Friday, 24 January 2025.

The Economic Freedom Fighters (EFF) categorically rejects the National State Enterprises Bill introduced by the Minister of Planning, Monitoring, and Evaluation, Maropene Ramokgopa. This Bill, deceptively framed as a “strategy” to reorganise government operations, represents a dangerous step toward the full-scale privatisation of service delivery in South Africa and the redundancy of state-owned enterprises.

The Bill proposes a drastic overhaul of how the state manages its entities, placing control over all state assets under a centralised entity called the State Asset Management SOC (SAMSOC). This company will oversee the planning, funding, and disbursement of resources across all national departments, SOEs, and public service tiers. While each department and SOE will still be led by its respective Director-General, their operations will be dictated by a centrally approved plan tied to the annual State of the Nation Address and the national budget.

The ANC’s strategy to privatise SOE’s has clearly shifted after the failed takeover of certain entities by private businesses in the past such as the SAA-Takatso deal, which was a glaring failure. While this Bill does not explicitly propose selling SOEs, it opens the door for private businesses to compete in sectors where the state holds a crucial monopoly and bears the primary responsibility for service delivery. It also creates pathways for private companies to partially own SOEs as investors, further eroding public ownership and control.

This move raises a fundamental question: who truly benefits when state-owned enterprises, instead of serving the public interest, are forced to compete with the private sector? Allowing private companies to encroach on services that the government has a constitutional obligation to deliver undermines the state’s capacity to provide equitable and affordable access. The introduction of competition will not improve services; rather, it will prioritise profit-making at the expense of the people, leaving the poor and marginalised further excluded from essential services. This is a betrayal of the principle that SOEs must serve the people and the nation, not private profit.

Adding to the concerns, the Bill proposes that SOEs, now renamed State-Owned Companies (SOCs), will focus exclusively on “economic development,” while social development responsibilities are to be handled by a sovereign wealth fund funded by SOC profits. This shift prioritises profit over people, side-lining the critical role of state entities in addressing social inequalities and delivering essential services to all communities. The separation of economic and social development responsibilities not only contradicts the holistic purpose of SOEs but also undermines the state’s ability to address the structural challenges facing the majority of South Africans.

The EFF has consistently called for SOE’s to be governed by ministries directly aligned with their policy and operational mandates. This approach is essential to ensuring coherence, accountability, and efficiency in their operation. These entities exist to serve their ultimate shareholders—the citizens of this country—not bondholders or private investors. As such, the criteria used to determine the sustainability of these SOEs must differ significantly from those applied to private corporations. Their balance sheets and funding frameworks should align with their public service mandate and overarching purpose.

We, therefore, call on all fighters, communities, and progressive forces to familiarise themselves with the details of this Bill and to participate actively in the upcoming public hearings, which are ongoing till the 14^th of February 2025. It is critical to challenge this legislative assault on our nation’s economic sovereignty. Fighters must mobilise in their communities, ensure widespread awareness of the contents of the Bill and the hearings, and oppose this Bill at every turn.

The EFF will continue to champion the fight against privatisation and defend the critical role of SOEs in advancing economic freedom and transformation.

ISSUED BY THE ECONOMIC FREEDOM FIGHTERS

Leigh-Ann Mathys (National Spokesperson) 082 304 7572

Thato Lebyane (Media Enquiries) 078 304 7572