Transnet Gets R5.8 Billion Cash Injection From State, Enoch Godongwana Says It Will Increase Efficiencies

• Minister of Finance Enoch Godongwana says R5.8bn has been allocated to fix the state of the state-owned rail company, Transnet
• He made the announcement during the 2022 Medium-Term Budget Policy Statement (MTBPS) on Wednesday, 26 October
• R2.9 billion is to repair infrastructure damage, and another R2.9 billion is allocated to purchase spare parts and locomotives

CAPE TOWN - Finance Minister Enoch Godongwana said government has allocated R5.8 billion to state-owned logistics company Transnet to recover the damage caused by floods and the shortage of locomotives. He delivered the 2022 Medium-Term Budget Policy Statement (MTBPS) on Wednesday, 26 October.

The company has received funding from the fiscus for the first time in decades. R2.9 billion is specifically for repairing infrastructure damaged by the recent floods, and another R2.9 billion was allocated to purchase spare parts and locomotives from China’s CRRC Corporation.

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Transnet has been in dispute with the company for years after terminating a procurement programme for new locomotives.

According to News24, Godongwana told journalists that it is more effective to fund state-owned enterprises to do the right thing and increase efficiencies. He added that revenue foregone exceeds the support SOEs would need later.

Aside from the cash injection to Transnet, the government plans to use the revenue to increase spending in the health, education, local government, and security and safety sectors. In the address, Godongwana also said that a significant portion of Eskom’s R400 billion debt will be removed.

BusinessTech reported that about R130 billion and R260 billion in debt might be taken away. The minister said billions had been spent supporting Eskom, with minimal improvements in the reliability of the electricity supply. However, he believes the debt takeover will ensure Eskom is financially sustainable.

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Citizens react to the Medium-Term Budget Policy Statement

@VimalSh48777322 said:

“And ensure feeding inefficient Tenderprenures.”

@newhorizanman posted:

“You can’t buy efficiency. You can only MANAGE it.”

@i_r_b_r_m commented:

“Transnet cadres are grinning from ear to ear with R5.8billion to loot!”

Transnet to fork out at least R24 million to replace cables stolen during wage strike

In a related matter, Briefly News also reported South Africa’s rail, port and pipeline company is tallying the costs of cable theft in the wake of the two-week wage strike.

Transnet Freight Rail was subject to a 22% surge in cable theft on the container corridor as opportunistic criminals took advantage of the protest and vandalised key infrastructure.

According to News24, the rail company anticipates replacing the cables on one corridor will cost R24 million.

Source: Briefly News