In April 2018, Tito Mboweni issued what appeared to be a radical call for economic transformation and transfer of wealth to the majority of South Africans. He said that the state should own 40% of all mining companies, establish a sovereign wealth fund, and urgently create a state bank. Mboweni even framed it as a prayer to God, asking that the eyes and ears of South African leaders be opened to this vision. Yet, just a few months later, Mboweni was appointed Minister of Finance by President Cyril Ramaphosa, and what unfolded was the exact opposite of what he had prayed for.
To understand the depth of this irony and its consequences for South Africa today, we must trace the thread connecting three pivotal policy moments: the 1987 White Paper on Privatisation, Mboweni’s 2019 Economic Paper, and the now-celebrated but deeply problematic and dangerous Operation Vulindlela, led by the National Treasury. These moments are not isolated—they are continuities in the state’s long-term trajectory towards privatisation and austerity, wrapped in the language of reform and economic efficiency.
Apartheid privatisation strategy
The 1987 White Paper on Privatisation and Deregulation, under the apartheid government, laid the foundation. It did not merely propose privatising state-owned enterprises (SOEs)—it laid out a structural vision of the state in which public corporations would be trimmed, deregulated, and replaced by market mechanisms. In fact, it led to the establishment of the Ministry of Public Enterprises and Privatisation. This established the machinery for restructuring core state functions such as electricity, rail, ports, armaments, aviation and forestry. After the democratic transition, the ANC-led government inherited this ministry but never quite knew what to do with it, having not been the architects of its mandate.
Sewage in the streets of a Durban township. A functioning state would be a barrier to privatisation. To repurpose the state, you must first hollow it out.
For nearly 30 years, the ministry lingered in ambiguity, spending vast sums of money without a coherent policy direction for strategic SOEs. Many of them drifted into dysfunction and near collapse due to uncontrollable, industrial-scale rent-seeking. In the end, the original logic behind the ministry’s formation was quietly absorbed into Operation Vulindlela. It has effectively taken over the role under a different guise, now dressed in reformist language, but rooted in the same privatisation framework envisioned in 1987.
That vision was interrupted by the democratic transition, but never dismantled. Like a ghost policy, it lingered in the background, waiting for its time. And it has returned—this time with a more sophisticated playbook.
Tito’s contribution
By the time Tito Mboweni re-entered the National Treasury in 2018, the institution had already faced intense internal disruption under Jacob Zuma. Frequent changes of ministers had shaken the Treasury, culminating in the infamous December 2015 moment when Pravin Gordhan was returned to the post under pressure from business. What followed was a quiet institutional consolidation.
Mboweni’s key contribution was the 2019 economic policy document, Economic Transformation, Inclusive Growth and Competitiveness: Towards a Growth Agenda for SA. Co-authored with Harvard economists Ricardo Hausmann and Robert Lawrence, the document argued that growth could only come from market reforms. It proposed opening electricity, rail, and water systems to the private sector and repositioning the state as an enabler—not a provider—of essential services.
Gone was the rhetoric of radical transformation. In its place stood cold orthodoxy: liberalisation, deregulation, and fiscal restraint. The leopard had not changed its spots—it had simply changed its vocabulary.
Operation Vulindlela
In 2020, as the country reeled from the COVID-19 pandemic, the National Treasury and the Presidency launched Operation Vulindlela (OV). While framed as an urgent reform agenda to unlock growth and investment, its deeper intention was to structurally repurpose the state.
Phase I of OV boasted “94% completion” of its targets, including unbundling Eskom, enabling private electricity generation, reforming the visa regime, and liberalising logistics. It was lauded for unlocking R500 billion in private investment and streamlining processes in sectors like energy, transport, and water licensing.
Yet, behind these metrics lies a more unsettling reality: the deliberate transfer of state capacity to the private sector. Operation Vulindlela systematically removed key public services from government control and opened them to profit-making. These include electricity generation, freight rail operations, water use licensing, ports, and digital infrastructure—sectors that were once the backbone of public service delivery but are now being restructured to attract private investment and introduce market competition. In reality, this is a continuation of the 1987 White Paper—just modernised and cloaked in new language.
