The president’s man: Eskom, and how Pravin Gordhan navigates treacherous political waters

2020-01-24 08:00

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He seems to be under constant pressure, with calls for his dismissal being made at all times of the day and from all quarters. But Pravin Gordhan, the minister of public enterprises, seems pretty unflappable, writes Pieter du Toit.

On the evening of May 17, 2016, Pravin Gordhan, the former commissioner of the South African Revenue Service (SARS) and then well into his second stint as finance minister, issued a remarkable statement.

He had been fighting off attempts by then-president Jacob Zuma's Praetorian guard to intimidate and threaten him and the National Treasury, attempts that were made to force both into submission before the juggernaut that was state capture.

And even though he was able to batten down the hatches at Treasury's head office in Church Square, Pretoria, the onslaught against him inside the party was relentless. Besides Zuma, he had to contend with Zuma zealots and proxies like Mosebenzi Zwane, David Mahlobo, Nomvula Mokonyane, Malusi Gigaba and Bathabile Dlamini.

It forced his hand, and in the statement, he implored the South African public "to protect the National Treasury staff, who have diligently, honestly and skilfully served the national interest to the best of their ability".

The statement revealed the intensity of the war inside the government and ANC. And Gordhan enlisted the public to help him against Zuma.

Almost four years later, and Gordhan, today the minister of public enterprises, seems to be under similar pressure.

Overseeing the country's biggest state-owned companies, and in charge of restructuring those laid waste by grand corruption, greed and mismanagement, Gordhan has again become a political target.

WHAT IS KILLING GORDHAN

President Cyril Ramaphosa and Public Enterprises Minister Pravin Gordhan who is one of the president's most trusted lieutenants. (Media24 Archive)

"The guys are still trying their luck with the procurement system," Gordhan said before he explained that state capture was not over. "It's not only me they want out, they want others out, too. And they want us out because they don't want this government to succeed."

"They" seem to be a coalition of the aggrieved, a loose alliance of former Zumaites now on the out, ANC factions opposed to President Cyril Ramaphosa, populist opposition leaders with much to lose, union leaders with links to Eskom procurement and supply chain networks and lastly, Zuma himself.

The patronage networks do not want to die.

Reality and social media

For someone who faces a daily barrage of criticism and demands that he must be dismissed because of the disaster that is Eskom, Gordhan seems remarkably centred and at ease meeting in an old Pretoria eatery close to SARS' head office in Brooklyn. He arrives alone, white shirt sans tie, and quickly skips up the stairs to a secluded table.

The ANC, South Africa's governing party and in power since 1994, had just completed a four-day annual planning meeting and speculation before the gathering was rife that there was going to be a big push to get rid of Gordhan. He stood accused of mismanaging Eskom and being unable to ensure that the lights remained on (South Africa has been suffering under load shedding for months).

Indeed, some weekend reports told of attacks on him led by Zwane, a Gupta stooge if ever there was one, with Gordhan relegated to the corner, cowering and awaiting the inevitable. The capture faction in the ANC, and its wingmen elsewhere, was licking it lips. Its prey was wounded.

But reality seems far removed from the make-believe world of social media, where the so-called forces of "radical economic transformation" hold sway.

Gordhan seems to be consumed by events at Eskom and SAA who both pose significant threats to the national accounts and both - along with Transnet - riven by corruption, capture and patronage networks.

The attacks on him, the clamour for his head is background noise. It is of no consequence, it seems.

"The damage to Eskom is huge. One of the groups that is looking into the company for us describe it as damage to people, process and plant. I think of it as damage to governance, operations, finance and business model," Gordhan said.

He started to explain the only analogy that worked: That of an old car whose owners neglect to regularly service it.

Suddenly his phone beeps. It a system update from Eskom's control room. He gets an update every hour, on the hour, every day, day and night. "The situation is not looking good at the moment…" he murmured while checking his phone.

The system update is a full diagnostic of the whole of Eskom's grid. It shows, in minute detail, the status of each of the country's power stations and the different units inside of them. The screen flashes in an array of different colours as Gordhan swipes from one screen to the next, scanning every power station and analysing the state of electricity supply.

"Every colour represents a different power station," he explained. "These are diesel levels, this the number of megawatts available, this the number of megawatts demanded … every bar denotes the levels of production … this is Arnot, Camden, Cahora Bassa, Koeberg…"

He explained the impact of one unit at one power station being out while flipping through different screens on his phone.

