Hansard: NA: Mini-plenary 3
House: National Assembly
Date of Meeting: 20 May 2022
Summary
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Minutes
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MINI PLENARY - NATIONAL ASSEMBLY
FRIDAY, 20 MAY 2022
VOTE NO 10 – PUBLIC ENTERPRISES
Watch: Mini-Plenary
PROCEEDINGS OF MINIPLENARY SESSION – NATIONAL ASSEMBLY CHAMBER
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Members of the mini-plenary session met on the virtual platform at 10:00.
The Acting Chairperson Ms R M M Lesoma took the Chair and requested members to observe a moment of silence for prayer or meditation.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon members, before we proceed I would like to remind you that the virtual mini- plenary is deemed to be in the precinct of Parliament and constitutes a meeting of the National Assembly for debating purposes only. In addition to the Rules of virtual sittings the Rules of the National Assembly including the Rules of debate shall apply. Members enjoy the same powers and privileges that apply in a sitting of the National Assembly.
Members should equally note that anything said in the virtual platform is deemed to have been said to the House and maybe ruled upon. All members who have logged in shall be considered to be present and are requested to mute their microphones and only unmute when they are recognised to speak. This is because
the mics are very sensitive and will pick up noise which might disturb the attention of other members. When recognised to speak, please unmute your microphone and connect your video. Members may make use of the icon on the bar at the bottom of their screens which has an option that allows a member to put up his or her to raise points of order. The secretary will assist or alert the Chairperson to members requesting to speak.
W
hen using the virtual system, members are urged to refrain or desist from raising unnecessary points of order or interjections.
Hon members, let me deal with the confusions which seem to have occurred. I noticed that the final speakers’ list indicates 9:00, but the programme that has been circulated to members and the link indicate 10:00 hence the platform was opened at 9:30. With that, there was no confusion from my side or the front Table. The mini-plenaries start at 10:00. Now we proceed to the Order of the day, Debate on Vote No 10 – Public Enterprises, Appropriation Bill.
Mr W FABER: Chairperson, it’s hon Faber.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Is it a point of order? Yes, I can hear you, proceed.
Mr W FABER: Chairperson, I just want to bring to your notice that today is the hon Mr F Essack’s maiden speech in the
National Assembly. Although he was a member of the NCOP he returned to the National Assembly and I just want you to, maybe, welcome him and that they respect him on his maiden speech in the National Assembly today. Thank you, Chair.
The ACTING CHAIRPERSON (Ms R M M Lesoma): That point is noted.
Allow me, hon members, to proceed. I now recognise the hon the Minister of Public Enterprises to present the Appropriations Bill. Over to you, sir!
APPROPRIATION BILL
VOTE NO 10 – PUBLIC ENTERPRISES
Debate on Vote No 10 – Public Enterprises:
The MINISTER OF PUBLIC ENTERPRISES: Chairperson, hon members, chairpersons, CEOs, employees of state-owned enterprises, SOEs, ladies, gentlemen and the public that might be listening, I have the honour today to present the Budget Vote for the Department of Public Enterprises for the 2022-23
financial year. We do so in a complex economic, social and political world in which geopolitical tensions and war prevail and have resulted in the shocking rise in energy prices as well as a rise in food prices and other costs of living. Huge economic stresses have emerged in many parts of the globe,
rising inflation, increasing interest rates, risk of stagflation and even recession in certain countries. There is a battle between a multilateral and multipolar vision of the global order and this has been contested by a unilateral and unipolar vision and actions that pursue this vision.
The impact of the COVID-19 pandemic as led to a reordering of the productive capacity and its location as well as the disruption of global supply chains which are impacting people throughout the world. The impact of climate change has hastened global efforts to transition to a net zero carbon resilient economy that is just and fair. Gross inequality in most parts of the world is matched only by the extraordinary greed and rapaciousness of elites across the world. Fake news, bots, populist narratives and bullying now seek to intimidate and mislead desperate people into wrong political choices.
These factors greatly impact South Africa, its economy and its people. This compounds the many challenges we have in South Africa which we are all familiar with, namely, unemployment, low growth, erratic investment, poverty and inequality. We have to all of these challenges confront and to overcome. But this has been compounded further by the heartrending tragedies in the recent past, namely, the state capture, the July unrests, the pandemic, floods earlier this year in KwaZulu- Natal and now the impact of war elsewhere in the world. In all of these, ours is the responsibility to ensure progress,
redress, recovery from the damage caused and unite the progressive forces and people in a joint effort to rebuild, recover and reinvent SOEs. This is central to the economic reconstruction and recovery plan of government. The Department of Public Enterprises has the mandate to oversee this process in some of the important SOEs. We must therefore seize the many opportunities we have and overcome
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the challenges left to us by our past, firstly, by enhance the
governance and integrity amongst SOEs and not only at the
level of the board, but also at the level of the staff;
introduce a new ownership model with the guidance of the
Presidential State-Owned Companies, SOC, Council; implement
the structural reforms needed in the network industries that
working is working hard at; to take account of and implement
the recommendations of the Zondo Commission; relentlessly
focus on operational improvements and efficiency in all of our
SOEs; reinvent the business models of the SOEs and their
strategies to take account of some of the global developments
that I have referred to; constantly build the professionalism
and competence of managers and staff; co-operate with workers
to lead and embrace the substantial changes that are required
in the SOEs; needed to ensure the sustainability of SOEs;
encourage public–private partnerships that mobilise the
necessary resources and skills to advance the SOE programs;
and above all we need to combat corruption, disruption and
indeed sabotage whether from the SOEs or from the
counterrevolutionary quarters and criminals outside SOEs.
Chairperson, I was informed by the management of Eskom this
morning that yet another incident has taken place at the
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Hendrina Power Station where an important cable which is
required to start a unit that was undergoing repairs and to
get synchronised to the rest of the system, was cut. These
flexible copper bars which are required to synchronise this
unit to the rest of the power infrastructure was stolen next
to the generator and the reactor earth bars, as they are
called, were also stolen by, obviously, people working within
the power station. These are what engineers call single points
of failure. In other words, if there is a problem with these
bars and cables you cannot connect this unite which is ready
for connection and to supply power to the grid. These are
amongst other revelations that have occurred over the past few
days, namely, the corruption with the supply of oil and the
cable that was cut at another power station a few days ago.
These are all directly related to the load shedding that we
have experienced today over and above other operational
issues. I thought it is important that the hon members and the
public are aware of some of the challenges that we face –
something that I will return to.
These are all matters that impact ultimately on every single
person amongst the 60 million South Africans. The acts of the
greedy, the corrupt, the bully and the counterrevolutionary
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set back our progress as a democracy and stop us from becoming
a caring nation. While they sit back to enjoy their spoils,
the damage they cause is borne by our communities, by workers,
by small businesses, by the unemployed and the youth. Now is
the time for all of us to join the ranks of those who want to
build a better future and better institutions and not just
point fingers among ourselves. Now is the time to care for the
hungry, the marginalised and those in despair. Nothing can
destroy the might as we have learnt throughout our history of
an organised people driven by a clear vision and who take
their destiny into their own hands and change the course of
history. Ours is a task to build partnerships with communities
who are directly affected by the many changes that are
happening both in South Africa, generally, across the world
and in particular in a way in which our SOEs work.
We also need an important contract and constrictive
partnerships with workers who have an opportunity to be
partners in the process of transforming SOEs and to protect
the infrastructure that currently is facing all source of
challenges from the various forces. We also need partnerships
with the private sector which will take various forms from
joint investments with the private sector to solving
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challenges and problems at the day-to-day level and to
proactively collaborate.
In respect of the latter, Minister Patel and I have agreed
that in view of energy and logistic issues being vital to the
success of our industrialisation efforts, we will launch a
forum in which industrialists in key sectors together with
Eskom, Transnet and other entities will enhance collaboration,
advance planning and problem-solving. This will enable a
better climate for investment and job creation. We are both
making this announcement in our respective budget votes which
are taking place at the same time today.
Chairperson, Judge Zondo finds that the evidence presented to
him revealed that there was systemic corruption that collapsed
governance in these SOEs, and was led by certain board members
and senior executives. These people, he said, must be held to
account. His report has to date confirmed that state capture
tentacles were deeply rooted in Transnet, Eskom, Denel, SA
Airways, SAA and unfortunately, in the Department of Public
Enterprises as well. The department has moved swiftly since
2018 to ensure that SOES reporting to it open criminal cases
with the law enforcement authorities pursue civil recoveries
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to claw back billions of rands, refer cases to the registrar
of companies so that former directors of SOEs found guilty are
prohibited from ever again serving as company directors,
blacklist companies on the central supplier database to
prevent them from accessing state procurement opportunities
and refer cases to professional bodies for enquiries to ensure
that perpetrators and collaborators of state capture such as
auditors, accountants, lawyers and others, are prohibited from
practicing in their respective professions.
We must do these things so that the people responsible can be
made accountable - that is what the public demands - and so
that we never again allow our institutions to be destroyed.
We must collectively applaud the bravery of whistle-blowers
who put their lives at risk and continue to do so today to
expose the rot of state capture and criminality. They must be
protected and their courage must be celebrated.
Our mandate is to ensure that some of the plans in this
financial year must be implemented in this financial year by
SOEs. In respect to Eskom, I have already referred to some of
the challenges that it faces. But clearly Eskom generation is
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underperforming with the energy availability factor
languishing at 58% to date, as opposed to the target of 75%.
The reasons for the poor performance are well known and are
getting urgent attention. Eskom is taking urgent steps to
improve the performance of generation. An operations
excellence initiative is also in place in order to identify
the major causes of underperformance and to make improvements.
