It’s D-day for Eskom’s Tsotsi

270315 Eskom's Non Executive Chairman Zola Tsotsi had an interview with Business Report in his home in Bryanston regarding the suspension of his Executives in the Parastatal North of Johannesburg.photo by Simphiwe Mbokazi

270315 Eskom's Non Executive Chairman Zola Tsotsi had an interview with Business Report in his home in Bryanston regarding the suspension of his Executives in the Parastatal North of Johannesburg.photo by Simphiwe Mbokazi

Published Mar 30, 2015

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Embattled Eskom chairman Zola Tsotsi faces possible removal from his position as the board sits for a crucial meeting today.

Tsotsi confirmed that today’s meeting would discuss a motion of no confidence on his leadership of the board, but said he would fight the motion.

“There is definitely a meeting to discuss my leadership,” he said. “But I will make representation as to why I should not he removed.”

Today’s meeting comes in the wake of Tsotsi’s alleged fallout with Public Enterprises Minister Lynn Brown amid allegations of “misconduct involving dishonesty” for commissioning the services of consultant Nick Linnell to help run an inquiry Tsotsi announced more than two weeks ago into Eskom’s problems.

Tsotsi’s ouster would compound the challenges facing Eskom after its credit rating was cut to junk more than a week ago and the utility’s chief executive Tshediso Matona was suspended with three other senior executives.

Eskom’s failure to provide adequate and reliable power now stand as the biggest impediment to investment and growing the economy.

Reports of the boardroom revolt against Tsotsi emerged earlier this month after the board’s suspension of the four senior executives. Tsotsi also faced criticism from labour, with both the National Union of Metalworkers of SA and the National Union of Mineworkers baying for his removal.

Sabotage

In an interview with Business Report on Friday, Tsotsi said certain tender processes would form part of the inquiry. He accused some executives of trying to sabotage the inquiry into the problems that are currently affecting the utility.

He said Eskom’s tender policies were sound and the problem was how they were implemented. “Maybe there is a lot of stake for some people. But we want the inquiry to identify where the problems are and make recommendations on how they could be fixed.”

Tsotsi, who has vowed to fight any attempts to oust him from the board, said problems currently facing the beleaguered utility were not insurmountable, adding that he hoped to bring harmony within the rebellious board and ensure that the executive functioned in accordance with its vision.

“What we need to do is to focus on what we have to do and stop interfering in issues that are beyond our mandate,” he said. “We have the capacity and many qualified and efficient people to take Eskom forward.”

The Sunday Independent said Tsotsi has accused Brown of orchestrating moves to remove him from the troubled parastatal’s board.

He told the newspaper that it had become clear Brown never wanted him at Eskom from the very start of her tenure last year. “She had someone else in mind for the position, but was outvoted by her cabinet colleagues,” he was quoted as saying.

Tsotsi also claimed Brown was “regularly caucusing” with at least three of the four suspended senior Eskom executives, accusing her of interfering directly in the commercial and operational decision-making at the power utility.

Brown’s spokesman Lionel Adendorf said the minister had not tried to oust Tsotsi and was concerned about what was happening with Eskom. “The minister has no role, activity or decisions on what happens in Eskom,” said Adendorf.

“She has raised her concerns about the impact that this (Tsotsi’s removal) could have on the stability of the utility. She has advised them to be careful about whatever decisions they may want to take.”

Questions about Tsotsi’s position initially arose in an aborted “hearing” on Wednesday night, during which his lawyer challenged the fairness of the process and called for a postponement to this week.

Tsotsi, whose current second tenure as chairman begun in December, told Business Report that the utility was not in trouble and charged that the country was nowhere near a total blackout.

Lifeline

He said the suspension of the four executives would not affect the utility’s ability to disburse some of the R23 billion lifeline from the government.

The government said the first batch of R10bn would be made available as early as June to free Eskom from its long-term obligation to service its debt to the state and pay interest on the loan that runs until 2038, easing the strain on the entity’s balance sheet and enabling it to borrow.

“We have appointed competent people who will be able to ensure that Eskom functions as good as it can under these circumstances,” said Tsotsi. “We believe we are on track to disburse the money efficiently and to make sure that we keep South Africa as far away from a total shutdown as possible.”

Tsotsi also dismissed as “utter nonsense” the allegations that he had interfered with Eskom’s executive decision and procurement policies – including the R60 million he allegedly committed the utility to pay Japanese firm Sumitomo for the manufacturing of transformers.

Tsotsi said the Sumitomo letter was drafted by one of the suspended executives and given to him to sign. “I took the letter to the legal department and I only signed it after I was given the clear by the department,” he said.

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