Former public enterprises minister Lynne Brown defended herself at the Commission of Inquiry into State Capture on Friday after chair Deputy Chief Justice Raymond Zondo raised a point that performance of oversight on state-owned enterprises (SOEs) seemed to be poorly executed.
Brown weighed in her thoughts on SOEs, which have been plagued by a numbers of challenges including Eskom, saying some of them should be closed down.
“What I think what we must do for SOEs is that they must be taken outside of government and I’m not saying they must be privatised. Remember there are 720 SOEs in this country and those we don’t see and doesn’t affect our lives….we don’t know they exist.
“So some of them must be closed down or merged. There are a lot of culturally organisations…..they can be merged into one or a few others. Then we decide what are the strategic ones that we want to help grow the economy,” she said.
When Zondo asked Brown about oversight on SOEs, she argued that she did not have the powers as a minister to get rid of corruption or intervene in operations.
“In my time I couldn’t get rid of corruption and the people before my time couldn’t get rid of corruption. I think the answer at the end of it has nothing to do with the companies because it is to do with the model. Personally I couldn’t do oversight as an executive authority,” she said.
The former minister explained that oversight was done by the director-general (DG) and deputy director-general (DDG) in government departments.
“So everyone has an oversight responsibility, but you only get the documents….the annual statements or the quarterly statements for example two months after the statements have been drawn up because they [DG and DDG] have to interrogate those statements. Then they bring issues to you and the issues are never matters [sic] of corruption or any of that,” she said.
Brown emphasised that SOEs have a complex governance structure, which made it complicated for ministers to exercise oversight due to the Public Finance Management Act (PFMA) not allowing ministers to intervene in tender processes.
She further said that it led to her beginning talks with Special Investigating Unit (SIU) regarding an investigation on some SOEs.
However, it took six months to agree on terms of the investigation with the SIU.
Earlier during her testimony, Brown told the commission that Eskom was deep in debt and spending too much money on diesel to avoid load shedding, before she became minister.
She revealed that a tender project has also created conflict within the then Eskom board.
Watch the proceedings below, courtesy of the SABC: