The resignation, without an explanation, of Mpho Makwana as Eskom board chair after just over a year at the helm of the country’s most important utility must concern us all.
While board member Mteto Nyati will step in as the search for a permanent chair gets under way, a similar search for the Eskom CEO will run parallel.
Meanwhile, this happens as Eskom has joined an inglorious list of government entities that failed to table their annual reports in parliament for scrutiny. Other ignobles include Denel and SAA. And, of course, Eskom’s woes are happening despite the government-approved R254bn bailout to help ease the fiscal hole it had sunk itself to. Hopefully this will enable it to borrow to improve operations.
The challenges at Eskom are many and varied. The context within which these happen is also not helpful.
Transnet, another crucial entity considered an enabler for sectors such as mining, is almost on its knees, with the CEO Portia Derby resigning after pressure from key stakeholders for changes in leadership after losses of over R5bn. Over 50% of those losses related to Transnet Freight Rail, whose boss Siza Mzimela also quit.
What is tragic about the state of flux in our SOEs is their negative impact on the economy’s performance. The World Bank has said the obvious: we should not expect economic growth without energy. Yet the entity generating energy is in a precarious state.
What is tragic about the state of flux in our SOEs is their negative impact on the economy’s performance. The World Bank has said the obvious: we should not expect economic growth without energy
Reflecting on the exodus of executives, minister of mineral resources & energy Gwede Mantashe used a joke to shed light on something crucial.
“As a miner, that is my background, if you are underground and you see mice running, you do not go to see what they are running from. You should run with them because they are likely running from methane. If there is an exodus of executives, we need to understand what the methane is that they are running from,” Mantashe told reporters on the sidelines of the Africa Oil Week in Cape Town.
It’s pretty clear who the mice in public enterprises are. But it’s clear as mud why they are running and or what’s preventing the SOEs from making speedy replacements for those “running” away from their posts.
When the Eskom board was appointed in September last year, public enterprises minister Pravin Gordhan said “the most urgent” task for the board was to ensure “load-shedding will be minimised or eliminated; [and] secondly, that the collapse of or dysfunctionality in some power units is something of the past”.
It’s been hits and misses since Makwana took over. Is the “methane” perhaps differences in the preference for Eskom CEO?
The Makwana-led board recommended a CEO to Gordhan and he told them he needed three recommendations. In addition, he is reported to have told the board they should not limit their search to people under the age of 60. This was interpreted, elsewhere, as implying Gordhan may have a preference for the CEO position that’s at odds with who Makwana believes should lead the embattled utility. Makwana has now tendered his resignation before the process is finalised.
But given how staged Makwana’s departure is, it may take a while to establish the real reason behind his premature departure. What we know for sure is that it has taken a while to find a replacement for former Eskom CEO Andre de Ruyter, who announced his resignation almost a year ago.
Given what is at stake, we must hope it doesn’t take close to that to find a replacement for Makwana. Otherwise our country will be reduced to a circus of sorts, with many running with mice, unsure what we are running away from while the economy collapses in our hands.
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