Plans afoot to reconfigure government departments

Friday, February 16, 2018

Government will initiate a process to review the number and size of national government departments, President Cyril Ramaphosa said on Friday.

“We will therefore initiate a process to review the configuration, number and size of national government departments,” said the President.

Delivering his maiden State of the Nation Address (SONA) in a joint sitting of the two houses of Parliament, the President said growth, development and transformation depend on a strong and capable state.

He said that it is critical that the structure and size of the state is optimally suited to meet the needs of the people and ensure the most efficient allocation of public resources.

State owned enterprises

Turning his attention to State Owned Enterprises (SOEs), the newly sworn in President said many of these entities are experiencing several challenges including severe financial, operation and governance challenges that have impacted on the economy.

These challenges have placed pressure on the economy and subsequently government will intervene decisively to stabilise and revitalise them.

Among action taken to stabilise the SOEs is the January appointment of a new board to power utility Eskom.

“The recent action we have taken at Eskom to strengthen governance, root out corruption and restore its financial position is just the beginning. Government will take further measures to ensure that all state owned companies fulfil their economic and developmental mandates.”

Funding models

President Ramaphosa said state owned companies cannot borrow their way out of their financial difficulties.

“We will therefore undertake a process of consultation with all stakeholders to review the funding model of SOEs and other measures.”

In addition, government will change the way that boards are appointed so that only people with expertise, experience and integrity serve in those vital positions.

Board members will also be removed from any role in procurement, while the services of the Auditor General will be used to strengthen external audit processes.

“As we address challenges in specific companies, work will continue on the broad architecture of the state owned enterprises sector to achieve better coordination, oversight and sustainability.”

SARS Inquiry

Meanwhile, President Ramaphosa will appoint a Commission of Inquiry into Tax Administration and Governance at the South African Revenue Service (SARS).

“At the request of the Minister of Finance, I will shortly appoint a Commission of Inquiry into Tax Administration and Governance of SARS, to ensure that we restore the credibility of the service and strengthen its capacity to meet its revenue targets,” he said of the entity falling within the portfolio of National Treasury.

He added that tax morality is dependent on an implicit contract between taxpayers and government that state spending provides value for money and is free from corruption. -

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