Public Enterprise Portfolio Committee Legacy Report

Meeting report

Opening Remarks

The Chairperson welcomed all the members and Committee support staff present and noted the apologies from those who could not attend. She informed the Committee that the main purpose of the meeting was to deliberate on the legacy report, which was still a working document.

The Chairperson stated that there was only one item on the agenda, which was the adoption of the legacy report. And the report was emailed to all members of the Committee.

Committee legacy report

Mr Disang Mocumi, Committee Secretary, Portfolio Committee on Public Enterprises presented the draft legacy report which entailed a summary of the activities of the Committee during the fifth parliamentary term; outstanding issues that required follow up; and recommendations of the issues that required the attention of the sixth parliament.

The Chairperson allowed for input from the Members of the Committee.

An ANC member raised a concern on item 12 on page 16 of the legacy report that speaks to the pursuance of comprehensive governance of State-Owned Companies (SOCs).

Mr Mocumi responded that there are key interventions and programmes which have been made by the department. He stated that an assessment was taken to review the capacity and skills gaps undertaken during 2017-18 financial year. He went on to express that the Portfolio Committee on Rural Development and Land Reform was to resolve on how to deal with issues relating matters which are beyond the control of Committee on Public Enterprises.

Mr Mocumi informed the Committee that the gap analysis report was completed. He provided clear emphasis on the content of the report. He informed the Members that the report would give clear direction to the incoming Portfolio Committee on Public Enterprises. He noted that remarkable executive appointments have been made at Eskom and Denel for the purpose of proper management of these public entities. He said that there was a need to develop and capacitate the SOCs framework for effective functioning. It was stated that the state should constructively scrutinise the mining industry and develop the programme of action for state corporations.

On municipal debt, intergovernmental state entities were formulated to resolve the huge municipal debts. It was then mutually resolved that vacancies in the department should be filled as soon as possible. A new structure was developed which was to be put into action soon.

Mr Mocumi stated that the service providers should be paid in time. The Committee resolved that the Denel report should be rectified.

The Chairperson advised the Committee to identify issues on the report. She noted that from page one to three, there is an issue about the restoration of good governance in Eskom and SOCs.

The Chairperson welcomed input from Members.

Ms Z Rantho (ANC) wanted more emphasis on good governance and financial sustainability and stressed that this was an urgent matter. She informed the Committee to watch South African Airways (SAA) closely.

Ms Rantho referred to page three, point number 10, where it speaks about monitoring the South African Airways which were to be integrated and also the feedback to be provided in that regard.

The Chairperson advised that the committee to deliberate from page two to four.

A Committee member cautioned that issues which were subjected to the ‘Zondo Commission of Inquiry’ should not be handled by the Committee.  The view is that if the Zondo Commission has covered a said entity, then it should not be investigated by the Committee. It should be left for the Zondo Commission to investigate.

The Chairperson referred members to page two under “key areas”. She noted incoherence and asked for more emphasis. She then asked if members were accepting the document.

Ms Rantho, commenting on page 17 discussing internal auditors said that her issue was on the appointment of internal auditors, which has complicated the work of the two state entities. She stressed that the structure of selecting internal auditors was to be reviewed.

The Chairperson noted that before external auditors, there should be internal auditing forces. The internal auditing force should be appointed by the board. The vision was to ensure financial accountability. The Chairperson expressed that the City Manager should appoint an internal audit committee.

Ms Rantho adopted the report with all the recommendations made. She said that the Zondo Commission has accepted the report of the Committee.  She then stated that the Portfolio Committee on Justice and Correctional Service and the Portfolio Committee on Police were going to deal with the matter of criminal and state capture investigation and liaise with the Zondo Commission.

The Chairperson noted that the portfolio Committees on Justice and Correctional Service and Committee on Police may be restructured.

Ms Rantho pointed out the issues which came out of an inquiry and expressed that the next Portfolio Committee on Public Enterprises should observe the reports and proceedings relating to deliberations of these issues. She noted that the Public Enterprise Committee was relevant to the matter and it was important for it to receive feedback on the matter.

Mr S Swart (ACDP) recommended a joint sitting with the Portfolio Committees on Justice and Correctional Service and Police.

The Chairperson said that the Committee would take the resolution further.

Recommendations to the sixth parliament

There needs to be a strategy to overcome the cable theft at Eskom. Staff members and public members who are alleged to have stolen cables need to be prosecuted.

Ms Rantho adopted the report. Mr Swart seconded.

The Chairperson informed the Committee that the report would be rectified. When the report is final it will then be made available to the Committee.

The DA moved to adopt the report. The ANC seconded the adoption.

The Committee resolved that the Department should forward a detailed report on the challenges facing Medupi power station, including reasons for the cost overruns. This information should reach the Committee by 13 March 2019.

The meeting was adjourned.