Organised business has strong reservations about the state of national disaster announced by President Cyril Ramaphosa in his state of the nation address (Sona) on Thursday to deal with the load-shedding crisis which is crippling economic activity.
Ramaphosa also announced that he would create a minister of electricity in the presidency, which, together with the departments of mineral resources and energy, and public enterprises, will mean there will be three ministries managing the electricity sector.
Business Unity SA (Busa) CEO Cas Coovadia was not convinced that declaring a state of disaster will help address the electricity crisis.
“It must be seen as a low point in the life of our society that mismanagement and lack of governance has created circumstances in which a state of disaster has to be declared. We believe the appointment of a minister for electricity in the office of the president is a bad idea that will add to the confusion and turf wars rather than solve the problem. It is yet another example of failure to take bold decisions and opting instead for the soft but expensive option of adding another ministry rather than holding those ministers responsible for the crisis accountable.
“Business is concerned about the potential of a repeat of corruption we saw under the Covid-19 state of disaster, although we welcome the announcement that the auditor-general will oversee use of resources.”
Busa welcomed the proposed incentive for businesses and individuals to install roof top solar panels, which finance minister Enoch Godongwana will announce in his budget speech later in February, as well as the indication given by Ramaphosa that he will establish a structure for social partners to engage on the energy crisis.
Coovadia said the crises facing SA today — the electricity crisis, the logistics crisis, the law-and-order crisis and the water crisis — were primarily a result of poor governance and lack of decisive leadership, worsened by a weak state that is hesitant to work in a real partnership with business.
“The state of the nation address in our opinion, does not instil confidence that the structure of government is operating efficiently, and lack of performance and delivery will be held to account.”
Business Leadership SA (BLSA) was also concerned that the declaration of a state of disaster carried the danger of over-reach and of undermining of citizens’ rights as occurred during the Covid 19 state of disaster as well as the huge corruption linked to Covid-related tenders. It did not believe it was necessary to address the load-shedding crisis.
“It is important, therefore, for government to limit the use of the extra powers it has granted itself purely to address the load-shedding crisis on a least-regret basis.
“If used responsibly and effectively though, the state of the disaster, along with the new electricity minister driving the energy reforms, does offer hope of faster implementation of the measures needed to end load-shedding in the short term and secure our energy supply over the longer term through increased generation capacity.”
BLSA said the appointment of a minister of electricity within the presidency to oversee implementation of the energy action plan was a “bold move” though expressed concern that the energy sector would be governed by three ministries.
“Delineating clear responsibilities will be important, particularly between the ministers of energy and electricity,” BLSA said.
“We hope the new minister will be able to accelerate the processes needed to address both the short-term imperative of addressing load-shedding and the longer-term need to increase the country’s electricity generation capacity at a faster pace.”
Cosatu welcomed Ramaphosa’s commitment to include social partners in government’s efforts to tackle the energy crisis.
North West University Business School economist Prof Raymond Parsons also highlighted the downsides of the decision to announce a state of disaster including the danger of corruption that happened during the Covid-19 state of disaster.
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