At selected power stations war rooms will be set up in the
next few weeks to ensure that production challenges get
tackled in a systematic way.
In addition to this, a skills mentoring programme using highly
experienced power station managers has been launched. This
team will be deployed to power stations where load losses are
particularly severe.
There is clearly a neglect in relation to maintenance in the
Eskom’s past. This past neglect of maintenance is not easily
overcome. Contractors are going to be held accountable from
this point on for direct improvement in the energy
availability factor as a result of the work undertaken, and
not just paid because they have done some piece of work which
are often turn up to be shoddy. There need to be an upgrading
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of skills and training of senior managers, senior engineers
and operators. A lack of engineering and technical skills and
experience in Eskom remains a significant challenge. These are
prerequisites for a major industrial operation like Eskom.
Eskom has introduced a new training programme at its academy
of learning to upgrade the skills of these people.
Lack of generation capacity is also a constraint that has been
publicly articulated. Eskom estimates, as we have said before,
that 4–6GW of 4 000 to 6 000 of additional capacity is
immediately required in order to allow for proper maintain of
power stations. Government has issued bid windows 5 and 6 and
will be moving on to 7 - as my colleagues has announced - in
order to ensure that an affective 3 000MW is added to the
grid. However, this might not be adequate on its own rights.
The President’s announcement of the lifting of licensing
restrictions on own generation to 100MW will undoubtedly
assist the position. However, red tape is holding up the
development in these projects and we need to appeal to the
National Energy Regulator of South Africa, Nersa, to speed up
the processes of approval and cut red tape.
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Recently, Eskom has opened up its own land around power
stations in Mpumalanga for long-term leases to renewable
energy developers which will see investments in these areas
before the end of the year.
The poor quality of coal is another factor that is seriously
damaging power station plants. This is caused by syndicates
that deliver coal from the mines to power stations mixing this
coal with metals, rubbles and other rubbish which ultimately
cause huge damage to bottles tubes and many other parts of the
Eskom machine at the power station machinery. Eskom is seeking
collaboration with the coal mining industry to solve this
problem and this require their early attention. I have
indicated that sabotage continues to be a problem. There are
more and more examples that are emerging and clear evidence
that this is an issue that the whole of the state need to get
involved in and address.
Corrupt procurements, although has been set back a bit,
continue in many sectors of Eskom as well. There is more than
adequate proof that something apart that it might cost R100 or
R100 00 eventually get bought for R1 million and the rest of
the money is shared across the value chain of beneficiaries
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who enables this kind of corruption to continue. Measures are
being taken to identify the insiders who are enabling
syndicates to gain access to the procurement opportunities,
and who are involved in essentially defrauding Eskom. Measures
are also being taken to eliminate overpricing and other
malpractices
Eskom has made remarkable progress in terms of financial
stabilisation and has been able to achieve significance
improvements in its earnings before interest, taxes,
depreciation, and amortisation, Ebitda, for the 2022 financial
year with early indications prior to audit confirming this
showing an improvement of over 85% compared to the 2021
results. Eskom has also achieved savings of R50 billion since
inception of the savings program in the 2019-20 financial
year. A further reduction in debt to R396 billion has also
been achieved.
The structuring process in Eskom and the separation of the
transmission is moving at a pace and a transmission company
has already been set up. A just energy transition process has
been more than adequately prepared for. All that is being
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awaited at this point in time is the finances to enable Eskom
to move in this direction.
Transnet is another important entity that affects the network
of logistics in this country and the supply chain that must
operate efficiently in our country. Transnet is driving a
portfolio of initiatives intended to address challenges to
competitiveness of South Africa’s value chains. The Ports
Authority plans to improve operations by refurbishing tag and
pilot boats, acquiring a new helicopter for private services
and 12 new tons for the port system. Transnet port terminals
will focus on three aspects, namely, people, port equipments
and processes to reach the desired port efficiencies. Transnet
pipelines is combatting the issue of pipeline tapping or
stealing of fuel from the pipeline. This is a huge detrimental
factor equivalent to the cable theft that is occurring in many
of our SOEs. Tapping has also become a serious environmental
issue and requires affected areas to be rehabilitated as a
consequence.
Transnet is implementing the following policy objectives,
namely, approved branch line concessions are now fully
operational for concessioning; recently announced the slots
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sales on the container and Cape Corridor for private sector
participation has been activated; procurement of port
equipment, as I indicated earlier, is taking place;
corporatisation of the Ports Authority has been accomplished;
and the road to rai migration strategy will increasingly take
effect as rail infrastructure, particularly the post-KwaZulu-
Natal floods are resolved. There are specific sectors of our
industry that are receiving the necessary attention and
support from Transnet. The automotive industry, for example,
the development of a prefeasibility business case and the
request for information, RFI, for the Kaalfontein area and the
three auto port terminals are in progress.
As far as manganese is concerned a decision was taken to limit
the expansion via the Port of Ngqura and the Port of Saldanha
to increase their capacity.
Regarding energy, the Richards Bay natural gas import terminal
initiative RFI was closed on 14 April 2022, with an extension
of one month as per request from certain participants.
Private sector participation is also being pursued by Transnet
so that these partners can be brought in in respect of the
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development of the Pier 2 at the Durban Container Terminal and
the Ngqura Container Terminal as well.
Transnet’s financial performance will improve from the
previous year as a result of recovery from the COVID-19
pandemic and in the near future there should be a solid
financial sustainability within Transnet itself.
Much has been said about the SA Airways, SAA, and the sale of
the 51% of its shares to the Takatso Consortium. Let me assure
the public and hon members that there has been absolute
transparency in this process. All the necessary legal
processes were compiled with. Notwithstanding regulative
efforts by many to sabotage or undermine what is an important
project in terms of recovering an SOE from the damage that was
caused by the state capture. The airline has begun to operate
from September 2021 and there are various routes for domestic
and across the African continent that have been pursued. There
are few regulatory processes that need to be concluded before
an injection of R3 billions of working capital by the
strategic equity partner takes place and the state is able to
consolidate its golden share.
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As President Ramaphosa said SOEs play a vital role in our
economy. He indicated in the 2022 state of the nation address
that the Presidential SOE Council, which I appointed in 2020,
has recommended that government adopts a centralised
shareholder model for its commercial state-owned companies.
This would separate the state’s ownership functions from its
policy-making and regulatory functions, minimise the scope for
political interference, introduce greater professionalism and
manage state assets in a way that protects shareholder value.
Much progress has been made in this particular regard. A
shareholder Bill will be introduced after Cabinet’s approval.
The necessary legal documents for the establishment of the
holding company are in progress and the necessary
consultations will be concluded.
There is also further work that is being done in this council
in respect of the consolidation of SOEs and helping to manage
those that find themselves in crisis. The state-owned
enterprises have also significantly contributed to economic
transformation through the training of internshps to an extent
of 2 715 trainees, 1 600 artisans have been trained and a
total of 387 students have been supported with bursaries. A
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number of designated groups have been the beneficiaries of
billions of rands in expenditure in this regard.
As I conclude, Chairperson, the programme of the department is
supported by an allocation of R23,9 billion. This is not for
the department because much of that money is transfers to
Eskom in particular. Of this funds payment financial assets
account for 98% of that expenditure. Compensation of the
employees in the department is the largest expenditure item
because we need to get in as much as expertise as is possible.
In conclusion, I wish to re-emphasise that rebuilding a broken
institution takes time. There is no silver bullet. It requires
courage, bold leadership and single-minded determination.
Reinventing strategy in the process of rebuilding requires a
clear vision, a recognition of market and community
volatility, new technology developments and awareness of the
competitive environment which must be accompanied by astute
change management strategies. The institutions we work with
are vital to the recovery and reconstruction of our economy,
as well as the wellbeing of millions of our people. This must
be a united effort which advances the good and defends against
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the vile and corrupt intent of counterrevolutionaries and
criminals.
We must extend our support to the leadership of SOEs, the tens
of thousands of honest staff and the members of the boards who
provide a national service in many instances. I invite all of
us, regardless of affiliation, to join in this national
effort. Surely, most of us want to rid South Africa of
corruption wherever it might be. Surely, we want to rid South
Africa of inequality and poverty, and we want to be part of
creating hope, jobs and skills for our youth and future
generations.
Finally, I want to thank the Deputy Minister, my chief of
staff, the Ministry, the director-general, D G, and the
department for their immerse efforts that they put in with
very limited resources to guide SOEs and maintain the
oversight that is required.
As President Ramaphosa said, and I quote:
Now, we must do so again. Let us forge a new consensus to
confront a new reality, a consensus that unites us behind
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our shared determination to reform our economy and rebuild
our institutions. Let us get to work. Let us rebuild our
country. And let us leave no one behind.
Thank you, Chairperson
Mr K E MAGAXA: Chairperson of the House, hon members of the
House, greetings to you all, the Budget Vote 10 debate comes
at a time when the national discourse in South Africa is
dominated by the received wisdom that the recent unbundling of
Eskom and the reforms to the barriers in the market and
economic activities previously dominated by the state-owned
enterprises, SOEs, to crowd in the private sector any signs of
rank capture by leading and middleman politicians who want to
privatise SOEs and subsequently earn monopoly profit or for
private gain. What separates the received wisdom from our
contention, however, is not so much a different view of the
fact but a different interpretation framework. Our contention
is that the management styles of SOEs are not static and,
therefore, they should be adaptive to the prevailing economic
best practices as smoothly as possible.
