Transport union slams cross-funding of state-owned entities

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The United National Transport Union has called on government to stop taking money from one state-owned company to finance another, saying the money may never be recovered. 

In a statement, UNTU bemoaned the fact that state-owned freight rail, port and pipeline company Transnet may have lost the R222m it loaned SA Express in December 2017.

Minister of Public Enterprises Pravin Gordhan told Parliament last week that SAA and SA Express would not be able to table their annual reports on schedule because of their financial woes.

"To UNTU this means that SA Express will never be able to repay Transnet its loan and that will be to the detriment of UNTU members, the majority of Transnet’s employees," the union said in a statement. 

It said it had written to the acting CEO of Transnet Mohammed Mohamedy to ask for more information. 

The union said it is high time that ministers and the boards of SOEs adhere to the promise made by President Cyril Ramaphosa during his State of the Nation address in February 2019 to "stop the political interference in SOEs and its boards in its operational functioning".

"UNTU wants to prevent a situation where Transnet has to write-off R220m to debtors who have not paid the SOE back. It is shocking that Transnet already wrote of R500m of bad debt in the previous financial year," said its general secretary Steve Harris.

Harris noted that the government had also given the SABC a R2.1bn bailout despite the fact that the public broadcaster continued to battle with revenue and the collection of TV license levies.

He said that, in the case of the Passenger Rail Agency of SA (Prasa), money was being taken from Prasa's budget and given to South African National Roads Agency.

On Tuesday, Parliament’s Portfolio Committee on Public Enterprises will be briefed by the office of the Auditor General on the audit outcomes and financial statements of state-owned companies. The committee will also get a briefing by the department of public enterprises on its annual report and financial statements for 2018/19 financial year.

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