SCOPA Calls for Urgent Action on R220 Billion Capital Funding Shortfall at SAA, PRASA, and Transnet
Statement by the Standing Committee on Public Accounts (SCOPA)
Background
The Standing Committee on Public Accounts (SCOPA) is gravely concerned about the R220 billion capital funding shortfall at three state-owned companies (SOCs): South African Airways (SAA), the Passenger Rail Agency of South Africa (PRASA), and Transnet.
This shortfall threatens the financial viability of these SOCs and their ability to fulfill their mandates. SCOPA has repeatedly raised concerns about the financial health of these companies and the need for urgent intervention.
Findings
In its recent meeting, SCOPA received briefings from the Minister of Finance, the Minister of Public Enterprises, and the executives of SAA, PRASA, and Transnet.
The briefings revealed that the three SOCs face a combined capital funding shortfall of R220 billion over the next three years. This shortfall is due to a number of factors, including:
- Declining revenue
- Increasing costs
- Poor management
- Government bailouts
Recommendations
SCOPA has called on the government to take urgent action to address the capital funding shortfall at SAA, PRASA, and Transnet.
The committee has recommended that the government:
- Provide financial support to the SOCs
- Improve the governance and management of the SOCs
- Develop a plan to reduce the costs of the SOCs
- Explore alternative funding options for the SOCs
Conclusion
The capital funding shortfall at SAA, PRASA, and Transnet is a serious threat to the financial viability of these SOCs and their ability to fulfill their mandates.
SCOPA has called on the government to take urgent action to address this shortfall. The committee believes that the government must provide financial support to the SOCs, improve their governance and management, and develop a plan to reduce their costs.
