Leave the day-to-day operations of Eskom to its board
Pravin Gordhan fought a good fight and stood head and shoulders above his peers in the ANC through the dangerous and desperate closing chapters of Jacob Zuma’s presidency. Ever since he was rushed back into the National Treasury as finance minister, he has been at the centre of the storm around state capture that has dragged this country into a deep depression. As public enterprises minister he is still in this fight and it’s a worthy cause. But I think it’s one that, at this moment, needs to be divorced from the day-to-day operations of Eskom. The weeks of load-shedding point to a parastatal in need of operational focus — an executive and management team left to what miners like to call “sweating the assets”. This is especially when commodity prices are low, which in Eskom’s case, is when supply can’t meet demand.
The sole shareholder — the government — should allow for a return of proper governance of the institution for the first time in more than a decade. The board and its CEO, Phakamani Hadebe, should be left to get a grip on its operational problems, in this case a lack of maintenance.
And if the minister believes the board is not capable, then he should ensure that the right people are put in place and left to correct the mistakes of previous management in neglecting maintenance in order to meet its debt financing costs.
Now, I understand that these are exceptional times and there’s argument that the suspension of proper governance at Eskom is necessary, particularly given that it was the centrepiece of the Guptas’ corrupt enterprise. But it’s because these practices were indefinitely suspended more than a decade ago that we are in this position.
I can clearly remember the justification for the constant meddling in the affairs of the state-owned enterprises about a decade ago by disgraced ministers Malusi Gigaba and his successor Lynne Brown.
They were supposed corruption-busters preparing to clean the rot.
The early years of this “shareholder activism” came with much fanfare as Gigaba chaired press conferences in his SAA pilot’s uniform and led deliberations around Transnet’s infrastructure spend.
The different boards and CEOs during this period were little more than cheerleaders playing games of musical chairs, except in the case of people such as Dudu Myeni at SAA, because of her relationship with the former president. Both Gigaba and Brown claimed to be restoring good governance, and as such “extraordinary measures” were necessary, but their meddling was just a way to get the right comrades in the right seats to ensure that the right mouths were fed.
Now, as President Cyril Ramaphosa tries to undo much of the damage, he has followed a similar path and seemingly allowed the shareholder representatives to take control of Eskom’s day-to-day operations. It started with wage negotiations with the National Union of Metalworkers of SA last year, when Gordhan quite literally pushed the board aside and managed those negotiations himself. Today, the breakdown of coal-fired power stations is a matter for the shareholder to deal with, instead of the executive.
Given Gordhan’s good fight and how well we regard the man, some of us may welcome his intervention, but I have to ask, is it not better that he instead focus on restoring governance at the parastatal? Empower its executive and rather focus his energies alongside the Treasury in dealing the big picture of Eskom’s future funding model. What to do about the more than R400bn debt that quite clearly the company’s revenues won’t be able to fund as demand continues to drop? That’s what the politics should be about, it’s our very own “Brexit” question.
Leave operations to the Eskom team, minus the almost 3,000 employees that are looking over their shoulders at looming disciplinary action.
I can clearly remember the justification for the constant meddling