It is time for Minister of Public Enterprises Pravin Gordhan to match his words about cutting red tape to get South Africa out of its electricity crisis and cut ‘the reddest tape’ of all – namely, race law – at Eskom.
In a statement noting Gordhan’s bold call for scrapping all ‘the damn red tape’ inhibiting power production and prolonging South Africa’s struggle under Stage 6 load-shedding, the IRR says Gordhan promised to ‘discuss’ moving away from the ANC’s long-failing Integrated Resource Plan (IRP). In addition, Gordhan’s admission that the government ‘cannot be pedantic’ anymore and ‘must respond with urgency and flexibility’ to Eskom’s current crisis opens the gate for public pressure to replace more talk with real action that puts power in plug points 24/7.
‘Many civil bodies have recently lobbied for important replacements of IRP policies with those resembling the IRR’s longstanding recommendations to expand private power generation at the cheapest price.
‘However, not enough has been said about cutting “the reddest tape” of all – namely, race law – at Eskom.
‘Unfortunately, some analysts still believe that most poor people are too dazzled by BEE’s future promises to be able to seriously consider public criticism of that policy when crises arise. This view profoundly misunderstands that when a person struggles in a shack without power, work, or a decent way to find either, this is not symbolic. This is a daily set of practical crises.’
The IRR points out that polling it commissioned in 2020 ‘showed that 80% of black respondents thought they would do better by a meritocratic, decentralized procurement system in healthcare, housing, and education rather than more BEE.
‘The “flexibility” of mind that already pervades South Africa’s base level has simply failed to percolate up to the top.’
The statement cites a 2019 article by Gwen Ngwenya, currently the DA head of policy, which posed pointed questions about Eskom, and drew candid conclusions.
Ngwenya wrote: ‘Why is Eskom in trouble? Because it has high operating costs and it cannot meet its debt obligations. Why? Its ambitious programme to build two big power stations has incurred substantial costs overruns and technical faults. Why? In part it was flawed from the beginning with a small bidding pool, meaning it was likely not cost competitive from the start. Why? There was political meddling. Why? Chancellor House [the ANC investment arm]. Why? Contractors needed to have a black partner in order to secure contracts. Why? BEE.’
The IRR suggests that ‘if Minister Gordhan is serious about thinking flexibly and urgently about basic problems, he must ask whether it makes sense to continue “interposing non-value-adding intermediaries”, as Eskom CEO André de Ruyter phrased matters, which “inflates costs, introduces additional risk in terms of corrupt practices, and slows down our supply chains” even while loadshedding is at Stage 6’.
The consequences, the IRR argues, are felt most acutely by the poorest – ‘the 11 million South Africans that are not only left in the dark for at least 6 hours a day, but who also have been unemployed for at least a year under business conditions that are garrotted by red tape constantly’.
Arguing that ‘(cutting) the reddest tape is doable’, the IRR points out that in February it laid out why Finance Minister Enoch Godongwana is empowered to ‘exempt any organ of state from any or all the provisions’ of the framing Act’s racial preferencing if ‘it is in the public interest’, and that – according to the Zondo Commission – the ‘national interest’ lies in penny-pinching procurement rather than trumping race law.
‘The power to cut the reddest tape of all was briefly exercised by Minister Godongwana shortly after the IRR’s call, and should be exercised again now, permanently. It is in the public interest to save every possible penny at Eskom to keep the lights on as a matter of “urgency and flexibility”.’
Said IRR Head of Campaigns Gabriel Crouse: ‘South Africa has already had too much “white power” and “black power”. What we need is electrical power to drive factories and heat shelters. We need something more helpful than skin, Mr Gordhan. Skin is not thick enough to stop the cold. What matters lies within.’