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In the earliest stages, the management styles within the SOEs
resemble those of the parastatal sector but over the past 10
years, SOEs have come to be managed with a much stronger
commitment, at least nominally to compliance developments in
global corporate governance, especially the key codes of
corporate governance. Although some degree of technical
compliance with key codes, the recommendations were enforced.
The state-owned enterprises could not be carefully from the
incoming political storms of state capture as some of them
were staffed with politically obedient technocrats with little
or no business experience and, therefore, were not efficient.
Today, the management of SOEs are oriented toward creating
businesses that are attractive partners for domestic and
international investors.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon Magaxa, may I
just disturb you. Just mind your hands, they are being shown
as being bigger than your face on the screen. Okay. Thank you.
Mr K E MAGAXA: Not just the large players in domestic terms
supported by the government primarily for their social
benefit, at the exclusion of prospects of moderate or high
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profit. As a result, what emerges as most significant
regarding the new management style is the willingness of the
state-owned companies, SOCs, to use their political leverage
to attract investments with high expected social benefits and
positive economic externalities, including those associated
with venture capitalism. Moreover, the new management styles
have been spectacularly successful by insulating SOCs from the
anti-corporate mentality and disregard for the rule of law
which was prevalent across the most strategic SOCs during the
heydays of state capture.
Through the work of the Presidential State-Owned Enterprises
Council, whose operation is covered by the reprioritised
allocation of R17,5 million in Budget Vote 10. In the current
financial year, SOCs have shown commitment to private
partnerships with the best private partners available in the
market. However, we have to be tough-minded about the terms
and conditions of private partnerships as evidence illustrates
that some SOCs may benefit from being led from the front and
vice versa depending on their operational and financial
performances. Take, for instance, the case of SA Airways, SAA,
SAA was trading recklessly and without the financial support
from the government, as well as the refusal of the banks to
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lend to SAA, as the government could no longer guarantee any
debt.
The airline found itself unable to continue to operate and
honour its obligations to the suppliers. Acutely aware of the
complexity of SAA and the paucity of the operation, the
decision was to commence with the business rescue plan in the
hopes of a radical restructuring of the airline to make it
attractive for a strategic equity partner. Of course, the
opposition parties are suspicious of the strategic equity
partnership between SAA and the Takatso Consortium.
But this practice is common in African countries like Rwanda,
where the Rwandan Patriotic Front’s investment arm named Tri-
Star sold its majority control in MTN Rwanda to MTN
International, as well as Angola, where the national oil
company ventured into a partnership with the international oil
companies in oil exploration and production through joint
ventures and production sharing agreements.
More importantly, the terms of the strategic equity partner
are such that the government assumes a minority stake in SAA
partly due to the airline’s non-profitability operation since
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2011, partly due to its unsustainable core structure.
Furthermore, the National Treasury has made it clear that it
will halt the SOCs bailouts as its intended goal is to reduce
the ratio of debt to GDP over the Medium-Term Expenditure
Framework. The government adopted a relatively active stance
in the partnership in at least three areas; first, the
consortium cannot sell the airline without the consent of the
government; second, the government will have full veto rights
on matters of national interest; and third, the name SAA as a
brand will belong to the government. It is worth noting that
the success of the strategic equity partner hinges on the
settlement of SAA’s legacy debt. That is the reason that
Budget Vote 10 allocates R1,8 billion in the current financial
year as part of its business rescue plan, and intended not to
burden the new airline with legacy debt.
Interestingly, the Department of Public Enterprises will
develop a framework for the shareholder oversight model for
SOCs with a minority government shareholding in the current
financial year to ensure, amongst other things, that the
profit-making objectives of the consortium complement the
social objectives of the government. In the 2020 state of the
nation address, President Ramaphosa expressed the government’s
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efforts to repurpose and rationalise the state-owned
enterprises to support growth and development. Moreover, the
Economic Reconstruction and Recovery Plan released established
priority interventions including aggressive infrastructure
development and improving the capabilities of the state-owned
enterprises, in particular, there is a strong interest on the
side of the government in the option of bringing private-
sector discipline into strategic state-owned enterprises. In
the current financial year, Budget Vote 10 allocated funds to
enable the Department of Public Enterprises to develop
business plans as well as establish their restructuring unit
to ensure that the government’s efforts to repurpose the
state-owned enterprises and the Economic Reconstruction and
Recovery Plan’s priority interventions take precedence.
Establishing the restructuring unit will effectively and
advantageously assist in developing and implementing new
business models for Alexkor and Denel, to ensure that business
efficiency, as well as the meeting of both strategic economic
and social objectives, take precedent. The Department of
Public Enterprises’ interest, exemplified by the commitment to
establish their restructuring unit, is a need to restore Denel
to something approaching its previous status of having
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financial means and the technical know-how at its disposal
that no other defence equipment manufacturer can revive. The
interest is also geared towards improving Alexkor hard by
gaining a bargaining competence in joint ventures with private
partners in which for the first time a state-owned diamond
company to capture large diamond revenues to promote national
development.
Bringing private sector discipline will help SOCs to extend
their mandates further. For instance, Transnet intends to sell
slots to private operators to improve the capacity of the rail
network and ports, especially in strategic sectors linked to
the nine commodities that contribute 80% of its revenue and
42,2% of the total GDP. In ending, the ANC supports Budget
Vote 10. The portfolio committee will continue monitoring the
progress made by the Department of Public Enterprises in terms
of the observations and recommendations shared regarding
Budget Vote 10. I thank you.
Mr G K Y CHACHALIA: Chairperson, this department is tasked
with the vital responsibility of providing shareholder
oversight and leadership to a number of state-owned
enterprises, SOEs. Through every successive term of government
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this Department has produced strategic plan after strategic
plan to oversee funding and ensure that the SOEs are both
sustainable and delivering on government’s developmental
objectives. The core role of SOEs is to provide a strategic
network infrastructure to primarily ensure the security of
logistics and energy.
Contributions and impacts of SOEs such as Transnet and Eskom
were highlighted as these companies were envisaged to grow the
economy over a long-term period. The sad reality is that this
Department has overseen, over time and at eye-wateringly
increased cost, a scenario that is best described as abject
failure. It has failed miserably, at great cost to the economy
and as the Zondo Commission attests to the moral fabric of our
society. It failed then. It is failing now. Not only has this
abject failure, underscored by theft on an industrial scale,
purposeful ineptitude, cronyism, cadre deployment and more,
brought our country to the very edge of the cliff, it has
failed even on the deliverance of government’s own
developmental objectives.
The theory of the developmental state by Harding Strong, is
characterised by having strong state intervention, as well as
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extensive regulation and planning to invest and mobilise the
majority of capital into the most promising industrial sector
that will have the maximum spill-over effect for the society.
That’s the theory anyway, control, control, control. But to
what effect though. The idea is to intervene in the market
system, by granting of subsidies to improve competitiveness.
This involved controlling the exchange rate, wage levels and
manipulation of inflation to lower production cost for
industries that caused economic growth.
The arguments for and against the developmental state aside,
the variant being practiced in South Africa is at odds with
the style known worldwide in general, and in South East Asia,
in particular, which was so effective in lifting millions out
of poverty and unemployment in those geographies. In South
Africa, however, it has not made any positive difference,
instead it has been a net drain on the fiscus with scant
contribution to the provision of public goods, sustainable
jobs and industries.
As the lights flicker towards a beckoning darkness in Eskom,
the once proud ports falter, our rail infrastructure literally
rots, our airlines limp from failure to vain hope, Denel is
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all but dead, Alexkor, a potentially profitable diamond mine
in an industry that remains important, especially, for local
employment and community upliftment, is witness to the children
of the Richtersveld eating sand on river banks; and Safcol
posts a R45 million loss while competitors show rising
profits.
There you have it. A plethora of PowerPoint plans
notwithstanding, more than R300 billion has been used to bail
out failing State-owned enterprises, leading to a current
reduction of R257 billion in public funds available for
frontline services and infrastructure. The Minister of Finance
says state-owned enterprises must develop, and implement
sustainable turnaround plans and their future is under
consideration by the Presidential State-Owned Enterprises
Council, PSEC. This council like others before it, will now
assess the value they create and whether they can be run as
sustainable entities without bailouts from the fiscus. Some of
them will be retained, while others will be rationalised or
consolidated.
The problem, however, lies with the millstones that will be
retained and reinvented, rebuilt and recovered, as the
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Minister put it. For rationalising and consolidation, read the
same old time-dishonoured efforts that have brought us to this
parlous place and cross-reference these to every successive
plan going back well over a decade and you will be able to
plot the trajectory of failure, successive misadventures
leading to non-performance of this department, of this
government, of its policies, of its ineptitude, of its
destruction of the spine and arteries, of the barely beating
heart of our economy. This is why we will not support this
Vote.
This rubberstamping of imprudence, this un-adapted, ill-
thought through, habitually flawed set of reports. And in case
you’re wondering; a rubber stamp, as a political metaphor, is
a person or institution with considerable de jure power but
little de facto power, one that rarely or never disagrees with
more powerful masters and organisations. Well, if the shoe
fits ... More than fitting, it suits the Minister, it suits
the Cabinet, it suits the SOE council and it suits the bottom
feeders that are wittingly or and unwinkingly dragging our
economy into the depths of darkness on the back of a train
headed for disaster.
