SOEs under microscope

PUBLIC Enterprises Minister Pravin Gordhan has indicated that the common problem in the country’s state-owned enterprises is a liquidity issue‚ the Black Business Council said yesterday.

The council met with Gordhan to discuss issues surrounding SOEs focusing on corruption and state capture‚ the department’s strategy to stabilise the entities to ensure they are profitable and the appointment of boards.

BBC secretary general George Mofokeng said Gordhan had given the council a breakdown on what the issues were in each SOE individually.

“On a common basis‚ a lot of them were [facing] a liquidity issue. They need working capital in order to fund projects. This is one of the issues [he] is going to work hard on in conjunction with the boards appointed in those particular SOEs‚” Mofokeng said.

South Africa’s SOEs have been in embroiled in allegations of state capture and many of them looted.

Mofokeng however said the liquidity issues at the entities could not only be blamed on maladministraiton‚ fruitless expenditure and corruption but also on the state of the economy.

“Growth of the economy also has a direct impact on growth of SOEs‚” he said.

Mofokeng said the changing of SOE boards was the first step to address the issues.