Hon Chairperson, Minister and Deputy Minister of the Department of Public Enterprises, DPE, colleagues of the Fourth democratic Parliament, distinguished guests, ladies and gentlemen, may I preface my speech by extending my sincere and heartfelt condolences, on behalf of Cope, to the family, friends and comrades of Letsile Fani, who served as a member of this House from 1994 to 1999. Comrade Mdange, as he was affectionately known, passed away on 20 May 2011 and will be laid to rest at his home in Fort Beaufort on 3 June 2011. May your soul rest in peace.
Hamba kahle Mdange kaTshiwo, thole leenkunzi zasemaTshaweni. [Farewell Mdange kaTshiwo, son of the amaTshawe clan.]
The Department of Public Enterprises may rightfully be called the problem child of the South African portfolio of departments, not through its own doing, but through the conduct of certain state-owned enterprises, SOEs. This is a department with such a crucial role to play in the South African developmental state, but year after year some of its SOEs continue to be unsuccessful and fail to come to the party.
According to some reports, SOEs have lost in the region of R2,5 billion in 2010 alone. For how long will we sit idly by and let these SOEs drain our economy? Allow me to quote from my budget speech of last year. [Interjections.] There's not much to quote:
It is such a shame that the developmental state we purport to be cannot learn from the past desperate situations and apply desperate measures as applied by the apartheid government during their isolation.
A few weeks ago, I asked the Minister about the details of the new deal with Matsui of Japan to acquire new locomotives. I got evasive answers. He said the total value of the transaction could not be made public because it was "commercially sensitive". What is even more disconcerting is the fact that no new tender was issued for the delivery of the new locomotives; this tender automatically went to Matsui. Surely a new transaction constitutes a new tender?
The department has disclosed that some local businesspeople are partners in the deal with the Japanese, but we would like to know the details of the people or companies involved, in case it's Chancellor House once again.
As Members of Parliament we are here, inter alia, to make sure that government and its subdivisions can account for each and every cent appropriated to them. But then we are stonewalled when we try to perform our tasks. So, Minister, once again, may I ask you to please enlighten me on the details of this transaction.
The once powerful Denel is now just a drain on the fiscus. Denel Saab Aerostructures and Denel Dynamics are pulling this struggling entity even further into the abyss. I welcome the announcement by the Minister in this regard. We are awaiting a final decision on the viability of this entity going into the future.
The department has been adamant that it is capable of turning this ship around. I just ask myself why Saab, the Swedish manufacturer, would decide to give up 20% of its stake if the contrary is untrue. A local firm, Aerosud, is now in talks with Denel and we will be watching this space with keen interest.
The role of public enterprises is well documented in the New Growth Path. The infrastructure development programmes have been identified as key job drivers of this document. Again, Minister, I welcome your announcement that you are holding bi-monthly meetings with chairpersons and CEOs of these SOEs. However, it must not stop there. A harsher stance needs to be taken on underperforming entities and those responsible should be brought to book for underperformance. No performance bonuses for nonperformance, Minister.
With winter in our midst, Eskom's ability to supply power readily will be tested severely. I still cannot figure out how it is possible for one company, BHP Billiton Smelter, to consume a total of about 6% of our total generated electricity yet Eskom, in its newly renegotiated deal with this smelter, stands to lose about R4,7 billion. Government needs to ensure that we are not left in the dark in this regard.
In conclusion and on a more positive note, not suggesting that I'm taking up the offer from the Minister of joining the ANC, may I commend the Minister on his role in resolving the struggles experienced in Transnet and the sterling work that seems to be happening at SA Airways. May I also congratulate the Minister on addressing the problem of vacancies experienced within the SOEs, especially with the appointment of the new chairman and the group chief executive officer, CEO, of Transnet. May this be a positive sign of things to come. Cope will support the Budget Vote. Thank you.