Budget: Eskom, Transnet, Sanral expected to spend R382bn

Capital expenditure by major state-owned companies is expected to reach R381.9-billion over the next three years and investments by Eskom, Transnet and the South African National Roads Agency Limited (Sanral) will account for 90% of it, the national treasury said in its budget review.

In delivering on their infrastructure commitments, state-owned companies have improved their performance, spending 79.9% of a budgeted R137.6-billion, up from 70% of R131.7-billion, the budget review said.

"Underspending was mainly the result of contractors not meeting targeted delivery schedules, labour unrest, poor weather, material shortages and engineering delays. Eskom and Transnet spent a combined R88-billion during this period, bringing state-owned companies' total spending over the past three years to R284.3-billion."

Eskom's infrastructure figures have been revised downwards over the medium term due to lower projected revenue and its budget for the 2013/14 year is now R56.4-billion as opposed to the previous budget of R61.9-billion."

Infrastructure investments have led to a steady increase in the asset base of state-owned companies, from R450.1-billion in 2008/09 to R793.9-billion at the end of 2012/13, the review said.

Value increase
Meanwhile, the net asset value of state-owned companies has increased to R252.2-billion in 2012/13, with Eskom and Transnet accounting for 77% of this. In 2012/13, state-owned companies' average return on equity slowed to 4%, from 7.6% in the previous year, mainly due to lower earnings and higher operational costs at Eskom.

"Over the next three years, 61.6% or R235.3-billion of funding required for infrastructure development by state-owned companies is expected to be raised in debt markets, with the remainder coming from internally generated cash. Eskom and Transnet will account for the bulk of these borrowings," the review said.

"Revised borrowing in 2013/14 relate to Eskom's higher borrowing in response to revised revenue estimates. In 2014/15, an estimated 67.3% of borrowing by state-owned companies will be sourced in the local market.

"To reduce borrowing costs and ease pressure on the domestic market, state-owned companies are encouraged to pursue funding opportunities with multilateral agencies that offer them favourable funding terms and conditions."

An actual Black Friday deal

Subscribe for R2/mth for the first three months. Cancel anytime.

Subscribers get access to all our best journalism, subscriber-only newsletters, events and a weekly cryptic crossword.

Related stories

WELCOME TO YOUR M&G

Already a subscriber? Sign in here

Advertising

Latest stories

Covid-19 vaccines still protect against severe illness from the Omicron...

The vast majority of hospital admissions in Gauteng are of unvaccinated people, data from the National Institute for Communicable Diseases shows

It is right that audititing is under scrutiny, says Deloitte...

Deloitte has learned a lot about the importance of professional scepticism from its corporate mishaps, says incoming chief executive Ruwayda Readfearn

Impala Platinum re-enters Royal Bafokeng Platinum buyout bid

The announcement comes just weeks after competitor Northam inked a deal to acquire up to 33.3% of Royal Bafokeng Platinum

Brakes put on foreign truck drivers

New legislation aims to protect local jobs in the transport sector amid questions as to whether SA has enough willing and skilled drivers
Advertising

press releases

Loading latest Press Releases…
×