South African SOE executives earn billions amidst rising bailouts

17 July 2023

While the South African government has spent a total of R331 billion on bailouts for state-owned enterprises since 2013/2014, with Eskom accounting for 55% of that amount, it is deeply concerning that executives and CEOs at these entities are earning a combined total of R2 billion per year in salaries.

This stark contrast between the increasing bailouts provided by the government and the exorbitant earnings of SOE management highlights a gross misalignment, especially considering the growing poverty rates and financial struggles faced by ordinary South Africans.

The DA’s research has shown that the amount of SOE bailouts has significantly increased in the last six years during President Ramaphosa’s time in office (2018/19 to 2023/24) compared to the previous ten years (2008/09 to 2017/18). The average annual bailout amount more than quintupled from R9.51 billion per year to R50.49 billion per year.

Eskom is by far the largest recipient of bailouts, receiving almost five times as much as the second-largest recipient, SAA.

The years with the most bailouts coincide with significant increases in bailouts to Eskom and SAA, suggesting that these SOEs are driving the overall trend.

Top 5 Years with Most Bailouts

2021/22: R79.75 billion

2020/21: R75.67 billion

2019/20: R64.99 billion

2018/19: R46.09 billion

2017/18: R36.43 billion

Top 5 SOEs with Most Bailouts

Eskom: R242.25 billion

SAA: R49.90 billion

SANRAL: R23.74 billion

Sasria: R22.00 billion

SAPO: R14.19 billion (including the additional proposed R3.8 billion for this year)

Total Bailouts from 2008/09 to 2017/18 (Zuma tenure): R95.08 billion, averaging to R9.51 billion per year.

Total Bailouts from 2018/19 to 2023/24 (Ramaphosa tenure): R302.93 billion, averaging to R50.49 billion per year.

The salaries of top executives, such as those at Transnet, PRASA, Postbank, and SABC, reach astonishing figures, with compensations for CEOs reaching even higher amounts, regardless of dire performance and eye-watering losses posted by these entities and the absence in many instances of annual financial statements. Moreover, reports of financial mismanagement and wasteful expenditure within these entities further emphasize the disregard for responsible governance.

Consider the steep earnings of these SOE CEOs:

- Transnet: R8.500.000.00

- PRASA: R6.800.000.00

- Postbank: R5.049.993.00

- SABC: R5,735,155.00

The jaw-dropping compensations for top executives, in total, are even more shocking:

Transnet: R61.400.000.00

PRASA: R35.108.566.00

SABC: R26.836.724.00

SACAA: R26.627.635.00

This situation is a clear affront to the citizens and exposes the ANC's priorities, favouring their politically connected individuals over the well-being of vulnerable South Africans.

It is essential for South Africans to question whether they want to continue supporting an ANC government that perpetuates such disparities and prioritise party interests over those of the people.

The DA, on the other hand, is committed to safeguarding the vulnerable and aims to break the cycle of poverty, offering an alternative that genuinely cares for its citizens.

Issued by Ghaleb Cachalia, DA Shadow Minister of Public Enterprises, 17 July 2023