The South African Communist Party (SACP) has called on government to further consolidate its position in partly-State-owned telecommunications group Telkom for a developmental purpose, instead of further dilution or privatisation, an action the party will “oppose vehemently”.

The government currently has an equity stake in Telkom of 40.51%, while fully State-owned Public Investment Corporation (PIC) has a 13.39% stake, bringing combined ownership to a decisive 53.9%.

“By further consolidating its stake, the government can increase public ownership in Telkom, and work together with the PIC in pursuit of a developmental mandate,” the SACP said in a statement released on Thursday.

“The government must build and strengthen thriving State participation in the information and communication technology (ICT) network industry as part of the wider imperative to build a more diversified and growing public economy on behalf of the people as a whole,” it said, highlighting the dominance in the industry of Vodacom and MTN.

Further, public service workers need to unite and intervene strategically to ensure that their Government Employees Pension Fund managed by the PIC tightens its grip on their collective stake in Telkom.

“The SACP will approach the progressive trade union movement, among others, as a matter of priority, to discuss and develop a joint programme of action to realise this way forward.”

The ICT network industry is strategically important in the unfolding digital technological advances.

“This process of industrial transformation is heading towards a future of the most profound and more capable quantum technology industry, which is too important to be left entirely in the hands of profit-driven, private capital accumulation interests leaving the majority of the people behind in ownership and related income terms,” the party pointed out.

“The suitors who have compiled and approached Telkom with unsolicited equity acquisition bids, including its former CEO Sipho Maseko’s Afrifund group, know that it is a productive asset with highly valuable content.

“Their aim is none other than making far more than they would advance in equity acquisition capital if the deal they want were to be allowed to go ahead.”

The SACP said that there was nothing in principle prohibiting the government, as the largest shareholder, from further consolidating its position and repositioning Telkom to make more on behalf of the people as a whole.

The government, together with the PIC, can help South Africa to roll back uneven development by bridging the digital divide through a rollout of digital connectivity infrastructure across the country.