If one power station has the capacity to produce 3 200MW, but it can only produce half, and one or two more units crash it takes out almost the whole of the power station.

The cumulative effect of units and power stations taken out of commission due to maintenance and faults is serious.

Pravin Gordhan at the judicial commission of inquiry into state capture in 2018. He was finance minister during the height of the assault on the National Treasury. (Media24 Archive)

His phone rings. It is about SAA. Meetings are happening all over the place, trying to find money to keep SAA going. Again, Gordhan frowns. It is difficult cleaning up other people's mess.

Gordhan explained there were full losses and partial losses of power stations, and this should never amount to more than 9 000MW. If there are unplanned losses, this number breaches the 9 000MW threshold, and when stage six load shedding happened last year, it shot up to over 16 000MW.

"We don't have reserves, and that's why the Cabinet asked the Department of Energy to go and find 3 000MW to 5 000MW of alternative energy sources. That will give us enough space to take out power stations for proper maintenance so that we know they'll last … if the right people carry out the work," Gordhan said.

As one of Ramaphosa's main corruptions busters, Gordhan knows how networks of patronage and capture look and how it operates. But he has had to learn how the innards of a power station look, what makes it work and what is needed to effect repairs. And that, literally, meant that he had to understand the nuts and bolts of the operation - or the conveyor belts and steam turbines that make up the national grid, rather.

"Eskom's culture of engineering has been destroyed," he said, explaining some of the nonsensical staffing decisions taken over the years, including removing many experienced engineers from the power stations where they worked and moving them to Eskom HQ.

"It's crazy," Gordhan said. "Those engineers knew their plants so well that merely by listening [and he cups his hand to his ear], they could hear whether there was something wrong. We are now moving those engineers back to the plants from where they came. And we need to get back all the skills that we lost."

Accountability lost

Serious damage has been done to the country's ageing and temperamental fleet of power stations over the years, thanks to mismanagement by a series of executives and aided by widespread corruption. Contracts were doled out to companies without the necessary skills to undertake maintenance and necessary inspections were sometimes just skipped.

"The quality of our operators and power station managers declined, and many are overseas, running power stations in places like the Philippines. The previous management, for example, replaced power station managers with managers they could control, so they could control the procurement process," said Gordhan.

Former president Jacob Zuma during a court appearance in 2019. The country is still suffering from the consequences of state capture which allegedly happened under his watch. (Media24 Archives)

"And there is no culture of accountability or consequence management," he said. "And no shame.

"When I, as the so-called minister, go there [to Eskom's head office in Sunninghill, Johannesburg] for a meeting at a quarter to three in the afternoon, people are on their way out, on their way home, with their bags and their lunch boxes in their hands. No fear, no embarrassment, no sense of urgency.

"It speaks to a culture and that's going to be new group chief executive Andre de Ruyter's big job. He must build a new management, a new team and a new culture," said Gordhan.

His phone beeps again. Another system update. This time he just checks it, and frowns.

Eskom had its financial issues, Gordhan continued, but there were serious process matters the new management should deal with. "It's about discipline, it's about discipline in maintenance, discipline in how to run plants and discipline in monitoring it."

Risk management should be at the top of the mind at Eskom, otherwise "we'll be in kakstraat", he emphasised.

Gordhan has started to what amounts to a full audit of every part of Eskom's generating business, picking apart every power station, identifying the biggest cost drivers and investigating the supply and value chain of every single one of those cost drivers. He produces a diagram of a typical power station and identifies where the biggest scope for corruption is.

He wants to understand the anatomy of a power station and to see where the patronage networks go to feed.

"The areas in which there is serious procurement … we must pinpoint everything: boilers, tubes, coal bunker, feeder, ash … each will have a value chain and suppliers … who is involved? We need that information … today we will investigate coal, then, oil, tube maintenance, turbine maintenance…" he said, running his finger over the diagram.

Gordhan has a mammoth task to help save Eskom. But, just like in 2016, not only does he have to fight for good governance and policy clarity, he must also fight many in his own party.

And just like in 2016, this fight will be pivotal to the country's future.

Read more on:    pravin gordhan  |  cyril ramaphosa  |  jacob zuma  |  andre de ruyter  |  state capture  |  load sheadding  |  eskom
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