Financial and Fiscal Commission raises alarm over SOEs fiscal drag

THE Financial and Fiscal Commission (FFC) has sounded a clarion call to Parliament, highlighting alarming trends in the fiscal drag imposed by State-Owned Enterprises (SOEs).

- BANELE GININDZA

In a recent presentation to the Portfolio Committee on Monitoring and Evaluation, the FFC revealed that direct government transfers to SOEs rose significantly from 1% of GDP in 2015/2016 to 1.6% in 2021/2022.

This stark upward trend raises pressing concerns over the sustainability of SOE funding and the need for urgent reforms.

The Commission's damning analysis underscores a decade-long commitment from the government, which, between 2008/2009 and 2019/2020, spent approximately R160 billion to bail out financially troubled SOEs.