Confusion reigns at South Africa’s Eskom

JOHANNESBURG – A week of confusion over the leadership of South Africa’s troubled electric utility Eskom has raised new questions about political meddling in the running of public enterprises, analysts said.

One week after Eskom’s chief executive Jacob Maroga reportedly resigned, it was still unclear who was at the helm of the company, which is already a target of public scorn after hefty rate hikes meant to avoid a repeat of last year’s crippling blackouts.Maroga’s resignation was announced to staff last week Thursday by chairman of the board Bobby Godsell, who subsequently resigned on Monday. At the same time, Maroga said he was returning to work – only for the board to reportedly lock him out of his office.Newspaper reports at the weekend said that both men had offered to resign after presenting the board competing visions for the power firm’s future. When the board sided with Godsell, they reportedly took Maroga at his offer to step down.A black business group and the youth wing of the ruling African National Congress have claimed racist motives, saying state-owned enterprises were becoming ‘slaughterhouses’ for black professionals.President Jacob Zuma has reportedly met with Godsell, as unions and the ruling African National Congress publicly defended his credentials.Public Enterprise Minister Barbara Hogan has so far been silent on the saga. Her office did not return calls seeking comment.Analysts said that it was clear that there was some political interference in the drama and that the board decision was not supported by government.’There is interference and that has taken away the authority of the board,’ said Azar Jammine, chief economist at Econometrix trading house.The sparring over leadership is delaying a critical decision on building new power plants, which South Africa desperately needs to prevent new national blackouts, he added.’The biggest impact is that the board is not taking critical decisions on building capacity,’ he said. ‘In 10 years we might have a blackout because there is inactivity and we don’t know how long it’s going to last.’Michael Spicer, head of corporate lobby group Business Leadership South Africa, said although state enterprises’ boards were elected by the government, they were not independent.’State entities are facing a challenge because they are complex and should not be held up by political seminars. Instead there should be clear and decisive leadership,’ Spicer said.That’s been lacking from several high-profile public businesses.National carrier South African Airways, chronically bleeding cash, sacked its chief executive over corruption claims, but gave him a golden handshake worth N$13,6 million.Parliament in July dissolved the entire board of the South African Broadcasting Corporation amid massive debts and strike threats.State rail company Transnet has been without a CEO since March, after the previous one resigned. The selection process stalled when one candidate, Siyabonga Gama was accused of corruption and taken out of the running.Gama fumed at a conspiracy to block his appointment, but failed to prove his case in court. Nonetheless, the ruling African National Congress says Gama remains its preferred candidate for the job.’It would be inconceivable in the private sector that a major enterprise such as Transnet to be without a CEO and CFO (chief financial officer),’ Spicer said.’There is a generic systematic problem where government wants to be referee the game, also play and makes the rules as they go along, which contradicts the existing rules,’ Spicer said.- Nampa-AFP