Gordhan’s new SOE Bill receives mixed responses

Johnathan Paoli

Public Enterprises Minister Pravin Gordhan released the National State Enterprises Bill which seeks to enable private equity investment in ‘strategic’ state-owned enterprises (SOEs) last week – the culmination of five years of work with advice by some of the members of the Presidential SOE Council.

The draft legislation proposes a new model for South Africa’s troubled SOEs, which could potentially include listings on the stock exchange.

Gordhan has previously said the model would have the advantage of separating the state’s ownership functions from its policy and regulatory functions, minimising the scope for political interference, and introducing greater professionalism into the entities and would replace the Department of Public Enterprises, which would cease to exist.

However, the SOE Bill has been criticized for its provision for a new shareholding company to oversee the dysfunctional SOEs, which some have argued as counterproductive and rendering the bill undesirable.

Critics argue that