Pravin Gordhan Suggests Private Sector Partnerships With SOEs, SA Feels Betrayed: “It Was His Plan”

• The Minister of Public Enterprises, Pravin Gordhan, suggested that state-owned enterprises enter into partnerships with the private sector
• He reasoned that doing so would decrease the pressure on the ailing institutions' finances
• Professor Pundy Pillay from Wits University broke down why it's a bad idea for SOEs to seek help from the private sector
• Netizens were heartbroken that this was his plan all along and slammed him

Tebogo Mokwena, an experienced Briefly News current affairs journalist, contributed political coverage to Daily Sun and Vutivi Business News during his eight years in South Africa.

Minister of Public Enterprises Pravin Gordhan revealed that state-owned enterprises need the help of private partnerships to be saved. He believes that this will help them with their struggling finances. South Africans fumed and said that this was always his plan and he was now showing his true colours.

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SOEs should partner with private sector

Pravin addressed the Portfolio Committee on Public Enterprises when he briefed the committee on Transnet's annual report and financials.

According to SABC News, Gordhan believed many issues arising within State-Owned companies can be traced to state capture. Pravin Gordhan further pointed out that the state should consider the private sector getting involved in the SOEs so that the state does not lose control over State-owned enterprises.

Gordhan also pointed out that Transnet's problems come from its inability to provide efficient service to its clients. Mzansi's state-owned institutions have been bleeding leadership positions. One of the most recent to resign is former Eskom Chairman Mpho Makwana. His resignation has been allegedly linked to conflict with Gordhan.

Wits professor disagrees with Gordhan

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Professor Pundy Pillay from the Wits School of Governance told Briefly News that state-owned enterprises partnering with the private sector is not a great idea.

"State-owned enterprises are there to provide public goods from which ALL citizens can benefit. These goods include roads, harbours, railways, electricity, water, and other infrastructure. They are also there to ensure that the country’s infrastructure is sufficiently and appropriately developed to promote equitable economic growth and development patterns. They are not and should not be profit-driven institutions," he said.

He also suggested what should be done instead of knocking on the private sector's door.

"We must undertake wholesale re-structuring and replacement of incompetent and corrupt individuals. If this means secondment of personnel from the private sector, then that should happen. But this is not privatization.

"Ironically, we can take some lessons from the apartheid government and their building of efficient public corporations such as Eskom, Iscor, SA Railways, etc., (albeit that this was for a small segment of the population). However, the important lesson is that key infrastructure development should not be handed over to the private sector driven by profit rather than government which nation-wide developmental objectives should drive."

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Mzansi feels betrayed

Netizens who read his words took their frustrations out on Facebook.

Thabo Mutlanyana said:

“The plan is to privatise as much as possible SOEs to their comrades coming as BEE partners before the elections, as it is clear that ANC will go below 45%.”

Akainu Redhound Phatudi exclaimed:

“He is finally speaking publicly about his true mission in government!”

Dikgang Legoase wrote:

“They are going to sell state-owned enterprises right under our noses, and yet we are told that a white man took things by force. Our ancestors sold things to a white man just like today the ANC is selling SOEs to them.”

Thembinkosi Taba added:

“That’s his whole plan: to let them collapse and privatise. Suddenly, Transnet needs a cash injection, something that has never happened before.”

Ramaphosa must solve SOEs' leadership crisis

In a similar article, Briefly News reported that political analysts called on President Cyril Ramaphosa to intervene in the country's leadership crisis in State-owned companies.

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They spoke after an exodus of leadership in Transnet and Eskom and believed that Ramaphosa must act. Netizens pointed the finger at Pravin Gordhan and exclaimed that he was the source of the leadership exodus.

Source: Briefly News