{"id":377811,"date":"2020-02-28T08:21:02","date_gmt":"2020-02-28T06:21:02","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=377811"},"modified":"2020-02-28T08:21:02","modified_gmt":"2020-02-28T06:21:02","slug":"of-all-the-major-state-companies-under-the-department-of-public-enterprises-only-one-is-not-making-a-loss","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/377811\/of-all-the-major-state-companies-under-the-department-of-public-enterprises-only-one-is-not-making-a-loss\/","title":{"rendered":"Of all the major state companies under the Department of Public Enterprises, only one is not making a loss"},"content":{"rendered":"<p>Parliament&#8217;s Portfolio Committee on Public Enterprises has expressed concern about the performance of South Africa state-owned enterprises (SOEs) as the companies continue to haemorrhage money.<\/p>\n<p>The committee said that it was particularly <strong><a href=\"https:\/\/www.parliament.gov.za\/press-releases\/public-enterprises-committee-says-soes-are-loss-making\" target=\"_blank\" rel=\"noopener noreferrer\">concerned<\/a> <\/strong>to hear that all SOEs under the umbrella of the Department of Public Enterprises are loss-making &#8211; with the exception of the <strong>South African Forestry Companies Limited (Safcol).<\/strong><\/p>\n<p>Speaking to BusinessTech, Committee chairperson Khaya Magaxa said that there are currently seven major SOEs that fall directly under the Department of Public Enterprises. These include:<\/p>\n<ul>\n<li>Alexkor<\/li>\n<li>Denel<\/li>\n<li>Eskom<\/li>\n<li>Safcol<\/li>\n<li>South African Airways<\/li>\n<li>SA Express<\/li>\n<li>Transnet<\/li>\n<\/ul>\n<p>In in 2019, Eskom said it expects losses to amount to R20 billion for its current year, while SAA has not published financial results over <a href=\"https:\/\/businesstech.co.za\/news\/government\/376167\/saa-wont-publish-its-finances-over-fears-it-will-be-liquidated\/\">fears of being liquidated<\/a> if it does.<\/p>\n<p>SAA&#8217;s problems extended to SA Express, which saw a financial loss of R590 million in 2019.<\/p>\n<p>Alexkor reported an accumulated loss standing at R174 million in the current financial year, while Denel and Transnet saw losses of R1.9 billion and R12 billion, respectively.<\/p>\n<p>This brings total losses in excess of R34 billion (excluding SAA, which is unknown) in a single year.<\/p>\n<p>The committee said the department\u2019s presentation on SOEs painted a dismal picture with notable deteriorations seen at Transnet and Denel.<\/p>\n<p>Transnet\u2019s overall shareholder compact performance has dwindled from 49% in the first quarter to 41% in the second quarter and 32% in the last quarter of the period under review.<\/p>\n<p>Magaxa said that the regression at Transnet is of particular concern, as the entity was previously considered more successful.<\/p>\n<p>He added that SOEs are rife with governance challenges and financial distress, as a result of corruption.<\/p>\n<p><strong>Wage bill cuts<\/strong><\/p>\n<p>Key to turning around South Africa&#8217;s SOEs is the plan to cut over R160 billion from the country&#8217;s public sector wage bill.<\/p>\n<p>Between 2006\/07 and 2011\/12, the state added over 190,000 employees. However, wages also increased significantly, finance minister Tito Mboweni said during his Budget Speech.<\/p>\n<p>&#8220;To balance the books, we slowed hiring, and since 2011\/12, the number of government employees has declined,&#8221; he said.<\/p>\n<p>&#8220;We cannot go on like this. Classroom sizes are growing, hospitals are getting fuller and our communities are becoming increasingly unsafe.&#8221;<\/p>\n<p>He said once wage growth, corruption and wasteful expenditure was under control, government would focus its attention on hiring in important areas such as education, police, and health care.<\/p>\n<p>&#8220;We can hire strategically and better match skills with opportunities,&#8221; he said.<\/p>\n<hr \/>\n<p><strong>Read: <a href=\"https:\/\/businesstech.co.za\/news\/budget-speech\/377399\/government-will-reduce-the-public-sector-wage-bill-by-r160-billion\/\" target=\"_blank\" rel=\"noopener noreferrer\">Government will reduce the public sector wage bill by R160 billion<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Parliament&#8217;s Portfolio Committee on Public Enterprises has expressed concern about the performance of South Africa state-owned enterprises (SOEs) as the companies continue to haemorrhage money.<\/p>\n","protected":false},"author":55,"featured_media":71071,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[26],"class_list":["post-377811","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/377811","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/55"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=377811"}],"version-history":[{"count":15,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/377811\/revisions"}],"predecessor-version":[{"id":377971,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/377811\/revisions\/377971"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/71071"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=377811"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=377811"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=377811"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}