Questions and Replies

Reply:

According to the information received from Eskom:

(1)(a)The atmospheric emission license (AEL) emissions reports are compiled monthly and submitted to the licensing authorities by the power stations, and the Head office receives a copy of these reports when it is sent to authorities. Most of the stations are up to date with their submissions to the licensing authorities. However, Eskom experienced a delay in uploading the submitted and completed AEL monthly reports to the Eskom data portal due to issues with system access rights. These issues were resolved in October 2023, and all completed reports have been updated on the portal. Going forward Eskom will keep the portal regularly updated.

(b) The issues in respect of access rights for the uploading of completed AEL reports have been resolved by ensuring that additional staff are trained and have the appropriate system access rights to allow the uploading of completed reports. The delayed publication of the reports on the data portal was not indicative of any gaps in compliance monitoring in relation to the AELs.

(2) There was no lack of regular reporting on AEL compliance to the authorities, and no regulatory and/or enforcement actions were implemented.

(3)(a)(b)Eskom has already published all the available monthly AEL reports as submitted to the authorities onto the public data portal. Eskom will regularly update the portal which is available to the public.

 

Remarks: Approved/Not Approved/Comment

Ms Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

There is 1 recorded case of mismanagement of funds by senior management official in the Department. The details are shown below:

Total of cases of fraud and mismanagement of funds lodged against current and previous senior management officials since 1994	Nature	Arrests have been made	Cases before the courts	Convictions have been secured
2020/2021 – 1 Case	Mismanagement of funds	No need for arrests. It is a civil recovery matter	Matter not before court as yet. Matter is still at pleading stage.	No need for conviction. This is a civil recovery matter.

Remarks: Reply: Approved/Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

The budget for flights within the Department is not split between senior managers and other officials. However, 95% on average of the travel is undertaken by senior managers. The total flights of officials over the last three years are shown below:

(i) 2019/20 Financial Year:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
Flights	19 557 000	15 728 000

(ii) 2020/21 Financial Year:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
Flights	3 924 000	2 384 000

 

(iii) 2021/22 Financial Year:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
Flights	9 607 000	5 130 416

 

Remarks: Reply: Approved / Not Approved/Comment

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

(a)(i) The Board of Directors, entrusted with the ultimate responsibility and guided by their fiduciary duties, is empowered to manage all facets of the SOE's business. In instances of significant operational challenges affecting both the Company and the broader economy, as exemplified by Transnet, I have tasked certain Boards, including Transnet's, with developing and implementing a recovery plan. This strategic initiative aims to reassess and enhance operational effectiveness, ultimately leading to a substantial improvement in SOE’s performance.

The Boards are wholeheartedly committed to ensuring operational continuity and the successful implementation of the turnaround plans.

(ii) The Shareholder has a responsibility to hold the Boards of SOEs accountable in line with relevant laws including the Companies Act and Public Finance Management Act. Furthermore, the shareholder exercises shareholder rights in line with the Memorandum of Incorporation. There has not been any political interference in the SOEs that resulted in any leadership vacuum.

While the Departments ensures that there is stable leadership in SOEs, we have appointed interim leaders who possess the necessary experience and expertise to effectively manage and guide Eskom and Transnet. We have recently directed the Transnet Board to promptly formulate solutions for a variety of operational challenges, which encompass matters such as accountability, cost structure, and employee engagement.

(b) During extremely challenging times, it is found that more often than not, changes in leadership at both Board and Executive level are necessitated in order to drive urgent change and performance of an organisation, based on its operational requirements and the need for a review and refocus of operational effectiveness. This has been the case in the instance of Transnet and Eskom in recent months.

Leadership change is but one of the levers utilised to drive strategic enhancement of the organizations. It is on this basis that a review of Executive Management to determine whether they were fit for purpose and capable of executing the Board’s revised strategies and plans was undertaken by the SOE Boards. Coupled with leveraging of existing resources to pursue long-term success, the Boards of some entities in the DPE portfolio, namely Transnet, Eskom, and Denel, are undertaking rigorous and comprehensive recruitment processes to fill key positions of Group Executives and Prescribed Officers.

While the recruitment processes are underway the Boards have appointed interim executives and prescribed officers from within their existing management structures, with immediate effect. This ensures leadership continuity and stability, and operational sustainability.

Any assertion of the so called “interference” is rejected emphatically.

Remarks: Reply: Approved / Not approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

I have directed the boards of several SOCs in my portfolio to formulate and implement turnaround plans. These plans aim to enhance operational efficiency and significantly improve the overall performance of the respective companies.

Eskom

Eskom is making strides towards ensuring energy stability and sustainability. The Generation Recovery plan has already recovered 1,535 MW between April and September 2023 contributing to Eskom’s goal of achieving an Energy Availability Factor (EAF) of 65% by March 2024. This progress is poised to reduce the intensity and frequency of load shedding while increasing grid capacity. Furthermore, Eskom has significantly improved generation at its coal-fired stations through accelerated maintenance. In addition, the bringing online of three units at Kusile Power Station earlier than scheduled has reduced the amount of load shedding. Eskom’s partnership with independent power producers (IPPs) will add 9,421 MW of renewable energy to the grid. This underscores Eskom’s and the countries commitment to cleaner energy solutions. Eskom is also undergoing restructuring process that will result in the company having ion and Distribution. This is to promote efficiency, accountability, and the adoption of new technologies. The recent debt relief package from the government, along with efforts to strengthen the transmission grid and combat corruption, further solidifies Eskom's position on the path to a sustainable and reliable energy future for South Africa.

In addition to these advances, Eskom has made significant progress in addressing financial challenges and enhancing its corporate structure. The debt relief package of R254 billion from the government and measures to write off municipal arrear debt demonstrate Eskom's commitment to financial sustainability. Their focus on strengthening the transmission grid, with a special emphasis on the first 1,000 km of power lines, underscores their readiness to accommodate power from independent producers. Importantly, Eskom's anti-corruption efforts have led to a number of arrests, the recovery of assets, and the pursuit of criminal cases, affirming their resolve to protect the integrity of the company and public funds. These combined efforts paint a promising picture of Eskom's commitment to a more stable, sustainable, and accountable energy future, ultimately benefiting the people of South Africa.

Transnet

On 1 September 2023, I directed the Transnet Board to urgently address and report to the shareholder on its decisions and recommendations within the next few weeks in respect of, inter alia the following:

1. Operational transformation: Develop or enhance a turnaround plan to radically transform the operational performance of each of the business areas, including the restructuring of the entity to deliver on its mandate more effectively and efficiently.
2. Root causes: Identify the root causes of the inability of management and staff to meet the performance targets and a plan to deal with the deficiencies.
3. Stringent / rigorous accountability Oversight: Transnet to develop, with the DPE and National Logistics Crisis Committee (NLCC), a new framework for transparency and accountability through detailed reporting on the successful execution of the turnaround strategy.
4. Digitisation of systems: Mechanisms to speed up the automation and digitisation of performance reporting systems to prevent deliberate and wrongful manipulation of data.
5. Rigorous system of controls: Implement urgently the controls identified by the Auditor General reports.
6. Private sector participation: Transnet is in the process of getting private sector involved in various capital projects. For example, a reputable international private sector partner has already been identified for the development and operation of the Pier 2 container terminal at the port of Durban.

As a result, the Board and Interim leadership have formulated an impressive “Recovery Plan” that is being rigorously implemented. In particular, the operational inadequacies are being systematically overcome – the assistance of the private sector through the establishment of “Centre of Excellence” will result in better operational outcomes in due course. Similarly, extraordinary efforts are being made to acquire additional equipment to improve port performance. Already a difficult operational approach at the ports introduced by management, is reducing the time spent by ships at anchorage.

 

Alexkor

Alexkor is solvent and does not have any interest-bearing debt. Alexkor’s financial position has limited financial risk as the largest liability will be settled by ring-fenced funds.

In January 2022, I appointed an interim board to restore governance amid years of instability. The appointment process for a permanent CEO and CFO is underway.

In 2019, we initiated a forensic investigation into allegations of maladministration and corruption. This led to significant findings, prompting President Cyril Ramaphosa to authorize the Special Investigating Unit (SIU) to delve into corruption and maladministration in Alexkor and joint venture diamond operations on December 10, 2021. We remain resolute in our commitment to transparency, justice, and ethical governance as we pave the way for a brighter future.

South African Airways

There have been notable strides in the SAA Strategic Equity Partner (SEP) transaction. The approval of the transaction in July 2023 by the Competition Tribunal offers the potential for a significant turnaround. It provides the opportunity for SAA to comprehensively address and overcome its longstanding financial difficulties, with the added benefit of mitigating the compounding effects of the COVID-19 crisis. By securing a strategic equity partner and fostering collaboration, SAA may embark on a path towards financial stability and long-term viability, marking a pivotal moment in its recovery journey. Currently, it has expanded its route network to 11 destinations and increased a number of aircraft by 9 with further expansion expected over the short and medium term. It also plans to commence international routes with the first flight to Brazil expected shortly.

