State companies bleeding South Africa dry – giving nothing back

 ·2 May 2024

The South African government has put R282.5 billion into various State Owned Enterprises (SOEs) as “capital investments” since 2019, but has seen just R1 million back in dividends.

This was revealed by the Minister of Public Enterprises, Pravin Gordhan when asked in parliament by MP Farhat Essack how much six SOEs have received from the state, and in return, paid out since May 2019.

The minister started off by saying that all of South Africa’s SOE’s were adversely impacted by the effects of state capture, and emphasised that since the sixth administration took over, “no bailouts were provided to SOEs, but rather capital invested to put them on a path of sustainability.”

Four entities (South African Airways, Eskom, Transnet and Denel) were listed by Gordhan as having received funds from state coffers since May 2019, amounting to R282.5 billion.

None of these entities paid out any dividends in return.

The only state company under Gordhan’s portfolio to have paid anything out was the South African Forestry Company SOC Limited, which delivered a total dividend of R1 million over the five years.

If it is to be taken that these are “capital investments” and not bailouts, as emphasised by the minister, this means that the government’s return on equity over the past five years equates to 0.0003% for all SOEs under the Public Enterprises portfolio.

While it could be argued that the money pumped into these companies is to ensure they fulfil their respective mandates and not to make a profit and pay dividends—the well-documents and widely reported power (Eskom), logistics (Transnet) and defence (Denel) crises show that these companies are still far off from even that.

SAA, meanwhile, has had its own troubled path back to the skies, with its privatisation saga still far from over.

Bailouts by any other name

Looking at the breakdown, Eskom received the lion’s share of government funds since 2019, amounting to R234.6 billion.

R158.6 billion of this has been through the Special Appropriation Act of 2019 and R76 billion in terms of the Eskom Debt Relief Act of 2023

“The National Treasury recognises that debt relief alone will not return the utility to financial sustainability,” said Gordhan, adding that without tariff increases, the debt-relief arrangement is not sustainable.

Outstanding municipal debt, which stood at R74.5 billion in February 2024, is listed as one of Eskom’s biggest revenue challenges.

The second biggest has been South African Airways (SAA), amounting to R33.136 billion.

SAA is currently looking for minority investors, capital market access, and loan financing after the failure of a deal to sell a 51% stake to the Takatso group, which would have provided a R3 billion cash boost. This comes after SAA’s emergence from extended bankruptcy proceedings.

Transnet and Denel also received fund from state coffers, amounting to nearly R15 billion, however also did not pay out any dividends.

Despite not declaring a dividend for the past five financial years, Alexkor did not receive any government “capital investments.”


Year“Capital investment”Dividends
2019/20R49 000 000 000.00R0.00
2020/21R56 000 000 000.00R0.00
2021/22R31 700 000 000.00R0.00
2022/23R21 900 000 000.00R0.00
2023/24R76 000 000 000.00R0.00
TotalR234 600 000 000.00R0.00

South African Airways

Year“Capital investment”Dividend
2019/20R5 500 000 000.00R0.00
2020/21R18 275 000 000.00R0.00
2021/22R6 778 000 000.00R0.00
2022/23R1 583 000 000.00R0.00
2023/24R1 000 000 000.00R0.00
TotalR33 136 000 000.00R0.00


Year“Capital investment”Dividend
2022/23R5 837 000 000.00*R0.00
TotalR5 837 000 000.00R0.00

* Gordhan only provided the figures for January 2023, when Transnet received R2.937 billion as disbursement for the repair of flood damages during April 2022, and R2.9 billion to hasten the repair and maintenance of its freight rail locomotives.

These figures do not include the recent R47 billion guarantee facility against which Transnet will draw down an initial amount of R22.8 billion to deal with immediate liquidity matters.

“Government has not considered [this as] an equity injection given that the budget for 2023/24 is closed,” said finance minister Enoch Godongwana.


Year“Capital investment”Dividends
2019/20R1 800 000 000.00R0.00
2020/21R576 000 000.00R0.00
2021/22R3 068 886 261.73R0.00
2022/23R3 582 700 000.00R0.00
TotalR9 027 586 261.73R0.00


Year“Capital investment”Dividends
2022/23R0.00R1 000 000*
TotalR0.00R1 000 000

*declared at AGM of 2021/22.


Year“Capital investment”Dividend

Gordhan said that given that Alexkor and the 51%–owned joint venture PSJV have not handled maintenance backlogs for fatal and non-fatal non-compliance with the Mine Health and Safety Act requirements over the last six years, it is not possible to declare a dividend on 31 March 2023.


Year“Capital investment”Dividend
EskomR234 600 000 000.00R0.00
DenelR9 027 586 261.73R0.00
SAFCOLR0.00R1 000 000.00
SAAR33 136 000 000.00R0.00
TransnetR5 837 000 000.00R0.00
TotalR282 600 586 261.73R1 000 000.00

Read: SAA is looking for investors and loans

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