BL Premium reports that National Treasury plans to lay down criteria for government funding of state-entities in a bid to reduce their reliance on the fiscus.

Set conditions would simplify decisions by the National Treasury on bailouts for state-owned enterprises (SOEs) which have been a drain on government finances for many years, Finance Minister Enoch Godongwana told MPs on Wednesday. Having set criteria would be in line with the “tough love” approach that Godongwana has advocated as the government seeks to improve the performance of SOEs, including Eskom, SAA and Denel, which rely on regular cash injections to keep operating. Delivering the medium term budget policy statement (MTBPS) in November, Godongwana said struggling state enterprises needed to drastically improve their performance before receiving any further government funds. In his speech on the National Treasury budget vote he said a review of governance systems at several high-risk SOEs was in progress and the department was also working on a sustainable solution for Eskom’s debt of about R392bn “that is equitable and fair to all shareholders” and about which further details will be released later this year.

• Read the full original of the report in the above regard by Linda Ensor at BusinessLive (subscriber access only)

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