SAFCOL

SAFCOL's unqualified audit and INFLOMA's clean audit underscore SAFCOL’s financial responsibility and transparency. With a notable R285 million profit, SAFCOL is not only stable but also positioned for growth, especially as it pursues projects like Combined Heat and Power (CHP – generating heat and power from wood chips) to mitigate load shedding risks. SAFCOL’s initiatives further highlight its commitment to social responsibility. SAFCOL is a thriving, responsible organization, ready to embrace future opportunities and challenges.

Denel

 

In the past three years, Denel was faced with significant viability challenges. The malfeasance linked to State Capture and poor management decisions resulted in a steep decline in revenues and profitability since 2017/18, reversing a 7-year trend of good governance, growth, and profitability. This culminated into in a weak balance sheet, declining order book, poor operational performance, unpaid salaries, and suppliers which resulted in an erosion of key defence industrial capabilities and loss of critical skills.

Government has made significant interventions to stabilize the SOC. In the past five financial years, the State has injected into Denel approximately R9 billion, including settling guaranteed debt which was keeping Denel in a debt trap due to high interest payments. The intervention has resulted in an appreciable improvement in the market sentiments (employees, clients, partners, financial institutions, and suppliers) regarding the clarity of Government’s strategic intent with respect to Denel.

The focus in the near term, the Department is encouraging Denel to optimise on short term revenue opportunities to ensure that the SOC can fund its operational requirements and deliver on existing contracts.

Despite the challenges of the prior years, the interest by both local and international entities as well as government to collaborate with Denel on various defence technologies remains high.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from SOCs:

ALEXKOR:

Alexkor had good returns from the sale of diamonds in the 2022/2023 reporting period and there are sufficient reserves to continue operating in the next 12 months without reliance from the fiscus.

DENEL:

• Denel has tabled a comprehensive turnaround plan dealing with all aspects of the business with the following objectives:
• Reduced costs and increased revenue
• Engaged staff who are performance orientated
• Increased customer base
• Ensuring effective supply chain procedures
• Optimized planning and production
• Partnerships and joint ventures

This plan and actions were underpinned by a recapitalisation programme from Government and Denel is currently executing this plan and will not require any additional bailouts from the Government.

SAFCOL:

SAFCOL has implemented cost curtailment measures since the start of the second quarter. Through this, revenue-generating and compliance expenditure is prioritised. The impact of these cash preservation measures is closely monitored on a monthly basis. Due to this intervention, SAFCOL’s total expenditure at the end of September 2023, was 16% below budget and continues to show positive variances in the forecast for the remainder of the year.

SAFCOL has no government guarantees in place and relies on the robustness of its own balance sheet. Currently, there are no indications that any bailouts would be necessary in the foreseeable future.

 

 

Remarks: Approved / Not Approved/Comments

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from SOCs:

ALEXKOR:

a) R4 620 135.75

(b)(i)

(ii) No interest has been accrued on the items listed.

(c) None

DENEL:

1. (i) R100m
2. (i) Aluwani

(ii) R 5,456,986.30

1. 3 months Jibar + 280 basis points

SAFCOL:

(a) (ii)	R58 537 150
(b)	(i) Nedbank Bank: Capital R4 600 167 Standard Bank: Capital R52 483 995	(ii) Nedbank Bank: Interest R387 066 Standard Bank: Interest R1 065 922
(c)	Nedbank Bank: Interest R387 066   Standard Bank: Interest R1 065 922

Remarks: Approved/Not Approved/Comments

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from SOCs:

ALEXKOR:

 

(1)	(a) There were no private equity capital investments invested in Alexkor for the past 5 years.
	(b) (aa) N/A there were no private investors.
	(bb) N/A there were no private investors.
(2)	No dividends were paid as there was no private equity investor.

DENEL:

(1) (a) (i)None

(b) (aa) None

(bb) None

(2) None

SAFCOL:

1. (a) (ii) There are no Private Equity Investments in Safcol.

(b) (aa) N/A

(bb) N/A

2. N/A

Remarks: Approved / Not Approved/Comments

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

a) The Minister did not attend the Rugby World Cup final in France in October 2023.

b) The Deputy Minister did not attend the Rugby World Cup final in France in October 2023.

c) There were no other officials who attended the Rugby World Cup final in France in October 2023.

 

Remarks: Approved/Not Approved/Comment

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Eskom

Before February 2023, the Melkspruit area had been experiencing poor electricity supply. During February and March 2023, Eskom arranged planned outages to conduct maintenance on the equipment and power lines in the area. As a result, 80% of the defects on the lines were resolved by Eskom’s construction maintenance teams. The reliability and electricity supply situation has been improving since the planned maintenance took place. There has been a significant reduction in the number of faults per month from 19 faults in February and March 2023 to an average of about four faults per month in the last few months. Eskom continues to closely monitor and clear any faults on the power lines in the area.

Remarks: Approved/Not Approved/Comment

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

1. Twenty-three project proposals have been received to date.

• Load Management (LM): 16 proposals received.
• Residential Load Management (RLM): zero proposals received.
• Energy Efficiency (EE): seven proposals received. (See tables in (2) for details).

Of the 23 projects received, 16 projects (11 LM and five EE) have met the programme criteria to proceed to the governance approval stages. (See the tables in (2) for details).

(2)

Eskom Distribution Demand Management Programme – Load Management Projects
Project number	Project name	Project type	Demand reduction (MW)	Project costs	Status	Project description
2023001	Cooke 4 Water Pumping System	Load Management	10.000	R30 000 000	Procurement phase	Optimisation of underground mining water pumping network to enable electrical load shift in the evening peak hours
2023003	Driefontein 4 and 5 Fridge Plant	Load Management	5.000	R15 000 000	Procurement phase	Optimisation of underground mining refrigeration system to enable electrical load shift in the evening peak hours
2023008	LM Karee 4 – Water Pumping System	Load Management	1.000	R3 000 000	Investment phase submission for 8 December 2023	Optimisation of underground mining water pumping network to enable electrical load shift in the evening peak hours
2023009	LM Karee 4 – Compressed Air (CA)	Load Management	1.300	R3 900 000	Investment phase submission for 8 December 2023	Optimisation of underground mining compressed air network to enable peak clipping of electrical load in the evening peak hours
2023010	LM Samancor WCM Mooinooi CA	Load Management	1.000	R3 000 000	Investment phase submission for 8 December 2023	Optimisation of underground mining compressed air network to enable peak clipping of electrical load in the evening peak hours
2023011	LM Samancor MFC Mills Load Shifting	Load Management	1.440	R4 320 000	Investment phase submission for 8 December 2023	Optimisation of smelter-milling plant to enable electrical load shift in the evening peak hours
2023012	LM Samancor TAS Mills	Load Management	1.058	R3 174 000	Investment phase submission for 8 December 2023	Optimisation of smelter-milling plant to enable electrical load shift in the evening peak hours
2023014	LM Samancor ECM Doornbosch PC	Load Management	0.700	R2 100 000	Investment phase submission for 8 December 2023	Optimisation of air pressure control for the underground mine to enable peak clipping of electrical load in the evening peak hours
2023015	LM Samancor ECM Tweefontein PC	Load Management	1.000	R3 000 000	Investment phase submission for 8 December 2023	Optimisation of air pressure control for the underground mine to enable peak clipping of electrical load in the evening peak hours
2023016	LM Great Noligwa KOSH Pumping	Load Management	1.600	R4 800 000	Investment phase submission for 8 December 2023	Optimisation of underground mining water pumping network to enable electrical load shift in the evening peak hours
2023017	LM Moab Khotsong Compressors	Load Management	0.800	R2 400 000	Investment phase submission for 8 December 2023	Optimisation of underground compressor network to enable peak clipping of electrical load in the evening peak hours
			24.90	R74 694 000

 

Eskom Distribution Demand Management Programme – Energy Efficiency Projects
Project number	Project name	Project type	Demand reduction (MW)	Project costs	Status	Project description
2023004	Driefontein 5 Service Water Optimisation	Energy Efficiency	1.000	R3 000 000	Procurement phase	Optimisation of underground mining water pumping network to enable electrical energy savings between 06:00 and 20:00
2023005	Driefontein 5 Energy Recovery	Energy Efficiency	1.800	R5 400 000	Procurement phase	Commissioning of an underground turbine to break the water pressure feeding down the mine shaft to generate electricity, reducing the amount of electricity needed from Eskom
2023007	EE Limpopo Schools Lighting Project	Energy Efficiency	0.443	R1 329 000	Investment phase submission for 8 December 2023	Replacing old fluorescent lights with energy-efficient light-emitting diode (LED) lighting at 34 Limpopo public schools
2023018	EE Kusasalethu Turbines	Energy Efficiency	3.200	R9 600 000	Investment phase submission for 8 December 2023	Commissioning of an underground turbine to break the water pressure feeding down the mine shaft to generate electricity, reducing the amount of electricity needed from Eskom
2023019	EE Shoprite T5 LED Retrofit	Energy Efficiency	0.640	R1 920 000	Investment phase submission for 8 December 2023	Replacing old fluorescent lighting with energy-efficient LED lighting at 31 Shoprite Checkers supermarkets
			7.083	R21 249 000

(3)

