State-owned companies a threat to fiscus

hat our state-owned enterprises pose serious risks to the country’s fiscus is no

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Finance minister Tito Mboweni was spot-on in his budget speech on Wednesday.

These companies are placing the state of our economy in an impossible situation.

Doing away with them would cost many people their jobs – that is inevitable.

But every year they are costing the taxpayer billions of rand in bailouts.

In his speech, Mboweni revealed funding requests from SAA, SABC, Denel and Eskom, to mention but a few, have increased.

Their condition is so bad they can’t operate without state support, he added.

If there is one thing to admire about Mboweni, it's his frankness when it comes to issues of finance. He does not beat around the bush.

Not so long ago, the minister came under fire from some sections of the population for suggesting the government should consider shutting down our national carrier, the SAA.

Again in his budget speech, the minister asked whether the country still needs these enterprises and, if it does, whether they can be managed better and if not, what it is the country would need to do without them.

Six months or so ago, this kind of talk would have been an offence.

With ministers such as Mboweni, one cannot help but hope there is still hope for our country.

But, of course, talk is cheap. There is no guarantee that Mboweni's stance will translate into action.

Mboweni assures the nation that restoring the country's finances and fixing state-owned enterprises can be done, but says it will take great courage.

Mboweni's straight talk veers onto another sensitive topic – the public wage bill.

He openly stated in his speech that the public wage bill is unsustainable.

He said national and provincial budgets will be cut by R27bn over the next three years.

According to the minister, the country could save billions if the first step in a plan to reduce the public wage bill is carried out.

The step is to allow older public servants who want to do so, to retire early.

Apparently members of parliament and provincial legislatures and executives at public entities will not receive a salary increase this financial year.

It remains to be seen how much of a difference this will make.

In the meantime, the country is gearing up for the upcoming national elections in May and it will be interesting what the impact of the polls will be in shaping the future of this struggling country. Also see Page 17.