Expanding Government and Private Sector Collaboration to Address Key Challenges in South Africa

We are now joined by Martin Kingston, you've just heard him speaking, but for a further comment on the key outcomes of the meeting that was held between Business and the Presidency. Martin, thanks so much for your time. I think maybe important to put into context, just in terms of the outcomes that you were going through there earlier in the meeting, being the outcomes of the partnership between Business and the government of the 6th Administration. Now we are into the 7th Administration, it's a different kind of government that you are dealing with, and I just would like to understand in the Phase 2 that you did make reference to, what changes? Well, good afternoon Fifi, Ashley. All of the progress that we made, I rehearsed and you replayed just now. And when we look back, which we did with the President and his Cabinet colleagues, and this is a joint initiative, don't forget, it's a partnership between Business and government, Business supporting government platforms in all of those three areas of focus. It's clear that real and discernible progress has been made because we put in place the right structures, we capacitated them appropriately, we were very focused and disciplined in terms of where there should be intervention. Business was mindful of government's responsibility and ultimately its authority in terms of structural reform, it doesn't mean that we can't input on policy, but we were able to bring very significant amounts of resources to the table. I mean over 350 subject matter experts across the three areas, 130 CEOs who signed up to the pledge last year, 260 million rands worth of expertise in addition to that which has been mobilised both for government and for business. And some of that is evident in the progress that we've made, as I said, in structural reform, others in the cessation of load shedding, in the reduction in waiting time for vessels as we said at anchor, but much more needs to be done. And what was very interesting about the meeting yesterday was first of all the energy in the room, I think a high level of commitment from both sides, certainly from government as well as from business, to the partnership, to redoubling our efforts to address those areas where there were deficiencies that needed to be dealt with. You know the performance of Transnet is one such where we need to up its performance, its efficiency very dramatically. We need to implement the structural reform to bring in scope for the private sector to participate as quickly and as appropriately as possible. That was all touched on, as was the need to ensure that we can both retain and attract the skills that are required to capacitate both the state on the one side and of course business on the other side. And the Minister of Home Affairs was very clear in the meeting as to the need to accelerate visa reform, which I think he said publicly and we acknowledge. I guess Martin, maybe put differently, as you did make a reference to the 130 CEOs that had signed up to the pledge, I think you mentioned around 350 also experts who had provided their insights, as it were, and their recommendations in solving for some of the key challenging areas. Does the same sort of squad or team stay under this government of national unity or perhaps are some of the CEOs who had pledged previously sort of retiring their seats? Well if only that were the case, I don't think so at all. I think we're going to increase the number of CEOs who step up today. You'll recall, Fifi, that each of the work streams is headed by two or three CEOs from leading companies across the economy. We're looking at broadening that. Just as we're looking at and we've been asked repeatedly whether we can consider extending the scope into other areas, what we've said is we're not going to do that unless we're confident that it's not going to detract from our focus and our progress in the three areas concerned, but we're certainly not going to ignore the fact that there are other compelling and critical areas that need to be considered and people have talked about water, they've talked about infrastructure, they've talked about local governments and municipalities. We're not going to stray into those areas, as I said, if we're going to undermine our existing efforts and to do that we need to retain the support of the CEOs that you've mentioned and build on it. Indeed, we anticipate sort of relaunching, if you like, the partnership within business and more broadly within the country to not only retain but attract additional CEOs who can commit not only themselves but their companies, their sectors to the partnership because that's the only way we're going to be able to embark upon and maintain the inclusive growth trajectory that is critical if we're going to deal with unemployment and unemployment of course featured very significantly in the meeting yesterday, certainly off the back of the announcement of very worrying statistics in terms of rising levels of unemployment both narrow and broad and the only way we can do that is by ensuring that we are powering real and sustainable levels of economic growth and that can only be done if we're going to harness all of the skills, capability and commitment of the country at large and in particular of the private sector. So, Martin, not specifically related to the areas that you are targeting, the partnership with government