Government ineptitude taints Pravin

NEWS ANALYSIS

The resignation of Vuyani Jarana, the chief executive of crisis-stricken SAA, just a week after the resignation of his counterpart at Eskom, Phakamani Hadebe, has sparked questions about whether they were hounded out of their jobs.

READ MORE: SAA, Jarana impasse turns nasty with probe into leaked resignation letter

The charge, on the political front, has been led by the Economic Freedom Fighters and the Black Management Forum. The two are lumping these two resignations with the dismissal of former Transnet chief executive Siyabonga Gama — over a slew of serious corruption allegations — and branding them an assault on black executives in state-owned entities (SOEs).

They accuse Minister of Public Enterprises Pravin Gordhan of being the leader of an attack that is geared towards capturing SOEs and running them into the ground, with a view to selling them off to their friends.

These allegations, however, have helped to shine a light on a malaise that has affected SOEs for years and driven many a capable executive out. The causes range from government apathy to inadequate support and poor leadership.

Gordhan’s detractors are right about one thing: Hadebe’s goose at Eskom was cooked as far back as last August — seven months into his job — when Gordhan directly intervened in the impasse between him and unions at Eskom.

At the time Hadebe, who had informed employees that, in a bid to avert job losses, Eskom would implement a zero percent increase for the year, stood firm in the face of insults, illegal strikes and acts of sabotage, only for Gordhan — and President Cyril Ramaphosa — to intervene and promise unions a pay increase.

Although the intervention was critical to avert further violence and sabotage of Eskom’s power stations, the way it was done had the effect of alienating Hadebe from employees, because it seemed that he did not have the shareholder’s blessings, and weakening his position. Employees started believing his decisions could always be overturned at a political level.

Added to that, several sources in and close to Eskom have said that Gordhan and the public enterprise department’s very public intervention on the load-shedding crisis, often without Hadebe in tow, left a perception that he was no longer trusted by his principals.

The sources cited two examples of this. The first came in March, when Hadebe only learned about Gordhan and Eskom chair Jabu Mabuza’s off-the-record meeting and press briefing at Hendrina power station the night before it happened. The second was that Eskom management was not told about that press visit, which was organised by the public enterprises department. The visit was in response to Eskom ramping load-shedding up to stage four — the first time in its history.

Public pronouncements by Gordhan about the appointment of Enel, a renewable energy company, as consultants at Eskom, apparently because Eskom did not have the capacity, again without Hadebe’s knowledge, only served to further alienate the chief executives from employees.

This landed on fertile ground, where mostly black members of staff at power stations believed the fight against corruption was a ruse to purge them and bring in white employees who had left Eskom years before. This narrative had been sparked by the reappointment of chief operations officer Jan Oberholzer, who was said to have been brought in to add technical know-how.

But, even with this growing backlash against the resignations of senior figures at SOEs, it does not seem that Gordhan’s actions were driven by malice. In the case of Hadebe, the two would have worked closely together when Hadebe set about turning around the Land Bank, between 2008 and 2012.

What has happened is rather the result of a poorly co-ordinated response to public pressure, commentary on the labour crisis at state utilities, load-shedding at Eskom and also, more critically, government placing politics over what is really needed to turn Eskom and SAA around.

This has made life hard for the people running those entities. Hadebe, Jarana and, perhaps to a slightly lesser extent, Madoda Mxakwe at the SABC, have spent many Sundays over the past year on the phone with unwilling banks and lenders, begging for extensions on lines of credit.

The running joke in higher echelons of finance circles is that these individuals had become like those uncles one avoids at family gatherings, because they have the unenviable talent of turning any conversation into a money-borrowing exercise.

Calls to people in financial institutions will continue until the shareholder, government or Ramaphosa make the tough decisions and take actions such as allowing the necessary job cuts at the struggling parastatals.

None of this helps to soften the image of Gordhan, with people split between lauding his work and questioning his motives.

Sabelo Skiti

Sabelo Skiti is an investigative journalist.

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