New Lottery boss promises huge clean-up

The board of the National Lotteries Commission (NLC) in South Africa has approved a reparation process that will lead to apologies and, in some cases, financial reparation, to former staff who were punished or driven out of their jobs for blowing the whistle on corruption.

The NLC will use a reparation model similar to the one used by the South African Revenue Services (SARS) which apologised and paid reparation to staff who were forced out during the capture and hollowing-out of the organisation during Jacob Zuma’s administration.

“We’re doing it because the NLC has wronged communities and we need to say sorry,” the new Commissioner, Jodi Scholtz, told GroundUp in a candid interview.

“It needs to be lawful and authentic. We need to make amends within the PFMA (Public Finance Management Act). The idea is to say sorry in a way that is meaningful and for everyone. My original proposal was for staff only. But communities have also been affected. They have been hurt. We cannot just say it is business as usual.” – say Scholtz.

With regard to projects that collapsed when grants were looted, she said the NLC had asked the Industrial Development Corporation to provide engineers to investigate abandoned or unfinished projects “to see what could be done to make them useful for the communities where these facilities are situated“.

Since last year a clean-up at the NLC has led to the replacement of the entire NLC board and much of the senior executive, and the resignation both of the previous Commissioner, Thabang Mampane, and the former chief operating officer, Phillemon Letwaba. Several other senior staff are currently on suspension pending disciplinary inquiries.

Scholtz also confirmed that the NLC plans to introduce lifestyle audits and integrity testing for all staff “starting from the top … me, the executive and the NLC board“. One idea being considered was to fund reparation awards from money raised by selling off assets such as seized luxury houses and properties and cars bought with looted lottery funds, Scholtz said.

One example, she says, is the R3.9-million that was raised from the sale of Tsotsi star Terry Pheto’s house, which was paid for from a grant intended to fund an initiation project. The Special Tribunal has already issued preservation orders running into hundreds of millions of rands on properties and other assets, involving multiple individuals, companies and non-profit companies.

Among the other luxury properties paid from lottery funds that the Special Investigating Unit (SIU) has seized are a Pretoria mansion belonging to former NLC board chairperson Alfred Nevhutanda, and a luxury home on a golf estate belonging to a trust in which former Commissioner Mampane and her family are beneficiaries.

The system was enabled for corruption. It was as if people sat around a boardroom table and planned how to corrupt and steal.

“The system was enabled for corruption. It was as if people sat around a boardroom table and planned how to corrupt and steal. With my tongue firmly in my cheek, I can say that the one thing we were good at is paying out. Some grants were adjudicated one day and paid out the next day. But others who needed it were kept waiting.” – said Scholtz.

Zero tolerance

Scholtz has been meeting staff and labour unions as part of an organisation-wide clean-up. She said she has made it clear to staff that the NLC will have “zero tolerance” for fraud and corruption and that there will be consequence management. I have told them that everyone is obliged to report corruption if they encounter it.

She has also held meetings with former staff who were driven out after they tried to blow the whistle on corruption. Among those she has met with are Sello Qhino and Mzukise Makatse. Both have paid a heavy personal price after being hounded out of the NLC.

She said at times the meetings had been heartbreaking. She had met an unnamed whistleblower who told her that his daughter had been so affected that she contemplated suicide, said Scholtz.

“I am a parent. How can I not be affected by this?”

She has also met communities where tens of millions of rands of public money was spent on facilities that were not needed, and representatives of organisations whose credentials were “borrowed” or hijacked and then used to apply for Lottery funding.

“I found a legacy of good people [at the NLC] who wanted to do the right thing. But they were very disempowered and scared of doing their work. Records and functions were in odd places and there were problems with record management. We brought in consultants to compare job descriptions, standard operating procedures and what people actually did. There were lots of disconnections and things that didn’t fit.” – Scholtz said.

She also found “a lack of attention” to working conditions.

“Chairs are in a state of disrepair, and locks on toilets are broken. The focus was not on how to help people, but rather on ‘how can I loot? Staff are very fragile and scared to speak out,” – said Scholtz.

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Samuel

I am a journalist specializing in gambling in Africa and around the world. I am particularly interested in stories about games and casinos.

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Samuel

I am a journalist specializing in gambling in Africa and around the world. I am particularly interested in stories about games and casinos.