The resignation of Transnet CEO Portia Derby and Eskom chairperson Mpho Makwana is more than a symptom of the runaway train that state-owned enterprises (SOEs) have become.
But who is the wrecking ball? This collapse demonstrates a huge crisis in the architecture of SOEs. Over the past three decades various SOEs have moved from global iconic status to the pits.
Just last week we saw about 400 branches of the once-loved post office close their doors. Last month we saw the shambles at the Post Bank with the bungling of social grants for the most vulnerable in society. It seems the government can’t even get the basics that appeal to their primary constituency right before a crucial election year.
The state capture report told us how parastatals such as Prasa, Transnet and Eskom were looted by organised crooks. What is happening to these parastatals now is the result of years of rot and dysfunction. The deployment of clueless individuals to head multibillion-rand enterprises made things worse. A classic case was the deployment of a delinquent director, a primary schoolteacher, Dudu Myeni, as chairperson of a multibillion-rand airline that she ran into the ground.
There is also political neglect at the apex of government. One wonders what the problem is with holding the minister of public enterprises to account. Is the president perhaps beholden forever? Behind Pravin Gordhan? Why is he not yet fired? Or is it unfair to pin the systematic collapse of key SOEs on one man?
The bigger question also remains: do we really need 700 parastatals?
I think the answer is simple. There is no culture of accountability in the cabinet. Ramaphosa is not known for having fired a single minister for incompetence and he is not going to start now with Pravin Gordhan. There are many other ministers who quite frankly should not be in their jobs. It does not seem to be Ramaphosa’s style to link cabinet postings with the performance of his ministers.
The energy crisis is the best demonstration of this. Instead of taking even the ANC's own counsel to consolidate the leadership of the sector he appointed a third minister instead of firing the incompetents. He hired an additional monster and left those who were surely falling in place. Now those chickens have come home to roost.
As usual, Ramaphosa set up a committee instead of taking decisive action. This time it was called an SOE council. It’s been in existence for a few years but has clearly achieved little or nothing that affects the performance of the SOEs.
What needs to be done?
Dissolve public enterprises and return every entity to the relevant line ministry. This will ensure focus and remove the jack of all trades mentality from the public enterprises ministry and hopefully also enhance accountability by relevant ministers.
Strengthen the shareholder compact in line with chief justice Raymond Zondo's recommendations to ensure professionals are appointed with relative freedom and independence to run SOEs as proper businesses with business principles that will make them sustainable entities that can contribute to economic development.
Strike a balance of public and private partnership and avoid wholesale privatisation as we saw with the “R51 sale” of SAA.
These few pointers could be a move in the right direction to stop the sure collapse of SOEs we are witnessing.
The bigger question also remains: do we really need 700 parastatals? The answer is the same as why we don't need a bloated cabinet of 70 ministers and not so useful deputies or even 400 MPs and meaningless provincial legislatures.
We have to go back to the drawing board about the architecture of our state to create a capable government.
*Dr JJ Tabane is editor of Leadership Magazine and anchor at eNCA
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