A friend of mine (who is also a member of parliament) recently mentioned to me that many government departments have essentially been moribund for at least a decade.
He says the private sector is the only reason why this country is still functioning in many respects. According to him, the good news is that there is still abundant, yet underutilised, human capacity left in the public sector on which to build.
And why would anybody doubt his claims? The ANC had such a lengthy, corrupt and intense stranglehold on the State and bureaucracy that it really comes as no surprise. Media reports, independent research, the public’s daily experiences and anecdotal evidence have repeatedly borne this out.
What would this country look and be like if not for private industry, private schools, private hospitals and privately owned farms? And seeing as the government’s fiscal position and general capacity leave little room for further investments and development, what other choices are left but to increasingly involve the private sector in saving the country? South Africa didn’t get into this mess by coincidence, but by design.
However, this is ostensibly changing – albeit slowly and selectively in the form of utterances – but hopefully it is more than just mere rhetoric. Once anathema to any ANC cadre, there seems to be some talk about the virtues and value of the private sector these days – even from inveterate commies.
According to BusinessLive, Gwede Mantashe, mineral & petroleum resources, recently said private investors are sought to develop the mothballed Sapref refinery, which the government bought for R1 in May. If leveraged to its full potential, Sapref could be responsible for 35% (or some 180 000 barrels per day) of the country’s refining capacity.
Likewise, transport minister Barbara Creecy seeks to establish a dedicated unit in her department to drive private sector involvement in the rail network. Transnet has already opened its rail network to third parties and the private sector and a Philippine ports operator has been contracted to run the Durban container terminal. Private contractors would also be involved in building rail infrastructure.
She frames this move within the context of job losses and the social impact it would render, and draws inspiration from that which has been accomplished in energy generation. “Our freight rail system was characterised by maintenance backlogs, cable theft and skills shortages. Our road systems deteriorated throughout the country and many provinces failed to execute maintenance and new build programmes, resulting in unspent funds being returned to National Treasury,” she said according to BusinessLive.
Energy and electricity minister Kgosientsho Ramokgopa has also roundly stated that if economic growth is to be expedited, the country cannot rely solely on Eskom. Hence, necessity and reality have given rise to this increased desire for private sector involvement (although not privatisation per se) in key sectors – not dogma. Transport and electricity woes are exacting a gargantuan toll on imports, exports, jobs and the economy, especially in the mining sector. Either way, this is positive and in line with the reform objectives of the much-vaunted Operation Vulindlela.
Of course, not everyone is thrilled with this. But the SACP and Cosatu can stop blaming the “neoliberal” DA for stymying the revolution by being part of the government of national unity (GNU). The ANC is currently making the loudest noises about private stakeholder involvement from within the GNU, because they really have no choice.
Let’s hope the unshackling of the reformist faction in the ANC, and the inclusion of pro-market parties in the GNU, allows privatisation, pragmatism and true freedom to reign supreme. There really is no other way forward at this juncture. Hopefully some competition between departments managed by different parties in the GNU would evince improved innovation, efficiencies and common sense.
But let’s also hope that these plans are not of the venal, oligarchic and exclusionary variety that has only served to undermine and denigrate pro-market reforms in so many local and global contexts. Let it be transparent, eschew toxic and politicised tenderpreneurship, reward merit and innovation, and save (and of course, generate) money.
Also, use the right people that are already in government to execute these initiatives, while reducing its size and unleashing the untapped and vast potential in this country. Lastly, if the communists cry foul, let them participate in elections and obtain their own governing mandate. Until then, their invective against the private sector and its involvement in getting the country back on track (all the pun intended) is really of no import (again, pun intended!).
Dr Eugene Brink is a business consultant, entrepreneur and analyst from the Cape Winelands