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It’s as if the warning lights, flashing red in the face those
who are tasked with avoidance of a catastrophe are drunk on
their own drink and are of little consequence, because any
meaningful overhaul will upset the proverbial applecart. Every
plea, every suggestion, every demand from the DA to
acknowledge failure and to do things differently falls on
wilfully deaf ears while masterplans forged in the folly-fed
crucible of state-controlled inanity continue to deliver
disaster, so much so that we have called for a state of
disaster to be declared around Eskom. As the cover story of
this week’s Financial Mail says:
We all know the impact that Eskom has had on destroying
South Africa’s economic growth, but Transnet’s abject
failures have been equally corrosive.
It’s not just the media that has awoken to this, experts in
the field and in academia rail on about it of late. But does
the department, it’s Minister and the Cabinet see the dimming
lights of Eskom, the dead end of Transnet’s arteries, the
inability of Denel to assist any readiness ...
[Interjections.]
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Ms J TSHABALALA: Chair, I have raised my hand from the podium,
it’s Judith Tshabalala.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon Chachalia, one
minute. Hon Judith, you are recognised. I didn’t see that.
Ms J TSHABALALA: Thank you so much, House Chair. House Chair,
I want to ask if the hon member is willing to take a question?
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon member, there’s
a question posed to you. Hon Chachalia. No, he’s not willing.
You may proceed, hon Chachalia.
Mr G K Y CHACHALIA: But does the department, it’s Minister and
the Cabinet see the dimming lights of Eskom, the dead end of
Transnet’s arteries, the inability of Denel to assist any
readiness for any DEFCON status and the failure of SA Airways,
SAA, to fly profitably while it runs a diamond mine into the
ground – in an industry and region that marked the beginnings
of industrialisation in our country? No, because their
collective heads are buried firmly in the sand, Sadly, because
good governments are proactive and not simply reactive, which
is why we have called for commissions of inquiry and states of
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disaster to be declared to stem our decline in these key
areas, and to ensure that we put partisan politics behind us
and champion a whole of society approach comprising all
stakeholders and in particular, implementation savvy experts.
That is, Minister, how you address urgency that you refer to.
What we don’t need is platitudes from public servants that
seek to assure us that matters are being monitored, addressed,
developed, workshopped, iterated, and overseen while the
collective ship we all travel in heads firmly and resolutely,
like the ill-fated Titanic, in the direction of an epic
collision with an iceberg. It is for these reasons and in the
hope of a radical redirection that we reject this Vote. What
we need at the helm of the ship is a hand that is schooled by
informed choice that leads to timely action, and that time is
now. Perhaps at the parting shot, the Minister might tell his
tripartite alliance partners that, 15% increase has been
demanded by NUM’s labour at the stockist of Eskom, and for his
convictions, is hardly the way to go. Thank you.
Ms R N KOMANE: Hon House Chairperson, the Economic Freedom
Fighters reject the proposed Budget for the Department of
Public Enterprise and the committee report. If anything, the
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committee report is a clear demonstration of the collective
incompetence, ideologically bankrupt, and economically
illiterate that characterises the dying ruling party.
At the beginning, the committee report says the state has a
developmental role to play and uses state-owned entities,
SOEs, as an implementation tool to fulfil the developmental
role. At the end, this report says the committee welcomed the
restructuring of SOEs by the department, which effectively is
privatisation of the SOEs. This is the madness we are dealing
with.
House Chair, allow us to not waste time dealing with the
department that changed its mandate to public privatisation
and secrete dealings, let us deal with Eskom. Let us start to
say that the mandate of the Eskom is to supply stable
electricity in an effective and efficient sustainable manner
to contribute to lowering the cost of doing business in South
Africa, and to enable economic growth. Today, Eskom is doing
the complete opposite; Eskom cannot supply stable electricity.
Blackouts are a daily occurrence. Businesses are suffering
because of electricity blackouts. We have put Eskom at the
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hands of the incompetent management without either generation
experience or management of complex institutions.
Under De Ruyter, Eskom burned 458 million litres of diesel in
2021 compared to 10 million litres when Eskom was able to
arrest the problem of blackouts, spending R4,1 billion. In the
current year, Eskom is spending R800 million per month on
diesel because they are failing to keep the lights on.
We have been threatened with 100 days of rotational blackouts,
and no one has lost their jobs — not a single person. The
white management at Eskom keeps their jobs even though they
have shown over and over again that they are not qualified. We
know that there is a plan to bring down Eskom so that the
Independent Power Producers, IPPs, can take over and
electricity generation can be privatised.
Let us then go to Transnet. Transnet was created to be the
custodian of ports, rails and pipelines to ensure that the
freight system in South Africa enables sustained growth and
diversification of the country’s growth. This is no longer
what Transnet exist for. Instead, we are told that Transnet is
now actively seeking private sector participation in the port
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and rail freight. We know that this is already happening. The
deliberate collapse and sabotage of Transnet is to hand its
strategic assets to the private sector at a fraction of their
value.
The South African Airways, SAA, was established as a national
carrier to support the country’s developmental agenda. The
ANC, which is the ruling party, handed it over to corrupt
white senior management who sold its fleet and allowed the
Gupta parasitic cronies to take over. Now we are told that SAA
is bleeding the fiscus. The truth of the matter is that the
ruling party collapsed SAA to sell it to friends for a
fraction of its value. We are not shocked at the price that
SAA is being sold. This is corrupt deal and we are going to
expose it even if it means that we must go to court, we will
do that. There is nothing to say about SA Express and Mango,
they are history.
Denel is nothing but a shadow of its former self. A company
that designed and manufactured complex military weapons and
vehicles was allowed to collapse when it could have been
repurposed to build cars for our people and ambulances for
hospitals and clinics. Instead, Denel cannot pay salaries. All
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of this was done on purpose to bring the company to its knees
and sell to friends and cronies who had never manufactured
anything before, let alone complex military equipment and
vehicles.
South African Forestry Company was created to manage South
Africa’s forestry assets on behalf of all of us to increase
the strategic investment and ensure that there is sustainable
management and plantation forest so that the timber can play a
catalytic role in the rural economic development. This is not
happening. The company is sabotaged and only exists on paper
without any intention of increasing its investment. The timber
processing plant and the IFLOMA Mozambican investment only
exists on paper.
Alexkor was created to mine marine and land diamonds in
Alexander Bay and the Northern Cape. Alexkor has downsized its
operations, workers are retrenched and others resigned. There
is no intention to strategically position Alexkor as a state
mining company with a license to sell and market the diamonds.
The only reason the company recorded a profit is because of
retrenchment. This is the strategy to collapse the SOEs that
we are also aware of as the EFF.
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In conclusion, the EFF is the only organisation that is not
afraid to stand up against the white capitalistic
establishment. We are going to do it even when it is not
fashionable because we understand that the state ownership and
control of strategic sectors of the economy is the only
foundation for sustainable economic transformation in South
Africa, and without the SOEs we will not achieve this. The EFF
is the only organisation that is going to confront white
capitalist establishment puppets even if it means we go to
court. We will not be intimidated; we are ready for
everything. If the Minister is used to being the one with the
last word, not when it comes to the SOEs. The EFF rejects the
proposed Budget for the department of privatisations and its
secrete dealings.
Mr W W WESSELS: Hon House Chairperson, captured, mismanaged,
destroyed state owned entities, and the question is what fruit
will the Presidential State-Owned Entities Co-ordination
Council really bear? The question is what will another forum,
the Minister now refers to, really do to recover and to heal
the completely destroyed entities? Because the Presidential
Review Committee on state owned entities’ recommendations have
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not yet been implemented, and those recommendations come as
far back as 2014.
There is still no remuneration standards for executives and
boards of state owned entities. The Minister talks about
accountability and consequences, but it seems like only lip
service because, with all due respect, the politically
connected are still being protected.
If we go to loadshedding, the crucial matter here is that
loadshedding is not saving South Africa from a total blackout,
but actually getting closer to it. If we listen to energy
experts who tells us that each time the electricity network is
switched OFF it actually damages the whole network.
Transformers and electrical systems are not designed to be
switched ON and OFF. When the load is taken down and then
peaked later on it damages the whole network. A national
blackout will not be prevented by loadshedding, but will be
caused by it, and this we should take note of.
The hon Minister refers to shortage of technical skills, and
especially engineering skills, and that is what is needed.
Training is not the only solution to that; there are a lot of
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engineers out there who are unemployed because they were let
go by Eskom for no apparent reason, and they are able and
willing to assist to restore the power network. South Africa’s
power network requires complex management; it is a
sophisticated network; bigger than the whole electricity
network of Europe.
Let me get to the South African Airways. The Minister talks
about absolute transparency, but I beg to differ, because
there is still so many questions. If there is real
transparency, then answer those questions because the
department does not. The media tries to report on this issue
to give South Africans clarity but there are no real answers
by the department. The Minister must now tell us what this
transaction actually entails.
Let me get to the hon Komane from the EFF. She talks about
white males that destroyed the South African Airways. I am not
sure if Dudu Myeni is aware that she is a white man. Your
racial obsession is nauseating, hon member. To rebuild South
Africa, hon Minister, we need to utilise the pool of skills
that do exist in South Africa, regardless of skin colour,
political affiliation and political faction. We need skills
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and we need to build this country. South Africa can only be
rebuilt if we get rid of failed ideologies, failed policies
and the failed ANC-led government. South Africa deserves
better. I thank you.
Mr S N SWART: House Chair, with your permission, I will leave
my video off due to connection challenges. The ACDP shares
deep concerns as the operational and financial health of many
state-owned entities, SOEs, continues to decline. Eskom as
many speakers have indicated presents the most severe risk to
economic growth and recovery and continues to rely on
government guarantees and equity injections to finance its
operations.
The electricity availability factor continues to fall and
result in an ongoing ... [Inaudible.] ...
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon Swart, are you
still here?
