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Unions vow to resist bailing out 'bankrupt' state-owned firms

Oct 17 2017 21:30
Liesl Peyper

Cape Town – Trade union federations on Tuesday unanimously said they will resist attempts by government to use workers’ hard-earned pension money to bail out “bankrupt” state-owned enterprises, like South African Airways (SAA). 

Trade union federation Cosatu, the South African Federation of Trade Unions and the Federation of Unions of South Africa (Fedusa) made presentations to members of the standing committee on finance on Tuesday afternoon, following a briefing about the annual reports of the Public Investment Corporation (PIC) and the Government Employees Pension Fund earlier.

Kgomotso Makhupola, treasurer at the National Health Education & Allied Workers Union, said the PIC is neither a “kitty” for cash-strapped ministers nor a fund for state-owned enterprises that have been "run into the ground by corrupt people".

“We’re very concerned about rumours that the PIC will consider investing in SAA,” Makhupola said, referring to PIC CEO Dan Matjila’s earlier utterances that the PIC will still consider investing in SAA if it meets certain conditions.

Matthew Parks from Cosatu said government should remember it’s not doing workers any favours by “allowing them to invest via the PIC”.

'Corruption at a state level across the board'

“There’s corruption at a state level across the board. We do take comfort from the PIC’s clean audit, but we can’t be too vigilant,” Parks said.

“We will resist an SAA bailout. All investments must be investment-worthy with above inflation returns on investment.”

Fedusa general secretary Dennis George shared the other federations’ concerns about attempts to use PIC funds for state-owned enterprises and insisted that workers serve as directors on the PIC board and at state-owned entities.

Zwelinzima Vavi, general secretary of the South African Federation of Trade Unions, said once SAA has been bailed out, other state-owned entities like Eskom will start “looting” the PIC. 

The trade union federations were also scathing about Finance Minister Malusi Gigaba and his deputy Sfiso Buthelezi, who they allege had been appointed to further the state capture project. 

Fedusa's George said the erosion of competency at the boards of state-owned entities started when Gigaba was appointed public enterprises minister in 2010. "That's when the state capture project started." 

Gigaba the 'blue-eyed boy of Saxonwold'

Vavi called Gigaba the "blue-eyed boy of Saxonwold" - referring to the Gupta family's residence in Johannesburg - who was appointed solely to ensure the controversial family's further access to state-owned entities. 

Trade union federations were also critical of Gigaba's move to launch a forensic audit of the PIC, questioning his motives. 

Gigaba on October 11 announced a forensic audit of the all PIC investments for the past two years.

In a letter written to Buthelezi, the chairperson of the PIC, Gigaba requested that the audit be carried out by a “reputable independent forensic company”.  

Members of the standing committee also questioned Gigaba's intentions concerning such an investigation. 

Both the ANC's Yunus Carrim, chairperson of the standing committee on finance, and David Maynier of the Democratic Alliance insisted that Gigaba provide a proper scope of the audit, the terms of reference and the reasons for it. 

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fedusa  |  saftu  |  cosatu  |  pic  |  bailouts  |  trade unions  |  investments
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