We will stop the bleeding, Transnet CEO tells Joburg Mining Indaba

When former Transnet CEO Portia Derby addressed the Joburg Mining Indaba two years ago, she came across as tone-deaf to the cries of an industry reeling from the mounting failures of the state-owned enterprise (SOE), which were costing the economy billions of rands a year in lost export revenue under her watch.

Derby said that Transnet’s strategic agenda was to allocate any new rail and port capacity to emerging black miners – a vision set out as the existing infrastructure was crumbling and the SOE had no capital for new capacity.

Michelle Phillips, who has the arduous task of turning this failing ship around, has struck a completely different tone.

“We are going to stop the bleeding,” she told the Indaba. Simply acknowledging that cash was bleeding was a stark departure from her predecessor.

“The balance sheet is not what it should be. I (Transnet) sit with up to R67-billion of what I refer to as ‘ineffective debt.’ It’s money that has been borrowed for the purpose of buying assets to resource this network and they did not do that,” she said.

Effectively, money that was borrowed and then misspent, squandered or stolen.

Phillips recently told Parliament that the amount of “ineffective” debt amounted to R60-billion, so the estimate appears to be rising.

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