South Africa

Worst investment in South Africa – R283 billion invested and only R1 million returned

The South African government has invested R283 billion in six state-owned companies over the last five years and has received only R1 million in dividends.

This was revealed by the Public Enterprises Minister Pravin Gordhan during a parliamentary question and answer session.

DA MP Farhat Essack asked Gordhan how much SA Airways, Eskom, Transnet, the SA Forestry Company, Alexkor, and Denel received in bailouts over five years.

He also asked the minister how much these companies paid out in dividends over the past five years.

The feedback was telling. It shows that state-owned enterprises are a black hole for taxpayer money.

  • The government gave South African Airways R33.1 billion over the last five years and received nothing in return.
  • It gave Eskom R234.6 billion and received nothing in return.
  • The government invested R5.8 billion in Transnet, but the company has not paid dividends since May 2019.
  • Denel received R9 billion in bailouts and did not pay any dividends.
  • Alexkor received no bailouts and did not pay out any dividends.
  • The South African Forestry Company received no bailouts and paid R1 million in dividends over 5 years.

The question from Essack did not include other SOEs, like the South African Post Office or the SABC, which also received billions in bailouts.

The numbers showed that the government invested R282.5 billion of taxpayer money into a handful of state-owned companies, with virtually no return.

This would be considered an incredible waste of money in the private sector, and heads would roll.

However, despite their dismal performance, South Africa’s government continues to pump billions into these companies.

Gordhan admitted that a large part of these bailouts was necessary because of corruption and mismanagement at these companies.

However, despite the corruption and mismanagement continuing unabated, billions continue to flow into these enterprises.

The table below summarises the government’s investment in the six state-owned enterprises and the dividends the government received.

State-owned companyMoney receivedMoney returned
EskomR234.6 billionZero
South African AirwaysR33.1 billionZero
TransnetR5.8 billionZero
DenelR9 billionZero
South African Forestry CompanyZeroR 1 million
TOTALR282.5 billionR1 million


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