We can make SOEs ‘exemplary’, says Gordhan

JOHANNESBURG - Government is working to make sure that in the next few years state-owned enterprises will not be dependent on the fiscus, but it will take time and the damage of state capture to these entities must first be addressed, said Public Enterprises Minister Pravin Gordhan.

The minister was responding to a debate on the financial burden of sustaining non-profitable state-owned enterprises (SOEs) during a sitting of the National Assembly.

Earlier, President Cyril Ramaphosa chaired a virtual inaugural meeting of the Presidential SOE Council (PSEC). Ramaphosa had appointed the panel in June to support government in repositioning SOEs so that they could be effective in their mandates of economic transformation and development.

The inaugural meeting discussed the country's economic reconstruction and recovery plan, as well as an overview of SOEs and the terms of reference of the Council, the Presidency said in a statement.

Following the meeting the Presidency said that the Council resolved to set up work streams in response to areas of priority that are identified and to commence work immediately. The Council will report back to the president by January 2021, when the next meeting is expected to be convened.

Gordhan has said that restructuring the airline would be far more beneficial than liquidation - it could preserve jobs, maintain competitiveness in the aviation sector so that consumers won't be price takers and it would avoid negative knock-on effects to other industries reliant on the aviation sector.