I’m no stranger to criticising our unions – you just have to read my last five or so articles and it will be clear that I have scant regard for organised labour. But in this instance, I must give credit where it is due: the unions rock. Whether they did it to secure workers’ jobs or to secure the future of their own children and by extension our children’s future, the decision to bail out Eskom to the tune of R250-billion must be hailed as historic and courageous.
I hear all the criticism flooding in from certain quarters, especially from the DA and some private sector elements, but the truth is this:
The Public Investment Corporation (PIC) manages one of the largest funds, of which a portion is pension money and one of its aims is to seek out investment opportunities to grow the overall stake of the fund so as to benefit workers.
This can happen in one of two ways – invest because the fund expects a return in the form of more capital for the fund in the medium to long run, or invest in order to safeguard workers’ jobs.
Yes, the fund is not only there to safeguard workers’ pensions but also, where possible, to make damn sure that workers’ jobs are safeguarded in order to continue to derive benefits from their pension contributions and to grow the fund in this way.
Hence, the Edcon investment, which was primarily about securing the jobs of members, and as a result, those members are able to contribute to the pension fund and numerous other investments. The investment in Eskom must be seen as another calculated investment in order to benefit workers. It seems some are arguing that it’s okay if the PIC invests in private sector initiatives and investment opportunities, but not the government.
A good economist and friend of mine told me that when you ask potential international investors about South Africa, they say they are not too worried about the sovereign debt position of the country, but are concerned about the ballooning Eskom debt. With the unreliability of electricity provision, they simply cannot risk bringing much-needed new businesses and/or industrial plants to South Africa. Which in turn will create jobs.
I am convinced that the decision to effectively halve the Eskom debt is the correct one.
It will free up much-needed capital that otherwise would have been lost to debt servicing cost and in turn will provide Eskom with money for much-needed maintenance.
However, I am curious about the outcry from certain quarters. Could it be that some people are genuinely concerned about workers risking their pension money and hence their futures? Or do they believe this will be the beginning of a trend where the government is continuously borrowing from the PIC?
It took 25 years for our government to get to this point. What justifies the trust deficit for the current administration?
Surely, if you want to give President Cyril Ramaphosa a real chance at overturning the last 10 years, including the looting and corruption at Eskom, then you cannot hold him up against the same set of rules as the previous administration.
The old-guard board members are gone, the old CEO is gone, corrupt managers have been arrested and more arrests are to follow, according to the National Prosecuting Authority. An agreement has been struck to break up the entity into more manageable chunks and recently the new CEO informed us of a maintenance roadmap for the next 18 months. This seems like a plan coming together.
You can either be completely pessimistic about this or optimistic about the future of Eskom and South Africa.
Don’t tell me, “These blacks are incompetent and inept and cannot be trusted. They have run a perfectly well-managed and profitable state-owned entity like Eskom into the ground and now we must all suffer.”
The truth is that lights were not kept on for all during the apartheid years, but only for a small segment of society – white suburbs in the main, and of course industry, to keep the economy going. Large segments of black South Africa were simply left in the dark, hence the illusion that the then-Eskom worked perfectly.
Like many other sectors in our fledgling democracy, when it was placed under enormous pressure to spread the pie more evenly across the entire demographic makeup of South Africa, it experienced challenges.
Inherent in this notion that “these blacks are incompetent and inept” is a deep lack of confidence in the future of South Africa. In other words, if you don’t believe this country and government will stand the test of time, then you will argue that taking pension funds will not realise a return on investment, and that this error will be repeated time and time again.
As for the large corporations, I can’t help but think that one of the main reasons some of them might express apprehension for this brave decision by workers is the fact that maybe government and pundits alike will ask the question: What is it that the large corporations are bringing to the table of solutions? The large corporations are just sitting on what some argue is more than half a trillion rand, refusing to invest it in South Africa’s economy because of so-called policy uncertainty.
If it’s not that argument being punted, they find an excuse at every turn as to why they cannot stimulate the economy and create much-needed jobs. The workers have done exactly that, put their money where their mouths are.
What do you large corporations say? Instead of just bemoaning this historic, decisive decision by Cosatu, show us how you too will invest in the future of South Africa.
Thuma mina! Send me! Do you not want to be sent? Clearly, workers do. DM