SOuth African minister opens up on gambling board scandal

The reasons for the suspension of the entire South African National Gambling Board six weeks ago (see previous  report) were finally – if belatedly – disclosed Friday when Trade and Industry Minister Rob Davies briefed an impatient parliamentary committee enquiring into the issue.

In a written brief, the minister revealed that allegations of maladministration, wasteful spending and corrupt activities prompted him to suspend the members of the National Gambling Board (NGB).

Earlier, the chair of the parliamentary trade and industry portfolio committee, Joan Fubbs, had demanded an explanation from the minister on the scandal, which was characterised by a remarkable lack of government transparency and the inability of administrators to answer the committee’s questions.

The minister’s submission was presented by the DTI director general in the absence abroad on business of the minister.

Davies has ordered a forensic investigation into the conduct of the board, and has appointed two caretaker administrators to run the organisation until all issues have been resolved.

The minister commented in his brief that the suspensions were a “precautionary” measure following a report by the auditor-general which had indicated possible contraventions of the Public Finance Management Act through “….failing to prevent irregular, fruitless and wasteful expenditure, and making overdraft on the entity’s bank account without the approval of the minister of finance”.

Other allegations concern the actions of the NGB’s accounting authority, which may have transgressed the provisions of the National Gambling Act by “….allowing members whose term of office had expired to continue participating in the board’s activities and representing the NGB”.

The minister also referred to other serious allegations flowing from disclosures made to him in terms of the Protected Disclosures Act which indicated that unlawful staff appointments and corrupt activity involving the National Central Electronic Monitoring System may have taken place.

Yet further allegations had been made of tyrannical behaviour toward staff and the theft of evidential material, the minister noted.

The official Opposition party the Democratic Alliance provided further information, presumably gleaned from its own enquiries.

In welcoming the minister’s disclosures, spokesman Dean Macpherson MP claimed that members of the board had boosted their own remuneration by “a staggering” 46 percent in 2013-2014, and had spent Rands 2.7 million on international travel.

Macpherson said that his party would be asking parliamentary questions, and would propose that criminal charges be laid in respect of any unlawful behaviour that can be proved.

The NGB oversees a South African gambling industry that generated gross gambling revenues of Rands 21.8 billion (around GBP 1.23 billion) last year, most of it from land casino activity.  The government accrued around Rands 2.2 billion in tax revenues on this amount.

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