Editorial: State recapture of SOEs

In his budget speech this past week, Minister of Public Enterprises Pravin Gordhan reminded South Africa that state-owned enterprises(SOEs) can play a vital role in development: they can directly enable economic growth and help to generate desperately needed employment.

He did not say, in so many words, that they have largely failed to do any such job, instead becoming a serious drain on national resources. (For example, this week SAA’s latest debt hole, about R5-billion, was revealed.) Gordhan touched briefly on the fact that “the last few years have seen a progressive weakening and capture of these institutions”, before quoting President Cyril Ramaphosa’s stern words about the need for a judicial commission of inquiry into state capture to end “the plunder of public resources”. Gordhan added to that his determination to “recapture” SOEs and get them back on to the national developmental job.

Later on in his speech, he got a little more heated.
“We shall not only be satisfied with putting the criminals in jail,” he said. “The money they have stolen from the [SOEs] … must be recovered and returned … They belong to our people, not to crooks.”

That sounds obvious enough but it’s good to hear it strongly stated in Parliament — and to be able to believe that the minister, the president and the government will live up to those words. There is every sign that they are moving swiftly to do exactly as they say they will, to “recapture” and “restore” the SOEs. Prasa, Denel and Eskom have new boards, and Jacob Zuma’s point man at the South African Revenue Service, Tom Moyane, is being prised from his position and his malign influence on the state’s key revenue-collecting arm countered.

Given the vast scale of the depredations suffered by the SOEs, it’s clear that restoration will be a huge job. We are very cheered that Ramaphosa and Gordhan have seriously started that job, and we can only cheer them on.

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