Energy expert Mthunzi Luthuli said Public Enterprises Minister Pravin Gordhan should have been fired or stepped down long ago as all the parastatals under his watch are failing.
Luthuli told Newzroom Afrika that Gordhan “keeps giving excuses” for the poor performances of South Africa’s state-owned enterprises (SOEs).
“Pravin Gordhan keeps giving excuses. He’s five years into the job. He keeps giving excuses about state capture. He blames geopolitical forces and all sorts of excuses,” he said.
“In my view, Pravin Gordhan should have been fired a long time ago, or he should have left on his own because he’s ineffective.”
Luthuli said it’s not Eskom’s performance that has deteriorated but all the parastatals under Gordhan’s watch. “They’re failing – all of them.”
Luthuli’s comments echo renowned economist Dawie Roodt, who said Gordhan is the worst Finance Minister South Africa has ever had, and he is partly to blame for the mess at the country’s SOEs.
Speaking to State of the Nation, Roodt said Gordhan should be blamed for the poor state of South Africa’s fiscal accounts.
Although there were many reasons for South Africa’s rising fiscal deficit, Gordhan was the Minister who put it all in motion.
Under his leadership, South Africa’s debt-to-GDP increased tremendously, undoing the good work of his predecessor, Trevor Manuel.
Manuel was able to significantly reduce the country’s debt-to-GDP, which points to sound and responsible fiscal policies.
However, after he handed the reigns to Gordhan, matters quickly changed. He gave considerable increases to civil servants and gave billions to SOEs.
“He was the one who set the collapse of the state-owned enterprises in motion. He is now the Minister of state-owned enterprises and continues his destructive work,” Roodt said.
South Africa’s SOEs, including Eskom, Transnet, the South African Post Office, and the SABC, are in deep financial trouble.
The Post Office is in business rescue, the SABC records huge losses and requires bailouts to survive, and the state had to take over a chunk of Eskom’s debt to prevent big problems.
Transnet also requires support from the state to implement its turnaround plan to reverse the collapse over the last few years.