Denel, along with currently grounded national carrier SAA and embattled electricity supplier Eskom, are “problem children” for Public Enterprises Minister Pravin Gordhan and, by extension. Parliament’s Portfolio Committee on Public Enterprises (PCPE).
In pursuance of its oversight role on State-owned enterprises (SOEs), the PCPE and the Select Committee on Public Enterprises (SCPE) were briefed by senior Department of Public Enterprises (DPE) officials this week. Other SOE’s in the DPE stable include Alexkor, Transnet and SAFCOL. The DPE annual performance plan (APP) was the topic of discussion with committee members told a board performance framework has been developed for SOEs. It will be implemented ensuring each existing SOE board undertakes an independent board performance “to ascertain boards are performing” a Parliamentary Communication Service statement said.
Concern was expressed about board members who serve on multiple boards with committee members questioning the critical skills offered if board members were double-dipping.
Further questions were asked about SOEs competing with private sector companies and the effect of bureaucracy on progress and the balance sheets of SOEs.
“SOEs are businesses but most are in financial distress – a cause for concern,” according to the statement.
Notwithstanding “operational and financial instability at SOEs”, DPE needs measures in place assist the companies it is the sole shareholder of and identify risks to national developmental goals.