DA calls for immediate dissolution of failing Centlec Board

Issued by Eddie Rasoeu – DA Mangaung Metropolitan Municipality Councillor
21 Sep 2022 in Press Statements

The DA, Mangaung Metropolitan Municipality on 19 September 2022, submitted a motion for the Board of Centlec (SOC) Ltd to be dissolved with immediate effect. On 1 June 2022, four Non-Executive Directors resigned from the Board, leaving only two Non-Executive Directors and two Executive Directors.

The non-functioning board, mismanagement, cadre deployment and corruption have left Centlec a dysfunctional mess as it is incapable of serving its 186,858 customers. The communities of Mangaung, Kopanong, and Mohokare have badly been affected as electricity supply, maintenance and infrastructure by the distributor have become unreliable. In addition to load-shedding, residents have to struggle with an electricity distributor that can’t service its customers.

According to practised law and managerial policy, the ‘Board’ does not exist. As such, whatever structure or formation within Centlec that currently functions as the ‘Board’ doesn’t have the power or the authority to convene meetings, and cannot take binding effectual resolutions on behalf of Centlec. Should it continue to convene meetings and take decisions, such actions and decisions shall be unlawful and/or nullities by law.

The state of affairs exposes the company, its shareholder, directors and officers to liabilities and risks because all public power must be exercised in tandem with the Constitution and all applicable subordinate legislation. Specifically by the doctrine of legality that binds all arms of government and legal persons to constraints in exercising power and performing functions only to the extent of the law. The board can only exercise its powers if properly constituted.

The Mangaung Metro is the sole shareholder of Centlec and is therefore obligated to intervene and ensure that the “governance structure” of Centlec is restored. Having carefully demonstrated that the current ‘Board’ is NOT properly constituted, this motion, therefore submits that the current Board MUST be dissolved and a new board be constituted. The DA will defend the rule of law and ensure there is good corporate governance within state-owned enterprises.