ANC grappling with worsening SOEs

Our SOEs need saving
Our SOEs need saving

The ANC is sitting for a four-day national executive committee (NEC) meeting and lekgotla this weekend at St Georges in Irene, Tshwane, where plans to save an increasing number of state-owned enterprises (SOEs) from collapsing will be top of the agenda.

The country is fast running out of good candidates to serve on the boards of state entities as more people continue to lose faith in government’s capacity to work hand in hand with them.

In the space of two weeks, the condition of SOEs has placed the credibility of the governing ANC on the line. National power utility Eskom is without a stable board; SAA is facing liquidation; and board members are running for the door.

Research and development company, the SA Nuclear Energy Corporation (Necsa), officially does not have a board in place.

Pule Mabe
ANC spokesperson Pule Mabe

ANC spokesperson Pule Mabe on Friday said the NEC would focus on state entities, and each member from the committee who was in any way involved with the running of these companies would be given the opportunity to submit a report on their portfolios.

Mabe said the outcome of the discussions would be important to find a clear solution to the issues faced by the entities.

“We will come out with firm steps that need to be taken. We are as concerned as you are,” he said.

ON SAA

Legal advice obtained by the SAA board triggered the resignation of Martin Kingston this week, and it is expected that at least two more members are considering whether to stay.

In his resignation letter, Kingston said that “the appointment of the business rescue practitioner had, effectively, removed all oversight and authority from the board”.

Read:Martin Kingston quits SAA board

Based on legal advice received by the board, he said: “I do not believe that I can serve any useful purpose by remaining as a non-executive board member. The ongoing challenges that continue to confront the company and its stakeholders will, hopefully, be moderated by the business rescue process.

“In due course, and after final decisions have been made as to the future of SAA and its various underlying assets and activities, I will share my observations based upon my experience as a board member.”

ON NECSA

Following the resignation of board members this week, insiders told City Press the company was beyond business rescue.

But an unfazed Mineral and Energy Resources Minister Gwede Mantashe was persuaded that, to recover from financial distress, the company did not need its two subsidiaries, NTP Radioisotopes and Pelchem, as stand-alone entities with their own boards, but rather as divisions of Necsa.

Critics said the move could result in between R80 million to R100 million paid by NTP to the state coffers being wiped out.

ON ESKOM

Some within ANC circles were wary that the bailout given to the entity was in fact funding the difference between the price charged by independent power producers (IPPs) and the price at which Eskom sold its services.

Read: ‘SA bent over backwards for Eskom’: Nersa heads to court

IPPs charged twice and, in some cases, three times as much as Eskom for providing the service.

This week, government appointed Professor Malegapuru Makgoba as the acting chairperson of Eskom’s board.


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