No.	Possible barriers to uptake	Mitigation
1	The DDMP performance contracting programme participating criteria limit mid-segment consumers to participate, as the minimum criteria requirement targets larger projects.	Review programme participation requirements to attract medium to small customers to participate. Revise the engagement plan to address the missing middle segment.
2	Developers have challenges in securing upfront project funding from commercial funding institutions. The incentive is paid after project implementation and during the sustainability period.	Project developers have been encouraged to engage the public (Development Bank of South Africa (DBSA), Industrial Development Corporation (IDC), etc.) and private financial institutions for support in financing Energy Efficiency and Demand-Side Management (EEDSM) projects.
3	Project developers, customers, and funders require certainty in the markets when it comes to Demand-Side Management (DSM) incentives. How long will they be available so that they can plan on capital?	This is important to developers and customers, as it will assist them in the decision to invest. Eskom Integrated Demand Management (IDM) intends to run the DDMP after the Multi-Year Price Determination (MYPD) 6 (the 2029 financial year) and to motivate the inclusion of DSM in the Integrated Resource Plan (IRP), which will assist in enhancing certainty.
4	The skills shortage is a critical factor. Most customers do not have the necessary skills and resources to undertake DSM measures. This also has an impact on the assessment of benefits when it comes to DSM initiatives.	Eskom IDM and the National Cleaner Production Centre (NCPC) have collaborated to assist customers who have the potential to participate. The NCPC has the resources to offer customer training on DSM and to conduct energy assessment audits.
5	DDMP's current engagements are held at executive customer level, and the information is not adequately passed on to on-site engineers to develop projects.	Engage engineers/energy managers at site level within the cluster.

(4) The following interventions are ongoing to improve the visibility of the DDMPs:

• Ongoing presentations to industry associations, such as the South African Property Owners Association (SAPOA) and the Energy Services Company (ESCO) Association.
• Eskom has also presented the DDMP at the National Energy Crisis Committee (NECOM) DSM Indabas (national, Western Cape (WC), and KwaZulu-Natal (KZN). Furthermore, Eskom participates in NECOM Work Stream 5 - DSM as a task team member.
• In addition, Eskom has held EEDSM symposiums and continues to engage with customers and stakeholders to promote and provide clarification on the DDMP performance contracting programmes.
• Eskom IDM management recently held meetings with large municipalities/metros (KZN and the WC) and is planning to engage other distributors.
• Eskom IDM management has decided to conduct roadshows in all provinces that address the missing middle (small- to medium-sized customers) to improve participation.

 

Remarks: Approved / Not Approved

Ms Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

The Department has no capped amount at which it will cease to provide financial relief to state-owned enterprises. Each request for financial relief is assessed on its own merit. The factors to be considered are diagnosis of the challenges the SOE is facing and the development of turnaround plan to remedy those challenges.

The Presidential State-Owned Enterprises (PSEC) was established by the President in 2020, of which the Department is the Secretariate. The task of PSEC is to reform, reposition and revitalise the SOE’s not only within the Department’s portfolio but others as well. The exercise will require some funding which may be from Government and/or from other sources including disposal of non-core assets, private sector participation amongst others. Funding will therefore be assessed on a case-by-case basis.

 

It must be emphasised that SOEs should not operate on the basis that they will always receive funding from the fiscus. In fact, SOEs must be viable in their own right as soon as possible.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

(a) and (b)

The Department of Public Enterprises (DPE) does not have short-term and/or long-term contract with any national or foreign companies in respect of all Power Stations, this includes the Kusile and Medupi Power Stations. Any such contracts are entered into by Eskom. Examples would be with supplies from Cahovva Bassa, Southern African Power Pool

(aaa), (bbb) and (ccc)

The Department of Public Enterprises has an oversight responsibility over State-Owned Companies (SOCs) and is not involved in the operations of the SOCs. The Department is not responsible for procurement in the Eskom power stations in line with the Public Finance Management Act (PFMA). Eskom Holdings SOC Ltd management is responsible for all the interventions at the Kusile and Medupi Power Stations.

.

Remarks: Approved / Not Approved

Ms Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet:

a) Over the preceding three financial years, Transnet National Ports Authority (TNPA) made a capital projects investment of R 2.7 billion in the ports of Cape Town, Saldanha Bay, Durban and Port Elizabeth. No capital investments have been made into the development of the Port of Boegoebaai thus far since only conceptual studies have been conducted. Table 1 provides (a) the total amount (detailed breakdown) of the capital expenditure over the past three financial years.

Table 1: Capital Expenditure over past three financial years

Ports	Expenditure 2020/21 (Rm’s)	Expenditure 2021/22 (Rm’s)	Expenditure 2022/23 (Rm’s)	Total Expenditure (Rm’s)
Cape Town	86	280	141	507
Saldanha	70	123	187	380
Boegoebaai	0	0	0	0
Durban	133	954	508	1,595
Port Elizabeth	31	65	128	224
Grand Total	320	1,422	964	2,706

b) Tables 2 and 3 below offer insight into (b) the nature of the capital expenditure for the same period. In expansion projects (Table 2), a new asset is either constructed/ acquired or an existing asset is extended. Whereas in sustaining projects (Table 3), an existing asset is replaced or refurbished.

Table 2: Investment on Expansion Projects over past three financial years

Ports	Expenditure 2020/21 (Rm’s)	Expenditure 2021/22 (Rm’s)	Expenditure 2022/23 (Rm’s)	Total Expenditure (Rm’s)
Cape Town	0.8	238	15	254
Saldanha	0.1	1.5	22	24
Boegoebaai	0	0	0	0
Durban	12	711	98	821
Port Elizabeth	0	0	0	0
Grand Total	13	951	135	1,099

Table 3: Investment on Sustaining Projects over past three financial years

Ports	Expenditure 2020/21 (Rm’s)	Expenditure 2021/22 (Rm’s)	Expenditure 2022/23 (Rm’s)	Total Expenditure (Rm’s)
Cape Town	85	42	126	253
Saldanha	70	121	165	356
Boegoebaai	0	0	0	0
Durban	121	243	410	774
Port Elizabeth	31	65	128	224
Grand Total	307	471	829	1,607

 

Remarks: Reply: Approved / Not Approved

Jacy Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

1. (a) State capture was characterized by intensive levels of political interference, with Eskom and Transnet emerging as focal points of this concerning phenomenon. These SOEs faced undue external influence, compromising their governance structures, decision-making processes, and overall operational integrity. Political interference led to the appointment of key executives and board members who were compromised, resulting in leadership that was not best suited to address the complex challenges the SOEs faced.

However, various interventions were made to ensure operational viability and sustainability of Eskom and Transnet.

The interventions to date include:

​1.1 Eskom

I have instructed the Board to expeditious address the following issues:

• 1.1.1  Management Structure / Skills
• Review and enhance leadership team to capacitate all subsidiaries for effective objective execution.
• Expedite filling critical vacancies.
• 1.1.2 Restructuring - Eskom Roadmap 2 and Implementation
  • Develop a revised Eskom Roadmap guiding the restructuring process.
  • Ensure the plan addresses external dependencies.
  • Capacitate the executive team with the right skills.

• 1.1.3 Finance
  • Develop a comprehensive allocation policy for assets and debts post-restructuring.
  • Continue cost-cutting exercises with defined targets discussed with the Department.
  • Capacitate the Treasury team to ensure compliance with debt relief conditions for loan-to-equity conversion.

• 1.1.4 Forensic Investigations
• Conduct robust forensic investigations to isolate irregularities.
  • Implement consequence management for those found in the wrong.
  • Test the internal control universe to ensure timely detection and prevention of irregularities.

1.2 Transnet

On 1 September 2023, I directed the Transnet Board to urgently address and report on its decisions and recommendations in respect of, inter alia the following:

• 1.1.1 Operational transformation: Develop or enhance a turnaround plan to radically transform the operational performance of each of the business areas, including the restructuring of the entity to deliver on its mandate more effectively and efficiently.
• 1.1.2 Root causes: Identify the root causes of the inability of management and staff to meet the performance targets and a plan to deal with the deficiencies.
• 1.1.3 Stringent / rigorous accountability Oversight: Transnet to develop, with the DPE and National Logistics Crisis Committee (NLCC), a new framework for transparency and accountability through detailed reporting on the successful execution of the turnaround strategy.
• 1.1.4 Digitisation of systems: Mechanisms to speed up the automation and digitisation of performance reporting systems to prevent deliberate and wrongful manipulation of data.
• 1.1.5 Rigorous system of controls: Implement urgently the controls identified by the Auditor General reports.
• 1.1.6 Private sector participation: Transnet is in the process of getting private sector involved in various capital projects. For example, a reputable international private sector partner has already been identified for the development and operation of a container terminal at the port of Durban.

2. There is no leadership vacuum at both SOEs as there is an adequate complement of the Board with Acting Group Chief Executive Officers and Acting Chief Financial Officers. Of importance is that in respect of Transnet the focus is on operational and financial performance that the Minister needs to address as per the statement dated 1 September 2023.

3. In relation to Eskom, it is noteworthy that the former Group Chief Executive Officer (GCEO) operational performance has deteriorated under his watch.