Phase II of OV continues this logic with even more aggressive reforms: infrastructure privatisation, SOE repositioning, and greater dependency on “performance-based public-private partnerships”. The state was once thought of as the driver of economic transformation. It is now reduced to being a referee in a match played by private players. Meanwhile, we, the people, watch in the midst of unimaginable levels of poverty, unemployment and racialised inequality.
There is a fog that settles whenever big structural reforms are announced. Words like “efficiency,” “growth,” “competitiveness,” and “unlocking investment” are used as if they are self-evidently good. But they mask deeper intentions. They muddy the waters, leaving society busy debating technicalities, while the state is being repurposed for rent-seeking at an industrial scale.
In that fog, we lose clarity on fundamental questions: Who owns the infrastructure? Who sets the price of essential services like water and electricity? Who benefits from logistics reform? And who will be left behind when the dust settles?
Austerity is a political strategy
Alongside OV, the National Treasury has implemented a ruthless austerity programme. Real per capita spending has declined significantly over the past nine years, particularly in health, education, and infrastructure. Treasury calls this “fiscal consolidation,” but what it really does is weaken the state’s ability to deliver essential services.
This is not an unintended consequence—it is deliberate. A functioning state would be a barrier to privatisation. To repurpose the state, you must first hollow it out. That is why basic education infrastructure budgets have been slashed, municipalities starved of resources, and SOEs pushed to the brink before being offered as investment opportunities.
Austerity is not just a policy—it is a political strategy. And its roots run deep, drawing from moments of economic crisis when neoliberal treasuries moved in with restructuring: Chile after the 1973 coup, the UK in 1976, and now South Africa post-Zuma. The era of Jacob Zuma was defined by rent-seeking and corruption. Public frustration with state inefficiency provided the political cover to introduce austerity and liberalisation as “necessary” corrections. But instead of rebuilding state capacity, the Treasury used the crisis to embed a market-first governance model. This was started by the 1996 Growth, Employment and Redistribution (GEAR) but got interrupted during the Zuma years.
In this model, everything becomes a service to be priced and a function to be outsourced. The public is no longer a citizenry to be served but a market to be exploited. There is a straight line from the 1987 White Paper, through Mboweni’s 2019 paper, to Operation Vulindlela. The continuity is not accidental. It reflects the long-standing dominance of a technocratic elite trained in orthodox economics, often under the influence of figures like Bethuel Setai-Mboweni’s mentor, known for his conservative economic views.
These continuities matter because they show that, despite changes in party leadership or rhetoric, the deep structures of economic governance remain untouched. Whether it is Mboweni, Gordhan, or now Enoch Godongwana—who, at the 1991 National Union of Metalworkers of South Africa (Numsa) Conference, served as a member of the Economic Policy Commission that boldly declared capitalism incapable of resolving South Africa’s structural crisis of poverty, unemployment, and inequality—the pattern is the same. That commission called for nationalisation of the commanding heights, worker control of production, and social ownership as necessary for economic reconstruction. Yet once figures like Godongwana ascend to the Treasury, they are absorbed into its ideological machinery.
A battle for the soul of the state
Today’s fight over the fiscal framework and revenue proposals is not a technical disagreement—it is a battle over the soul of the post-apartheid state. If Treasury succeeds, it will have completed the most significant repurposing of state functions in over a century, dating back to the Union’s formation in 1910.
It will have reduced the state to a hollow shell, outsourcing its mandate, monetising its infrastructure, and eroding its legitimacy—all while the public cheers on reforms that promise jobs and growth but deliver exclusion and inequality.
Those on the left and in progressive spaces must see through the fog. We must name what is happening: this is not reform—it is a slow-motion privatisation project, 30 years in the making. And it is happening under the guise of technocratic neutrality, when in fact it is deeply ideological.
If we do not stop this trajectory, we will be left with a fragmented, disempowered state that cannot meet the basic needs of its people. Meanwhile, capital will have extracted what it could and moved on, leaving behind a broken society.
Dr Gumani Tshimomola is a Senior Researcher for the Economic Freedom Fighters.
