow her time to let them know about the remuneration of board members.

It would be the responsibility of the chairperson to ensure that board members were in attendance and to determine valid reasons for absence. With the candidate in question, they had simply asked where the candidate resided. In this case, the person had indicated that they come to the Western Cape only on a temporary basis. Regarding gender representivity, there was one African and one White female.

Ms Makamba-Botya asked how this would affect the applicant who did not reside in the Western Cape, given that a board member’s responsibility would amount to only three days a month. The applicant in question had said he was able to be in Cape Town temporarily. On what basis then this applicant been excluded?

Ms Horton said she agreed with this view, but the Act stated that the candidate must ordinarily reside in the Western Cape. It did not refer to availability or costs.

Mr Mackenzie said the Committee had previously decided on candidates not residing in the Western Cape, so this matter did not need to be reopened.

The Chairperson said a legal opinion had been sought on it, and thanked the Member for raising the matter.

Mr Van der Westhuizen said the law prescribed this requirement on candidates needing to reside in the Western Cape, and the province was not unique to this legislation.

Outcomes of probity reports

The probity reports were presented in-camera, and the Chairperson closed this part of the meeting to the public to protect the personal information associated with the applicants.

Resolutions/Actions

The Chairperson asked whether Members wanted an interview process or a paper-based evaluation process.

Ms Makamba-Botya said many issues had been presented to the Committee, and there was a question relating to the requirements to be re-selected as a candidate for interviews. However, one could see many things had not been dealt with, such as tax compliance status, which had not been attached to the applicants' documents. There was a candidate who could not be verified in terms of employment, as there was no information on the database. How could the suitability of a candidate then be determined? She did not think it was wise to do interviews in this case.

Ms Nkondlo said the information should be analysed and interviews should be postponed.

Mr Van der Westhuizen said the process should be finished this year if possible, as many months have passed since the applications were made. Candidates should be interviewed. A number of outstanding items should be clarified before starting interviews. A number of candidates had already served on the Western Cape Gambling Board and other boards before, so it was important for the Committee to get clarity on more than the attendance of meetings, but whether candidates were able to contribute to the debate. This information should be sought objectively. They needed to gather as much information as possible to assess the potential of candidates to contribute to the Gambling Board.

The Chairperson said further information was required to have interviews. She proposed that a legal opinion be requested on what “good financial standing” meant, and that the consultant provide the necessary tax certificates and other information by 1 November, so that by 4 November, they could deliberate on this matter appropriately.

The Committee would try to hold interviews on Friday, 11 November, from 08:00 to 15:30, which would include consideration and adoption of the draft report on the candidates to be submitted to the Minister. The Committee would also decide whether the interviews should be closed or open to the public.

Mr Van der Westhuizen said those interviewed later may be offered an advantage, as they would have had an opportunity to listen to the questions asked to those interviewed earlier. He proposed that interviews be in a closed session so that candidates could be asked similar questions.

The Chairperson said she supported this.

The Provincial Treasury would provide electronic files on the candidates seven days prior to the interviews.

Ms Nkondlo asked what the implication of sourcing any additional information from a candidate at this level would be, and if this would not prejudice others who had submitted information by the due date. If a tax clearance had been a requirement previously and the person had not submitted it, they would ordinarily be disqualified at this point. She said a legal opinion should be sought on this, including issues relating to debt review.

Mr Van der Westhuizen said that looking at previous requirements, there was no reference to SARS compliance, but this may be required now in terms of the onerous forms people needed to complete to apply.

The Chairperson said a legal opinion would be sought on this. The Provincial Treasury would provide the Committee with a list of questions and an answer guide by 4 November. The Committee would decide which questions to ask and how Members would ask the questions. Time would be set aside from 08:00 to 08:45 on 4 November for preparation. The Committee should decide on the scoring process and whether the same scoring process should be used as in 2021. Notes on these sheets would assist the Minister and Executive Council (EXCO) when making the final decision.

The Chairperson noted that Members agreed with this.

Mr Van der Westhuizen asked if the interview process could be shortened, and whether the candidates should be interviewed online or be physically present. He suggested the interviews be held online.

The Chairperson said interviews should be 30 minutes, with ten minutes in between, so that Members could deliberate.

Members agreed to this.

The Chairperson asked that interviews be in person, but put it to the Committee that there could be a hybrid approach.

Ms Makamba-Botya's comments were inaudible.

Mr Van der Westhuizen said if candidates were required to appear in person, all candidates should be treated in the same way. Members could be allowed to join in a hybrid fashion, but all candidates should either be online or in person.

The Chairperson supported this for fairness, and said the interview process should be done in person.

Consideration and adoption of the draft report on candidates would occur directly after the interviews on 11 November.

Three candidates would be recommended.

Annual report resolutions

The Chairperson asked Members what resolutions from the annual report were not yet concluded.

Mr Van der Westhuizen proposed the reports be noted, and congratulations extended to those who were able to receive an unqualified audit. He asked that Wesgro inform the Committee of the adjustments it had made for it to have an unqualified audit again. The AGSA had been asked about being unable to verify some of the performance targets set by Wesgro. He proposed that Wesgro be engaged on this. The Standing Committee on Public Accounts (SCOPA) might also want to do this, but it was appropriate for the Committee to do so, based on oversight.

Ms Nkondlo supported this view. The Head of Department (HOD) had said they were reviewing the current strategy which should be presented to the Committee with clarity on the informal economy, which had always been discussed with the Department. A presentation should be made on work the Department was doing with the municipalities. Small, medium and micro enterprise (SMME) development and the informal economy were important. A joint engagement with local government should be considered. This should be done jointly with the provincial Treasury, and the Committee should receive a framework and an updated report on this. The Committee should tighten its oversight role on entities such as Wesgro.

She congratulated the previous chairperson of the Atlantic Special Economic Zone (SEZ).

The Chairperson referred to the township economy strategy, and said the Department should include information on their "Jobs for Growth" action plan and the stimulation of SMMEs.

Some guests from the public were in attendance, and the Committee should follow up with the Department on their engagement with an individual on Nyanga Tourism. Mr Bester would submit questions to the Saldanha Industrial Development Zone (SIDZ).

The Chairperson suggested that the Committee resolve to exercise oversight over the SIDZ and SEZ to have a look at the progress made and get a better understanding of the R21 billion investment pipeline.

The meeting was adjourned.