PHEPISI RADIPERE | Let capable hands run SOEs for economic progress

File photo.
File photo.
Image: Siphiwe Sibeko

There’s often some misinformation and disinformation doing the rounds, mainly by populists, that there are some people within the ruling party who want to privatise some state-owned entities (SOEs), including Eskom.

The truth is non-performing SOEs must be given to capable hands if people do not get value for their money. Some politicians within the ruling party are still obsessed with old school economic ideologies of nationalisation, while SOEs are collapsing without any intervention to rescue them.

The ruling party and some within its alliance partners, want us to believe that nationalisation of the Reserve Bank will solve the country’s economic growth constraints, while the Post Office has been allowed to collapse under their watch.

The call for the establishment of a state bank has been made numerous times, but no one has invested with the Post Bank, as no one would want to risk their money with a failed institution.

So, how can we expect a government struggling to keep the Post Office afloat to run a big institution like the Reserve Bank? The Post Office used to operate the best courier services, but today the private sector couriers are doing the job and people might be paying more than they were paying.

But there are no complaints because they’re getting value for money. The Post Office’s courier services also had an opportunity to enter online shopping with its footprint across the country, but in its current state, it must regard online shopping as a missed economic opportunity.

When Transnet Freight Rail was taken off the rails, private companies had no choice but to use the private sector to handle delivery of cargo at higher prices, but there’s value for money.

The privatisation of cargo delivery came at a huge cost to the government too, as it must now maintain roads more often, and they’re struggling to keep up with road maintenance. The government is also struggling to handle road transported cargo, as ports are overstrained.

Passenger Rail Agency of SA had its fair share in delayed trains, until it was off the rails, and its former passengers had to find alternative means of transport, though at a huge cost with value for money.  We hardly hear any voice from the nationalisation lobby group, and their silence might give rise to suspicions that they too, are beneficiaries of services previously rendered by collapsed SOEs.

Municipalities always promise free water, and they’re failing to provide even a drop per month. On a sad note, people are paying for water provided by the private sector. As load shedding has disrupted many economic activities, people had to get alternative and uninterrupted energy at higher prices.

When South African National Road Agency does not have the capacity to operate some of its toll roads, it often outsources portions of the roads to the private sector, and the roads get maintained non-stop. Gautrain too is a Public-Private Partnership (PPP) initiative, and it’s operating smoothly. Why can’t the government go for PPP for struggling SOEs? Many SOEs are in existence thanks to bailouts and sooner there might be calls for the establishment of the department of bailouts.

Former SACP general secretary and current chairperson, Dr Blade Nzimande, has privatised the distribution of National Student Financial Aid Scheme (NSFAS) funds to private companies. The SACP often wants us to believe that it’s anti-privatisation, but its silence on NSFAS funds distribution  shows their double standards. Student bodies aligned to political parties at tertiary institutions are silent while their fellow students are struggling to get their allowances to make ends meet. The distribution was previously handled by tertiary institutions. If ever there were challenges with tertiary institutions, such challenges should have been addressed and the state if truly capable would have taken over.


  • Radipere is a Sowetan reader

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