Wits School of Governance (ETDs)
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Item Factors contributing to transgressions in the procurement practices of state-owned entities (SOES): Eskom and Transnet(University of the Witwatersrand, Johannesburg, 2024) Moloto, Bonolo; Setlhalogile, MatlalaPublic procurement is a vital process for governments and state-owned enterprises (SOEs) to procure essential goods and services. However, state capture and unethical practices have plagued it. The State Capture Commission Report highlighted issues such as poor governance, unethical conduct, and insufficient internal control systems. This has led to financial and operational challenges for SOEs, which heavily rely on state guarantees and bailouts. In South Africa, the government spends around R1 trillion annually on procurement, which represent 12% of the country’s gross domestic product (GDP) (National Research Foundation, n.d.). The Auditor General (AG) report for the 2020/21 financial year reported that most SOEs had high balances of irregular expenditures. Transnet had the highest irregular expenditure, totalling R14.1 billion, followed by Eskom with R11.6 billion (Maeko, 2021). This study aimed to identify the underlying governance factors contributing to transgressions in SOE procurement practices and to provide remedial actions to prevent recurrence. Agency Theory was used to examine the identified issues, and a comprehensive literature review was conducted to investigate the underlying factors. The study found that failure to address these governance issues could lead to qualified audit opinions, issues of going concerns for SOEs as well as impact investments and public confidence. The study also revealed that the slow implementation of consequence management could foster a culture of noncompliance and accountability. The current South African public procurement system ca is characterised by political interference and cadre deployment, which undermines transparency, accountability, and good governance. Political appointments and cadre deployment in critical positions encourage wasteful spending, undermine governance, and promote dictatorship. Politicised boards and management in SOEs has led to an increasing prevalence of corruption. The AG, Standing Committee of Public Accounts (SCOPA), National Treasury (NT), Department of Public Enterprises (DPE), and the respective SOEs’ boards have been unable to conduct their oversight functions effectively due to their unwillingness to do the right thing and failure to establish robust preventative controls. The state's approach to board nomination lacks transparency, operates in an ad hoc manner, and is excessively politicised. iii Remedial actions to address these issues require a dedicated commitment from top leadership, fast implementation of corrective measures, and periodic monitoring and evaluation processes. Limiting political interference in the administration of remedial actions can enhance the effectiveness, fairness, and integrity of the anti-corruption process.Item The extent of decision-making criteria included in Procurement Legislation at Transnet Port Terminals(University of the Witwatersrand, Johannesburg, 2022) Bhogal, KatherineState Owned Entities (SOE’s), like Transnet Port Terminals, have been plagued with maladministration and poor governance within Procurement. In the last 20 years, SA government have procured goods and services from the private industry to an estimated valueof between R400 to R500 billion per annum. Procurement is subject to Legislative requirements, that aim to reduce political influences, fraud and corruption and safeguard the decisions made to award contracts that result in government spending. The main aim of this exploratory study was to assess the extent of decision-making criteria included in Procurement Legislation at TPT, using the Bounded Rationality decision-making model. The thematic analysis research methodology was used to analyse the results of the research and indicated that there was no and (or) limited Legislation that govern and regulate decision-making within Procurement at TPT. There is an urgent need to update existing and develop new Legislation and Policies to assist SOE’s, like TPT, adhere to sound governance principles that will improve decision-making for Procurement transactions and related expenditure.Item Assessing performance management in transnet(2020) Moeletsane, FaithState-Owned Enterprises (SOEs) are vital for the development of South Africa’s strategic sectors (Fourie, 2014). They have been a significant mechanism for driving economic growth and the reduction of poverty since 1994 (Kikeri,2018). They are critical in addressing market failure and for the growth of South Africa’s strategic sectors, “especially energy, transport, telecommunications and manufacturing” (Fourie, 2014, p.1). The PRC has undertaken extensive research and based on that provided recommendations that should be adopted across all SOEs in South Africa. The PRC notes the importance of ensuring effective performance management and monitoring of SOEs as critical, and important that SOEs carry through their mandate with effectiveness and efficiency due to the heavy reliance that the State has on the SOEs (PRC,2016. Through referencing large SOEs such as Eskom, SAA and Denel and their questionable performance over the last ten years that an opportunity to assess the impact of performance management in an SOE is imperative. In President Cyril Ramaphosa’s February 2019 State of the Nation Address (SONA) he makes mention of restoring stability in strategic entities as of the critical decisions taken (SONA, 2019). The president announced, “the establishment of the Presidential SOE Council, which will provide political oversight and strategic management in order to reform, reposition and revitalise SOEs, to ensure that SOEs play their mandated role as catalysts of economic growth and development” (SONA,2019). South Africa is not exempt from the global woes that face the public sector on the delivery on quality services to all its people; maximising of available resources, effective and fruitful public private partnerships, state safety and security, dealing with migration, employment, inequality and poverty, however there is a need to look at alternatives to Public Sector Management to 12 overcome these pressing challenges (Brinkerhoff & Brinkerhoff, 2015). Performance Management is thus important as it drives performance at both the strategic and individual level, encouraging improvement both on management and subordinates (Bussin, 2012). This study closely looks into the governance of SOEs by assessing the implementation of performance management. Field research will be conducted at Transnet one of the biggest SOEs in which the Department of Public Enterprises (DPE) “provides shareholder oversight” (Fourie, 2014, p. 5). The study contributes to the body of knowledge by outlining the practices, processes and applications of performance in the SOE and lessons that can be learnt.