Perform or you’re out - #SONA2016

Cape Town – President Jacob Zuma said that state-owned companies (SOCs) that were not performing well and those that are no longer relevant to the country’s developmental agenda will be phased out.

Delivering the 2016 State of the Nation Address (SONA) in Parliament on Thursday night, Zuma said these entities must be properly governed and managed.

Zuma said SOCs must contribute to the successful implementation of the National Development Plan, and must be financially sound.

“Many of our SOCs are performing well. Those companies that are no longer relevant to our development agenda will be phased out,” Zuma said.

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In a statement on Friday, government said it will ensure the implementation of the recommendations of the Presidential Review Commission on state-owned enterprises, which outlines how the institutions should be managed.

Deputy President Cyril Ramaphosa chairs the Inter-Ministerial Committee which is tasked with ensuring the implementation of these recommendations.

The statement said government departments, to which these companies report to, will set the agenda and identify key projects for the SOCs to implement over a defined period.

Zuma, during SONA, highlighted the achievements and challenges facing some of the country’s SOCs.

He said the South African National Roads Agency (Sanral) had built some of the best roads in Gauteng and in many parts of the country. He added the Trans-Caledon Tunnel Authority had constructed dams of varied capacities, making it possible for people to have access to safe drinking water.

Transnet had built rail infrastructure which had enabled the country’s mines to move massive bulk of commodities through ports to markets around the globe, Zuma said.

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Zuma added Eskom had managed to keep the country’s economy going despite the challenges it faced. He said government has invested R83 billion in Eskom, which had enabled the power utility to continue investing in the Medupi and Kusile power stations, while continuing with a diligent maintenance programme.

“Progress has been made to stabilise the electricity supply,” Zuma said, adding there has been no load shedding since August 2015.

In his address, Zuma also said the nuclear energy expansion programme remained a part of South Africa’s future energy mix, adding nuclear would only be procured at a scale that the country can afford.

But Democratic Alliance leader Mmusi Maimane, presenting his alternative SONA last week, said Zuma needed to commit to sorting out SOCs, adding the DA was in favour of privatising the country’s ailing national airline.

Maimane has been calling for the privatisation of key SOCs, especially Eskom.

“[Zuma] should have announced the privatisation of South African Airways and the selling of some of some state assets so that we can recoup capital to finance development objectives. He should have made sure that he cuts his cabinet by half so that we can release some of the money towards higher education and learning. Those would have been bold,” Maimane said on Thursday night, in response to cost-cutting measures announced by Zuma at SONA.

Maimane said Zuma was repeating the same policies, but hoping to get different outcomes.