Mr S N SWART: ... load shedding. Minister, ... [Inaudible.]
... must be dealt with speedily given its impact ...
[Inaudible.] ...
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IsiXhosa:
Inkosi M MANDELA: Ayisebenzi ikhompyutha yakhe. [His gadget is
not working.]
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon Swart, can you
just log out for now and log in again. We will give you your
remaining two minutes. I will request the table staff to also
communicate with him. Let’s proceed, hon members.
The DEPUTY MINISTER OF PUBLIC ENTERPRISES: Thank you so much,
Hon House Chair and greetings to you, to the hon Minister, hon
members in the House, I’m greatly humbled at the opportunity
that I have to participate in this debate on the Budget Vote
of our department.
I wish to quote from the first President of the democratic
South Africa who when addressing the 4th session of the
democratic Parliament had this to say and I quote:
A new year is upon us once more affording us the opportunity
to account in a comprehensive manner to the citizens on the
awesome responsibilities they’ve mandated us to fulfil. All
of us in the executive and legislatures the majority
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legislatures party and the members in the opposition benches
are called upon to outline practical programmes to improve
the nation’s quality of life.
Hon House Chair, it is common cause, - and the Minister has
outlined this in his introduction of this Budget Vote that we
are emerging from a period of more than two-years of the state
of national disaster occasioned by the global pandemic of
coronavirus that is had resulted negative economic impacts.
As though that was not enough we also emerging from the
debilitating effects of the phenomenon of state capture as
extensively reported by the commission headed by then Deputy
Chief Justice Raymond Zondo. There are other economic events
that have shattered our country in the recent past to which
the Minister in this introduction spoke to that extensively.
It is against this backdrop that our President charged us with
the mandate to stabilize and restructure this state-owned
enterprises, SOEs, so that they can play a critical role in
the implementation of the country’s Economic Reconstruction
and Recovery Plan.
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In the recent past, never before in our country has the role
of SOEs enjoyed as much attention and created such a strident
debate and rightly so. We as custodians of these state
entities, it is in ours and in the country’s best interest
that we ensure that they are financially sustainable and
deliver on their mandates efficiently and become pillars of
our economic recovery.
As the Minister has begun outlining I would wish to add to
that by specifically paying attention to some of the SOEs,
Denel as the case in point. Denel is a strategic national
security asset and government is committed to finding a viable
solution that recognizes this imperative and the need for
self-sustainability.
The recent seismic shifts and the consolidation of
geopolitical dynamics and regional threats of terrorism
underscore the strategic importance of Denel. Denel continues
to experience significant liquidity challenges. Long overdue
payments to creditors and suppliers meant the supply chain was
no longer fully available to support the operations.
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Denel’s business model as a system integrator, depends
significantly on local manufacturers to supply critical
components and subsystems. The disruption of this delicate
relationship with suppliers has become one of the binding
constraints regarding Denel’s operations. As we speak, in
order to remedy the situation, we have assisted in the
development of a business case that is now awaiting the
perusal of both Ministers of Finance and Defence en route to
Cabinet for final decision. In addition, the department has
taken a number of steps to ensure that Denel is brought back
to life in as short a period of time as possible.
One of the interventions is that the National Treasury has
approved an allocation to settle the R3,4 billion guaranteed
debt which was costing Denel more than R200 million in
interest payment per annum. We have also engaged the
Department of Defence and Armaments Corporation of South
Africa, Armscor, on funding critical capabilities that Denel
is managing on behalf of the Department of Defence. Thirdly,
we have given full support to Denel to discontinue the Denel
Medical Benefit Trust and the estimation is more than R750
million will flow to Denel in the first half of this financial
year. The funds are expected to flow within the first half of
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this financial year. This is further to the other efforts at
improving and creating a new business case for the entity so
that it can be able to immediately start with some of the work
opportunities provided the funding is made to come on line.
We are equally concerned about the human costs that the non-
payment of salaries is having on the employees and their
dependents. Together with management of Denel, and Denel
Boards we are doing everything humanly possible to correct
that state of affairs. Government is determined to stabilize
the entity and to restore it as trusted supplier, partner and
employer.
With regard to Alexko, the state diamond miner, it has gone
through its own challenges over the years. But we really say
now it has really made a turn for the better. After changing
the board and putting in new management, we are beginning to
see the positive results within the entity.
Having tasked themselves to ensure that cost-cutting
initiatives are put in place so as to preserve the remaining
reserves against the bleak future. The consolidation of the
head office function of Alexko and Alexander Bay, we have seen
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significant progress in this respect in that the two entities
have since provisionally consolidated the function of the
chief executive officer, CEO, with the Alexkor CEO taking over
the role of joint venture CEO. We have also seen the cost-
cutting initiatives beginning to bear fruit in that the
organisation is financially getting to be stable.
All be it, this was happening on the back of some of the job
losses. But of course, certainly, coming back into the
operations we will see more jobs being created in the entity.
The board as well as the new management has undertaken the
revitalising of diamond operations. This will include the
consideration of drawing in different funding models for the
expansion of the diamond mining operations. Despite the
diamond sector facing depletion of high value deposits, the
diamonds from the joint venture remain globally sought after
due to their gem quality properties.
It is true that the effort put in place have significantly
brought about the change in the affairs there and certainly
going forward we are looking to more improvements being
recorded.
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In the forestry sector, the South African Forestry Company SOC
Limited, SAFCOL, continues to be one of those entities for
which the Board and management has put in place a new
innovation and growth strategy that is bearing fruits. A
strategy that is reinforcing the Forestry Sector Masterplan,
which is looking at encouraging sector growth, investment, job
creation, and competitiveness.
SAFCOL has to this date engaged very favourable with the
banking sector and a lot of interest is being shown
particularly in the development of green bonds and green loans
in respect of some of the projects that are underway and being
considered in that entity.
The combined heat and power strategic project seems to have
really gathered a lot of interest from among the banking
fraternity. And the entity has a very sound balance and is
capable of attracting on its own some of those investments.
SAFCOL continues to contribute towards sustainability in terms
of climate change by ensuring that some of the plantations are
grown and further targeting some plantations in Mpumalanga
province. We are hoping to see a lot of progress in this
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respect particularly collaboration with the Department of
Forestry Fisheries as well as environment.
This entity is financially stable. It has a healthy cash
balance that exceeds the targets and it's being maintained
properly as well given the strong financial position it's been
recognized recently by securing offerings from the asset-
backed financing. Particularly for some of its projects.
In respect of South African Airways, it is common knowledge
that it was placed under provisional liquidation since April
of 2020, on account of an High court order.
Today, the liquidators have managed to dispose of the tangible
assets raising an amount of R24 748 million. Following that
latter process, the selling of intangible assets is currently
underway.
On or not about March, the liquidators had initiated the 3rd
round of the sale of the intangible assets a process that
awaits a completion. We are looking at this so that the value
that can be derived of that is a value that worth the money we
expect of it.
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Hon House Chair, of the other members who have participated in
the debate I was just left with only one thing in mind, what
have we heard from them? Are they contributing by any means in
suggesting as to how to deal with some of the challenges we
have? I have heard nothing but complaints I am sure that we
who are content in what we must do must just put shoulder to
wheel, get things done they will get us along the way. I would
urge support for this Budget Vote. I thank you very much, hon
Chair.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon members, as hand
over to hon Mahlaule, I will allow hon Swart to speak and
finish his two remaining minutes.
Ms C P PHIRI: He has nothing to contribute you may pass,
Chair.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Wait, hon member.
Hon Mahlaule, you may proceed with the debate. Thank you very
much.
Mr N L S NKWANKWA: Hon Acting House Chairperson, the UDM does
not support the budget vote. The return of the load shedding
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and own going government’s issues at several of South Africa’s
largest state-owned enterprises especially Eskom have without
doubts fewer traps of declining foreign direct investment in
South Africa. It means that in order for us to improve
investor sentiments and towards ... [Inaudible.] investment in
South Africa, South Africa needs to create a spirit of a
departure to a new era where there is no load shedding and
where entities such as Eskom are managed properly. If the
trend continues it will have serious detrimental effects on
the growth expecting the prospects of the South African
economy as well as the total taxable income which is available
to the fiscus for the socioeconomic needs of South Africa and
the country.
It is important that South Africa is sorted out so that we
prevent it from continuing to be a drain on the fiscus as it
currently is. In order for it to help us place South Africa on
an economic trajectory that would enable us to handle and deal
with the socioeconomic challenges facing the country. This is
particularly important on the comments that have been made by
leaders around the world that they would like now to start
focusing on investing in Africa particularly.
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What we require is that South Africa should continue to be a
point of entry for trade into the African continent as was the
case in the last decade. On 1 July 2021, the party president
General Bantu Holomisa wrote to the Chairperson of the
Standing Committee on Public Accounts, Scopa, Mkhuleko
Hlengwa, requesting that the committee investigate the
government’s sale of a 51% of the SA Airways, SAA to Takatso
Consortium. In the letter, he cited a number of issues which
include, the lack of proper due diligence done on the sale of
SA Airways.
One of the most pertinent questions was how is it possible
that a mere R3 billion injection is now suddenly enough to
save South Africa from a certain death whilst government has
been pumping billions of Rand sponsored in part by taxpayers
and the public corporations’ entities for years? He also cited
that Global Aviation Airways, one of the partners in Takatso
Consortium, is known to have been an advising the Department
of Public Enterprises on SAA. If this is true, this naturally
constitutes a serious conflict of interest as Takatso
Consortium would have set an insider information that would
have disadvantaged other possible bidders.