4. It is important to indicate that the recruitment process for the Group Chief Executive Officer (GCEO) is carried out by the Board in accordance with the provisions outlined in the Memorandum of Incorporation, which aligns with the standard procedures across the Department of Public Enterprises (DPE) portfolio. The Board will run the recruitment process including the advertisement, shortlisting and interviewing of candidates. The Board will then present to the shareholder three appointable candidates. The shareholder will then approve the appointment of a candidate.

Remarks: Reply: Approved / Not approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

No!

Each SOE is on a challenging recovery path, and each has met with some success. The boards are working diligently to overcome the effects of State Capture and restore the entities to effective operations.

Eskom

Eskom is making remarkable strides toward energy stability and sustainability. Their Generation Recovery plan has already recovered 1,535 MW between April and September 2023, with a goal of achieving a 65% Energy Availability Factor (EAF) by March 2024. This progress is poised to reduce the intensity and frequency of load shedding while increasing grid capacity. Furthermore, Eskom has significantly improved Energy Availability in coal-fired stations and accelerated maintenance at the Kusile Power Station, bringing units online earlier than scheduled and reducing the impact of load shedding. Their partnership with independent power producers (IPPs), which will add 9,421 MW of renewable energy capacity, underscores their commitment to clean energy solutions. Eskom is also actively restructuring the company into three subsidiaries to promote efficiency, accountability, and the adoption of new technologies. The recent debt relief package from the government, along with efforts to strengthen the transmission grid and combat corruption, further solidifies Eskom's position on the path to a sustainable and reliable energy future for South Africa.

In addition to these advancements, Eskom has made significant progress in addressing financial challenges and enhancing its corporate structure. The debt relief package of R254 billion from the government and measures to write off municipal arrear debt demonstrate Eskom's commitment to financial sustainability. Their focus on strengthening the transmission grid, with a special emphasis on the first 1,000 km of power lines, underscores their readiness to accommodate power from independent producers. Importantly, Eskom's anti-corruption efforts have led to a number of arrests, the recovery of substantial assets, and the pursuit of criminal cases, affirming their resolve to protect the integrity of the company and public funds. These combined efforts paint a promising picture of Eskom's commitment to a more stable, sustainable, and accountable energy future, ultimately benefiting the people of South Africa.

Transnet

On 1 September 2023, I directed the Transnet Board to urgently address and report to the shareholder on its decisions and recommendations within the next few weeks in respect of, inter alia the following:

1. Operational transformation: Develop or enhance a turnaround plan to radically transform the operational performance of each of the business areas, including the restructuring of the entity to deliver on its mandate more effectively and efficiently.
2. Root causes: Identify the root causes of the inability of management and staff to meet the performance targets and a plan to deal with the deficiencies.
3. Stringent / rigorous accountability Oversight: Transnet to develop, with the DPE and National Logistics Crisis Committee (NLCC), a new framework for transparency and accountability through detailed reporting on the successful execution of the turnaround strategy.
4. Digitisation of systems: Mechanisms to speed up the automation and digitisation of performance reporting systems to prevent deliberate and wrongful manipulation of data.
5. Rigorous system of controls: Implement urgently the controls identified by the Auditor General reports.
6. Private sector participation: Transnet is in the process of getting private sector involved in various capital projects. For example, a reputable international private sector partner has already been identified for the development and operation of a container terminal at the port of Durban.

Alexkor

• Alexkor is solvent and does not have any interest-bearing debt. Alexkor’s financial position has limited financial risk as the largest liability will be settled by ring-fenced funds.

In January 2022, I appointed an interim board to restore governance amid years of instability. The appointment process for a permanent CEO and CFO is underway.

In 2019, we initiated a forensic investigation into allegations of maladministration and corruption. This led to significant findings, prompting President Cyril Ramaphosa to authorize the Special Investigating Unit (SIU) to delve into corruption and maladministration in Alexkor and joint venture diamond operations on December 10, 2021. We remain resolute in our commitment to transparency, justice, and ethical governance as we pave the way for a brighter future.

South African Airways

There have been notable strides in the SAA Strategic Equity Partner (SEP) transaction. The recent approval of the transaction by the Competition Tribunal offers the potential for a significant turnaround. It provides the opportunity for SAA to comprehensively address and overcome its longstanding financial difficulties, with the added benefit of mitigating the compounding effects of the COVID-19 crisis. By securing a strategic equity partner and fostering collaboration, SAA may embark on a path towards financial stability and long-term viability, marking a pivotal moment in its recovery journey. Currently, it has expanded its route network 11 destinations and increased a number of aircraft 9 with further expansion expected over the short and medium term. It also plans to commence international routes with the first flight to Brazil expected shortly.

SAFCOL

SAFCOL's unqualified audit and INFLOMA's clean audit underscore SAFCOL’s financial responsibility and transparency. With a notable R285 million profit, SAFCOL is not only stable but also positioned for growth, especially as it pursues projects like CHP to mitigate load shedding risks. SAFCOL’s initiatives further highlight its commitment to social responsibility. SAFCOL is a thriving, responsible organization, ready to embrace future opportunities and challenges.

Denel

In the past three years, Denel was faced with significant viability challenges. The malfeasance linked to State Capture and poor management decisions resulted in a steep decline in revenues and profitability since 2017/18, reversing a 7-year trend of good governance, growth, and profitability. This culminated into in a weak balance sheet, declining order book, poor operational performance, unpaid salaries and suppliers which resulted in an erosion of key defence industrial capabilities and loss of critical skills.

Government has made significant interventions to stabilize the SOC. In the past five financial years, the State has injected into Denel approximately R9 billion., including settling guaranteed debt which was keeping Denel in a debt trap due to high interest payments. The intervention has resulted in an appreciable improvement in the market sentiments (employees, clients, partners, financial institutions, and suppliers) regarding the clarity of Government’s strategic intent with respect to Denel.

The focus in the near term, the Department is inducing Denel to optimise on short term revenue opportunities to ensure that the SOC can fund its operational requirements and deliver on existing contracts.

Despite the challenges of the prior years, the interest by both local and international entities as well as governments to collaborate with Denel on various defence technologies has not remains high.

 

Remarks: Reply: Approved / Not Approved

Melanchton Makobe P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to Information Received from Eskom:

1. Battery storage is used by Eskom to support the network during peak loading and ancillary services such as frequency regulation and voltage support.

However, gas is used as mid-merit or peak generation, depending on the prices. Gas can power the network on a continuous basis.

The costs of battery storage cannot be directly compared to those of gas, as battery storage has charging and discharge components. Charging costs and discharging costs differ.

Gas costs are only for electricity generation.

In addition, the use of gas would require new pipelines and gas distribution networks to Eskom substations. The country would have to invest in new gas pipeline networks, and these would need to be built underground and protected which would further increase costs.

2. Storage that would be currently required is about 70% of the installed solar photovoltaic (PV) and wind capacity to ensure power supply continuity equivalent to baseload generation. The storage capacity must accommodate load shedding cycles to be effective. The battery storage costs are in the peak generation range. Using current battery energy storage costs of R11bn for 200M/800MWh, an installed PV base of 5000MW would require 3500W/14000MWh a day at an estimated installation cost of over R192bn noting that this excludes operational costs.

 

Remarks: Approved / Not Approved

Ms Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to Information Received from Eskom:

The smart meter installation programme is an Eskom Distribution wide programme which was implemented in all the provinces to ensure alignment to the Distribution key initiatives of growth, efficiency and servicing the customers better. It is not confined to Gauteng and Fourways only.

(1)(a) The total number of houses identified for the smart meter installation programme in Gauteng was in excess of 35 000, in Sandton, Midrand and Soweto.

(b) A total of 30 597 customers in Gauteng acceded to the installation of smart metersand in Fourways approximately 10 000 meters were installed as part of the smart meter programme. Furthermore, approximately 8 000 houses also acceded to the load limiting pilot that required the use of smart meters.

Load limiting seeks to manage the demand during periods when emergency is declared such as when the system is constrained (during load shedding Stages 1 to 4), while at the same time ensuring that customers experience a reduced impact during loadshedding (customers have enough power for lights and electronic appliances during load shedding).

(c) The total number of smart meters installed for the Gauteng smart metering project is 30 597. Of which approximately 10 000 were installed in Fourways.

(2)(a) The smart meters were installed by Landis+Gyr, which was the successful bidder following an open tender procurement process.

(b) The details entail the installation of meters, data concentrators (DC), and customer interface units (CIUs). The cost associated with the installation is approximately R96 million.

Remarks: Approved / Not Approved

Ms Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet:

a) An emergency procurement process was followed for the acquisition of disposable mouthpieces for alcohol breathalyzer straws.

b) The Executive Manager for Group Continuity and Disaster Management and the Executive Director for Safety were central to the procurement of the breathalyzer straws.

c) An internal disciplinary process was instituted in respect of the two employees central to the procurement of the breathalyzer straws. At the conclusion of this process, they were both dismissed. The matter was also reported by Transnet to the Directorate of Priority Crime Investigation (DPCI) on 5 October 2021 in terms of Section 34 of the Prevention and Combating of Corrupt Activities Act 12 of 2004. A referral has also been made to the National Prosecuting Authority. Transnet also referred the matter to the Special Investigating Unit (SIU) for further investigation in terms of Proclamation R23 of no 2020 published on 23 July 2020 in Government Gazette No. 43546. The SIU has launched an application in the Special Tribunal to review and set aside the contracts awarded to the 3 service providers. The two employees central to the procurement have been cited as respondents in this application.