and business being the energy crisis which you have mentioned a lot of progress having been done there, also the rails and ports crisis as well as crime and corruption but what is trending right now is the statement from the presidency regarding the decision to postpone the second presidential health compact or the signing of the second presidential health compact and one cannot ignore the fact that obviously this postponement coming after the meeting that you have had with government and one cannot ignore the expression of by business of the critique of pursuing national health in the current form of framework. So, can you just comment on that and whether this was discussed in yesterday's meeting and whether this does mean there could possibly be a relook at how NHI is rolled out going forward? So, it wasn't discussed at all, it didn't feature neither NHI nor health in the meeting yesterday with the president. I think it's completely coincidental that the signing of the health compact tomorrow has been deferred. The position of business is very clear which is we're committed to a health compact where we address the issues of universal health care and again we harness all of the resources, capability and expertise of the private sector but we've equally made it clear that we are fundamentally opposed to the NHI in the form in which it has been currently signed into law that we believe that it needs to be fundamentally reassessed. The president has indicated publicly that there needs to be an appropriate level of engagement and we're certainly both amenable to and keen to engage in a structured way on that but I don't believe that has anything whatsoever to do with the postponement of tomorrow's signature. Sure, so you mentioned Transnet and the fact that a whole lot of work still needs to be done there. In fact, in the statement that does come from the presidency what was mentioned was the fact that there was broad consensus that Transnet requires substantial interventions to improve performance to meet its customer needs as well as market demand and I just would like to understand what substantial interventions could possibly mean. You mentioned the guarantee that government had given Transnet but I remember being at that budget announcement by the finance minister in February and the consensus agreement then was that a guarantee wasn't enough so when you're talking about substantial interventions, Martin, are you alluding to a bailout for Transnet and if so how much? We're not alluding to a bailout at all. In fact, you'll know that the guarantee fee when it was announced had many conditions attached to it. We support those conditions. We're talking about significant improvement in operational efficiency and that has to be driven as a matter of absolute urgency. It's critical because many industries, the freight industries broadly, obviously the bulk commodity industries, the agricultural industries are suffering very significantly and that is manifesting actually in permanent restructuring of some of those businesses and job losses which is completely untenable and therefore the point was made that we need to bring all hands on deck, if you'll forgive the pun, and ensure that those operational inefficiencies or deficiencies are addressed immediately. One last question and I know you've got to run but just in terms of why progress perhaps on the rail and the ports line as well as crime and corruption has been a lot slower than what you have been able to achieve with energy and what you are planning to do differently this time around? So in fact that was discussed yesterday. The role of the Energy Action Plan and the National Energy Crisis Committee was critical alongside the board of ESCOM and the new management being brought on board in ensuring that over time the power stations could perform more effectively. We've seen the energy availability factor coming up. For example, new supply coming on stream in particular from the private sector and there are lessons to be learned there and certainly the National Logistics Crisis Committee needs to play an equivalent role and Transnet is a critical part of that. We need to ensure that there's a higher level of integration and oversight that was discussed. I think it's not controversial at all and business stands ready to make sure that its own resources and expertise are mobilized and work alongside Transnet just as we've done with ESCOM again. That was reiterated at the meeting yesterday and hopefully we'll see that start to gain traction in the coming weeks. All right. Martin, thanks so much for that. Martin Kingston, Chair of B4SA Steering Committee.

President Cyril Ramaphosa says he wants to expand a government collaboration with the private sector that has helped address some of the country's most pressing challenges in the fields of energy, transport and logistics. B4SA Steering Committee Chairman, Martin Kingston joins CNBC Africa for more. 

President Ramaphosa wants private sector collaboration expanded

President Cyril Ramaphosa says he wants to expand a government collaboration with the private sector that has helped address some of the country's most pressing challenges in the fields of energy, transport and logistics.

President Ramaphosa wants private sector collaboration expanded

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President Ramaphosa wants private sector collaboration expanded

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