South African SOE execs are paid millions for losing billions

South African state-owned enterprises (SOEs) are a mess. In fact, Eskom and SAA are such a liability that they pose a significant risk to the South African economy.

Standard & Poor’s, for example, pointed to SOEs as a major reason for the downgrade of South Africa’s credit rating.

Under the ANC government, and especially under Zuma’s presidency, these institutions became easy places for the politically-connected to steal money.

It became a free-for-all, with corrupt officials flouting corporate governance rules to enrich themselves.

The government has even admitted the dire state of these companies, with President Cyril Ramaphosa describing SOEs as “sewers of corruption”.

There is now a drive to fix these institutions, but this will not be an easy task. The loss of skills and endemic corruption is nearly impossible to root out.

SOE executives still earning millions

Despite the dire state of Eskom, SAA, the SABC, and Prasa, their executives are still getting paid millions.

The SABC’s acting group chief executive officer Nomsa Philiso, for example, got paid R3.149 million for 8 months at the state broadcaster.

This high executive pay comes despite the broadcaster losing R622 million in the last financial year.

The same holds for Eskom, SAA, and Prasa, where executives earn millions despite gross mismanagement, corruption, and huge losses at these companies.

The table below provides an overview of executive pay, with the annual losses at the SEOs provided as an indicator of performance.

SOE Exec Salaries
Company Executive Annual Salary Company Loss
Eskom Anoj Singh R9.4 million R4.6 billion
SAA Phumeza Nhantsi R3.4 million R5.7 billion
Prasa Sibusiso Sithole R3.1 million R928 million
SABC Nomsa Philiso R4.7 million* R622 million
*R3.149 million for 8 months, extrapolated for 1 year.

Now read: Eskom wants to increase electricity prices by 15%

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South African SOE execs are paid millions for losing billions