afrol News, 17 May - South African Public Enterprises Minister, Jeff Radebe, yesterday announced that he intends to proceed with his programme of privatisation of Telkom, Eskom, the ports, Denel and other state assets. Trade unions protest the decision to sell out "essential services".
Radebe yesterday presented the budget of his Ministry in the South African National Assembly. Noting that the 2000-04 programme of restructuring state owned enterprises was now "halfway down the road", his Ministry would now emphasise on the privatisation process of state owned infrastructure companies. The main affected companies are within telecommunication, aerospace/aviation (Denel), power (Eskom) and the ports.
- Where we choose to restructure state owned enterprises, we promote models to enhance their positive contribution to the economy and their global competitiveness, Minister Radebe said. "We also recognise that the larger, strategically placed state owned enterprises like Transnet, Eskom, Telkom and Denel, play a significant role in international relations and in the foreign policy of our country."
The Congress of South African Trade Unions (COSATU) today however says it was "deeply concerned and disappointed" by the Minister's statement. "COSATU remains opposed to the government selling off state companies which provide essential services to the community. We will continue to demand that the government look at alternative forms of restructuring which maintain these organisations in the public sector and make them deliver affordable and accessible services, especially to the poor," spokesmen Patrick Craven and Moloto Mothapo said.
Craven and Mothapo especially react on the Minister's disregard of ongoing work in all these enterprises to enhance service and productivity through reorganisation. These local initiatives were in close cooperation with workers' representatives and might find "better solutions than widescale privatisation."
COSATU supported the view that "riding roughshod over labour in the manner that government is currently doing will only alienate workers and make such a turnaround in the ports sector impossible." The spokesmen therefore urged the minister "to meet with us, so that we can discuss with him and avoid a repetition of the kind of protest action against privatisation that we experienced in 2001."
Minister Radebe however claimed in Parliament that "engagements between government and organised labour at the sectoral level have been extensive and constructive. We have a common commitment to retain jobs and where possible extend secure employment."
The Minister holds that South African economic development depended on the emergence of globally competitive companies that export products with a high value added. "However, a sluggish domestic market, increasing competition, the rationalisation of ... industries internationally, the high costs of research and development investment, and growing demand have all placed particular pressures," he said.
Especially in the case of Eskom, the national power supplier, the privatisation fight between the government and civil society might get inflamed, as examples in other African countries have shown. Radebe plans to split Eskom into separate divisions of generation, supply and transmission before privatising it. "This approach aims to derive benefits and efficiencies from competition and ensure that Eskom remains our dominant energy supplier," he said.
COSATU strongly rejects the proposal and demands "that the government retracts the Minister's statement and immediately engages in discussions ... to find serious and sustainable solutions to the problems in these industries."
- There must be a solution which recognises the vital role of the state in directing investment into better and faster service delivery, affordable charges, better standards of service and the retention and creation of jobs, Craven and Mothapo say. The argumentation is known from all over Africa, where the privatisation of power suppliers seem the norm at the moment.
The most common concerns in these discussions are always the social responsibilities connected to the access to electricity. This includes the imminent tariff price hike of a privatisation - making electricity even less available to the poor - and the responsibility over rural electrification at affordable
Sources: Based on COSATU, SA
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