Gordhan cracks down on SOEs 

Public Enterprises Minister Pravin Gordhan has promised stricter conditions for SOE guarantees.

On Friday, Public Enterprises Minister Pravin Gordhan issued a written response to a question from Mosiuoa Lekota, leader of Congress of the People (COPE), who asked whether Gordhan had found that further financial support and guarantees from the government would be required to keep specified state-owned entities (SOEs) operational.

Gordhan told Parliament his department would apply strict conditions when approving guarantees for the state-owned enterprises in its care, and noted that SOEs within the Department of Public Enterprises that have been given government guarantees include Eskom, Transnet, Denel and South African Express.

He said:

"The government guarantee is limited to a maximum of R350 billion for Eskom, R3.5 billion for Transnet, R2.4 billion for Denel, and R800 million for SA Express… Further financial support will be subject to SOEs providing a viable business case, clearly demonstrating that financial support will be utilised solely for advancing both commercial and developmental mandates."

In recent months, Gordhan, along with Finance Minister Nhlanhla Nene, have taken much stricter approaches to financially assisting under-performing SOEs.