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The fact of the matter for us is that there seems to be a
consistent pillaging of the SOEs that are strategic to the
country that would help to the socioeconomic developments of
the country that would also enable government to drive a
developmental state agenda using SOEs. The intention of that
is that there must be prioritised.
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon member, I am
afraid your time has expired.
IsiXhosa:
Mnu N L S NKWANKWA: Hayi, uyayigada le mizuzu yam kunjalo nje
awufuni ndithethe kwaphela.
The ACTING CHAIRPERSON (Mr M G Mahlaule): I even gave you few
seconds.
Mr N E DLAMINI: Hon House Chairperson, the recent floods in
KwaZulu-Natal should not be perceived as the kick start of -
Disaster Capitalism Complex – that is, waiting for a major
natural disaster crisis, then selling pieces of the state to
private players while citizens are still reeling from the
shock or trauma, then quickly making the reforms permanent.
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This view is likely to be dominant among opposition parties,
particularly the EEF as the party is convinced that with the
scarcity of resources and climate change providing a steadily
increasing flow of new disasters, responding to emergencies is
a perfect strategy for using moments of collective trauma to
engage in economic engineering that advances only the private
sector goals.
In the context of Budget Vote 10 debate, Transnet’s new
strategy as their theme goes of driving volume growth through
private sector participation is an attempt by the ANC-led
government to privatise Security Operation Centres, SOCs and
become the biggest customer for private sector new services.
Chairperson, this view is in several respects exaggerated. You
must be aware that for a party that is battling to
differentiate between contentions and privatisation and they
still want to position themselves as the arbiters of business
model. You cannot take the EFF too much seriously. They do not
know whether they are coming or going.
Let me explain why this news is exaggerated. The success
stories of Japan and South Korea were motivated by the ability
of governments in these countries in maintaining growth to
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stimulate competition in the sense of entry or expansion of
new private sector players in the market instead of
concentrating resources and subsidies in SOCs as national
champions. These essential points are that, for the reasons
best known, without reducing concentration on monopoly, the
high rate of investments and economic growth in Japan and
South Korea might arguably not have occurred at all. The other
side of the coin is that, the government of Taiwan with the
SOCs especially in the upstream industry where scale economy
is crucial as well as state finance, research and development
and to promote development and economic growth.
The difference between Taiwan and comparator countries, Japan
and South Korea is that there was no large private sector in
Taiwan in whose affairs the state left to intervene. In the
context of South Africa, the market has expanded with the
emergence of significant players especially in sectors
characterised by major backward and forward linkages and
externalities such as the one that Transnet operates in. Thus
the goal of government is about crowding in instead of
crowding out new significant players.
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As the Economic Reconstruction and Recovery Plan stipulates
that government’s efforts would be strengthened to attract
private investment in the delivery of infrastructure as part
of pulling broad based public-private sector partnerships. For
it, it implies that the emphasis is on using financial floods
as well as technical skills and advanced technologies of the
private sector players to enable SOCs to achieve both
operational and financial competitiveness with regional,
continental and international who would be competitors.
Transnet is currently being transformed and reconfigured to
meet the needs and mandate outlined in the Economic
Reconstruction and Recovery Plan. In the 2021, state of the
nation address, President Ramaphosa announced that the
government will commence with the corporatization of the
Transnet National Port Authority, TNPA in the hopes of
magnifying the redesign of the Port of Durban and
strategically reposition it as an African, as well as an
Indian Ocean hub for containerized cargo. This is crucial as
the port of Durban has declined in accordance with the
international standards, implying that the port should remain
almost unchanged without private sectors involved. Thus, the
Department of Public Enterprises is committed towards ensuring
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that Transnet concludes the partnerships for the Durban
Terminals by the end of December 2022. In addition, Transnet
will issue out proposals for the private sector partners for
the Ngqura Container Terminal which will foster partnerships
to be in place by October 2022. This in turn will allow
Transnet to improve our operational efficiency at the ports
through procuring additional equipment and implementing new
system to reduce traffic congestions.
Moreover, the Department of Enterprise will finalise the
appointment of a permanent board of the Transnet National
Ports Authority, TNPA, during the course of the current
financial year. Of course, it will be in the public interest
that the Budget Vote 10 is passed as it is through this budget
that all these initiatives and repositioning enable greater
capacity for the movement of greater freight to be realised.
In other words, the establishment of TNPA as a subsidiary and
as an introduction of private public partnerships are
imperative to strengthen Transnet position and sustainability.
Going further, in the 2022 state of the nation address
President Ramaphosa announced that there will be improvement
of rail network capacity in Transnet through the selling of
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slot to private sector players is expected to be concluded by
2023. This is crucial for introducing competition and in
improving supply chain inefficiencies. To be franker, the
involvement of private sector players will be linked to the
commodities, manufacturing, and agriculture product corridors,
focusing on the Iron ore, Manganese, Coal, Chrome and
Magnetise, Auto and Containers, Fruits and Grains, Fuel and
Gas, which are the backbone of Transnet’s key industrial
supply chains.
Furthermore, the South African experience shows that there is
an abundance of untapped resources such as cobalt, copper,
lithium, nickel, and zinc which are becoming increasingly
important in the face of transitioning to a green economy.
Investments in rail network infrastructure and expansion
combined with the implementation of the African Continental
Free Trade Area, AfCFTA policies are expected to enable
Transnet to take advantage of transporting these new resources
and subsequently increase the share of rail bulk freight
relative to road, thereby contributing to the migration from
road to rail and reduce the cost of logistics, as well as
doing business in the country. To complement this, the
resolution of contract disputes to acquire locomotives is set
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to improve the availability of rolling stock and maintenance
material, as well as Transnet’s ability to access certain
parts from Original Equipment Manufacturers, OEM.
Chair, although Transnet scores well on the capabilities to
address challenges that hamper its operations, there are
widespread disruptions that may materially affect Transnet’s
strategic targets and potential revenues. Among others, the
recent floods in KwaZulu-Natal have affected the rail network
and it will be impossible to revive rail network in a very
short space of time. The worst part is that, houses next to
the rail network will have to be relocated to get network to
operations and obviously Transnet had to cover some of the
relocation related costs as the estimated bulk figure between
R2,7 billion and R3 billion.
However, not everything is gloom. The supply of jet fuel as
well as locomotives and containers terminals would retain
their efficiency as a result of the measures that Transnet has
put in place. Aside from all this, rail and pipe plant
manufacture vandalism and theft are partly responsible for
Transnet poor revenue performance in the previous financial
year and they are most likely to continue to disruptions to
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rail and pipeline plant operations in the current financial
year.
Regardless, Transnet has developed partnerships with the
private sector to address cable theft, infrastructure
vandalism through advanced technologies and additional
security personnel. Moreover, the Department of Public
Enterprise is working on a strategy to support Transnet with
safety and security, with the intention of collaborating with
Departments whose SOCs are similarly affected. Chairperson,
Budget Vote 10 must be passed so that the Department of Public
Enterprises can continue to assist Transnet to overcome the
highlighted challenges.
Chairperson, the ANC supports Budget Vote 10. The portfolio
committee will monitor the department’s performance. Hon
Wessels talks about engineers that are unemployed. I hope he
is not talking about the technicians that left Eskom because
they did not want to support the democratic government. Hon
Cachalia is avoiding the issue of theft of both the copper and
the pipeline. You must ask yourself who are the beneficiaries
of this theft? Who sells this copper and who is selling this
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fuel that is stolen from the pipeline? These are the real
people who are collapsing Transnet.
Hon Cachalia is well aware of these but for reasons which
might be associated with racism in the DA and their posture of
avoiding real issues and want to loud hail and say this
government is failing. Hon Cachalia must look at the issues
and assist us in coming up with solutions on how to deal with
theft. This takes the budget away from the resources that are
needed in these SOEs. To try and rehabilitate and fix the
stolen copper and gas. I thank you, Chair.
Mr N SINGH: Hon Chairperson, from the words of a wise
philosopher, and I quote: “God made everything good, but it
became evil by the hands of man.” This rings true when trying
to describe the government of the ANC and its running of
state-owned entities.
The Department of Public Enterprises’ mandate is to be the
primary interface between government and state-owned companies
and it provides input into the formulation of policy,
legislation and regulation. However, looking at this mandate
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and what is currently happening under the leadership of the
ANC, it is quite the opposite.
Instead of the development of sound legislation to create a
conducive environment in which SOEs can function, we find this
in total disarray. Instead of creating jobs in the various
sectors such as energy, transport and defense, all we see is
SOEs such as Eskom, Denel and SAA working against the
department’s very own mandate.
Government must take decisive action once and for all and
privatise these entities or allow government to become a
partner with the private sector, because we cannot face these
very same challenges year in and year out.
While the department is doing well in terms of key performance
areas, we see that the entities under the department are
worsening. We, as the IFP, will always believe that
privatisation or commercialisation and partnerships is the key
to unlocking the potential of these SOEs. A public-private
partnership will better position state companies to flourish,
like what is contemplated for SAA.
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It seems the ANC-led government is naïve. Everything proudly
South African does not need to be owned by government. Hand
over these state companies to private South Africans and see
SOEs blossom.
Lastly, when we look at the issue of Eskom, we speak high
level of how many businesses are affected by blackouts, but
have we turned our attention to the poor South Africans living
in rural areas? Ordinary South Africans are suffering more
with the little food that is in their fridges and homes going
rotten. They have no insurance and they cannot make claims in
order to recover what they have lost.
What we should be focused on is quantifying the effects of
Eskom’s mess on people’s lives and livelihoods. Some can
afford generators, but most cannot. Therefore, we believe that
government should defend the poor. Investors and big
businesses are important, but we should remember that there is
no buffer for the poor.
