House Chairperson,
Today I dedicate my speech to the Honourable Members of this Portfolio Committee on Public Enterprises.
Members who were brave enough to stand up against corruption in state-owned enterprises (SOE) and stood up to intimidation.
They spent hours working through documents requested and questioned witnesses until late in the evening at Parliament’s Public Enterprises Committee Inquiry into Eskom.
The governance of South Africa’s power utility has been undermined and repurposed to materially benefit a politically connected elite while compromising national and social development.
The committee probed breeches of laws and regulations and exposed individual acts of corruption. Where these were clear, it will recommend prosecution and forward relevant details to the national prosecution authorities.
The Department of Public Enterprises oversees six state-owned companies that play a pivotal role in providing services to our people. These six companies are the key drivers of economic growth over the short and medium term.
The DA, however, supports the partial privatisation of some of these SOEs.
The DA supported National Development Plan (NDP). The Department must strengthen its oversight capacity and implement its new strategy to improve the performance of state-owned companies in order to sustainably enhance their contribution to the implementation of the NDP.
The capital expenditure programme in state-owned companies, under the oversight of the Department, is an important policy instrument to accelerate economic growth. This has largely been driven by Eskom and Transnet.
As far as the budget is concerned, the majority of the allocation is within compensation of employees.
Spending on consultants sits at 11.5% of the budget over the medium term and that is too much.
The budget for legal services increased by 4.3% over the medium term and is acceptable to ensure compliance with the applicable legislation.
Travel and subsistence increased by 45% from R13.4 million in 2017/18 to R19.5 million over the medium term and that is far too high.
The Auditor-General (AG) report on the Annual Performance Plan of the Department Public Enterprises for 2018/19 financial year stipulates in its findings that certain indicators are not well defined and verifiable and certain targets not being specific and measurable.
SOEs are experiencing governance and financial challenges that have affected their performance and weakened their governance structures.
Chairperson,
To highlight just a few:
1. Eskom
- Corruption eroding needed cash and credibility of the institution; and
- Executive management in acting positions.
2. Transnet
- Lack of action and consequences for widely reported allegations of corruption; and
- Poor consequences management and inability to close cases against corruption.
3. South African Express Airways
- Lack of credible leadership and poor financial performance;
- Delays in the finalisation of commercial agreements with SAA that continue to erode any revenue opportunity for the airline; and
- Quality assurance and control for airplane maintenance.
4. SAFCOL
- Instability at Executive Management level; and
- Land claims not solved.
5. Denel
- Allegations of corruptions against previous board and management; and
- Liquidity challenges and ageing plant and equipment.
6. Alexkor
- Operating cash balance is depleting without a stable source of income.
- Delay in the implementation of the settlement agreement with the Richtersveld community.
Voorsitter,
Daar is ‘n uitdrukking in Afrikaans wat sê: “Nuwe besems vee skoon”.
Ek moet Minister Gordhan, komplimenteer dat sedert sy aanstelling hy al heelwat vermag het met nuwe aanstellings van raadslede wat ‘n daadwerklike bydrae kan lewer en oor kennis beskik op die onderskeie rade.
Strategiese poste op uitvoerende vlak by verskeie maatskappye is egter vakant. Die Minister, het ‘n enorme taak op hande om dit so spoedig moontlik met die mees bevoegde individue te vul