LOBAMBA – Members of Parliament (MPs) have passed the loan Bill intended to support the financially distressed Eswatini Posts and Telecommunications Corporation (EPTC), with the new management assuring that there are currently no plans to retrench employees.
The assurance was made during the debate on the EPTC loan Bill in the House of Assembly yesterday, as MPs raised concerns about the corporation’s financial position, its pension obligations and the future of its employees.
However, it could not be ascertained if the ‘no retrenchments’ principle will apply to those employees who have for months been fighting following that they received letters informing them that they would be retrenched.
Chairperson of the Finance Committee, Lobamba Lomdzala MP Marwick Khumalo, who moved the Bill, said the financial challenges facing EPTC had persisted for years, with the corporation’s deficit having reached a critical point.
Khumalo said the US$26 million (around E455 million) loan guarantee was necessary to assist the corporation, particularly given the pressure created by its pension obligations.
He said EPTC had, over the years, been forced to use money that would otherwise have been used to run the corporation to address its financial obligations.
The MP said one of the factors that had assisted EPTC was its shareholding in MTN, which had generated funds that helped the corporation pay pensioners.
“The deficit had dragged for too long,” Khumalo said, adding that the pension scheme was now facing a serious deficit running into hundreds of millions of Emalangeni.
He said there were currently around 500 beneficiaries of the pension scheme, while only about 144 people were contributing to the pension fund.
The financial position of EPTC’s pension scheme has been one of the issues of concern surrounding the corporation, with MPs questioning how the entity would stabilise its operations while also dealing with its long-standing pension obligations.
Khumalo said during engagements, MPs had also asked the new EPTC Managing Director, Thulani Fakudze about the possibility of retrenchments as part of the corporation’s turnaround strategy.
According to Khumalo, the new MD had made it clear that retrenchments were not part of the plans and that the corporation would continue with the employees already in its establishment.
The issue of job security featured prominently during the debate, with MPs and ministers seeking assurances that workers would not be sacrificed as the corporation implements its turnaround strategy.
Ngwempisi MP Bishop Bhekibandla said he supported the loan, describing the situation at EPTC as sad.
However, he said MPs needed clarity on the causes of EPTC’s decline and what had been agreed upon during engagements with the corporation on how those challenges would be addressed.
He wanted to know what plans had been developed to fix the problems that had contributed to the corporation’s financial decline.
Manzini North MP Mashayinkonjane also raised concerns about employees who were working on contracts at EPTC.
He asked whether such employees would be moved to permanent positions once EPTC received the loan.
The MP also questioned whether government’s guarantee of the loan would ultimately translate into cheaper services for emaSwati, particularly in terms of data and calls.
He wanted to know whether consumers would first face higher costs before any benefits from the investment could be realised.
Zombodze Emuva MP Ntando Mkhonta said the EPTC loan debate also had to be considered within the broader issue of government borrowing.
He said it appeared that the country’s debt stood at around 40 per cent, while the figure could continue rising as more loan Bills came before Parliament.
Mkhonta acknowledged the challenges facing EPTC, including incidents of copper theft which, he said, had contributed to the corporation’s financial difficulties.
Meanwhile, Minister for Sports, Culture and Youth Affairs Bongani Nzima warned against individuals who had been responsible for the collapse of EPTC in the past returning to influence the corporation.
“We know those who collapsed EPTC years ago,” Nzima said, calling for them to stay away from the corporation because government did not want to see a repeat of what had happened previously.
Minister for Public Service Mabulala Maseko also raised the issue of workers who had allegedly been threatened with possible job losses.
Maseko said some employees had approached the Ministry of Public Service after being threatened, despite having worked for EPTC for decades.
He, therefore, sought an assurance that these employees would not be retrenched.
Deputy Speaker Madala Mhlanga said Parliament had considered the human element when dealing with the loan Bill.
He said there were people employed at EPTC who had families and whose livelihoods depended on their jobs.
Mhlanga said the question of leadership was also important and that the responsible minister would not be left to deal with the matter alone, as Parliament would continue playing its oversight role.
Minister for Information, Communication and Technology (ICT) Savannah Maziya thanked the House, the mover and seconder of the Bill, as well as the parliamentary committees that had spent time examining the EPTC matter.
She described the issue as a serious one, particularly because pension matters had been neglected over a long period, ultimately affecting the lives of emaSwati.
She said government was pleased that going forward there would be contributions towards the pension arrangements.
Maziya also expressed confidence in the new EPTC MD and the strategy being pursued to turn around the corporation.
She said the fact that MPs had expressed support for the appointment of the new MD demonstrated that government could make the right choices when allowed to do so.
The minister drew a comparison with the postal sector in the United States, saying she had recently read that there were about 33 000 post offices, with around 500 closing every year.
She said Eswatini needed to take the EPTC matter seriously and create an environment in which employees were encouraged and made to feel that they were the corporation’s most important resource and asset.
Maziya described the loan as a potential game changer for the country, saying she trusted the new MD and his strategy to turn around EPTC’s fortunes.
In his closing remarks, MP Marwick Khumalo thanked the House for supporting the Bill and the ICT minister for the supportive sentiments she expressed during the debate.
He said the issue of controls over the loan had been extensively deliberated upon by the committee.
He said Parliament had been given assurances regarding controls over the funds and that the unions representing EPTC employees had also asked Parliament not to simply pass the loan Bill and then walk away.
Instead, the unions wanted Parliament to continue monitoring EPTC to ensure that the borrowed funds were used for their intended purpose.
Khumalo said the unions trusted Parliament to maintain oversight over the corporation and the use of the loan.
He said the terms of the loan were clearly stated, including the grace period, after which repayments would begin.
According to Khumalo, the loan would only start being repaid in 2034, giving EPTC time to implement its turnaround strategy before repayments commence.
On whether emaSwati would benefit from lower telecommunications costs, Khumalo said EPTC would be responsible for the loan and that the people of Eswatini would ultimately benefit from the investment.
However, he acknowledged that it could not be guaranteed that costs would immediately go down.
He pointed to EPTC’s Wi-Fi service, saying it currently offered better speeds and charges that were competitive compared with other providers.
He said there was, therefore, hope that, eventually, consumers would benefit from lower costs. Khumalo also acknowledged concerns about the country’s rising debt, saying MPs had been told that the debt ratio could reach 50 per cent of GDP, although there was guidance that it could eventually return to around 45 per cent.
He said Parliament had also been assured that some of the country’s existing loans would be fully repaid in the coming years.
