Fin24

Gigaba: State battles to compete

2012-05-16 21:49

Parliament - Higher salary packages in the private sector are putting pressure on state-owned enterprises, Public Enterprises Minister Malusi Gigaba said on Tuesday.

Gigaba told reporters before his budget speech in Parliament that the government wanted its companies to be globally competitive and for that it needed highly skilled staff.

"The remuneration packages of the private sector are dragging remuneration packages upwards..." he said.

"We want SOEs (State Owned Enterprises) to be efficient and productive and to be competitive with the best in the private sector. To do that we need competent managers and executives.

"The issue of remuneration is of great concern to us."

Gigaba said his department hoped to conclude a remuneration model this year.

"We are now in the process of drafting the model itself," he said. "We hope to conclude this year."

The department was consulting with the Presidential Review Committee on the matter, he said.

"We have eight SOEs in our portfolio. We can't finish the remuneration model for eight SOEs and then come to the presidential review committee and propose a different model."

Gigaba said any new chief executive was being appointed on the same salary scale of a chief executive who resigned.

The new chief executive of weapons company Denel and internet company Infraco were examples.

The chief executives at mining company Alexcor and forestry company Safcol would be appointed at the last salary scale of their outgoing CEOs, he said.

That, he said, was being made very explicit during the recruitment process.

Comments
  • Faizie - 2012-05-16 22:04

    Pay the same and expect the same as the private sector. And fire them when the dont perform. Simple dude, stop the yada yada and fix this place or I will emigrate to CapeTown

      Bob - 2012-05-16 22:22

      Bloody refugee!..lol

      Boer - 2012-05-16 22:46

      The state battles to compete because the state is full off ANC DUMMIES.

      Alan - 2012-05-17 09:26

      (Alan2) Exactly. In fact I read the other day that State salaries were 34% higher than equivalent ones in the private sector, so what is Gigaba on about? And as for productivity - well!! A friend of mine worked for awhile as a consultant in a govt institution. He jokingly suggested that they should put a dividing rail in the entrance so the employees leaving early wouldn't get mixed up with the ones arriving late. The joke was not appreciated, funnily enough.

      Martin - 2012-05-17 12:02

      south africa has the most expensive labour force in the world, thats why we cannot compete. between strikes, payment of employees that are unproductive, unskilled, absent for any reason particularly sick leave, those are the reasons

  • Hugh - 2012-05-16 22:09

    Oh what B.S spin. Like the original one that black workers and equal work for equal pay should be itroduced as it would discourage stealing and encourage hard work. I would believe Gigaba if these parastals actually ran efficiently and produced the goods. What happoens in real corporates is that highly paid people are fired if there are loses and maladministrstion. So far none of these BBEE or EE affirmatives or party aligned bum kissers have produced the goods. I feel that they should give the money back as iot has beenj obtain through false pretences.

      Alf - 2012-05-17 08:25

      I agree. They are battling to compete with the private sector, because of the exorbitant salaries paid to our president, his family and ministers. What is left over is "spent" on travel allowances etc. for government members. It is not the salaries alone they should worry about, but also the decline in business ethics in general in South Africa. A number of export contracts were lost by companies due to a "decline" in business ehtics. Unfortunately ethics, morals, integrity and honesty can not be enforced by law!

  • Dave - 2012-05-16 22:22

    In the private sector people go to WORK, not to be at a work station for a given length of time. SUPERVISION & MEASUREMENT of work done is the difference between SOE and private enterprise. The acid test is:- does the worker add to the value, or just cost of the product.

  • mzwakhel2 - 2012-05-16 22:23

    Gigaba himself earns too much for what he does. Politicians are paid way above they deserve in SA.

  • John - 2012-05-16 22:31

    The remuneration packages are higher in the private sector as they do not have a bottomless trough for the state piggies to feed on at our expense. Stop stealing our tax money and you could pay people a better salary and attract the essential skills needed to fix SA again before there is no SA left to fix.

  • jacques.koorts - 2012-05-16 22:32

    Appoint qualified people and not cadres and see the difference MInister

  • brettcch - 2012-05-16 23:55

    The problem is not higher packages, it is the almost zero output and productivity on the existing wage bill, and zero accountability. Abolish cadre deployment, replace with a meritocracy, hold people accountable, presto. Repeat with all government structures and the country will "work".

  • EricksonTL - 2012-05-17 01:26

    State battles to compete. Period.

  • braamc - 2012-05-17 06:08

    What they don't earn they steal and more

  • Mxeki - 2012-05-17 06:54

    The parastatals wont compete the private sector due to the following reason: public servants dont take their clients serious compared to private sector due due to lack of accountability, limited market competition and negligence on public resources. Private sector is profit driven with huge competition where only the law of the jungle applies: 'survival of the fittest'

  • Kevin - 2012-05-17 07:53

    The SOE's have few skills, no work ethic, no motivation no accountability and poor management by deployees. They are also protected by unaccountable politicians. They are smoke and mirror operations, they have mission statements, beautiful logos, splendid offices and automated call centres which prevent the public from engaging them. Typical of SOE,s and Government Departments is my present experience of having waited for 4 weeks for a reply to an email on an account query with CIPC, that as yet has not been received. When I phoned them the call was cut off after 49mins and I had not spoken to a human being.

  • Blixum - 2012-05-17 07:56

    8 state owned firms = 8 apartheid legacies. Recent research has indicated that state employees are getting +35% more in salaries than the private sector. Also confirmed by Mike Schussler. Now we are getting this spin. Cough up tax payers. You are working for the anc whether you like it or not.

  • Rob - 2012-05-17 08:07

    From experience and observation the problem in the public sector is caused by hyperinflation of ranks and positions. Remember the business basics about flat structures, a single executive with lots of operatives. You don't need to look far (start with police and military) and you see the total inversion of this principle. The entire structure of public services need a dose of rationalisation....remember the pensions burden is just around the corner!

  • Wayne - 2012-05-17 08:14

    Perhaps its because in the private sector you are appointed on the basis of qualifications, ability and past record of achievement; all three of which are apparently not compulsory or even deirable when your a cadre seeking employment in Government.

  • Mark - 2012-05-17 08:19

    The only answer is obviously to nationalize everything and put a salary cap on managers. This way the government cannot be seen to fail at a competition that does not exist. Until such time as the free market destroys itself through greed, we will continue to see the state lose in any competition blah blah blah aluta contiua blah blah viva this blah blah injustices of the past blah blah bah. Just another fool with Marx's cold, dead hand shoved firmly up his... well you get the picture.

  • Sidney Gilroy - 2012-05-17 08:31

    If you think the Fiscal has problems now, wait untill 2015 when the growth in the tax pool, coupled with the shrinking economy, is outpaced by the growth in Government Expenditure. Give it about 5 years after that...and the month will come when the payment of Social Grants must be delayed. Tick tock tick tock ANC. I see you frantically looking for more ways to Tax already.

      Sidney Gilroy - 2012-05-17 08:53

      Simply put - 15 % of our governments money pays Social Grants. Even if you can't pay just 5% of grants...that means about a million people will not receive any money. That million could easily, with organization, become 3 million who turn to the streets to protest. All over the country. And THAT is what the ANC fears. Not the DA. Not Cope. Not the ANCYL. And THAT is why COSATU yields so much power, for the ANC is counting on them to stem such an uprising, for they are the grass-roots organization amongst the millions.

  • Pieter Mulder - 2012-05-17 08:44

    State is in a state of confusion firstly. OK and CHECKERS degrees will not help you. Better start to use DA people with degrees Boet.

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