Remarks: Reply: Approved / Not Approved

Melanchton Makobe P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet:

The triangular rail shuttle between the Transnet Port Terminals (TPT) of Ngqura (NCT), the Port of Port Elizabeth (PECT) and the TFR Deal Party container Terminal (PEG) started in June 2023 and continues to operate.

a) Progress made:

During June

The route between NCT and PECT (1480 TEUs) runs 15 trains that are made up of 50 wagons per train. The Reefer containers are all 40-foot containers which is equivalent to two x 20-foot containers. A single wagon carries one x 40-foot container and a total of 50 containers. The above scenario will remove 740 trucks from the road.

During September / October

The route between PECT and NCT based on 3 trains is equivalent to the removal of 150 trucks off the road.

b) The Inter-Terminal rail shuttle is an ongoing service that is based on customer demand. The service is not only restricted to the citrus season (reefer containers) but is a service offering throughout the year for general-purpose (GP) containers.

c) Stringent security measures have been instituted to ensure minimal security-related disruptions to the rail service. The Reefers are first inspected at the handover point at all Terminals by TFR Security Services. The Railway Police were called in as reinforcement when the service began operating in June 2023 to mitigate against the high-risk hotspot areas for criminal activity, which includes New Brighton.

 

Remarks: Reply: Approved / Not Approved

Jacy Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet:

1. The South African government, through the Department of Public Enterprises (DPE), continues to emphasise that involving the private sector in State-Owned Enterprises' (SOEs) operations should not be regarded as a departure from a state-led approach to public enterprises. One example of a partnership with the private sector that enhances Transnet's logistical value chains is the Mamathwane loop. This partnership brings in capital investments, expertise, and/or competences.

The state continues to play a major role in the management, oversight, and ensuring that the mandates of the SOEs are in line with the country’s socio-economic goals. Prior to the implementation of private sector participation (PSP) transactions, the DPE and other government departments evaluate and authorise these transactions in accordance with the PFMA and other legislative requirements.

Furthermore, the Cabinet's approval of the National Rail Policy (NRP) in March 2022 and the presidency's subsequent development of the Freight Logistics Roadmap set the stage for the country to move towards a more liberal rail market—a move that will necessitate major structural reforms. By allowing 3rd party private operators to operate on the national rail network, these changes are expected to encourage competition. This shift in policy will increase the effectiveness and performance of logistics, promote the development of rail-based support services (such as rail-focused warehousing), and draw in capital (via the acquisition of rolling stock).

For the first time, Transnet Freight Rail (TFR) will no longer be the sole provider of freight rail services, as private train operating companies (TOCs) will be able to operate on the freight network. TFR must be vertically separated into its component parts, namely operations and infrastructure, as part of the envisaged policy reforms and the Freight Logistics Roadmap's recommendations. The appointment of the interim rail infrastructure manager (RIM) on 1 November 2023, is proof that this process is well under way. In order to foster stronger cooperation between Transnet and the private sector and develop a vibrant rail sector, the establishment of a RIM is essential.

2. Transnet’s strategy is based on repositioning the organisation to deliver against the economic needs of the key market segments that it serves. There is a considerable opportunity to expand volumes (+/- 60 million tonnes of additional volumes) in the bulk mining commodity space, particularly in respect of iron ore, manganese, ferrochrome, and magnetite, in the next three to five years.

In order to provide industrial segments with more access to global trade and commercial networks, Transnet is repositioning its rail network and terminals to improve operational efficiency and capacity expansion. This is supportive of the Port of Durban being repositioned as a hub port for containers and automotives and Richard's Bay as an effective bulk commodities port.

Consequently, Transnet is driving capacity expansion and improving and transforming the key market segments that it serves by leveraging private sector participation in concert with Transnet's own assets and skills. Transnet's current corporate plans, which were submitted to Parliament, National Treasury, and the shareholder representative, clearly outline the nature and approach of private sector participation.

In addition, Transnet developed a comprehensive Joint Investment and External Partner Selection (JIEPS) framework that guides the involvement of the private sector in the business. To determine whether the private sector will offer any value, for instance, an extensive business case is developed that also includes a detailed financial model. A decision is taken at that moment on the suitability of working with the private sector partner.

The private sector’s is also not limited to ownership but involves other considerations such as capital contribution (for example, by customers through upfront payment or tariff adjustments), operations, and management.

Remarks: Reply: Approved/Not Approved/Comment

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet:

1. Private sector participation that Transnet has incorporated in its Reinvention and Growth Strategy is not intended to result in job losses. Rather, the involvement of private sector is to attract capital required to fund expansion programs and unlock growth in exports for key sectors such as manganese, chrome, and iron ore; and accordingly, growth in the overall economic activities in the country.

Transnet is also able to attract skills and competencies to accelerate efficiencies in its ports and terminals operations, which have been identified as one of the areas of concerns by the customers and shipping lines, as reflected in poor rankings of South African ports, especially in the container segment.

2. Transnet Management continues to engage with labour representatives, particularly addressing concerns around employee protection in implementation of the PSPs, such protection is also translated into agreements with the potential partners.

Remarks: Reply:Approved/Not Approved/Comment

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to Information Received from Eskom:

The Eskom Curtailment Framework involves the controlled reduction of electricity supply output from renewables (wind and solar) plants in response to system-security needs or temporary transmission capacity constraints. Eskom has developed this new approach to curtailment to allow for additional generation capacity to be built at points on the grid that had previously been shown as fully committed. It will therefore unlock scarce grid capacity in high-potential renewables regions ahead of Eskom’s grid investment roll-out. It is widely used by system operators to facilitate the introduction of renewable generators in a context of grid constraints. This involves the cumulative assessment of the new generation applications and ensures that the projects which are readiest for project implementation are prioritized for grid allocation. The framework could be implemented now that the updated Generation Connection Capacity Assessment is released.

The Generation Connection Capacity Assessment (GCCA) is an assessment of the generation that can be accommodated on the transmission system, at a given time and a a given location, without adversely affecting grid reliability and without requiring significant infrastructure upgrades. The GCCA aims to assist customers in making more informed decisions about where to pursue generation projects by providing information about the generation connection capacity that will be available on the transmission grid in a specific year, assuming that all planned projects are completed on time.

(1)(a) The curtailment framework has been approved within Eskom. A submission is being finalised by Eskom to NERSA on curtailment and other initiatives for noting and information. Detailed mechanisms and procedures to effect the curtailment framework are still to be finalised.

(b)(i) The Generation Connection Capacity Assessment 2025 was published on 31 October 2023 and can be accessed on the Eskom website:

GCCA Transmission Network – Eskom.

(ii) The curtailment framework will become official upon Eskom’s receipt of NERSA’s written response on the submission, as stated above in (a).

 

Remarks: Approved / Not Approved/Comments

Adv. Melanchton Makobe PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to Information Received from Eskom:

1. As at end September 2023 – the payment collection levels on 12 months moving average basis are as follows:

(a)(i) Municipalities = 87.3 %

(ii) All other customers combined = 99.9%

(b) The number of prepaid user customers as of September 2023 on Eskom’s Customer Care & Billing system is 6 803 462.

(c) The 2022-23FY non-technical losses are 13 396GWh and are equivalent to R5 607 441 692.

 

Remarks: Approved / Not Approved

Adv. Melanchton Makobe PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

(aa) The total salaries, travel, and accommodation of employees in the department for the last three financial years is shown below:

2020/21 Financial Year:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
i) Salaries	184 177 000,00	141 165 000,00
ii) Travel	3 924 000,00	2 384 000,00
iii) Accommodation	501 000,00	275 642,00
Total	188 602 000,00	143 824 642,00

 

2021/22 Financial Year:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
i) Salaries	158 954 000,00	140 046 805,00
ii) Travel	9 607 000,00	5 130 416,00
iii) Accommodation	1 410 000,00	872 699,00
Total	169 971 000,00	146 049 920,00

2022/23 Financial Year:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
i) Salaries	178 741 000,00	142 026 534,00
ii) Travel	12 510 000,00	7 232 659,00
iii) Accommodation	1 769 000,00	920 170,00
Total	193 020 000,00	150 179 363,00

Total for the 2020/21 to 2022/23 Financial Years:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
i) Salaries	521 872 000,00	423 238 339,00
ii) Travel	26 041 000,00	14 747 075,00
iii) Accommodation	3 680 000,00	2 068 511,00
Total	551 593 000,00	440 053 925,00

(bb) The total salaries, travel, and accommodation of employees in the department from 1 April 2023 to 30 September 2023 is shown below:

Expenditure Items	(a)	(b)
	Total budget allocated	Actual expenditure
i) Salaries	167 311 000,00	77 341 594,00
ii) Travel	13 970 000,00	7 002 339,00
iii) Accommodation	1 616 000,00	443 595,00
Total	182 897 000,00	84 787 528,00

 

Remarks: Reply: Approved/Not Approved/Comments

Melanchton Makobe P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet:

(1)(a) The total envisaged capital expenditure budget for the Transnet National Ports Authority (TNPA) over the next three (3) year period (FY24/25 – FY26/27) for the ports of (i) Cape Town, (ii) Saldanha Bay, (iii) Boegoebaai, (iv) Durban and (v) Port Elizabeth is R 7,221 bn. The proportion of the capital budget per port is shown in Table 1 below.

