Transnet, the state-owned logistics firm, has come out spitting fire over recent criticism of its performance even as unions met with the Minister for Public Enterprises Pravin Gordhan, to collaborate in charting a feasible turnaround plan for the entity.
Transnet said yesterday it was aware of opportunistic elements who were using the current operational challenges faced by the organisation to further their own agendas, stating that as it addresses its challenges, it remained committed to authentic stakeholder engagement and collaboration.
“However, it must be clear that those who owe Transnet money will have to pay, and the company will not be intimidated. Transnet will also no longer tolerate a distortion of public discourse by individuals who fail to disclose their true motive,” Transnet said yesterday.
Last week the Durban Chamber of Commerce and Industry wrote a scathing letter to Gordhan calling for the removal of Transnet CEO Portia Derby and her executive team - a letter that was leaked to the media.
Gordhan on Tuesday said that he had also noted the correspondence from the Association of South African Chambers in which its members have called for decisive action to resolve the issues affecting the economy because of Transnet’s underperformance.
Transnet has been making headlines due to its woes as the parastatal reported a R5.7 billion loss for its 2023 financial year. Transnet released its financial results three weeks ago, in which it posted a massive loss due to the volumes delivered by its freight rail business dropping 13.6% during the period, from 173 million tons to 149 million tons.
This is as the United National Transport Union (Untu) and the South African Transport and Allied Workers Union (Satawu) said they had met with Gordhan on his invitation on Wednesday to discuss the pertinent matters relating to the poor performance and presented practical solutions to turn Transnet around quickly and efficiently.
Union leaders Satawu General Secretary Jack Mazibuko and Untu General Secretary Cobus van Vuuren said it was emphasised that practical steps needed to be taken to stabilise and ensure the success of Transnet, as it greatly impacted the country's economy, job creation and job security.
“The meeting was productive, and further discussions will be held next week. Labour honoured the minister’s invitation as we recognise the crucial role that Transnet plays in the South African economy. Labour and Minister Gordhan both agreed that an urgent, radical intervention is necessary to prevent a further decline in Transnet,” they said.
Transnet is currently facing a variety of challenges, including revenue loss, overwhelming debt, locomotive unavailability, theft and vandalism, and poor performance from Transnet Engineering and Transnet Freight Rail.
In yesterday's statement, Transnet pointed out that it held regular discussions with industry players.
“In the case of its operations in Durban, Transnet meets with the Durban Chamber of Commerce and Industry in the Port Forum sessions, which are standing meetings every two months.
“In these meetings the parties discuss, among others, the port’s performance and dependencies on all stakeholders to achieve the common goal of an improved port for the benefit of all. The quarterly meetings of the Durban Chamber of Commerce Council, where Transnet has a representative, is another forum to tackle areas of mutual interest,” it said.
Public Enterprises Minister Pravin Gordhan has been forced to crack the whip and order Transnet to produce a convincing turnaround plan within one month in a bid to quickly address the derailment of the group’s operational and financial performance.
Gordhan said he had mandated Transnet and its Board to look into operational transformation, root causes, stringent / rigorous accountability oversight, management review, information and operational data transparency, the excessive cost structure and employee engagement amongst other issues.
“The Board is seized with the injunction that I have given it, and I am sure that the issues that have been raised by the Chambers will be addressed in its recommendations or in the feedback that the Board will present to the shareholder. The shortcomings of Transnet are of national concern,” Gordhan said.
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