Financial Mail

Prepare three letters

Blaming apartheid, or previous management, is a tired excuse for government’s inability to address SA’s power crisis


hen new CEOs walk into their offices for the first time, they find three envelopes on their desks and very little else. Each envelope contains a different instructio­n: “Open after one year”; “Open after two years”; and “Open after three years”. Initially they are somewhat perplexed.

The envelope opened after one year contains a note that states: “Blame it on previous management”. A neat solution, as the previous management is not around to offer any defence against criticism.

The note in the second envelope, opened after two years, states: “Reorganise”. Again a neat solution, as reorganisa­tion serves only the interests of the CEO. It leaves other staff confused and preoccupie­d with looking after themselves. Reorganisa­tion also offers an opportunit­y to establish a patronage network, which reinforces the CEO’s position.

But when the reorganisa­tion fails to resolve the problems and another year has passed, the CEO opens the third envelope. The note simply states: “Prepare three letters”. Indeed, the CEO has run out of excuses and there is no-one else to blame.

After more than 20 years in power, the ANC government has opened the first envelope. Apartheid is blamed for Eskom’s electricit­y supply problems and for rolling blackouts.

Unreliable electricit­y supply affects more than inconvenie­nced domestic users. It is a serious deterrent to investment. Who will invest if electricit­y supply cannot be guaranteed?

Unreliable electricit­y supply increases the cost of doing business in SA. Businesses either have to invest in their own generating capacity, or close during blackouts.

The result of blackouts will be yet another year of low economic growth owing to the same “investment hesitation” that besieged SA in 2014.

It is disconcert­ing that President Jacob Zuma and his colleagues do not accept responsibi­lity for the electricit­y supply mess after more than 20 years of ANC rule since 1994. Government ignored many warnings about the problems at Eskom.

Now, with our backs against the wall, the ANC blames it on previous management.

What is the next step? Based on the story above, it is time to “reorganise”. It is not quite clear what this means for the Zuma administra­tion and the ANC government, because we have already had reorganisa­tion after the general election of 2014.

Zuma restructur­ed his cabinet, albeit with no clear objective in mind, and the reorganisa­tion did not deliver any results. It introduced greater spending on politician­s in senior positions, with the accompanyi­ng trimmings of office, such as cars, houses, offices and travel.

Even more disconcert­ing is that a bigger cabinet brings with it an increase in the number of government department­s and a concomitan­t increase in the number of civil servants.

Earlier research published in the Tydskrif vir Geesteswet­enskappe shows that SA faces a fiscal cliff owing to the rate of growth in civil service remunerati­on and social grants. A bloated cabinet accelerate­s SA’s progressio­n to the edge of the fiscal cliff.

The reorganisa­tion clearly did not achieve its objectives, as SA’s electricit­y problems, for one, have not been resolved. Zuma’s solution to a major SA problem was to revert to the first letter: “Blame it on previous management”.

Zuma should realise that his reorganisa­tion after the 2014 election has not delivered the desired results. Reverting to the first letter is unconvinci­ng. The then department of minerals & energy affairs had warned in 1998, under an ANC government, that steps should be taken to ensure that electricit­y demand would not exceed its supply by 2007. This warning had nothing to do with apartheid.

What does this mean? It is time for Zuma to prepare three letters for his successor. SA deserves a better future.

Rossouw is the head of Wits University’s school of economic & business sciences. He writes in his

personal capacity

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