Mantashe’s return to mining is welcomed
INDUSTRY bodies yesterday urged new Minister of Public Enterprises Pravin Gordhan to tackle governance failures and management issues at stateowned enterprises (SOEs).
The Banking Association of South Africa managing director Cas Coovadia said the magnitude of problems facing SOEs should not be underestimated. Coovadia said most SOEs had been weakened significantly in the past few years.
“We expect him to immediately sort out government problems at these entities,” Coovadia said. “Secondly, he must make sure that we have people who are credible and ethical at the helm of these companies. We must have people in management who are capable of doing the job.”
Most of the country’s multiple problems are related to the so-called state capture, an elaborate type of corruption and looting through which private interests significantly influence the affairs of the state for their benefit.
Gordhan will be in the forefront of efforts to turn around wayward entities such as Eskom and Denel. The shortcomings of the country’s SOEs have contributed to the recent downgrades of the sovereign rating. NEW TRANSPORT Minister Blade Nzimande takes over his position with big challenges facing the industry, including the unworkable Gauteng e-toll system, underspending on capital budgets and addressing lawlessness on the roads.
Azar Jammine, chief economist at Econometrix, said a major challenge was the underspending on the transport capital budget, with most of the money going towards paying the increased salaries of public servants.
Jammine said transport and logistics received the biggest share of any sector in the three-year public expenditure framework at about 34 percent.
However, Jammine said the capital budget had been reduced to R834 billion from R947bn for the next three years but there had not been any reduction in current expenditure, which increased by 7.3 percent a year, two percentage points above the inflation rate.
Jammine said the country was using its roads as the main means of transport, which was putting a lot of strain on road infrastructure, and greater emphasis should be put on rail infrastructure, so more goods were transported by rail, while the e-toll system would have to be addressed.
“It’s a real mess now. The sad part is if they had introduced 9c litre on the fuel price in about May 2011, at a time when the fuel price came down by 75c a litre, they would have got all the money needed for the road network and would by now also be R14bn better off,” he said.
The Automobile Association said road safety remained a massive challenge, with road fatalities costing the economy an estimated R143bn each year.
Hendrik Moolman, the chairperson of the technical committee of National Association of Automobile Manufacturers of South Africa, said that the new transport minister needed to investigate the introduction of annual roadworthy testing on vehicles older than five years.
Moolman said that other issues that needed to be addressed were the proliferation of descriptions of commercial vehicle bodies on the eNatis system and the payment of vehicle licences based on an empty vehicle rather than the gross vehicle mass of a vehicle. THE APPOINTMENT of Mineral Resources Minister Gwede Mantashe has been welcomed across the board, with many expecting his experience as a former union leader to help give depth to his new role.
Cadiz Corporate Solutions director for mining, Peter Major, yesterday said that Mantashe’s first priority should be to throw away the controversial mining charter.
Major said the charter is designed to destroy the industry, jobs and the economy. “Scrapping the charter will slow down the demise of the industry,” he said, adding that Mantashe should also consider freezing the payment of taxes and royalties. “Mining companies should receive a 10-year royalty free holiday, a 5-year tax free holiday, and workers should use the secret ballot before going on strike.”
Mantashe was appointed on Monday and replaces Mosebenzi Zwane, the former Free State Agriculture MEC, who was embroiled in controversy after helping the Gupta family acquire Optimum Coal from mining giant Glencore.
The Chamber of Mines welcomed the appointment, describing Mantashe as a man of integrity and dignity, and saying he brought with him a sound and fundamental knowledge of the industry.