South Africa’s transport industry is not immune to the challenges faced by State-owned enterprises (SOEs), according to Transport Minister Joe Maswanganyi, who told a media briefing on Friday that the legislative framework for SOEs in South Africa was inadequate, conflicting and duplicitous.
Delivering a presentation on the performance in the 2015/16 financial year of SOEs that fall under the Department of Transport, Maswanganyi stated that South Africa had no "common agenda" for understanding SOEs.
“The governance, ownership policy and oversight systems, together with the quality of the board and executives’ recruitment, [are] found to be inadequate,” he said.
Maswanganyi further criticised SOEs by pointing out that there was not enough clarity on the role of the executive authority, boards and the chief executive in terms of the governance and operational management of SOEs.
He added that remuneration frameworks and practices were inconsistent, and required urgent reconsideration, owing to their direct impact on the performance of SOEs, as well as their influence on the supply and demand for skilled personnel in the market.
Maswanganyi stressed that many SOEs required a massive injection of capital and that finance policies required close re-examination.
He added that funding models for SOEs with social and economic development mandates were blurred and confusing, and sometimes led to undercapitalisation, impeding an SOE’s ability to contribute to the mitigation of national challenges.
“We too in the transport fraternity are not immune from these findings and misshapenness,” he noted.
Maswanganyi’s presentation was, nevertheless, a positive one. He lauded the Passenger Rail Agency of South Africa for achieving 45% of its predetermined objectives, compared with 35% in the previous year.
The South African National Roads Agency received an unqualified audit report in 2015/16 from the Auditor-General for the thirteenth year in succession and attained 99% of its performance target.
In the period under review, the Road Accident Fund managed to reduce the number of outstanding claims to 217 182 by March 31, 2016, despite a sharp increase in registered claims.
“Airports Company South Africa recorded [the attainment of] 96% [of its yearly targets] from 89% achieved in the previous year, while the South African Civil Aviation Authority attained, for the second year in a row, 100% of the targets set for the 2015/16 financial year,” he said.
The Rail Safety Regulator achieved over 90% of the yearly targets in the 2015/16 financial year.
“The South African Maritime Safety Authority performance for the 2015/16 financial year is sitting at 70.5%,” he said.
He added that the Ports Regulator was awarded a clean audit opinion certificate of excellence from the Auditor-General last year – the first such certificate achieved since the organisation was established.
"Most of our entities are performing above average. However, there might be those with challenges," Maswanganyi said.