Gigaba plans to curb executive pay

Minister Malusi Gigaba
Minister Malusi Gigaba

"Have you been able to meet your key performance indicators? Do we have a reason to incentivise you?"

PUBLIC Enterprises Minister Malusi Gigaba plans to clamp down on the excessive payment of senior executives and board members of state-owned enterprises (SOEs).

Gigaba told Parliament's standing committee on public accounts (Scopa) yesterday that he had ordered that chief executives and board members of all SOEs that fall under his department do not receive increases until a proper remuneration policy is in place.

"Remuneration generally of executives is quite high and it does not contribute to bridging the inequality gaps between the highest paid and the lowest paid," Gigaba said.

Members of the public accounts committee had taken issue with some board members at transport entity Transnet who sit on the boards of numerous other companies.

Gigaba said he planned to come up with a policy to regulate the remuneration of executive and non-executive directors of SOEs.

"The decision we have taken is not to increase the remuneration of non-executive directors until we finalise our views on these.

"The same applies to the chief executives of the companies," he said.

Gigaba took issue with the R10-million that was paid to Transnet Freight Rail chief executive Siyabonga Gama as incentives and bonuses for a period during which he was sitting at home.

Gama was suspended in September 2009 and fired in June 2010.

He was reinstated last year in February and was paid R10-million without doing any work.

The minister said given the Gama debacle, the issue of short-term and long-term incentives paid to executives of SOEs needed to be revisited.

"The fact that you were at work 365 days minus 21 days of leave doesn't entitle you to a bonus.

"Have you been able to meet your KPIs (key performance indicators)? Did you deliver on the KPIs? Do we have a reason to incentivise you?" he asked.

Gigaba said he was also reviewing the composition of boards of SOEs to ensure that they are the right size and are able to attract people with the proper skills to help run these entities.