In some ways, Tito Mboweni talked tough, through what he said, through what has been announced in the Budget, and through what has not been said. There are those who oppose change, who clearly benefit from the current situation that got them into their position in the first place. The real test for Team Ramaphosa will be in effecting a meaningful and long-lasting change in the way that these entities are treated, and run.

For his part, Mboweni has never one to run away from a fight. In the past, there have been moments when it looked like he almost relished a good scrap.

It might well have been in that fighting spirit that he said on Wednesday:

“The SOEs pose very serious risks to the fiscal framework. Funding requests from SAA, SABC, Denel, Eskom and other financially challenged state-owned enterprises have increased, with several requesting state support just to continue operating. Isn’t it about time the country asks the question: do we still need these enterprises? If we do, can we manage them better? If we don’t need them, what should we do?”

That paragraph will almost certainly lead to a heated political contestation within the alliance and the ANC itself. This was the Minister of Finance, appointed by an ANC President, musing aloud in Parliament, on the subject of whether the government should sell some of the SOEs.

As a general political principle, both Cosatu and the SACP will oppose any kind of move to sell SOEs. They both believe in a bigger state, and the uninterrupted government control of SOEs fits squarely into the state, should control the “commanding heights of the economy” view. And of course, Cosatu has strong representation at Eskom and other SOEs and it commands an army of members who can always frustrate big changes on the ground level.

What is politically interesting about Mboweni’s comments is that this is not the first time a sitting president has tried to reform SOEs, and even considered making serious changes. In fact, there’s an important resonance with what has happened before.

In 2010, just at the beginning of his first term of office, a sitting president was faced with nearly exactly the same problem; how to reform SOEs which were costing the government money, and not delivering on their mandate. That sitting president, one Jacob Zuma, had come into power on the back of a lefty tsunami led by Cosatu and the SACP, which made it difficult to actually make changes that they would oppose. His Churchillian solution to the problem was to appoint a Presidential Review Committee, led by Riah Phiyega, and kick the can a few years down the line.

The body’s first task was to determine exactly how many SOEs there were. The total at the time was “approximately” 715. That’s right, 715 bodies owned by the government of South Africa.

The report was filed in 2013, and suggested important changes to the way they were run (oddly, the final report is not where it used to be, one reference in a Daily Maverick piece from 2015 referenced it but that link no longer works, while another link to the final report also doesn’t work).

In the end, though, as many times before, the report was simply ignored, Phiyega went on to other things (she became the National Police Commissioner, miners were killed in Marikana, and she was declared unfit for that position), and the SOE report’s recommendations died.

Now, again, there is a president who is at the start of their term of office (presumably) and had the support of Cosatu and the SACP to get their position. This time, it seems, a different strategy is being pursued.

In essence, the real problem seems to come down to this: SOEs need to be restructured, but they need to be kept running while that restructuring is happening. It is this that makes the government and those who want to effect change so vulnerable. As an example, while Eskom needs to be transformed into a much better entity, it cannot be done in a way in which the electricity production and distribution stop, even for the briefest of moments.

Mboweni says that SOEs that need fiscal support to operate (presumably, as opposed to investing in upgrades or changes) will find that the “fiscal support is conditional on an independent Chief Reorganisation Officer (CRO) being jointly appointed by the Ministers of Finance and Public Enterprises with the explicit mandate of delivering on the recommendations of the Presidential Task Team. We will make announcements in this regard in the coming weeks.”

This suggests that any SOE that needs government money will find someone actually coming to that office and making big changes.

On paper, that appears to make sense. As Mboweni explained, banks are able to demand changes to the way companies are run when they lend money to bail a firm out; government itself can take provinces and municipalities into administration for the same reason.

Now the same logic should apply to SOEs.

But the contestation around this will be simply enormous. Already, there have been incidents in which the appointment of particular people to become CEOs of SOEs has been a political game. The examples of Siyabonga Gama, Brian Molefe and others shows how contested this can be. Exactly the same will happen in the case of “Chief Reorganisation Officers”. The ANC’s deployment committee will insist on playing a role in this process. Once that happens, the door will be opened for their many constituencies to find ways to hobble the process.

So who would want to take on the enormous challenges of fixing the failing SOEs? Imagine being asked to lead that process at Eskom, not only would you need to have the business nous necessary to make those big changes, you would also need incredible political smarts, and serious help. There is a reason why Ramaphosa, to spread the massive weight of the responsibility, has appointed to Eskom both a new board and an advisory panel. To have just one person making those changes, or be seen to be responsible for them, would in many cases be untenable.

All of that said, there is an interesting omission from the Budget that suggests Mboweni and his political leader are prepared to play hardball. It was widely expected in almost all quarters that he would announce a loan guarantee for the SABC. (IMPORTANT ALERT: The writer of this piece works at the SABC and has a keen interest in whether his salary will be paid at the end of March – Ed) During the traditional pre-Budget press conference in the lock-up for journalists before the speech, he was asked about this issue. As Fin 24 reports, Mboweni said:

“If they get the R6.8-billion they want, the chief restructuring officer that is dealing with Eskom will be on his way to Auckland Park. My advice to the SABC is to stay far away from National Treasury. But we will find a way to help them.”

This seems to almost change the rules of the game, in that the SABC did not get the expected help. Mboweni appears to be expecting big changes before any money could arrive in the state broadcaster’s account.

All of that said, the one thing that is very different, when comparing this situation to the situation in 2010 with regard to SOEs, is that the government’s financial position is so much worse. Mboweni said on Wednesday that we are spending roughly a billion rand a day on interest payments. This simply cannot go on. The sense of crisis has seeped into every hole and crevice of our troubled society. We should probably be close to panic, which might be a dark blessing. Maybe this time, the major, necessary and almost certainly painful changes are possible, thanks to the current national crisis, which was not the case back between 2010 and 2013, when Phiyega’s commission toiled, with no success.

In the end, strangely, it may be that Mboweni’s much-awaited Budget speech has not drastically changed the dial on what will happen to SOEs. The entire gigantic set of pulleys, levers and knobs that decimated Eskom and the other SOEs are still there. It all hinges entirely on the balance of power within the ANC, and whether Ramaphosa is able to force through these changes.

It is true that Cosatu is much weaker than it was in the past. But it is also true that Ramaphosa is surely weaker now than Zuma was in 2010. While the need for change is fundamental, and the future of South Africa depends on it, the politics of the present is likely to frustrate any truly radical action.

To make any life-altering move, Ramaphosa first has to change the political equation, possibly the hardest, most dangerous departure since Captain Scott attempted to be the first man at the South Pole. DM