Business Leadership South Africa CEO Busisiwe Mavuso. Picture: Gallo Images/Sunday Times/Masi Losi
The CEO of Business Leadership South Africa (BLSA), Busi Mavuso, says the Census 2022 data released last week shows how far we have come as a country, but she warns against complacency.
Mavuso says results of the census show good progress in extending basic services to ordinary South Africans, with 89% now living in formal housing compared to 65% in 1996, while access to water improved to 82% of households compared to 61% in 1996 and access to electricity as the main source of energy for lighting is at 95% compared to 58% in 1996.
“These are good indicators of how far we have come as a country to improve the lives of our people, but I take this good news with a level of caution. We are now at what could be an inflection point and complacency is certainly not an option. The economy is struggling and average per capita output has been shrinking for nearly a decade,” she warns.
“Unemployment, particularly among the youth, has been worsening. The performance of our state-owned enterprises has been a catastrophe, leading to the twin crises of electricity insecurity and the deterioration of our logistics system. Government revenue is lagging budgets leading to serious constraints on spending, increasing risks to the financial stability of the state.”
However, Mavuso says she sees signs of success now and then.
“Last week, we saw news of a major blow to the organised crime syndicates that currently extract resources from Eskom after the South African Revenue Service (Sars) led raids on coal smugglers and related entities across five provinces.
“Sars says these syndicates have robbed the state of over R500m in lost revenue, but I think the cost to Eskom of the fraud and theft undertaken by these syndicates will have been multiples more. Organised crime has been a disease at Eskom, driving sabotage, violence and widespread theft of Eskom resources.”
ALSO READ: Former Eskom employees among those targeted as Sars raids coal smuggling syndicate
Although Sars’s actions primarily focused on recovering lost taxes, Mavuso believes that it puts the criminals who do so much harm to the utility out of business.
“Our concern over the effect of criminal activity at the utility is what led us to provide financial support for the intelligence gathering efforts of the previous CEO.
“It is good to see Sars taking action, although the police can do much more to directly tackle the criminals.”
Mavuso also referred to Eskom’s problems with municipal debt.
“It is fiendishly difficult to manage this. Do you cut off [supplies to] the municipalities, with the obvious consequences for people’s lives and the political blowback? Do you hope that government will turn around the municipalities so they can meet their financial obligations?”
She says the Eskom Municipal Debt Relief Support Programme is one of the interventions. The programme is operated by National Treasury and enables debt relief, provided municipalities meet 14 conditions, including minimum collections and ring-fencing the Eskom account which must be paid first.
“However, municipalities representing less than half of the outstanding R58.5bn debt had applied by the end of the deadline last week. The deadline has since been extended to the end of October and I would like to see many more municipalities apply.”
ALSO READ: Eskom’s municipal debt must be addressed
Even if this happens, Mavuso warns that the hard work will only then start.
“The scheme must not result in more damage to Eskom’s balance sheet. The write-offs must be balanced with funding from government, but to be sustainable the national culture of non-payment must be turned around. Municipalities must step up collections, ensuring that they collect the revenue and then pay Eskom, and their residents need to pay. This will require a national effort.”
Mavuso says the Roadmap for the Freight Logistics System is another source of optimism for her. A draft was circulated for comment last week and she considers this a big step toward confronting the serious problems choking the rail and ports infrastructure.
“The document was drafted by experts from industry and government and envisages a reformed logistics system that will serve South Africa much better, with both public and private operators functioning in a well-regulated market. It sets out a promising set of actions to restore the logistics system. I am excited to work with partners through the National Logistics Crisis Committee to turn around our logistics and the draft roadmap is a good step forward. “
She says good things come from partnerships, particularly between government and business.
“There has been major progress on the electricity crisis, with the private sector now building almost 6GW of new generation and more projects in development. Together with important regulatory reforms that are in parliament, I can see the light at the end of the tunnel for the electricity crisis.”
Mavuso adds that the logistics roadmap is an important guide that can enable similar progress in the country’s logistics system.
“Fast-tracking the NPA Amendment Bill is equally important. The fruits of this work will enable the economy to turn its trajectory, generating jobs and the financial resources for government to give people better lives. That will enable progress, ensuring that the next census shows further improvements, rather than confirming an inflection point now.”
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