for subscribers

Ramaphosa clarifies privatisation, minimum wage

Share your Subscriber Article
You have 5 articles to share every month. Send this story to a friend!
Deputy President Cyril Ramaphosa.
Deputy President Cyril Ramaphosa.

Cape Town - Politicians should not run ahead of themselves and expect the wholesale or partial privatisation of state-owned enterprises (SOEs), Deputy President Cyril Ramaphosa said in parliament on Wednesday.

Responding to oral questions from MPs, Ramaphosa said there are currently around 700 SOEs – some of them key to South Africa’s developmental mandate and others less so.

The inter-ministerial committee tasked with reviewing all the SOEs will come up with a list of which ones are relevant and which not. “As of now we shouldn’t put the horse before the cart to decide which ones should be retained,” Ramaphosa said. “We’ll be looking at all of them in terms of their performance and profitability and only thereafter we’ll have clearer answers.”

Ramaphosa stressed that the management and governance at SOEs will also receive attention, as well as whether private sector investment and foreign direct investment will be needed as capital injections.

Minimum wage

As for a national minimum wage, Ramaphosa said it could go a long way to provide a much-needed injection into South Africa’s economy.
The issue of a minimum wage is currently deliberated in National Economic Development and Labour Council (Nedlac) and he said South Africa is progressing well with its implementation, compared to other countries.
“It took much longer in Germany and in Brazil it took eleven years. We’re doing it in a period of 18 months and we’re working frantically to reach agreements,” Ramaphosa said.
DA MP Ian Ollis asked the deputy president in a follow-up question if it’s wise to compare South Africa with other countries. “Brazil and Germany implemented a national minimum wage when their economies were thriving. The same can’t be said for our economy. We need to revise it downward; government can simply not implement it in a time where small knocks can have a devastating effect on the economy.”
Ramaphosa disagreed. “Brazil implemented a national minimum wage when their inequality was the worst in the world. A minimum wage helped them to grow their economy.”
He added that the parties who are deliberating at which level a national minimum wage should be set are “acutely aware” of South Africa’s economic circumstances.
“Today our level of inequality is the worst in the world. But this could be turned around and a minimum wage could lead to the injection of growth in our economy. If people have more money in their pockets they become better consumers.  This could fuel the manufacturing and demand for goods and services. We should not only look at a minimum wage from negative perspective,” Ramaphosa concluded.

There’s more to this story
Subscribe to News24 and get access to our exclusive journalism and features today.
Already a subscriber? Sign in
Brent Crude
All Share
Top 40
Financial 15
Industrial 25
Resource 10
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Yes. We need the money.
11% - 1359 votes
It depends on how the funds are used.
73% - 8816 votes
No. We should have gotten the loan elsewhere.
16% - 1947 votes