Picture: Henk Kruger/African News Agency (ANA) Archives
Picture: Henk Kruger/African News Agency (ANA) Archives

Eskom owed R28bn puts pressure on councils to pay

By Siyabonga Mkhwanazi Time of article published Aug 14, 2020

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Cape Town - Municipalities defaulting on their Eskom accounts are facing mounting pressure from the power utility to pay the monies owed.

Eskom has in the past few months battled to strengthen its balance sheet and rein in its debt, which is now sitting at R450 billion.

The power utility, however, on Thursday said it still wanted to recover R28bn owed by a number of municipalities across the country.

Spokesperson Sikonathi Mantshantsha said despite efforts to recoup the money, it would not use a blanket approach.

This comes after it attached the bank account of Maluti-a-Phofung municipality in the Free State, which owes it R5.3bn. Eskom only released a portion of the funds last month to pay salaries for workers in the municipality and to keep the operations running.

Mantshantsha said it would not resort to attaching the accounts of every entity that owed it, but each case would be treated on its own merit.

“Attaching assets is not the first thing Eskom does to extract for services rendered,” said Mantshantsha.

Deputy President David Mabuza also shot down suggestions recently that the National Treasury must withhold funds from municipalities that were in debt to Eskom. Opposition parties had wanted to know from Mabuza in June if the Treasury could block the transfer of funds to defaulting municipalities and pay that money directly to Eskom to settle the debt.

But Mabuza said: “That arrangement will be unconstitutional - to withhold money for municipalities - because they owe certain people.”

Eskom also came under fire from opposition parties which said the economy was already in trouble with Covid-19 and that load-shedding would make the situation worse.

Eskom said it had been forced to implement load-shedding due to the increase in the breakdown of its power plants. There had also been a delay in some of the plants returning to service. It said it would try and fix these.

Political Bureau

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