President Cyril Ramaphosa responds to the Sona debate in the National Assembly on 18 February 2021 in Cape Town. Photo: Gallo Images/Jeffrey Abrahams
Organised business have strong reservations about President Cyril Ramaphosa’s “solutions” to deal with the load shedding crisis which is crippling economic activity, as none of his plans have a clear indication on how they can be implemented.
During both the Mining Indaba in Cape Town and the State of the Nation Address, Ramaphosa implored the private sector to “get off of the rooftops and into the ring” with government as it works to address crippling issues related to energy, logistics and crime.
But Business Leadership South Africa (BLSA) and Business Unity South Africa (Busa) said neither the creation of a new post for an electricity minister, nor the declaration of a state of disaster provided a clear opportunity for businesses to partner and assist government to deliver an environment conducive to economic growth.
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Political and economic analyst Daniel Silke said the inability of the state to embrace the concerns of business and the obstacles often put in the way of business “was largely lacking from the president’s speech”.
“There is a frustration from the business community who would like to get more involved with the state, but ultimately and politically the government has to understand they will need to relinquish aspects of control over the policy environment and also over the state-owned enterprises in a meaningful way,” Silke said.
“To get an adequate and efficient buy-in from business, government can’t have it all their own way. They can’t say, well, private sector come and help us and then have a regulatory environment that actually doesn’t allow for a satisfactory end result. “The frustration ultimately plays into that particular issue.”
Both the BLSA and Busa CEOs said with regard to the new minister, it was unclear what legislative function they could perform. Busa’s Cas Coovadia said: “We already have Minister of Minerals and Energy Gwede Mantashe and Public Enterprises Minister Pravin Gordhan.
Where is the new minister going to fit in?” They already had their mandates and should “do what they are supposed to do”, he said.
“I do not understand why they cannot do what they are doing now without the state of disaster.” BLSA CEO Busi Mavuso said that both new directives could potentially disrupt the ways business was working with the government on solving current problems. “The responsibilities regarding Eskom and electricity policy are clearly assigned – the minister of public enterprises must exercise shareholder responsibilities, and the minister of mineral resources and energy must set the policy,” Mavuso said.
“These legislated responsibilities cannot be reassigned on a whim.” Business already plays a key role in the functioning of Eskom by supporting the National Electricity Crisis Committee (Necom), however, Mavuso said a better approach would be to continue the drive to restructure Eskom, with the main step being the unbundling of an independent system operator.
“The sooner that happens, the sooner we will be on the path to dealing with the problems of our electricity sector,” she said. But Silke said a new minister might make a tangible difference, “that’s why one must hold back judgment and perhaps give the new minister and the state of disaster a chance”.
“It’s premature for business to pan what the president announced, but at the same time, the frustrations that business has been doing work with the government have been there for some time.”
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