Business leaders and analysts are sceptical about the rumblings that “dark forces” are intentionally running down Transnet as part of a nefarious plot — they say it’s just the usual neglect and inefficiency that are crippling the state-owned enterprise (SOE).
Transnet says there is no truth to the claims of intentional management sabotage.
The United National Transport Union (Untu), the biggest of the unions at Transnet, raised the allegations during the 12-day strike that brought the country’s port and rail systems to a halt.
Transnet, whose initial 1% pay offer was rejected by unions, this week agreed to a pay hike of between 5.5% and 6%. Untu members have returned to work, but the SA Transport & Allied Workers Union (Satawu) delayed its decision.
Last week Untu general secretary Cobus van Vuuren accused Transnet leaders of wanting to devalue the SOE “so that it can be sold, like SAA”, or to implement “strategic private partnerships”. He said this was why Transnet did not want workers back “too quickly” and suggested there was “a deeper, darker strategy” behind management’s rejection of the union’s “extremely reasonable” wage proposal.
One executive in the logistics sector, who did not want to be named, agreed with Van Vuuren’s theory. He said Transnet CEO Portia Derby and her team had not bought new equipment for ports in the past three years or maintained what was already in place.
“It’s state capture, part 2,” he says. “They want to take Transnet to parliament, like SAA, and say: ‘Let’s liquidate it because it’s not worth anything.’”
But Transnet says the company strategy is to turn the business around and improve operational and financial performance.
Most economists, analysts and business leaders scoff at the sabotage theory. “Transnet has been run into the ground for many years now,” says Efficient Group economist Dawie Roodt. “It is just falling into the ground because of mismanagement. I don’t think there is a sinister plot to try to privatise it.”
What they are doing will work better than a conspiracy. It underperforms and is overstaffed, by staff who are overpaid
— Gerhard Papenfus
Political analyst Ralph Mathekga notes that the public has grown cynical about the government. Even if SOEs are collapsing because of ordinary incompetence, people suspect a deliberate strategy is at work “so they can be sold for scrap”.
He adds: “The government has lost credibility … if it says it is going to solve a problem, no-one believes it can.”
National Employers Association of SA CEO Gerhard Papenfus says inefficiency and cadre deployment are the problems. “Like everything else, they simply ran [Transnet] into the ground. People are simply not doing their work, there is no ambition and no striving to make it their best business,” he says.
“Everything needed to make it a top-class business is absent. I think just doing what they are doing will work better than a conspiracy. It underperforms and is overstaffed, by staff who are overpaid,” he says.
Road Freight Association (RFA) CEO Gavin Kelly dismisses the claims of conspiracy as speculation but agrees port infrastructure is in a “terrible” condition. “There is old equipment and equipment hasn’t been maintained.”
He says there is no-one in charge of the harbours, or anywhere in Transnet, who is willing to take responsibility.
“It might be because they don’t have the funding or the support of various political chiefs because they report to three different ministers [public enterprises, public works and transport],” says Kelly. “I can only imagine it must be extremely difficult if you have three bosses or departments that may have differing viewpoints on what to fund and fix.”
He says the RFA has for decades highlighted the lack of investment in port infrastructure.
Transnet has been run into the ground for many years now
— Dawie Roodt
“When it gets to the point of being in ashes and ruins, the private sector won’t want to touch it because it will take a lot to fix it. The private sector wants to take over an entity with some degree of sound operation. I don’t think Portia [Derby] is there to wind things down so it can be sold. But then I could be very naive,” he says.
Transnet spokesperson Ayanda Shezi rejects the idea that the SOE has failed to invest in new port equipment, listing recently acquired items from ship-mooring devices and helicopters to cranes and container-handling gear.
Stellenbosch University’s Bureau for Economic Research says the strike caused huge freight backlogs and cost the economy billions. “The Minerals Council of SA estimates that the strike is costing bulk mineral exporters R815m in revenue per day because they are unable to rail and load 357,000t of iron ore, coal, chrome, ferrochrome and manganese onto ships daily. Offloading crucial imports, including medical supplies and diesel, has come to a standstill.”
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