The Treasury has extended the closing date for the Eskom Municipal Debt Relief Support Programme.
In a statement it said yesterday that the closing date for the programme was set for September 30, but had now been extended to October 31 to accommodate more municipalities into the programme.
On March 31, the Treasury’s Intergovernmental Relations unit issued MFMA Circular No. 124 as part of the Eskom Municipal Debt Relief.
“The government’s debt relief package for Eskom is intended to improve the utility’s balance sheet and facilitates the proposal for Eskom to write off municipal debt under strict conditions and with the guidance of the National Treasury. The primary problem the government wants to solve is Eskom’s financial and debt crisis which also requires a solution for non-payment of electricity consumption by municipalities,” it said yesterday.
The Treasury said its Intergovernmental Relations unit has subsequently embarked on a national roadshow to engage provincial treasuries and municipalities on the contents of the Circular, and to encourage qualifying municipalities to apply for the debt relief programme. The workshops aimed to eliminate misconceptions, clarify areas municipalities may be unclear on, and unpack the conditions attached to participating in the programme.
Of South Africa’s 257 municipalities, 136 municipalities owed Eskom R58.5 billion in arrears debt as of March 31. As of September 22, 37 municipalities had applied to be part of the Eskom Municipal Debt Relief Support Programme, 28 of the 37 had been approved with nine of them still being assessed.
“There are 25 additional applications resting with the respective provincial treasury for submission for approval,” it added.
Municipalities that apply for Eskom’s municipal debt relief, which are successful, will lead to any existing repayment plan with the power utility relating to this debt coming to an end. As long as the municipality meets the conditions for debt relief, it no longer needs to repay any of the arrears, interest or penalties that it owed Eskom as of March 31, 2023.