SWEEPING MEASURES
EXCLUSIVE: New plan for SOEs ‘reassures agencies’
The radical changes spearheaded by Cyril Ramaphosa target inefficiencies and loss-making 'mischief' at state-owned enterprises
The review of state-owned enterprises (SOEs) that has been led by Deputy President Cyril Ramaphosa since 2014 has proposed sweeping measures, aimed at stabilising parastatals’ finances, reforming their boards and management and encouraging greater private sector involvement. The government has conveyed the contents of the review to ratings agencies to persuade them of the progress SA is making to fix its SOEs, whose ailing finances Moody’s Investors Service and Fitch Ratings said were problematic and posed a risk to fiscal stability. Treasury director-general Lungisa Fuzile told Business Day in an interview on Monday that part of the new measures would include introducing guidelines on the costing and financing of SOEs’ developmental mandates. This was designed to "take out the mischief where state-owned companies think development means loss-making and inefficiency gets masked", Fuzile said.The framework will require the state and parastatals to agree upfront on the terms and on wh...
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