Transnet bosses in the money

But expensive service leaves much to be desired

THEIR customers are paying some of the highest tariffs in the world to use their capacity-constrained services, but Transnet directors have little reason to lose any sleep: of the 15 top earners at state-owned enterprises, 12 work for the rail, ports and pipeline operator.

Controversial Transnet Freight Rail boss Siyabonga Gama, who was suspended in 2009 following charges related to tender irregularities, and then reinstated in 2011, was the best-paid Transnet boss, taking home R12.76-million. This included a performance bonus of R8.3-million.

Gama’s boss Brian Molefe, who is CEO of Transnet, took home R12.47-million. Other Transnet bosses in the top 15 include Karl Socikwa, CEO of Transnet Port Terminals, who was paid R10.89-million; Richard Vallihu, CEO of Transnet Rail Engineering, who took home R10.4-million; and Anoj Singh, chief financial officer, who was paid R9.9-million.

In total, the 12 Transnet bosses were paid R121.8-million in the year ending March 2012 — a handy sum for a company under investigation by energy regulator Nersa for the cost overruns and delays on its multiproduct Durban-Gauteng fuel pipeline, and whose container tariffs at the Durban port are 874% above the global average, according to a recent study by the National Ports Regulator.

Its fuel pipeline, which has started limited operations carrying petrol, diesel and jet fuel, is three years behind schedule and will cost at least R23.4billion, up from the original budget of R12.7-billion — and customers are footing the bill through increased fuel levies.

Transnet’s rail services are not getting much praise from customers either.

The Development Bank of Southern Africa, in a 2012 report on the state of South Africa’s economic infrastructure, slammed Transnet’s inability to consistently operate the Richards Bay coal line to its capacity, its inability to expand the Sishen-Saldanha line to cope with rapidly increasing global demand for iron ore and manganese, and the lack of capacity to address growing demand for container services

Siyabonga Gama was the best-paid Transnet boss

on various routes.

Monhla Hlahla, who resigned as CEO of the Airports Company of South Africa (Acsa) in September 2011 after 10 years at the helm, was the only director to earn more than Transnet’s top bosses.

Her Acsa pay of R13.45-million, including a performance bonus of R10.8-million, and R292 000 from the Industrial Development Corporation where she serves as chairperson, made her the best-paid parastatal director in the 2012 financial year.

While a total package of R13.7-million is not to be sneezed at, Hlahla’s pay package is a pittance compared with what the top earners in the private sector took home.

To illustrate the gaps in pay and the difference share options make, David Hathorn, CEO of Mondi and 2012’s bestpaid boss, earned R76.2-million last year, including share gains of R54.6-million.