In the run-up to the May general elections, our country experienced a prolonged no-load-shedding, the longest period in more than four years. Some people attributed this to electioneering and excessive diesel burning, while others predicted that the power cuts would return after the elections.
This was despite repeated assurances that the improved electricity supply by Eskom was because of a co-ordinated effort to stabilise power supply through the implementation of the Energy Action Plan, which began in 2022.
It has now been more than six months since the May elections, and there has been no load-shedding. Our country is now over the mark of 250 consecutive days of uninterrupted power supply.
For the first time in three years, Eskom has reached an energy availability factor of more than 60%, with the Kusile, Grootvlei, Majuba and Lethabo power stations performing at an energy availability factor of above 70%.
We are encouraged that for the first time since 2012, SAA has recorded a net profit of R252m for the 2022/23 financial year, and group revenue increased from R2bn to R5.7bn.
Eskom has also drastically cut its diesel expenditure on Open-Cycle Gas Turbines compared to the same period last year. For the period April 1 2024 to August 7 2024, Eskom reduced its diesel expenditure to R9.59bn.
While it is too early to claim that we are out of the woods, this significant milestone gives us hope that we are on the right track to put an end to load-shedding in the foreseeable future. This sustained improvement in the generation fleet’s performance is evidence that our recovery plan is bearing fruit.
It is also a result of the work that started during the sixth administration to use expertise, experience and capabilities from both within government and across society to help us restore the performance of our state-owned enterprises.
Many would recall that in 2020, President Cyril Ramaphosa established the Presidential State-Owned Enterprises Council to provide expert advice to the government on the reform, repositioning and revitalisation of SOEs. This council comprising individuals with different expertise has been instrumental in providing valuable recommendations to restore the operational performance of SOEs.
Eskom is not the only SOE that is on the right trajectory to recovery. We are seeing signs of recovery at South African Airways (SAA), Airports Company South Africa (Acsa), Denel, Eskom and Passenger Rail Agency of South Africa (Prasa).
We are encouraged that for the first time since 2012, SAA has recorded a net profit of R252m for the 2022/23 financial year, and group revenue increased from R2bn to R5.7bn. This strong performance highlights the airline’s significant progress towards financial sustainability.
Remarkably, SAA achieved this milestone while operating with only six to eight aircraft across nine destinations at the beginning of the 2022/23 financial year. Since then, the airline has doubled its fleet and increased routes to 16 destinations, including intercontinental routes to São Paulo and Perth.
Similarly, Denel made a profit of R390m before interest and tax for the 2023/24 financial year, while irregular expenditure dropped by 98%.
Acsa reported an increase of 16% in revenue to R7bn for the 2023/24 financial year, while profit after tax increased to R472m for the same period, recovering from a loss of R466m in 2022/23.
Furthermore, Prasa has succeeded in bringing back 80% to of its passenger rail corridors, after widespread theft and vandalism during the Covid-19 lockdown. About 31 of the 40 rail corridors are now operational, and the company has significantly increased the number of rail passengers over the past year. In March this year, the company reached 40 million passengers, compared to 15-million passengers a year earlier.
Through our reforms, we have also succeeded in improving and fully capacitating Sars after the effects of state capture. Sars has regained public trust through the implementation of the recommendations of the Nugent Commission, and this has enabled the institution to restore stability. Public trust is increasing, with improved levels of voluntary compliance and the collection of more revenue to fund our developmental agenda and faster economic growth. The fiscal revenue generated through tax is being injected into socioeconomic programmes as well as goods and services.
The steps we have taken to reform these institutions show that government is serious about stimulating economic growth and investment, and ultimately creating jobs. Restoring operational performance in our SOEs is critical to the development of a capable state and fostering economic growth. We need well-functioning and strong institutions that are based on the rule of law.
While we are not yet where we would like to be, this steady improvement in some of our SOEs is encouraging, and we expect this trend to continue under the GNU. Ramaphosa is leading a process that’s looking at how we house all SOEs and promote efficiency and greater public-private partnerships. We are also changing the way we appoint boards to ensure that only experienced, skilled and qualified people take up these crucial positions.
As part of strengthening auditing processes, board members will no longer be allowed to play an active role in the procurement process. The auditor-general will be allowed to assist and ensure these institutions comply with the prescripts and the law.
The Ramaphosa-led reforms have given rise to new hope, and this is further reflected in renewed investor confidence since the formation of the GNU. This investor confidence is well placed because we are committed to building on the gains we have made from the previous administration in building a capable state and improving the functioning of our institutions.
Vincent Magwenya is the spokesperson for President Cyril Ramaphosa
For opinion and analysis consideration, email Opinions@timeslive.co.za
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