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The status of universities under administration

Briefing to the Select Committee on Education and Recreation

Department of Higher Education and Training14 August 2013

University of ZululandBackground The UniZulu appointed a new Vice Chancellor in 2009.

She found a Council and institution riddled with corruption and reported the situation to the Minister

The Minister appointed Prof Hugh Africa as an Independent Assessor (IA) to investigate

The IA report revealed serious weaknesses in governance and management of the University and gross irregularities in financial management, procurement practices and chaotic registration and admission procedures

The IA recommended that the Council be dissolved, an Administrator appointed, but that the VC remain in office

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University of ZululandAppointment of an administratorThe Minister appointed Professor Chris De Beer as Administrator at UniZulu on 18 April 2011. His term of office will expire on 17 October 2013

Terms of reference of the administratorTo take over the authority of Council and appoint a new Council, establish Council sub-committees and draft a new StatuteTo initiate processes to restore proper governance and administrationConduct forensic audits as recommend by the IA and take appropriate action against individuals implicated if identified

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University of Zululand

Progress Office of the Registrar have been restructured and

protocols revised to meet challenges of registration and certificate irregularities

Policies, procedures and delegation frameworks to facilitate staff recruitment have been developed and implemented in consultation with Senate and Institutional Forum

The Code of Ethics has been revised and employees have to declare interests (to mitigate the culture of fraud and corruption reported by the IA)

Extensive forensic investigations were undertaken which identified corrupt practices and specific individuals

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University of ZululandProgress …Appropriate disciplinary action taken against members of staff and students found guilty, including dismissals An Institutional Improvement Plan and implementation strategy developed and implementedA New Statute approved by the Minister and publishedInstitutional Rules, Policies, Procedures and Protocol associated with governance responsibilities developed, approved and are being implementedThe process to appoint a new Council has commencedRecruitment of suitably qualified candidates for senior management positions is underway; key appointments have been made

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Tshwane University of TechnologyBackground On going instability and unrest at TUT Minister appointed an Independent Assessor (IA),

Dr Vincent Maphai to investigate the root causes of the ongoing strikes and discontent

The IA found serious problems in the governance and management of the university

The Council was requested to address key issues highlighted in the IA report

The Council failed to provide the department with evidence that these were being dealt with and instead went ahead and appointed a person with a fraudulent qualification as Vice Chancellor (VC)

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Tshwane University of Technology

Appointment of an administrator Minister appointed Prof Themba Mosia on 15 August 2011.

Term of office expired on 17 November 2012. Final report submitted on 27 November 2012

Terms of reference of the Administrator Assume the authority of Council and the functions of Vice-

Chancellor Identify and restore proper governance and administration Ensure a functional Council including a review and

establishment of necessary sub-committees and drafting of a new Statute

Initiate and conclude key recommendations of the IA report, specifically the appointment of the Vice-Chancellor

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Tshwane University of Technology

Progress Key executive positions were filled, appointment of Prof N

Ogude as Vice-Chancellor on 1 August 2012 Issue of poor governance and absence of ethics was addressed

with all members of executive management, facilitated by the Ethics Institute of South Africa

Procurement and financial policies were reviewed and implemented

New Statute developed and approved by Minister on 14 June 2012

The new Council took up office on 1 December 2012 The Student Representative Council was elected with a new

Constitution TUT is stable and progressing well

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Walter Sisulu University

Background

WSU was in financial crisis unable to pay its salaries. Council requested assistance from the Minister

On 5 August 2011 the Minister appointed Prof Daniel Ncayiyana as an Independent Assessor (IA)

The IA reported an institution in crisis with the all-encompassing collapse of systems, governance and financial management. The weak administrative systems had a crippling effect on the academic enterprise

The IA recommended an Administrator be appointed to take over the governance and management of the institution

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Walter Sisulu University

Appointment of an administratorThe Minister appointed Prof Lourence Van Staden as Administrator for WSU on 27 October 2011

Terms of Reference of the administratorTake over Council and management and steer the University back to operational and financial sustainabilityAssess the impact of the mergerImplement initiatives to restore governance, operations and viable systems and processes in finance, human resources, governance, information technology, academic enterprise and student governance and administration

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Walter Sisulu University

Terms of Reference …Introduce short-term and long-term measures to reduce the institution’s bank overdraftsInitiate appointment of a new Council, establishment of necessary Council sub-committees and drafting of a new statute for the UniversityIncrease the different revenue streams of the university, including government grants, student fees and other possible revenue sourcesReview and improve the academic integrity and relevance of the university’s programmes and qualifications and if appropriate design a new academic structure

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Walter Sisulu University

Progress Financial stability has been achieved in the short term

with all creditors paid, staff salaries secured, backlogs cleared and break-even budget tabled for 2013

A consolidated PQM has been approved by the DHET A report detailing the financial challenges pre-and post-

merger was submitted to the Department WSU has no bank overdrafts. This goal was achieved

during the first year of the Administration period Numerous forensic audits have been conducted and

concluded with some resulting in disciplinary action taken and dismissals effected

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Walter Sisulu University

Progress …A turnaround strategy, Turnaround Framework and Institutional Strategic Goals and Objectives (2012/13 – 2013/14 , submitted to DepartmentFeasibility study submitted in April 2013 motivating for a R3.150 million injection to fund the turnaround frameworkA new University Statute has been developed and submitted to the Minister for approval. This will pave the way for a new Council to be establishedA governance model suitable for a comprehensive, multi-campus university has been conceptualised and is embedded in the proposed new Statute

