ANC wants China-style state en­ti­ties

CityPress - - News - HLENGIWE NH­LA­BATHI hlengiwe.nh­la­bathi@city­

THE ANC-led gov­ern­ment is fac­ing a predica­ment and needs to ur­gently over­haul all boards of sta­te­owned en­ti­ties (SOEs) as they do not serve the de­vel­op­men­tal agenda as man­dated.

This is the view of the SA Com­mu­nist Party (SACP) in the wake of the latest public spat be­tween Prasa board CEO Lucky Mon­tana and board chair­per­son Popo Molefe.

In May, Public En­ter­prises Min­is­ter Lynn Brown said she had been tasked by Cab­i­net dur­ing a Fe­bru­ary lek­gotla to “cham­pion the de­vel­op­ment of an over­ar­ch­ing share­holder pol­icy that would de­fine cri­te­ria for state own­er­ship”.

This would en­tail whether gov­ern­ment pri­va­tises or owns these en­ti­ties and bet­ter de­fines their man­dates.

Brown is ex­pected to ta­ble this re­port at the Cab­i­net lek­gotla, which takes place soon af­ter this week­end’s ANC lek­gotla.

SACP deputy gen­eral sec­re­tary Solly Ma­paila said the se­lec­tion cri­te­ria of the boards needs to re­vis­ited.

“We need to en­sure that board mem­bers, and even CEOs in those en­ti­ties, are peo­ple who un­der­stand their de­vel­op­men­tal man­date,” he said, adding that some of the boards were more con­cerned with busi­ness deals.

The re­cent al­liance sum­mit spoke out strongly against un­due in­flu­ence ex­erted to some of these in­sti­tu­tions by politi­cians.

“Gov­ern­ment must be clear. If peo­ple are us­ing these in­sti­tu­tions for their own ben­e­fits, they must be re­moved.”

Ma­paila made an ex­am­ple with Eskom as a key na­tional as­set, say­ing it was set on spend­ing huge amounts of money to pro­cure coal and diesel to keep the power sta­tions run­ning merely be­cause “it’s another way of rev­enue for busi­ness”.

He said the in­fight­ing at Prasa, re­lat­ing to ten­ders, was highly em­bar­rass­ing to the ANC-led al­liance.

The prob­lems be­sieg­ing the state com­pa­nies was wor­ry­ing gov­ern­ment so much that last week’s visit to China by Deputy Pres­i­dent Cyril Ramaphosa saw the con­ven­ing of joint seminar to dis­cuss their role in the Chi­nese econ­omy.

His del­e­ga­tion in­cluded SACP boss and Higher Ed­u­ca­tion Min­is­ter Blade Nz­i­mande, who con­cluded that there are im­por­tant lessons to be learnt from China, es­pe­cially on paras­tatals.

“The SOEs made what is per­haps the sin­gu­larly most im­por­tant con­sti­tu­tion in the im­pres­sive de­vel­op­ment of the Chi­nese econ­omy,” he said.

“The PRC [Chi­nese gov­ern­ment] did not fol­low the ne­olib­eral pre­scripts of sur­ren­der­ing them to pri­vate com­pa­nies ... In­stead, it re­formed and repo­si­tioned state-owned com­pa­nies and man­dated them to in­vest in a par­tic­u­lar way that was to see the econ­omy grow to un­prece­dented lev­els.”

Nz­i­mande said that many coun­tries that had pri­va­tised their SOEs never saw much mean­ing­ful so­cioe­co­nomic de­vel­op­ment.

“In many in­stances, their de­vel­op­ment was held to ran­som by some of the very same pri­va­tised for­mer com­pa­nies.”

The ANC has made con­tra­dic­tory state­ments on paras­tatals, with eco­nomic sub­com­mit­tee chair­man Enoch Godong­wana speak­ing of the gov­ern­ing party’s in­ten­tion to pri­va­tise Eskom to help it out of its fi­nan­cial woes.

This would see the pri­vate sec­tor tak­ing up 30% of the stake in Eskom’s power-gen­er­at­ing as­sets.

But ANC sec­re­tary gen­eral Gwede Man­tashe and Min­is­ter of Public En­ter­prises Lynn Brown im­me­di­ately con­tra­dicted that, say­ing there was no pol­icy to pri­va­tise.

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