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DA Warns Against National State Enterprises Bill, Citing Risks of State Capture

Published November 21, 2024
2 months ago

The Democratic Alliance (DA) has expressed serious reservations regarding the proposed National State Enterprises Bill, articulated by their spokesperson on planning, monitoring, and evaluation, Darren Bergman. The main thrust of their concern is that the African National Congress's (ANC) initiative could pave the way for renewed state capture by consolidating all state-owned enterprises (SOEs) under a single holding entity.





The Bill, revived in the National Assembly in late July 2024 after its initial approval process was interrupted by the May 2024 elections, is seen by the DA as a regression in the management of SOEs, despite recent reforms. President Cyril Ramaphosa's proclamation, which assigned SOEs back to respective ministries correlating with their operational focus, was considered a positive step toward greater accountability and efficiency. This approach was seemingly undercut by the subsequent drive to push through the controversial Bill.


Bergman emphasizes the need for discernment in managing SOEs, suggesting that the government should evaluate which entities are still beneficial to the state and which might be better off privatized or disbanded. He advocates for "unbundling non-performing SOEs" and encouraging private-sector involvement, a move he believes would foster sustainable growth and stability within these enterprises.


Further complicating matters, following a state visit to China, Minister of Planning, Monitoring and Evaluation Maropene Ramakgopa was reportedly made aware of the flaws inherent in the current Bill. Alternatives were suggested that might mitigate potential negative outcomes. Despite this, Ramakgopa appears committed to the centralization plan, opting to ignore other suggested frameworks that involve decentralization or a hybrid of public and private management.


The DA's contention with the Bill highlights a critical ideological divide within South African governance — balancing control against freedom, centralization against decentralization, and public welfare against potential governmental overreach. As the Bill progresses through parliamentary procedures, these debates will likely intensify, potentially reshaping the landscape of South African state-owned enterprise management.


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