Transnet on Monday confirmed that Siyabonga Gama has been fired as the freight rail operator's chief executive officer and said it was in line with a government drive to turn around State-owned entities. 

Transnet said it informed Gama of its decision on Sunday and Monday would be his last working day, noting that he had failed to meet the deadline to submit reasons why his contract should not be terminated. He will be paid his salary for six months, instead of serving a notice period.

“You failed to make representations by the expiry of the time for making representations on 15 October 2018 or thereafter,” the board quoted from its letter to Gama sent on Sunday.

“As a result of your failure to make representation, the board has resolved to terminate your appointment as group chief executive on six months’ notice. You are not required to work out your notice period and will be paid six months’ remuneration in lieu of notice.”

The Transnet board said the decision brought to an end a long dispute over a breakdown in trust between itself and Gama.

The board served notice of its intention to fire him after he was implicated in misconduct and maladministration relating to Transnet's R54-billion contract to procure locomotives from China South Rail and China North Rail some six years ago.

Gama approached the labour court to try to interdict Transnet from firing him.

The court last week ordered that the case be referred to arbitration but the board said this in itself did not stop it from taking a decision based on Gama's failure to submit reasons why he should not be dismissed.

Board chairperson Popo Molefe said: “As a board, it is essential that the relationship between the board and the head of its management team is based on trust and confidence. 

“We value and require transparency, accountability and expenditure that is cost-effective and value for money. But we have found Mr Gama’s conduct – particularly during the investigation into the tender for new locomotives, with an inexplicable increase in excess of R9-billion in costs – to be incompatible with that culture."

He added that the decision to part ways with Gama was in line with a directive by President Cyril Ramaphosa to stabilise State-owned companies.

“We have acted in accordance with the President’s directive, as well as in line with Public Enterprise Minister Pravin Gordhan’s call for sound financial and business management at state-owned companies, coupled with good governance."