The Cape Chamber welcomes the unbundling of SOEs to allow for more private sector efficiency
Albert Einstein's bright ideas changed world history, but he's also famous for pointing out the obvious: it is crazy to expect different results when you do the same thing over and over again.
Einstein's observation is as true for scientific experiments as it is for South Africa's State-owned Enterprises (SOEs); a business-as-usual approach to SOEs will never achieve the promised turnaround the economy so urgently needs.
Fortunately Government appears intent on trying a different approach to SOE management, evidenced by recent publication of the National State Enterprises Bill.
Expect some political fireworks as the Bill comes under scrutiny. But it is tempting to welcome ANY intervention aimed at rejuvenating our SOEs.
Minister for Planning, Monitoring and Evaluation, Maropene Ramokgopa, says Government has a mandate to relinquish total control of SOEs and harness private sector expertise. In our view this would be a significant step forward.
The Cape Chamber welcomes the unbundling of SOEs to allow for more private sector efficiency. We have long advocated for SOE unbundling, particularly those SOEs central to economic development. Future business growth requires our SOEs to flourish, and this in turn requires an end to the era of cronyism and inefficiency.
SOE unbundling would introduce much-needed competition, particularly in relation to Eskom and Transnet. Multiple private sector stakeholders in the critical areas of energy and logistics would ensure that state monopolies are not simply replaced by private monopolies. Instead, Government should leverage private sector competition to drive efficiency based on multiple success stories worldwide. Already we are seeing the benefit of competing energy producers; imagine the economic benefit of competing container terminal operators, or rail service operators.
In this regard it is worth pointing out that Eskom, buoyed by private sector assistance, this week achieved a significant milestone – 300 days without load shedding. The last time this was achieved was June 2018.
There is a corollary to Einstein's theory about experiments and outcomes. In as much as we shouldn't expect change when repeating the same action, a change of plan can indeed produce a different outcome.
John Lawson
CEO of the Cape Chamber of Commerce and Industry