Janine Myburgh, president of the Cape Chamber of Commerce and Industry.
The comfortable mind-set of those running our state-owned-enterprises was made clear in the magisterial media release Eskom issued, following its triumph in getting the high court to approve its demand for a 15% increase in its prices.
It proclaimed that, “This order will result in an average price increase of approximately 15% in the electricity tariff for standard tariff customers….”
This side-stepped mentioning lesser beings like ordinary householders or shopkeepers who will pay much more than an extra 15% once the municipal bureaucracies add their cut.
It then proceeds to say that thanks to its victory (over another government department), the state can now spend more taxpayers’ money on “other priorities”.
That makes it quite clear. Not said, but clear as day: Eskom, in its own eyes, is a sacred cow. Ergo, anyone riding on its back, like its 30% surplus staff, is also protected.
Eskom’s chief financial officer Calib Cassim was quoted as welcoming the decision, as well he might. It will give Eskom a tidy sum. To this bonanza will soon be added further increase(s) allegedly owing to Eskom from previous years.
You see, dear electricity customer/Eskom slave, you have been failing to pay the full amount Eskom deems necessary to pursue its lifestyle (its management, staffing practices, salary and wages policies, bonuses, company cars, expense accounts, and so on).
Unlike managers in Eskom, private-sector managers of corporations use such things as zero-based budgeting and get fired if they fail.
This comfortable immunity from market reality is so ingrained that it reveals itself even in department titles such as “media desk” – a description that befits a government ministry more than a public-relations department.
The Eskom media desk person says the 15% jump in the cost of electricity “allows Eskom to recover efficiently incurred costs”. In another sentence, the justification is described as enabling Eskom “to recover prudently incurred costs”.
The 15% is also justified by the Eskom scribe by misquoting the “user-pay principle”, usually a phrase to describe polluters, but never mind. It makes the point that if you run a monopoly your customers are compelled to take it or leave it.
That sums it up. Eskom is a monopoly. It has customers at its mercy. It is a quasi-governmental organisation spending taxpayers’ money. Operating it efficiently, as demanded by all organisations competing in the private sector, is not high on its list of priorities.
Compare Eskom with any private business with shareholders. If its product is too expensive, customers will not buy it. If its overheads are too great, it has to shed them or go bust. Competitors will step into the breach.
Trouble is, no one competes with Eskom. It’s the problem. The solution stares South Africa in the face. Privatise it. Make Eskom (and every other feather-bedded SOE) compete in the marketplace, instead of behaving like a spoiled rich teenager with indulgent parents.
Which is what it is.