In a scathing presentation made before the Portfolio Committee of Public Enterprises today, by officials from the Auditor General’s office, the Department of Public Enterprises, under Minister Pravin Gordhan, was exposed as a crisis-ridden entity that was operating on auto pilot.
With practically no one in the cockpit, the condition of State Owned Enterprises has continued to deteriorate, performance is on a downward spiral and poor financial management has become the order of the day.
The tragedy is that the department is responsible for a number of key SOEs that have a disproportionate impact of the economy. These key entities – all except one – are in a critical state and need the attention of a qualified surgeon with a sharp scalpel at hand.
Clearly Gordhan is not the man and he must do the honorable thing and resign with immediate effect. It is no longer tenable for him to continue presiding over a department that has essentially failed to maintain strong internal controls and is unable to turn around or privatise the doddering SOEs.
Despite casting himself as an anti-corruption crusader who was going to clean up the mess created by the merchants of state capture, Gordhan has failed dismally. Major SOEs like Transnet and Eskom are teetering on the brink of collapse, and in doing so, threatening to destroy the South African economy as we know it.
The A-G’s office did not hold back on the precarious health on of the department, positing that:
- Despite the presentation of performance targets during the year, the status of SOEs has continued to deteriorate;
- The A-G was of the view that the Department’s performance target/s did not reflect execution of DPE mandate and the effectiveness thereof;
- “…we have long reported on pervasive mismanagement/ leakage of public funds without consequences.” – A-G;
- “…our audit recommendations not receiving the required attention, with little or no improvement noted in the status quo, leading to our relevance being questioned.” – A-G;
- Lack of transparency – by not reflecting activities linked to mandate;
- Weakening oversight process – as no direct recommendation and intervention can be made if status of SOCs are not reflected; and
- Public could lose confidence in financial and performance results.
If Ramaphosa was a firm President, not the weak appeaser that he is who puts party unity and pay-offs before the interests and fortunes of the country, he would have long since ensured that the minister and department responsible for these key SOEs attended to the failures with a firm hand, opening the door to the private sector where required. Better yet, Gordhan should tender his resignation as soon as he lands at OR Tambo International Airport from his trip in China, where he will no doubt be packing more statist solutions that have delivered us to this parlous place in the first instance.