Ramaphosa’s plan for Eskom and other state companies

Staff Writer10 March 2023


President Cyril Ramaphosa announced that the Department of Public Enterprises (DPE) would cease to exist in the future as state-owned entities are planned to revert to their respective departments.

Speaking during a national assembly Q&A, Ramaphosa said that a new holding company is in the works to oversee SOEs in the country to give ‘line of sight on what’s happening’ within the respective entities.

He added that legislation is currently being prepared to allow for the establishment of a holding company to standardise procedures relating to SOEs. No set timeline was provided.

The DPE, currently headed by Pravin Gordhan, is a shareholder representative for the government that oversees several state-operated companies engaged in energy, logistics, defence, mining and more.

Eskom is the most notable company under its wing; however, the department also encompasses the national freight and logistics company Transnet, the state defence company Denel, and South African Airways.

Eskom’s fate has been in question for years as the country’s energy capacity has continued to decline, and load shedding has ravaged the economy. The country has been in  a near-permanent state of load shedding since September 2022, while the government dithers on solutions.

During the recent cabinet reshuffle (6 March), Ramaphosa appointed a new minister of electricity to execute the national energy plan.

This move by Ramaphosa ruffled some political feathers when it was first announced, as it went against many ANC leaders’ expectations for the national power utility to shift to the portfolio of the minister of mineral resources and energy – currently Gwede Mantashe.

Responding to the initial proposal of a new electricity minister, Mantashe deemed the position a ‘project manager’ role.

During his cabinet reshuffle, the president revealed that Kgosientsho Ramokgopa would be appointed as the minister of electricity. His position was described by Ramaphosa to be ‘transitory’, noting that he would only stay in office until the energy crisis was dealt with.

For his part, Ramokgopa said his approach to the role is as a portfolio manager, and that he will be steering clear of politics. However, he has executive powers that give him direct control over the power crisis and may supersede both the energy and public enterprises departments.

Ramaphosa said that the new minister would assist in dealing with the challenges of fragmentation of responsibility across various departments.

“The primary task of the new minister will be to significantly reduce the severity and frequency of load shedding as a matter of urgency. To effectively oversee the electricity crisis response, the appointed Minister will have political responsibility, authority and control over all critical aspects of the Energy Action Plan,” the president said.

The reshuffle faced both business and political backlash for contributing to an already bloated cabinet.

The new appointments expanded the cabinet to 30 ministers, making it one of the largest in the world.

Busi Mavuso, the CEO of Business Leadership South Africa (BLSA), expressed hope that this would bring fresh energy to the government; however, she also expressed concern about the appointment of two new ministers due to the already bloated nature of the executive.

Source: Business Tech