The ANC government has neglected our rural people. They do not
focus on the poor and to be frank, they are only recycling
words to glorify being the oldest liberation party in Africa.
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Sadly, they are not living up to their standards and their own
message.
In conclusion, we can speak profound English about multiple
strategies to fix SOEs, yet, none of the strategies seem to be
helpful. If the real problem is to be solved, the ANC should
stop debating in this House for the sake of empty debates with
big words that mean nothing. The only way forward, if they
wish to make meaningful change in the lives of South Africans
is if they consider us, as the opposition, to be their mirror.
Upon response of the Minister and commitments thereof, the IFP
is still contemplating whether to reject or support this
Budget Vote. I thank you.
Mr F ESSACK: Hon Chairperson, all talk and no action willnot
clean up the rot in public enterprises. Today, Minister Pravin
Gordhan will once again give assurances that his department’s
turnaround strategies for state-owned enterprises, SOEs, are
on course and that these entities will soon emerge from the
edge of financial ruin that they currently face.
It is a line that successive Ministers in the Public
Enterprises portfolio, and of course, the ANC government
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itself, love to band about whenever they are called upon to
account on failing SOEs. But South Africans can now see beyond
this empty rhetoric. Almost every week there are stories of
how SOEs are lurching from one crisis to another, with no
discernible solution in sight.
On his appointment in 2019, Minister Gordhan was touted as the
fixer who was going to turn around the fortunes of SOEs and
bring about an era of prosperity for these entities. In fact,
the Minister was quoted in March 2019 saying, and I quote:
Ideally, we want our state-owned companies to be fully self-
sufficient and able to fulfil their economic role. But where
state-owned companies are not able to raise financing from
financial institutions or the fiscus, we will explore other
mechanisms, such as strategic equity partners or disposal of
noncore assets.”
Save for SAA, whose deal with a so-called strategic partner is
still mired in controversy, with an ever-increasing
possibility that the state may have to cough up more billions
for the airline, almost all SOEs in South Africa are hanging
by a thread and could go bankrupt at any time.
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Three years after committing to a disposal of nonperforming
assets within the SOE sector, Minister Gordhan has delivered
nothing, nothing on that promise. These days, his favourite
excuse for lack of action on underperformance in SOEs is to
hide behind state capture. Even on that front, holding
accountable those who have been implicated by the Zondo
Commission has been abysmal.
The Zondo Commission has recommended that an investigation be
launched to uncover how Alexkor entered into a dodgy contract
with Scarlet Sky Investments, a Gupta company, to market and
sell the diamonds produced by Alexkor. This dodgy deal
disadvantaged the impoverished communities in Richtersveld in
the Northern Cape, who were supposed to benefit from their
successful land claim. The question then is: Has the
Department of Public Enterprises instituted this
investigation, as recommended by the Commission? No, it has
not.
The Zondo Commission recommended that Denel, the Department of
Public Enterprises, as well as the Intellectual Property
Commission should consider bringing appropriate proceedings
against Daniel Mantsha and other members of the 2015 Denel
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board, who were shown to have supported Mantsha in his efforts
to capture Denel for the Guptas. Has the department made any
effort to action this recommendation? Your guess is as good as
mine.
Maybe, today is the day that Minister Gordhan will tell us why
there has been zero prosecutions to date on SA Express, who
were found, by the Zondo Commission, to have colluded to
defraud the North West government through an elaborate
corruption scheme, involving an airports project of the North
West Department ...
Mr A H M PAPO: Chairperson, on a point of order: I want to
check whether the member will take a question, because his
maiden speech is full of controversies, which I want to ask
about. Normally, maiden speeches are not like that.
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon member, you know
very well that you don’t disrupt a speaker during their maiden
speech. Hon Essack, proceed.
Mr F ESSACK: Maybe, today is the day that Minister Gordhan
will tell us why there has been zero prosecutions to date on
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SA Express, who were found, by the Zondo Commission, to have
colluded to defraud the North West government through an
elaborate corruption scheme, involving an airports project of
the North West Department of Transport. I doubt very much that
we will get any satisfactory answer on this one either.
Unless tangible action is taken ... [Time expired.] Thank you.
The ACTING CHAIRPERSON (Mr M G Mahlaule): I gave you the
seconds when you have been disrupted, but your time is up.
Ms J C N MKHWANAZI: Thank you, hon Chairperson, hon Minister,
Deputy Minister ...
The ACTING CHAIRPERSON (Mr M G Mahlaule): Before you start,
hon Mkhwanazi, hon Papo, can you lower your hand if it is a
legacy hand? Thank you very much. You can proceed, hon member.
Ms J C N MKHWANAZI: ... hon members, and South Africa in its
entirety, on behalf of the ANC – the leader of society, the
caring government – we rise to support Vote 10 of Public
Enterprises - the Budget that talks to the actions that are
taken and now the Budget that talks to the action in future,
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the strategies that will talk to the interventions that will
address the challenges we are facing in the state-owned
enterprises, SOEs.
As the ANC, we don’t just howl or talk over problems or run
away from challenges. We are the government of the people. We
face the challenges. We deal with them. We talk to them and
work with our people to address the challenges we are facing.
We remain focused to the Department of Public Enterprises
mandate to our country through our SOEs to unlock economic
growth, and through Eskom, which ... [Inaudible.] ... its
critical role to supply uninterrupted affordable electricity
to all.
In 2012, the study by Professor Anton Eberhard, who is the
member of the global commission to end energy poverty
indicated that there was a funding gap of US$29,2 billion as a
result of the difference between the investment required to
meet the energy demand of US$40,8 billion. The current annual
investment of US$11,6 billion to sub-Saharan Africa.
Unfortunately, sub-Saharan Africa countries are experiencing
subordinate finances due to their position as well as their
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weak currencies in the international financial system. As a
result of this, financial liberalization is likely to
undermine investment in productive activities in the sense
that international private capital flows driven by monetary
conditions in advanced economies and increasing in volume
expose sub-Saharan countries to financial crisis.
In this case, Eskom is a classic example of this financial
crisis in particular. The government has attempted to address
the funding gap to match the growing energy demand through the
procurement of the US dominated loans in the international
financial system. Consequently, the US dominated that ...
incurred while building Kusile and Medupi power stations
impacted negatively on Eskom credit conditions. On the other
hand, generated ... [Inaudible.] ... in Eskom financial
performance. Another danger was Eskom sales volumes and
revenue are in rands whilst its dept service costs are in
dollars. That further undermine the utility’s revenue margins
as Eskom maintenance and generation capacity expansion
projects are often cut back to meet the dept obligation.
It is due to these factors that Eskom revenue shortfall
sometimes covered through physical transfer, that is the
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reason why Budget Vote 10 must be passed as it allocates about
R21,9 billion to Eskom during the current financial year to
support repaying its debt and interest. This allocation will
certainly improve Eskom’s financial performance as the utility
has already reduced its debt from R484 billion to
R401 billion. This serves as tangible evidence that this ANC
caring government is doing everything possible to restructure
and rationalize Eskom.
The DA will never applaud Eskom for turning the tide in so far
as its debt is concerned because this party finds it difficult
to admit that its ideological predisposition of market
fundamentalism is partly responsible for some of the
challenges facing Eskom today.
Going further, the composition of the structure of the South
African economy has really challenged in the strongest sense
of the term. We note that the mineral resources sector, which
is energy intensive remain the third dominant sector of the
South African economy after the services and the financial
sectors. This implies that the mineral resources sector’s
highly intensified level due contribute towards the imbalance
between energy growth and demand. Although some mining
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companies migrated to the renewal energies, the energy
intensity in the mineral resources sector has not decreased.
Mining companies are not in the position to reduce energy
usage at the pace that could close gap between energy, growth
and demand. The government should work hand in hand with
mining companies to encourage them to invest in technologies
that reduce energy usage without affecting production.
Due the energy level in the mineral resource sector and the
other energy intensive sectors like commercial sector as at
manufacturing in addition to the household, energy generation
capacity shortfall eats around 4 000 megawatts of electricity.
The Department of Public Enterprises working with the
Department of Mineral Resources and Energy will procure
additional generation of about 9 213 megawatts during the
current and the next financial year and will include
3 000 megawatts and 530 megawatts of gas and storage,
respectively.
Interestingly to note, is the amendment of the Electricity
Regulation Act that will allow greater Independent Power
Producers’ participation within a clear regulated environment
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and subsequently ensure that the procurement of the targeted
energy become normal.
We are a government at work for our people, with our people.
It seems therefore that the opposition parties’ assertion that
Eskom is a threat and a proactive failure rest upon the
misreading of evidence and the progress underway.
Hon Chairperson and hon members, the unbundling of Eskom has
successfully led to corporation of the National Transmission
Company of SA, NTCSA, which will be completed in the current
financial year. That is another good reason why we must
support this Budget.
The opposition parties like the EFF will hold on to a mistaken
belief that the unbundling of Eskom is simply a continuation
of an American style of privatization of SOEs, which rests on
the conviction that the state should interfere in the market
place only when necessary. In other words, according to them,
the unbundling of Eskom seeks to erase what is left on the
state of government in the affairs of the utility and replace
it to the corporate mentality of selling electricity at the
market price.
