Faculty of Commerce, Law and Management (ETDs)
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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.Item Assessing performance management in Transnet(2021) Moeletsane, FaithBackground: In December of 2007 at its 52nd conference in Polokwane, the “ruling political party” of South Africa the African National Congress (ANC) called for the review of State-Owned Enterprises (SOEs) performance (PRC, 2016). The president of the ANC’s brief for this review was to consider the financial performance of the entities together with whether their Constitutional responsibilities were being met (PRC, 2016). The Presidential Review Committee (PRC) of SOEs was then established and mandated to do an examination on all SOEs in the country(PRC, 2016). The PRC understood its mandate as primarily making recommendations that would influence reform in the SOEs by being effective and efficient (PRC, 2016). Most SOEs continue to be inefficient and the weight is felt on the country’s fiscus as governments debt is pushed into unsafe territory (Mutize & Gossel,2017). The poor performance of SOEs not only affects a SOE under scrutiny, however there is deep concern from business, local and internal investors, civil society and government on that the failure of SOEs will have a huge spill over effect on the weakening of the economy of South Africa (News24, 2014). The SA Government’s continuous bailout of some SOEs has resulted in rating agencies continued monitoring of government’s bailouts or the issuing of guarantees because of the threat it poses to both the fiscal and policy priorities (Mutize & Gossel, 2017). Typically, a guarantee would be a commitment the State would make if an SOE defaults on the repayment of a loan it has taken (AGSA, 2018). In the event that an SOE is unable to honour its repayment agreement to a lender, the state then, through the Ministry of Finance provides surety by means of a guarantee to the lender (AGSA, 2018). Though the Provision of a guarantee on an SOE is not necessarily negative, especially when a decision has been taken by government to provide support to an SOE established in a specific industry or sector, due to that key industry or sector in the South African economy struggling to grow as expected (AGSA, 2018). However, in recent times calls on guarantees or bailouts for SOEs have increased the countries budget deficit, government debt and borrowing costs, and has resulted in downgrades from rating agencies (AGSA,2018). It is important that SOEs’ reliance on government guarantees is reduced by making sure that reliable turnaround strategies are implemented, including addressing leadership and governance issues at the SOEs (AGSA, 2018)