[Letter] Eskom board does not have full freedom

The editorial of October 3, “New Eskom board is no quick fix for a turnaround”, refers. The piece is correct to be cautious and to express doubt about whether the new board will turn around the ailing state-owned enterprise (SOE).

More airtime and analysis should be provided to this concern in particular: “Whether the government and governing party will give [the new board] the freedom to do what it needs to do”. Without a fundamental shift in the way the government views its relationship with the economy and society — through tools such as SOEs — it is highly unlikely that Eskom’s declining performance will be reversed.

Macro government policy, evidenced especially in areas such as labour laws, the power of unions, and a general thrust towards ever more centralisation and control, means that new board members have only so much say in what they can truly do at an SOE.

Superficial “progress” could well be made. To be fair, the bar for improving Eskom’s energy availability factor, as just one example of sorely needed attention, is not particularly high. But political concerns and sensitivities will still take precedence and hobble any substantive improvements that could be made.

Patronage networks — enabled and flourishing thanks to the commitment to cadre deployment — and those involved in them will not surrender their access to resources and contracts without a long, costly fight.

Letter originally appeared here.