JOHANNESBURG – Labour unions on Friday condemned plans announced by President Cyril Ramaphosa to split state power firm Eskom into three entities, with the National Union of Metalworkers of South Africa (Numsa) saying this confirmed its fears that the government wanted to privatise the utility, a move that would threaten jobs.
In his State of the Nation Address (Sona) to Parliament on Thursday evening, Ramaphosa said cash-strapped Eskom would be divided into Generation, Transmission and Distribution entities as part of a new business model to help turn it around.
He acknowledged Eskom was in crisis and posed a significant risk to the South African economy, requiring bold decisions that would not affect the country's sovereign credit rating. Ramaphosa also said Eskom would need more revenue through an affordable tariff increase.
On Friday Numsa General Secretary Irvin Jim said the plans to break up Eskom and sell "non-core assets" of state-owned enterprises in general were "nothing more than privatization through the back door" which the union would fight.
"Only an Eskom which is completely owned and controlled by the state is the best guarantee for cheap electricity," Jim said. "History has shown us that once the private sector is allowed to step in, prices increase and massive job shedding is inevitable."