Malusi Gigaba was always going to be proactive regarding the state-owned enterprises, and he is developing a reputation as a hard taskmaster. But there are concerns that his department lacks the skills to oversee the very large organisations in his portfolio, contributing to an already extensive bureaucratic burden on these companies.
The majority of the SAA board members quit under a cloud, complaining about a lack of shareholder support. They were followed rapidly by its chief executive officer and two other senior executives. SAA`s subsidiary, SA Express, received a qualified audit and its financials, which were incorrect, had to be retracted from Parliament. This resulted in its board being replaced as well.
Following the SAA fracas Gigaba made the questionable appointment of Dudu Myeni, as chair of the new board. Myeni is a known Jacob Zuma ally, who was reinstated in her position at the Mhlathuze Water Board, despite a divisive record at the institution.
The largest state-owned enterprises and those most integral to the government`s infrastructure ambitions, Transnet and Eskom, are for now running relatively well. But Eskom is losing its finance director, Paul O`Flaherty – another high-profile exit at a critical time – although he will remain with the company until July next year.
Despite capacity constraints, the department maintained its record of clean audits.
It is establishing a unit to oversee very large capital expenditure projects run by the state-owned enterprises and provide additional oversight. This is largely a reaction to the shambles linked to Transnet`s new multiproduct pipeline and follows a ministerial review that found many “systemic failings” in the project. The full report, which explained why the cost of the pipeline more than doubled in recent years, was not made public in a bid to protect Transnet`s reputation, but it has only served to raise more questions.
A firm believer in using the entities to lead state development, Gigaba has been actively involved in the presidential infrastructure co-ordinating committee, which is streamlining the planning of government projects. It has been sorely needed, but the private sector is complaining that the rolling out of new infrastructure projects is proceeding too slowly.