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Let me assist them because what the EFF lacks is the unusual
capacity to grapple with complex issues, because the success
of Eskom is too critical to be reduced a debate between public
versus private ownership. Therefore, Eskom require all
mechanisms and resources to turnaround its operational and
financial performance and to be mobilized. Besides the
unbundling of Eskom, follow the standard model, which is the
standard practice across the world and the main goals of this
model includes, amongst others, ensuring competition takes
place throughout the sector, restructuring with the goal of
full vertical and horizontal unbundling of the sector and
promoting private sector participation to encourage private
sector investment.
We must also note that the population growth in South Africa
grows faster than the supply of energy and this in particular
contribute to Eskom’s use of diesel open cycles to meet the
peak demand. Moreover, it should come as no surprise that the
diesel open cycles are not financially sustainable especially
now that there is uncertainty over the supply of oil due to
the Russian-Ukraine conflict. Eskom has attempted to supply
electricity to the majority of households to a non-cost-
reflective tariff, which means Eskom has kept its tariff so
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low that they are not reflecting to the average historical
cost of operations and maintenance. That shows that this ANC
government is a caring government. The cost of depreciating
assets, adequate provision for bad dept, the return on assets
...
In addition, Eskom consumer debt continue to grow with the
current expense of R45,5 billion, which 77,8% is owed by
municipalities ...
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Mkhwanazi, my
apologies ...
Ms J C N MKHWANAZI: Hon Chairperson.
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Mkhaliphi, your
hand is up.
Ms H O MKHALIPHI: Chair, can a member take a question?
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Mkhwanazi, can
you take a question?
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Ms J C N MKHWANAZI: No, Chairperson, I am not in a position to
take a question.
The ACTING CHAIRPERSON (Mr M G Mahlaule): Thank you. You can
proceed.
Ms H O MKHALIPHI: You must stop saying ANC is a government
while we have ... [Inaudible.] ...
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Mkhaliphi ...
[Interjections.]
Ms J C N MKHWANAZI: Regardless of ... hon Chairperson, I will
not attend to those howlings ... [Interjections.]
Ms H O MKHALIPHI: Chair, who is the one that is shouting at
me, because you said I must not ... [Inaudible.] ...
Ms J C N MKHWANAZI: ... but will not lose focus ...
Ms H O MKHALIPHI: Yeah, but you must stop saying the ANC is a
caring government ... [Interjections.]
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The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Mkhaliphi. Hon
Mkhwanazi, can you pause right there. Hon Mkhaliphi, you
raised your hand, I gave you an opportunity and you said what
you wanted to say. The member could not take your question.
Can we proceed at that? You can’t do what you are doing now. I
won’t allow it in this meeting. Can we allow hon Mkhwanazi to
complete her speech? Are those hands going to speak on the
same point or another point, because on this particular one, I
am proceeding forward? I am not going to take hands on this
one. We are proceeding. Hon Mkhwanazi, can you proceed?
Ms J C N MKHWANAZI: ... regardless of these cited reasons,
which presents a bleak picture that does not abhor well to
South Africa’s prospects of energy security, there are
measures put in place by this caring government that are being
aggressively pursued, for example, the interministerial
committee headed by the Deputy President is leading the
efforts to resolve municipal depts. And it has established
Eskom’s active partnership model, which will be piloted to
indebted Eskom municipalities to promote cultural payments.
Reducing outstanding Eskom’s municipality depts. Will surely
allow the utility to function sustainably, as well as limit
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the utility from cutting maintenance and investment activities
to make ends meet.
Furthermore, the amendment of electricity pricing policy will
definitely balance the need to secure Eskom’s financial
position whilst protecting vulnerable customers and emerging
businesses against high electricity tariffs. All these efforts
to reduce Eskom’s financial challenges hang on the success of
passing this Budget Vote 10 of Public Enterprises. This Budget
must be passed in order to, amongst other things, make sure
that Eskom continue intensively, as well as with new
investment.
We must note that as the ANC and as the leader of society, we
listen to our people and work with our people. We will not
lose focus through the programme that is in place to ensure
that we face these challenges and to make sure that we rise
above and deliver a better life to all the people.
It seems the EFF is pretending not to know the most powerful
SOEs around the world work with private sector partners with
clear formal, social and economic national priorities. All the
DA wants is the national asset to be sold to the highest
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bidder without any consideration of legacy and colonization of
special type – an apartheid we have reversed. An important
role of these SOEs in the national task that is ahead of us.
The ANC supports Budget Vote 10, and through the portfolio
committee which ANC members participate fully versus the
participation of the opposition, we will work to continue to
monitor the performance of the Department of Public
Enterprises and SOEs to make sure that their annual
performance plans are more effectively targeted, to make sure
that we deliver on our mandate of SOEs, and to make sure that
we grow the economy and skills development. We support the
Budget.
The MINISTER OF PUBLIC ENTERPRISES: Thank you, Acting House
Chairperson. You know, there’s a very popular saying, Acting
House Chairperson, that “there’s none so deaf as those who
will not hear”. Therefore, it’s quite clear that the
opposition is nearly interested in rhetoric in speech making
rather than grappling with the substance of what we have to
deal with as a country. Whether is due to state capture or
corruption or whatever the case might be. So, clearly, hon
Cachalia is often confused about this platform because he
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often thinks he’s involved in the high school high school
speech contest rather than ... [Inaudible.] debate in
substance.
Hon Komane and her associates in the EFF continues with the
racist attacks, they continue with misleading the public, but
often no solutions whatsoever in respect of the challenges
that we face. Hon Wessels, I think you need to humble yourself
a little bit and ask yourself what can a legacy have you left
for South Africans in terms of the party that you represented.
I understand that SA Airways, SAA, and the transaction it is
involved in is what the Chair of Standing Committee on Public
Accounts, Scopa, are called alive transaction, it’s nothing
commercial transaction. There’s nothing to hide, but when the
transaction is completed certain aspects of that bill will be
made available.
Hon Kwankwa, regrettable your leader has some kind of ...
[Inaudible.] ... that he continues to pursue. you can go to
court, and you can go wherever you like the truth will prevail
at the end of the day, and for the record global has not
impact the department in any respect whatsoever.
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Hon Singh, you want to be the mirror to government, perhaps
for a start you need to be the mirror to yourself, and ask
yourself what certain senior members of your party were doing
in some of the state-owned entities, SOEs, as were recorded in
the Zondo Commission reports.
Hon Essack, prosecution is done not by the Department of
Public Enterprises, but by the National Prosecuting Authority.
Therefore, you might want to direct your attention there.
However, the ... [Inaudible.] ... some point, hon Essack, is
that a maiden speech is not supposed to be controversial. If
you want not to be heckled, I think that your party must teach
you what a maiden speech is about. I’m not hiding behind a
state capture or any excuses. If you want to dirty your hands
and get involved in rebuilding a house that have been badly
damaged then come along, join us then you will understand what
are the issues that we are dealing with. There is forensic
investigation in ... [Inaudible.] There are attempts, if you
were listening carefully to the speech. There are six things
or five things that I have listed from recovering money, to
getting board, to act against the staff and anybody involved,
I can’t repeat that now because I don’t have the time.
Therefore, listen carefully and you will find that we are
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taking actions to pursue on what the Zondo Commission has
reported.
Hon Acting House Chair, what fascinating is that the four
speakers on the ANC went into matters of substance in details
not rhetoric. They went into matters that are grappling with
the real issues that are confronting our country and our
people. Therefore, the message for South Africans is very
clear, this government does care. This government will get
things right. There is no silver bullet as I pointed out ...
[Interjections.]
The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Minister, my
apologies. Hon Cachalia, your hand is up.
Mr G K Y CACHALIA: Yes, Chair, I want to know if the Minister
would take a question.
The MINISTER OF PUBLIC ENTERPRISES: No, Acting House Chair,
this is not a speech contest. No, thank you. May I continue,
Acting House Chair? Therefore, as I was saying that this
government will get things right, Acting House Chair.
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The ACTING CHAIRPERSON (Mr M G Mahlaule): Hon Minister, I hate
doing this to you. Hon Papo, your hand is up. hon Papo!
Mr A H M PAPO: Presiding officers, I’m very surprised, when
the debate is being responded to no rule allow for a question
to be asked.
The ACTING HOUSE CHAIRPERSON (Mr M G Mahlaule): Hon Papo,
allow me to preside over the proceedings. Hon Minister, can
you proceed.
The MINISTER OF PUBLIC ENTERPRISES: Let me repeat, Acting
House Chair, “there’s none so deaf as those who will not
hear”. The facts are there for everyone to become familiar
with. Therefore, if you want to get our hands dirty in
rebuilding what is a set of broken systems and join us in
actually doing so. Don’t develop wrong narratives. These are
not honest narratives to misdirect the public. To South
Africans we want to say clearly that this government is
serious about fixing things. We won’t always get things right;
we will make mistakes as we go on. However, never doubt our
sincerity and our determination to get things right. We want
energy security, we want an efficient logistics system, we
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want our people to have electricity at an affordable price,
and we want our people to actually enjoy safety against
criminals. However, what we need is for all of us to unite
together.
Hon Wessels, as I said so in my speech earlier so that we can
utilise all of the skills and all of the resources in order to
direct our energies towards rebuilding South Africa and making
everyone us proud of the country we have, the SOEs we have,
the economy we have, and above all, the skilled youth that we
have within our system. What we need to say to South Africans
is beware the fact narratives, beware the narratives about
liberalism wherever things must just be sold and the state and
your government must be left empty handed. Therefore, beware
the racist populism that is prevailing in our country as well.
We are absolutely convinced that we are on the right track and
we will prove that we are on the right track as we proceed
with rebuilding our country and bring building it better for
all South Africans. Thank you, Acting House Chairperson.
Debate concluded.
The mini-plenary session rose at 11:59.
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