Table 1: Ports Capital Expenditure (FY2024/25 – FY2026/27)

Ports	Budget 2024/25 (Rm’s)	Budget 2025/26 (Rm’s)	Budget 2026/27 (Rm’s)	Total Budget (Rm’s)
Cape Town	520	792	668	1,980
Saldanha	311	321	269	901
Boegoebaai	0	310	590	900
Durban	489	1,488	1,205	3,182
Port Elizabeth	81	99	78	258
Grand Total	1,401	3,010	2,810	7,221

(1)(b) The nature of planned capital expenditure for the next three financial years for the respective ports is allocated in terms of segments. Table 2 below indicates the breakdown of the budget per segment for the respective years.

Table 2: Budget Breakdown Per Segment Cumulative 3 Years

Segment	Total Budget 3 Yrs. (Rm's)	% of Total Budget
Auto	168	2.3%
Bulk Services	1,120	15.6%
Container	321	4.5%
Energy	626	8.7%
Fleet	1,238	17.3%
Infrastructure	2,116	28.8%
Iron Ore	110	1.5%
Liquid	468	6.5%
Manganese	900	12.5%
Other Segments & Supporting Infrastructure	155	2.2%
Grand Total	7,221	100.00%

2. TNPA prioritizes investment with a two-step system as detailed below:

• The capex portfolio undergoes a process that provides a view of strategic alignment and funding readiness.

• The projects are then vetted through a ranking and prioritization model, which provides an ascending rating scale to indicate project prioritization. This ensures strategic alignment, driving TNPA’s intended strategic direction, and consistency in admitting projects onto the CAPEX plan.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to information received from these intities

 

ESKOM:

ALEXKOR:

Awaiting response.

SAFCOL:

	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023
(i)Air Travel					R265 581.39	R132 180.16	-	-	R16 436.16	R26 831.83
(ii)Ground Transport					R137 214.98	R238 656.14	R3 441.79	R120 591.39	R250 519.36	R58 048.71
(ii)Hotel Accommodation					R132 112.70	R116 742.76	R6 579.62	R41 398.20	R85 254.27	R8 783.21
(iii) Residence Maintenance					None	None	None	None	None	None

 

 

Remarks: Approved/Not Approved/Comments

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet

Ms Derby’s comments, which were in response to a question from the floor, related to the huge growth in trucking in SA as result of the poor performance of rail and boom in global coal demand, have been taken out of context. The issue raised was what would happen to the trucking industry when rail returned to full operability. (Please refer to the statement issued by the Chairperson of the Board of Directors in this regard, as attached.)

Ms. Portia Derby has since resigned.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from SAA

(1)(a) The record shows that during Coleman Andrew’s tenure as CEO, the Board on 14 April 2000, considered the sale and leaseback of B737-200 aircraft and approved:

1. The sale of 13 B737-200 ADV aircraft (11 passenger and 2 freighters) to SafAir, or a party nominated by SafAir acceptable to SAA.
2. That SAA enters a 5 and half year leaseback in respect of each aircraft.

(1)(b) The total amount as per board resolution was.

1. Each aircraft sold for USD5.5 million.
2. Lease costs were R686 425 per aircraft per month, subject to changes in interest rates and foreign exchange rates.

2. With regards to the assessment of the state of the aircraft, SAA does not have records for answers to this question. Whilst the airline has the resolutions relating to that period (some 20 years ago) the requirement for record retention is limited to 7 years.

 

 

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

Transnet has a full complement of Board Members, save for the vacancy resulting from the recent resignation of Mr. P Molefe for personal reasons.

Remarks: Reply: Approved / Not approved

Melanchton Makobe PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to information received from Eskom:

1. Eskom cannot disclose the electricity pricing arrangements, as these are customer confidential and commercially sensitive information. The electricity pricing arrangements for the South32 aluminium smelter were approved by the National Energy Regulator of South Africa (NERSA). A new tariff structure was approved by NERSA in 2021 and complies with all the provisions of the Interim Long-Term Negotiated Pricing Arrangement Framework issued by the Department of Mineral Resources and Energy (DMRE).

A globally competitive tariff that considered the sustainability of the smelter and Eskom’s cost of supply was structured, as it was recognised that closure would have a negative impact on the South African economy and continue the trend of deindustrialisation and unemployment with which the country continues to grapple with. The tariff approximates the higher end of energy prices that aluminium smelters are paying and covers all applicable variable costs, with an additional contribution made to fixed costs.

In the absence of the smelter, contributions made by it to fixed costs would have to be borne by other consumers, resulting in an increase in other consumer prices. Several of the technical and financial benefits result from the large smelter baseload consumption and the interruptibility made available to the national System Operator that reduces the severity of load shedding.

 

Remarks: Approved / Not Approved/Comments

Adv. Melanchton Makobe PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

1. The progress in the transaction between Takatso Consortium and SAA is as follows:

a) On 25 July 2023, the Competition Tribunal approved the 51% disposal of SAA Government Shares to Takatso with conditions of minority shareholders divesting from Takatso Aviation and SAA not to retrench within 2 years of approval.

B) The subsequent steps are;

• 1. Aviation Regulatory Process: Apply to relevant aviation regulators for licensing approvals;

1. Repeal of the SAA Act, 2007: The process has started. The Department is in the process of seeking Cabinet approval for introducing bill in Parliament;
2. Fulfilment or Waiver of Conditions Precedent: Prior to the transfer of shares, ensure all conditions precedent are either fulfilled or appropriately waived to maintain the legality and integrity of the transaction;
3. Valuation of SAA: New valuation of SAA is being undertaken considering the lapse of time since the last valuation;
4. Revision of Transaction Structure: Considering the above valuation exercise, Parties are reviewing the structure of the transaction;
5. Transfer of Shares: Execute the legal transfer of shares from current shareholder to new strategic equity partner with all necessary documentation;
6. Establishment of New Governance Structures: Set up new governance structures for effective management and decision-making under the Strategic Equity Partner (SEP). This may involve forming a new board of directors and executive leadership; and
7. Implementation of Agreed-upon Strategies: Collaborate to develop and implement strategies for the national carrier's growth and development, focusing on areas such as operational efficiency, market expansion, and customer service improvements.

2. The allocation of funds to SAA, similar to other government funding needs has to go through a budgeting process based on Government priorities.

3. The funds of R85 million that was not transferred to Mango, are still with SAA until the Mango business rescue has been concluded. It is not being utilized by SAA for expansion purposes.

4. The audited annual financial statements for SAA for 2018/19 to 2021/22 financial years are currently going through the Board approval processes. They will be tabled in Parliament soon after the Annual General Meeting, scheduled in November 2023.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

13 On 13 September 2023, Cabinet approved the publication of the National State Enterprises Bill in the Government Gazette for public comments. The Bill was published for public comments on 15 September 2023.

In response to the valuable feedback received from public comments, the Department is diligently engaged in the refinement process for the National State Enterprises Bill. The ongoing refinement efforts are specifically aimed at integrating the insightful public comments into the fabric of the legislation. Central to this endeavour is the Department's commitment to crafting a revised Bill that not only addresses the concerns raised during the public commentary period but also establishes a comprehensive and inclusive framework for the appointment of boards within State-Owned Enterprises (SOEs).

The envisaged revisions seek to go beyond a mere legal framework. The Department aspires to codify a board appointment process that embodies the principles of transparency, equity, and fairness. By emphasizing these core values, the Department aims to instil a robust and accountable mechanism that stands as a testament to the commitment to good governance and stakeholder inclusivity.

(2) The envisaged processes for appointing board members to SOEs are expected to be comprehensive, designed to uphold transparency, fairness, and meritocracy. This will necessitate a thorough evaluation of candidates based on qualifications, experience, and alignment with the strategic objectives of the relevant SOEs. The government remains steadfast in its commitment to ensuring that appointments adhere to established legislative frameworks, including the Public Finance Management Act 1 of 1999 (PFMA), Companies Act 71 of 2008, and other pertinent statutes governing SOEs.

The government maintains vigilance in refining and improving existing processes to address challenges and enhance efficiency. Continuous efforts are made to draw lessons from experiences, both domestic and international, adapting best practices in governance.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

a) Takatso is currently managing the process. Unfortunately, the Department does not have access to information regarding the negotiations with the minority shareholder. However, once the process is completed, Harith, as the majority partner of Takatso, will inform the Department accordingly. 

Furthermore, if the Competition Tribunal approves the divestiture, the public will be informed of the outcome.

b) The stake by the minority shareholder is valued at 10.2% as that was the agreed shareholding by the parties in the Takatso consortium. The investment in the national airline will be made at the close of the strategic equity partner transaction.