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Walter Sisulu UniversityProgress …Academic programme is still a work in progress. A consolidated PQM has been approved by DepartmentGuidelines on the harmonisation of conditions of service are being finalised with labour unionsThe first legitimate SRC elections in two years were successfully held in 2012 following the implementation of a new SRC ConstitutionAdministration has been supported by the Department and significant funds have already been providedAdministrator faces major challenges on a daily basis. A change in the institutional culture is required for long term sustainability

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Vaal University of Technology

Background Persistent problems relating to opposing factions within

the university, administration, governance and management were identified

Allegations and counter allegations about the Council and Management were reported to the Department

The Minister appointed Adv Muzi Shikhakhane as Independent Assessor (IA) on 10 February 2012 to investigate and recommend appropriate action

The IA found that the Council has failed and was unable to provide strategic leadership. The Statute was not effective and must be replaced to ensure that the Council is properly constituted to lead a University

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Vaal University of Technology

Appointment of an AdministratorThe Minister appointed Prof Patrick Fitzgerald as Administrator on 17 July 2012

Terms of reference of the AdministratorTake over the authority of Council, appoint a new Council, establish Council sub-committees and draft a new StatuteIdentify/initiate processes to restore proper governance and administrationConduct forensic audits as recommended by the IA recommendations and to take appropriate action against individuals implicated if identified

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Vaal University of Technology

Terms of reference … Conduct a detailed analysis on human resource policies

and identify regulations, practices to improve employment relations

Establish a full complement of executive managers, including a review of the contract of the VC

Initiate an independent forensic audit to investigate procurement, management of student residences, tenders, including the appointment of MPL (Ltd)

Review the terms of reference of the Finance and Audit Committee to assess strength of risk management and internal control

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Vaal University of TechnologyProgress University is well-managed financially and financial situation

is very good Clean audits continue to be achieved Requisite risk registers have been developed Restructuring and change management process in respect of

HR and Employment Relations (ER) implemented and have resulted in improved HR and ER practice and culture

Forensic audits were conducted and revealed no major abuses in procurement and tender processes. However, a review of procurement policies and procedures has been done and improvements made

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Vaal University of Technology

Progress VC found guilty of misconduct for failing to adhere to

proper procurement processes; under final warning following disciplinary hearing

A new Statute was promulgated in April 2013 and a new Council appointed. Council convened on 19 July 2013

Administrator reviewed the contract of the VC. The process for appointing a new VC, whose term comes to an end soon, will be carried out by the new Council

A review and re-organisation of executive structure and portfolio was initiated due to expansion in terms of student numbers and programmes offered

The term of office of the Administrator came to an end on 31 July 2013

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Central University of Technology

Background Allegations of corruption and abuse of power at CUT were

received by the Minister in January 2011 The Council of CUT was requested to investigate and to

report back to the Minister Council repeatedly failed to provide a response and a

report while on-going allegations of abuse continued On 24 February 2012 the Minister appointed Prof Julian

Smith as an Independent Assessor (IA) The IA report was published on the 11 May 2012,

recommending that the Minister appoint an Administrator to take over the governance of the institution

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Central University of Technology

Appointment of an AdministratorThe Minister considered the findings of the IA together with the formal response on the IA report from the CUT Council which called for the Minister to reject the findings of the IA and made a decision to appoint an Administrator at CUT The Minister appointed Professor Stanley Ridge as Administrator on 20 June, 2012The CUT locked the Administrator out when he attempted to take up office, and CUT indicated they would contest the appointment in courtThe Minister indicated he would also file a case

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Central University of Technology

Legal action On 4 July the Minister issued a legal application and sought relief from the high court that:

his decision to appoint an Administrator was lawful and valid

that once the Administrator was appointed, the Council had no legal standing and ceased to hold any authority, powers functions and duties associated with the university

that the CUT acted unlawfully by disallowing the Administrator to assume and discharge his duties

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Legal action … On the same day, i.e. 4 July 2012, the CUT issued their application

to review and set aside proceedings of the Minister’s decision to place CUT under administration, in terms of section 41A of the Higher Education and Training Act 101 of 1997

The two cases were heard simultaneously on

19 and 20 July 2012, by agreement between the Senior Councils of CUT and the MinisterJudge Daffau made his judgement on 13 August 2012

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Central University of Technology

Central University of Technology

The judgement The Minister had the right to appoint an administrator to take over the functions of Council and managementIn doing so, the Minister did not have the right to dissolve the Council, and therefore Council had the right to bring a case against the MinisterThe Minister acted fairly in terms of the Promotion of Administrative Justice Act (PAJA)The Minister did not sufficiently apply his mind to all the facts, specifically the information provided by the Council in response to the IA Report, and therefore did not act Lawfully in appointing the Administrator

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Central University of Technology

The current situationThe Minister was granted leave to appeal by the Supreme Court of Appeal on 21 September 2012Following legal advice received from Senior Counsel for the Department, the Minister has withdrawn his appeal against the judgment in light of the enactment of the Higher Education and Training Laws Amendment Act, No. 23 of 2012None of the matters which gave rise to the Minister’s decision to appoint the Administrator have been resolvedThe Minister requested a copy of the CUTs independent investigation and will respond in due course

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Thank You