The powers of Ministers and/or Government to take money from one state-owned enterprise (SOE’s) to fund another one should be stopped.
The United National Transport Union (UNTU) says it is time that both Ministers and the boards of state-owned enterprises adhere to the promise made by President Cyril Ramaphosa, during his State of the Nation address on 12 February 2019, to stop the political interference in SOE’s and its Boards in its operational functioning.
But to date, this has not happened.
When Transnet released its financial statements for the previous financial year, Steve Harris, General Secretary of the United National Transport Union (UNTU) asked Mohammed Mohamedy, Acting Chief Executive Officer of Transnet, if the R222 million loan Transnet made to SA Express in December 2017 has been repaid.
Transnet was instructed to make this loan after intervention of former Minister of Public Enterprises Lynne Brown.
Mohamedy indicated that Transnet entered into a new agreement with SA Express a few months ago about this loan but did not provide any details.
Harris says UNTU has written to Mohamedy today to ask him for the details of the agreement. The Union is very concerned that this money will never be recovered from SA Express by taking into consideration their ongoing financial situation.
On 3 October 2019 it was reported that the Public Enterprises Minister Pravin Gordhan, who is responsible for both SA Express and Transnet, wrote to Parliament to request an extension of the deadline to table the annual financial statements of SAA and SA Express who has been unable to finalise their statements as neither company is financially viable.
According to the Minister both airlines are experiencing serious financial challenges and are unable to meet ongoing concerns.
“To UNTU this means that SA Express will never be able to repay Transnet its loan and that will be to the detriment of UNTU members, the majority of Transnet’s employees.
“UNTU wants to prevent a situation where Transnet has to write-off R220 million to a debtor who has not paid the SOE back. It is shocking that Transnet has already wrote off R500 million in bad debt in the previous financial year,” says Harris.
Government also gave the South African Broadcast Cooperation (SABC) yet another bailout of R2,1 billion last week even though the public broadcaster has a fee evasion rate of 69%.
“In the case of Prasa, Transport Minister Mbalula is allowing the decision of Dr Blade Nzimande, the previous Minister of Transport, to continue to the detriment of the ruined Passenger Rail Agency of South Africa (Prasa) for the bankrupt benefit of the South African National Roads Agency (Sanral).
“The Department of Transport admitted to the National Economic Development and Labour Council (Nedlac) that to date R5 billion of the allocated R8 billion has been taken from Prasa’s budget and given to Sanral.
“This is simply insane when one takes into account the devastating state of rail safety in our country,” says Harris.
Issued on behalf of UNTU by Sonja Carstens, Deputy-General Secretary responsible for Media, Liaison and Communication. For UNTU Press Releases phone Sonja at 082 463 6806.