Remarks: Reply: Approved / Not Approved

Jacy Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to Information Received from Eskom:

1. As at end September 2023, Eskom had over 6,6 million meters that required recoding with a new Key Revision Number (KRN). A strategy was developed with the following deployment components:

• The do-it-yourself (DIY) approach which ensures that customers are (i) issued with a pair of KRN key change tokens at the time when the customer purchases their normal top-up electricity or (ii) collects free basic electricity via any of the Eskom-approved vending channels and outlets.
• Customer support through a comprehensive communication campaign using regional radio live reads, community print and radio notices, radio interviews, newspaper and radio articles, leaflets, posters, Facebook, X posts, YouTube videos, community forums, customer communiques and the Eskom chatbot.

2. The 5 800 meters that were rolled out were part of a pilot programme for Eskom to gather information and insights on how to best implement the project. Following the pilot, Eskom developed, the automatic update process and prepared for project implementation. As a result, Eskom recently completed the first phase of deployment which ran from August 2023 to September 2023 to clear all the initial teething issues. Based on the results of this roll-out phase, Eskom is confident that the project will be successfully implemented. Key change tokens issued during the first phase are 671 653, and this is additional to the 5 800 that were issued during the pilot phase.

Eskom has developed pamphlets on how to recode (step-by-step- guides) the meter in all official languages and also posted step-by-step guides on social media platforms. Furthermore, Eskom personnel are deployed in areas where the roll-out is taking place to assist with queries, and a dedicated queue has been created to direct customers with KRN-related queries at the contact centre. The number to be used is 0860 037 566. Frequently asked questions have been loaded on the Eskom Alfred Chatbot. In addition, Eskom has ensured that additional personnel are trained to assist customers with queries.

Remarks: Approved / Not Approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to information received from Eskom

1. The emergency transition that led to the appointment of the certain company in July 2022 was allocated a budget of R500 million. The total actual spend was, however, R304 669 040.00 (including VAT).
2. The certain person was placed on precautionary suspension pending finalisation of Eskom’s internal investigation into the transaction. The scope of the investigation includes all the individuals who took part in the transaction. The investigation is close to being finalised.

.

Remarks: Approved / Not Approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

Both the government and Transnet are promoting private sector participation and the introduction of private capital in various projects.

According to the information received from Transnet

Regarding recent statements by the International Monetary Fund (IMF), Transnet acknowledges that it has encountered several challenges that have led to a decline in the operational efficacy of the railways and adversely impacted economic growth. The organisation is implementing targeted interventions aimed at resolving the challenges, and as part of this process, aims to improve collaboration with the private sector. Transnet believes that private sector partnerships (PSPs) are critical to our future and will provide the organisation with access to the additional skills, human resources, and capital required to reposition it. Furthermore, the active engagement and participation of various Transnet stakeholders across the work streams of the multi-stakeholder National Logistics Crisis Committee (NLCC), which includes the private sector and industry experts, exemplifies the nascent improvement in collaboration.

Going forward, Transnet' strategy (Reinvention for Growth) identifies private sector collaboration as one of its key levers for enhancing immediate performance and positioning the organisation for medium-term growth. As an essential component of the strategy, the private sector partners will play a crucial role in enhancing Transnet's capacity to execute quality services, develop and/or expand infrastructure, and unlock growth in industries such as mining, manufacturing and agriculture that contribute to job creation and GDP growth.

The rail reform process and the introduction of private train operating companies (TOC) on the freight network are essential components of the improved collaboration between Transnet and the private sector. This liberalisation process will enable the private sector to invest in rolling stock and establish freight railroads, which will have a significant impact on the market structure as TFR will no longer be the sole provider of freight rail services and will face competition from the private sector. In April 2024, the process of integrating private TOC will be formally initiated by inviting interested parties to acquire available slot capacity on the network. In addition, the reform will result in the establishment of a separate rail infrastructure manager, Transnet Rail Infrastructure Manager (TRIM), to oversee the network's management and ensure the equitable allocation of capacity to prospective TOCs. The establishment of TRIM is progressing well, and there is an expectation that the new OD will be established by the end of October 2023.

While most PSPs are long-term initiatives with benefits expected in the next 3 to 5 years, significant progress has been made in the development of these initiatives.

The recent announcement of a partnership between Transnet Port Terminals (TPT) and International Container Terminal Services (ICTSI) demonstrates the organisation's dedication to implementing this crucial lever. Several other initiatives are already in the partner selection process (request for qualification or request for proposal stages), and these include the Container Corridor Operating Lease; the Transnet Engineering Rolling Stock Leasing Company (TE Lease Co); the Ngqura Manganese Export Terminal (NMET) technical solution for the appointment of an EPC turnkey service provider; and Boegoebaai Port and Rail Development.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet

The Cost Containment measures issued by National Treasury on August 31, 2023, to assist National Departments, Public Entities, and Provinces do not apply to Transnet. Nevertheless, Transnet is aware of fiscal challenges and is implementing prudent measures in this regard. There is no moratorium on the recruitment of critical skills in Transnet.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister of Public Enterprises

Date: Date:

Reply:

Yes,

According to the information received from Transnet

Question	Response
a) How NLCC assisted Transnet in addressing operational challenges.	Transnet Operating Divisions (TFR, TNPA, and TPT) together with Business 4 South Africa (B4SA) technical experts, the private sector, and customers, have formulated Corridor Recovery Teams (CRT) to address Transnet operational challenges. The operational teams are progressing in implementing governance structures that will assist in the execution of the NLCC’s plans. This has assisted in the development of the Transnet turnaround strategy, which has identified deliverables for each corridor (Coal, Chrome and Magnetite, Iron Ore, and Manganese).   In addition to the rail and ports operations, work-stream 1, the following supporting work-streams have been established so far: Work-stream 5, which focuses on addressing challenges in the procurement system, including local content requirements as well as legislative changes/exemptions to improve efficiency in the freight and logistics procurement process. Work-stream 7, which deals with securing railway infrastructure, including addressing cable theft and vandalism on the container corridor, the coal line, the ore line, and pipelines. Work-stream 8, which focuses on communicating the NLCC/Transnet Strategy to the public in a coherent and effective manner, including regular progress updates. Work-streams 4 & 6 are on the structural rail reform of the freight and logistics system and financing and are yet to have their inaugural meetings. The workstreams are at an early stage and it is anticipated that significant results in operations will be achieved in 2024.
b) How NLCC has addressed the concerns of exporters	The Corridor Recovery Teams will cover both importers and exporters, and their concerns will be addressed in the Transnet turnaround strategy.

This is still work in progress and further detailed reports will be made public in the next few months.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet

There are some countries and regions where the management of the railways and logistics interfaces such as ports falls under one authority, this integrated approach can help improve the efficiency of transportation and logistics. One notable example is China, where state-owned companies like China Railway Corporation (CRC) oversee both railway and port operations. Other countries have varying degrees of integration between rail and port management, depending on their specific transportation and economic needs. These varying degrees of integration could be classified into several models, each with different levels of coordination and shared management, ranging from Full Integration models to Public-Private Partnerships models, or models based on geographical proximity (ports and rail situated closely) and models based on the country-specific regulatory frameworks. Another model is that of independent Operations, i.e. where railways, ports and pipelines remain entirely independent of each other with minimal coordination. While the latter may not optimize transportation efficiency, it could be the result of historical structures, regulatory hurdles, or a lack of incentives for integration.

Examples:

1. Full Integration: China Railway Corporation (CRC) – high level of integration.
2. PPP: United Kingdom (e.g., London Gateway Port involves a partnership between DP World and the UK government).
3. Geographic Proximity: Netherlands
4. Regulatory Framework: Singapore
5. Independent Operations: Russia, has a vast geography (historical and logistical reasons for separation).

In terms of Rail

The separation of the infrastructure manager is currently taking place. This will ensure that equal treatment and access are provided to all operators. The objective of the rail reform white paper is to ensure that the infrastructure manager has no bias towards TFR. Transnet is in the process of setting up an Infrastructure Manager outside Transnet freight Rail which is in line with the rail reform process. Private sector operators will therefore be guaranteed unbiased access to the network.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

The decommissioning of power stations is informed by the age of power stations which have a lifespan of 50 years. In addition, the IRP outlines the decommissioning dates of power stations. The repurposing of the power stations was driven by the fact that, power stations to be decommissioned can be repurposed to integrate renewable energy given that infrastructure is already in place. However, the energy crisis necessitated the review of the decommissioning of the power plants. The review is to enable a just energy transition wherein the power plants will be decommissioned and repurposed once new capacity has been added to the grid. The delays in the decommissioning of the power plants is part of the measures to minimise the impact of the power crisis.

Eskom is expanding the grid to enable connection of renewable capacity that has been approved under respective bid windows in the Renewable Energy Independent Power Producer Programme (REIPPP).

Since the outbreak of various conflicts in the North, many countries have indicated that (as SA has) their commitment to the NDC stands. However, each country’s domestic circumstances will dictate the path to decarbonization. This remains SA’s position.

The issue of funding for developing countries transitions, access to renewable technology, and the concrete plans to ensure the transition is/must still require further efforts.

