WE MUST DEFINE THESE INSTITUTIONS BETTER

The role of State owned Enterprises (SOEs) has been a matter of discussion and sometimes controversy for many years in South Africa. It has moved from ideological views e.g. support a developmental state, to individual preferences of the leadership of the time.
We have recently had the debacle at Eskom, the still lingering and unresolved issues at Transnet and there is also the role of the regulators that still need to be clarified, especially referring to ICASA, since recently both parliament and the department of Communications have been dealing with the issue of unterconnect charges.
Typical of South Africa, debates sometimes get lost by / around personalities and the whole nation after these have been sorted out, if they are ever sorted out or people simply get tired and move on, has no better understanding of the fundamental issues being debated.

It is becoming clear to me, at least, that we need to address, inter alia, the following issues regarding SOEs and similar public institutions.

1. What is the role of these institutions
a) Are they an extension of government departments
b) Are they expected to make a profit
c) Are they meant to deal with areas which the private sector would not / could not deal with because of the low returns. By the way, there is nothing the private sector cannot do as long as there are commensurate returns.
d) Are they national assets which therefore could / should be funded from the fiscus.

2. What is the role of the shareholder or of the ultimate owner
a) Is it to set them up and leave them alone.
b) Is it to dictate what they should, and should not do.
c) Is it to create one channel of communication and representation so that they should not be answerable to everybody.

3. What is the ideal governance structure
a) Who should oversee the functioning of these
b) What qualities are required from those who oversee these:, independent minds, people merely carrying out instructions of the ultimate owner?
c) How should those charged with governance relate to those they oversee i.e those charged with day to day management
d) Those tasked with governance, who are they answerable to
e) How should their success or failure be judged.

4. What is the caliber of those in management
a) Are they / should they be experts in the filed
b) Should it be people more politically inclined.
c) Who should appoint or dismiss these i.e who are they accountable to
d) How should their success / failure be judged.

5. What is the role of other stakeholders they interact with
a) What are the powers of these vis - a – vis the institutions

Of course, all these considerations must be made understanding that there are rights of individuals, groups, and structures that are enshrined by our constitution. All these discussions should take place with full knowledge that the world over, there are different models and our country must choose what suits it.

The sad part about this continuous state of flux, may I add, which is not new, is that there are many individuals who have made sacrifices to serve these institutions and are getting despondent day by day. There are also opportunists in the process, who will forever derail these institutions to the detriment of the whole nation. These opportunists strive when there is chaos and by the time we wake up, they would have looted these institutions. Good people will move on and these institutions will be plunged into a new form of crisis.

Somebody out there must finally put this matter out for debate so that the whole nation should know if we are dealing with a fish or foul because it has to be something whatever it is, we would even settle for a bat.

The asset base of Eskom, Transnet and SABC (to mention a few) at the last count was about R103 billion for Transnet, R199 billion for Eskom and 443 billion for SABC and the number of people employed by them collectively was over 130 000. By way of comparison, BHP Billiton has a market capitalization of about R509 billion. We are not talking pinutes here.