Transnet will train and employ thousands of people to meet its new strategic targets, writes Brian Molefe

Save & Share

5
Recommend

Email Print

THE Sunday Times's "Each One Hire One" campaign underscores the most profound challenge and pressing need facing our country: creating jobs and putting as many South Africans to work as possible. If the economy is to achieve the growth rates needed to create the millions of jobs that will help reduce unemployment, poverty and inequality, private sector businesses have a critical role to play. However, while the private sector plays a central role in economic growth and job creation, there has to be a balance between the role of the public and private sectors. State-owned companies (SOCs) have an important role to play in developing vital economic infrastructure, managing state assets, and driving the transformation of customers and suppliers. South Africa's economy needs to create jobs, and while businesses ultimately are the creators of jobs, most of them are focused almost solely on their survival or on ever-increasing returns to demanding shareholders. In an aggressively competitive world, the result is often that profitability and job creation can become increasingly mutually exclusive. State-owned companies have the intent and purpose to function somewhat differently. At the fourth Brics (Brazil, Russia, India, China and South Africa) summit in Delhi a few weeks ago - which I had the privilege to attend - it was clear that the old world order, with its attendant entrenchment of privileges established 60-odd years ago, is no longer sustainable. One of the major reasons is, of course, the rejection of an extremist view of a market economy. As a corollary to this, the Brics countries, which are, after all, the strongest of the emerging market countries and are therefore themselves developmental states, have been embracing SOCs with enthusiasm - to varying degrees of success. Most of South Africa's SOCs are in capital-intensive network industries, where few private sector companies are willing to participate because the barriers to entry are high. SOCs are better suited for these sectors because they are able to take the long-term view necessary for the sustainable investment in the infrastructure required for their respective sectors. Investing in economic infrastructure benefits all citizens of a country because it plays a profound role in productivity and promoting the competitiveness of local industry. The productivity of our economy ensures not just economic growth and sustainable job creation but creates a platform for wage growth, a key aspect of economic growth. While it is important that SOCs should be concerned about efficiency of capital and preferably be selffunding, their ultimate objective must be to provide a public return on capital. That return must be measured in more ways than just profit. It should be measured in social and economic factors. SOCs are the most genuinely publicly owned companies. All South Africans are shareholders in SOCs - and all South Africans should enjoy a dividend of some kind from these entities. I believe that dividend must be measured as a socioeconomic return with two underpinnings: helping the economy to be more competitive, and creating the platform for robust and sustainable job creation. In achieving a more competitive economy, we increase the scope for other domestic enterprises to be globally competitive, and hopefully to create jobs. We need a pragmatic balance where SOCs lead investment in terms of infrastructure. In the case of network industries - because of the natural monopolies inherent in those sectors - the state must also operate and regulate them, with the intent of building the overall competitiveness of a domestic industry.

In his state of the nation speech this year, President Jacob Zuma announced core aspects of Transnet's market demand strategy , our seven-year business plan that will be at the centre of South Africa's significant investment in economic infrastructure. The nature and extent of our investment will boost South Africa's mining and beneficiation, local manufacturing, broad-based black economic empowerment, and small and medium-sized businesses. The strategy will create a potential 588000 economy-wide job opportunities at its peak. We further expect the strategy to reduce the cost of doing business in South Africa to the value of 0.5% of gross domestic product. This will go some way towards making South African businesses more internationally competitive and, it is to be hoped, will lead to additional job creation. It is not just job opportunities that will be created. The strategy has profound implications for Transnet as an employer. Delivering on the strategy requires that we increase capacity significantly even as we become a much more customer-focused company. To deliver on the targets of the strategy, Transnet, which already employs 57000 people, will need to grow head count 25% by 2018/19. This will make Transnet one of the biggest employers in South Africa. As an organisation, we face a severe challenge of insufficient skilled resources. Transnet will invest heavily in the recruitment, development, deployment and retention of operational, technical and managerial skills. We recognise that Transnet will need to compete for skilled technical personnel who are in short supply and high demand. We recognise also that we have a commitment to build skills and capacity. It is therefore our intention as an SOC to contribute to skills development and training through Transnet's seven training schools focused on technical, operational, security and leadership training. At Transnet we do not believe that capacity and capability and transformation are necessarily exclusive. Even as we build the capacity necessary to deliver on the market demand strategy, Transnet will intensify its transformation programme to try to ensure that our workforce more closely reflects the national economically active population (EAP) benchmarks as provided by Stats SA. Currently, black employees represent 77.9% as compared to the EAP average of 87%. However, the biggest challenge we face is in gender work parity. There are still a disproportionately high number of male employees - 79% against 21.7% female employees and yet the national averages of the EAP are 53% males and 47% females. We see these challenges as an opportunity to make our mark and deliver a socioeconomic dividend. I believe that the business of state-owned enterprises is the business of economic development and human productivity. With the market demand strategy, Transnet embraces that challenge. Molefe is group chief executive of Transnet