South Africa withdraws state-owned enterprises bill amid partners’ opposition — TimesLIVE
In South Africa, the presidency has withdrawn a bill on state-owned enterprises after partners of the ruling African National Congress in the government of national unity opposed the proposed model. Minister in the Presidency Maropene Ramokgopa confirmed that the document is being reworked.
As TimesLIVE reports, the initial version of the bill provided for the creation of a state holding company, State Asset Management SOC, or Samsoc. Strategic state-owned companies currently overseen by relevant ministries were to be transferred to it.
Opposition from government partners
The Democratic Alliance, the Inkatha Freedom Party and other ANC partners in the government of national unity, as well as the business sector, opposed the holding model. The ANC controls 40% of seats in the National Assembly, so it needed the support of partners, including the Democratic Alliance, to pass the document.
According to Ramokgopa, after consultations with parties and receiving public comments, it became clear that the bill in its original form would not be able to advance further. It was withdrawn several weeks before the planned vote.
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A commission instead of a holding company
The updated version of the document, which has not yet been submitted for consideration by the cabinet, is to replace Samsoc with a commission or agency. It will be chaired by President Cyril Ramaphosa, while coordination will be handled by the Department of Planning, Monitoring and Evaluation.
The proposed model provides that state-owned companies will retain ties with the relevant ministries and may be separately listed on the Johannesburg Stock Exchange. In particular, Eskom is to remain under the Ministry of Electricity and Energy, Transnet, South African Airways and Airports Company South Africa under the transport department, Denel under the Ministry of Defence, and SABC in the communications and digital technologies sector.
Ramokgopa said that parties in the government of national unity had agreed to support the revised hybrid model. The commission is to begin operating even before work on the bill is finally completed. Its task will be to oversee and coordinate the activities of state-owned enterprises in order to increase their profitability; the ultimate goal is described as creating a sovereign wealth fund.
