JOHANNESBURG - Eskom’s municipal debt has increased to unsustainable levels, requiring drastic intervention, Eskom executive for customer services, Ayanda Noah told Parliament earlier today.
Eskom has been battling against ballooning debt as a number of municipalities have defaulted in their payments. This has prompted the power utility to cut off a number of the municipalities in order to recoup the money. Total municipal overdue debt at the end of August was more than R11.2 billion.
In a presentation to Parliament’s portfolio committee on Co-operative Governance and Traditional Affairs, Noah said: “Intervention from National Treasury and other national departments is required to stop the bleeding and to assist Eskom’s financial situation and help the municipalities to become sustainable.”
This, she said, included putting municipalities under administration. Eskom Board had to adhere to fiduciary obligations and Public Finance Management Act (PFMA) requirements. She said cutting off power supply to the defaulting municipalities was implemented as a last resort.