 

Remarks: Approved / Not Approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

(1)(i) The Department obtained Cabinet approval to publish the National State Enterprises Bill in the Government Gazette for public comments. The Bill was published for public comment on 15 September 2023 until 14 October 2023. The Bill incorporates Presidential SOE Council (PSEC)'s recommendation that South Africa adopts a centralized shareholder model to improve the management and oversight of South African State-Owned Enterprises (SOEs). This includes establishing a Holding Company (HoldCo) for strategic SOEs.

HoldCo will be established through the National State Enterprises Bill.

(ii) PSEC has reviewed and assessed 37 entities. Furthermore, the business and turnaround plans for 21 entities and 8 Water Boards were reviewed. PSEC has not yet finalised its work.

(b) PSEC is finalizing its report on recommendations of which SOEs to retain, consolidate and/or dispose.

2. PSEC has developed an evidence-based criteria for which SOEs to retain, consolidate and/or dispose.

3. The criteria will be made available when PSEC has finalised its work on which SOEs to retain, consolidate and/or dispose.

4. PSEC will present its report to the President as soon as it is completed. The President will determine when and how the report will be made public.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

1. The Strategic Equity Partner (SEP) process started during 2020/21 financial year, the period when the impact of COVID-19 had a debilitating effect on the aviation sector. As a result, some parties that had expressed interest could not provide capital required to operate SAA as required. The Government required an SEP that could provide all the finances for SAA following the exit from Business Rescue.

The transaction advisor assessed and evaluated the EOI’s of potential SEPs. However, there were no suitable SEP that could be identified as none of the potential SEPs had an offer that could be accepted by the Department. The entities were not showing evidence of immediate funding to restart SAA’s operations. RMB and the Department in January 2021 agreed that the SEP transaction was unlikely to be successful, the mandate of RMB ended and the Shareholder Department took over the process.

A proposal by Harith General Partners, which had been engaged in the RMB process, and Global Aviation which later became the Takatso Consortium (Takatso) was made to the Department together with other proposals from other interested parties. After evaluating the proposals, Takatso was then appointed as the preferred SEP. Takatso had the requisite combination of financial and operational capabilities required for the successful relaunch of SAA. Their composition would advance the transformation agenda. The preferred SEP was thereafter approved by Cabinet. This offer satisfied the Department’s requirements including the ability to provide the funding needed to restart operations.

2. Takatso has agreed to meet SAA’s working capital requirements. An initial funding of R3 billion is projected for SAA’s growth path leading to stability. All financial obligations will be borne by Takatso, absolving the government of further funding support. The fulfillment of this financial commitment by Takatso is critical as without it, the transaction cannot be concluded.

3. The initial valuation of SAA was undertaken in 2020, a time when the company was not operational due to the business rescue process and the effects of the COVID-19 pandemic, which inevitably impacted its assessed value. A subsequent valuation was carried out in October 2021, just as SAA was resuming its operations and the overall aviation industry outlook was still uncertain.

Given that Takatso was selected as the preferred partner in June 2021 and more than two years have elapsed since, another valuation of SAA is prudent to ensure alignment with prevailing market conditions, for an updated and equitable value for the state. In light of this, the Department of Public Enterprises has initiated a new valuation to accurately ascertain the company's present status and prospective worth in the existing market environment.

4. The price that Takatso will pay for the 51% stake in SAA will be determined through negotiations, taking into account the updated valuation of the 51% share. This ensures that the settled amount accurately reflects the current worth of the stake, providing a fair transaction for both parties involved.

5.  Takatso Consortium has agreed to engage in negotiations aimed at finalizing a transaction amount, contingent upon and reflective of the revised valuation. This ensures that the concluding agreement is based on the prevailing market conditions.

The public and Parliament will be informed of all details once all processes have been concluded. It is also quite evident that current dominant entities and other proxies would not like any serious competition which could cause a reduction in fares to customers.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to Information Received from Eskom:

1. Eskom has been rolling out the residential load management pilot in Gauteng, in areas such as Beverley, Lonehill, Craigavon, Magaliessig, Dainfern Valley, Witkopen, Fourways, and Douglasdale. The load limiting pilot is implemented in areas where customers already have smart meters. Therefore, there are no additional costs associated with the current pilot in the areas mentioned above, as Eskom had already installed smart meters in those areas. Eskom is leveraging functionalities embedded in installed meters for the benefit of both customers and Eskom. Thus, load limiting can be rolled out in all areas with smart meters at no additional cost.

2. Eskom is not aware of any concerns raised by users that are part of the load limiting pilot that Eskom is trying to control their electricity usage remotely. On the contrary, the participants are receiving the programme very well.

Eskom would like to highlight that the purpose of load limiting is not to remotely control the customer’s electricity usage. Load limiting is intended to provide customers with the benefit of using some appliances such as lights, refrigerators, televisions, and Wi-Fi routers, as long as the load remains below 10 Amps during load shedding Stages 1 to 4.

An hour before the start of load shedding, the system prompts customers to reduce their

consumption from 60/80 Amps to 10 Amps by sending a message to the customer interface unit (CIU) or cell phone. Customers are provided with four opportunities to reduce their consumption, and thereafter, if the load has not been reduced, the meter automatically switches off the electricity for 30 minutes.

Remarks: Approved / Not Approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

The white paper specifically calls for the separation of the infrastructure manager to be outside of Transnet Freight Rail to ensure that equal treatment and access are provided to all operators. The objective of the rail reform white paper is to ensure that the infrastructure manager has no bias towards TFR operations. Transnet is in the process of setting up an Infrastructure Manager that is an entity outside Transnet freight Rail which is in line with the rail reform process. Private sector operators will therefore be guaranteed unbiased access to the network. This is in line with the DoT and the Interim Rail Economic Regulator.

 

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

According to the information received from Transnet

Transnet debt increased by R76.4 bn from R58.1 bn in 2012 to R134.5 bn in 2016. The current debt is approximately R130 bn. The increase in debt relates to capital investment on infrastructure, locomotives or rolling stock procurement.

A portion of the debt was raised to fund the procurement of 1064 locomotives, which has been subjected to the state capture enquiry.

The operational performance has constrained the company’s ability to reduce its debt levels. The revenue generated, informed by tariffs charged and volumes moved over the years has not been sufficient to repay a significant portion of the debt raised in the years 2012 to 2016.

Currently, the board and financial experts are engaged in a process to develop a plan in this regard. This includes meeting with the National Treasury. Furthermore, in terms of the statement I made on 1 September 2023 (copy attached), the Board and management must also engage in a process of cost reduction.

 

 

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

The process to reconfigure Government is underway. DPE participates in this process which is coordinated by Presidency. The steps to start the handover / reconfiguring of Government will be informed by this process.

 

Remarks: Reply: Approved / Not approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

This question should be referred to the Minister of Forestry, Fisheries and the Environment.

 

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister of Public Enterprises

Date: Date:

Reply:

1. The financial obligation with respect to the development of the National State Enterprises Bill is borne by the Department of Public Enterprises. For 2023/24, budget has been allocated and ring-fenced for the necessary external project support and expertise under the Departmental funds for the processing of the Bill. Working capital of the Holding Company will need to be secured, and consultation with the National Treasury is on-going in this regard.

2. (a) Preliminary costing of the HoldCo has been done on the basis that it shall become self-sustainable in the short term. The Holding Company will derive dividends from its subsidiary companies and it is envisaged that this income stream will be sufficient to cover its operational costs.

(b) The closure, merger or restructuring (some which is already happening, e.g. in Small Business Portfolio) will be considered by government on the basis of recommendations of the PSEC.

Remarks: Reply: Approved / Not approved

Jacky Molisane PJ Gordhan, MP

Acting Director-General Minister

Date: Date:

Reply:

ESKOM REPLY:

In January 2022, Eskom’s Forensic and Anti-Corruption Department received a complaint via email from an anonymous whistle-blower, which highlighted concerns regarding a procurement transaction for Electrostatic Precipitators (ESP) at Tutuka Power Station.

A detailed preliminary investigation was conducted, and the preliminary findings revealed that the matter warrants a full investigation. The matter is currently outsourced to an external service provider, and it is envisaged that the investigation will be completed by the end of November 2023. Eskom will share the findings and recommendations of the investigation with the DPE. If the investigation uncovers fruitless and wasteful expenditure, Eskom will initiate proceedings to recover losses. Eskom will also further engage with law enforcement agencies if any criminality is uncovered.

DPE REPLY

The department has a process in place to oversee that recommendations emanating from forensic reports are implemented. The department shall monitor that the commitment made by Eskom to finalise the investigation. Accordingly, the department shall apply itself to the report to ensure that all recommendations are fully implemented should the allegations be confirmed; and that relevant parties are held accountable in line with the laws of the country. Furthermore, the department shall through the Shareholder Compact, hold the board accountable in ensuring that whistle-blower reports Eskom receives are addressed speedily; that forensic investigations are initiated and completed within a reasonable timeline and that recommendations are fully implemented within reasonable timelines.

Remarks: Reply: Approved / Not Approved

Jacky Molisane P J Gordhan, MP

Acting Director-General Minister

Date: Date: