Press statement by Dr Sean Phillips, former Managing Director of the Johannesburg Road

Agency

On 24 April Mayor Mashaba issued a press statement: “Setting the record straight for JRA
and the Coalition”.

In his statement, the Mayor indicates that: “Last year, I held an engagement with Dr Sean
Phillips and the Board Chairperson for the JRA, Mr Sipho Tshabalala, in order to address
what I had been made to understand was a breakdown in the working relationship between
the two parties…It is important to state that at no point was there any prima facie evidence
that any corrupt activity had taken place. Irrespective of this, I invited Dr Phillips, to provide
any such evidence of wrong-doing, which would then be immediately acted upon – this I did
on several occasions….During my engagement with the parties, the Board Chairperson
explained that the Board was of the view that they had an oversight role to play in the
governance of the JRA, including how it operated its supply chain processes, and that the
Board could not find itself in a position where it was accountable for the entity’s decisions yet
was unaware of major operational decisions taken by the entity. This was their reason for
their greater oversight in the organisation.”

Indeed, I did not provide the Mayor with any prima facie evidence that any corruption had
taken place. However, as the Managing Director of a major Johannesburg municipal entity, I
felt that it was my duty to bring the following issues to the Mayor’s attention, both in writing
and verbally:
a) That the Board Chairperson had bluntly requested me to not award any tenders without
his involvement (there are minutes of the Board induction workshop in which the
Chairperson repeats this statement). When I indicated that this was illegal in terms of the
Municipal Finance Management Act, the Chairperson asked to be involved “informally”
b) That the Company Secretary had been suspended by the JRA Board for doing her job
and raising concerns with the City’s anti-corruption unit regarding governance issues
involving the JRA Board;
c) That the Chairperson was insisting on appointing a company as a “Project Management
Unit” which could have made an existing department in the JRA redundant and had refused
in writing to allow me to raise my concerns about this with the Board.

I raised the above issues twice with both the MMC and the Municipal Manager before raising
them with the Mayor.

While the above issues may not be “prima facie” evidence of corrupt activity, they are major
red flags about governance in the JRA and the Mayor should have acted on them. I was very
disappointed that the Mayor did not tell the Board Chairperson that he may not try to involve
himself in the award of tenders, that the Board should not proceed with the appointment of
the PMU without addressing my concerns, and that the suspension of the Company
Secretary should be withdrawn.

I resigned because I felt that I could not survive in my position without the support of the
Mayor, in the light of the suspension of he Company Secretary and my refusal to proceed
with the appointment of the PMU without my concerns being addressed.

In addition to being accused of making a protected disclosure to the ant-corruption unit

without the permission of the Board, the Company Secretary was also accused of other
charges which I considered to be trumped-up and spurious. This view was vindicated when
the Board decided to pay her ten months full salary to leave, rather than to take disciplinary
action against her.