SOEs need to be turned into credible organisations: Gordhan

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Minister of Public Enterprises Pravin Gordhan says government has to turn things around in State Owned Enterprises (SOEs) to ensure private investment. According to Gordhan government has to change SOEs into sustainable businesses in order to improve private investor confidence.

“Part of our task now as government is to turn these entities into credible businesses, sustainable businesses so we get private investment, if you try to sell a junk entity, today 25 % (of shares) might be worth 25 million , tomorrow it could be worth 250 million.”

Gordhan says private participation in SOEs is government policy and that they are working on the implementation.

“Under the previous cabinet there was a set of policy issues that were agreed upon for example what is the governance model, how do you choose board members what is the procedure of the remuneration and one of those policies was the question of private sector participation, so it is a policy of government, the second is now we have to execute that policy, many of the entities remain under public control.”

He highlights that there have been gains regarding public-private cooperation in SOEs in the form of the relationship between Eskom and independent power producers. Click below for more on the story: