File picture: Henk Kruger/African News Agency (ANA).

JOHANNESBURG - The DA said on Tuesday that financial losses reported by Eskom were the result of years of corruption and mismanagement, leaving the power utility in its worst financial state in history.

Eskom on Tuesday announced a whopping R20.7 billion net loss after tax for the financial year ended 31 March, up from R2.3 billion the previous year, the biggest financial loss for corporate South Africa in years. 

In what was described as a perfect storm, Eskom chairperson and interim chief executive Jabu Mabuza said the losses for this financial year were not a reflection of the outgoing chief executive Phakamani Hadebe's performance, but rather a combination of various unavoidable factors. 

Natasha Mazzone, DA spokesperson on public enterprises, said other worrying trends include the increase in municipal debt from R13.6 billion to R19.9 billion, adding that things were going from bad to worse at the utility.

"Eskom's financial trajectory is not sustainable. South Africa cannot afford a recurrence of load shedding, as we stare down the slow collapse of the entity. This will have irreparable consequences for the economy and ordinary citizens," Mazzone said. 

"The utility will require expert leadership to take control. We have seen this scenario of interim appointments play out time and again at state-owned entities (SOEs), which only leads to uncertainty and instability. This is exactly what Eskom, and our national economy does not need."

Mazonne also took issue with the appointment of Mabuza as interim acting group chief executive for the next three months, while remaining board chairperson, as Phakamani Hadebe leaves the utility on Wednesday. 

She said placing the responsibilities of two critical positions on one individual was a mammoth task and undoubtedly set a person up for failure, adding that this decision violated any attempt to establish good governance practices at Eskom.

"Eskom is a sinking ship, and judging from Public Enterprises Minister Pravin Gordhan's announcement on Monday that the entity would appoint its current board chairperson, Jabu Mabuza, as an interim acting CEO, there is no permanent captain to steer the ship through this storm," she said.

"Given the fact that Eskom finds itself sinking financially, we cannot afford any form of board instability. The appointment of Mabuza as acting CEO will only bring his independence into question as the board's primary responsibility is to hold the executive to account and perform proper oversight."

Mazonne called on Gordhan to ensure the speedy appointment of a permanent group chief executive, saying the current instability did not bode well for investor confidence or Eskom's financial well-being.

- African News Agency (ANA), Editing by Lindiz van Zilla