President Cyril Ramaphosa to be grilled over Eskom load shedding
Politics / 20 October 2019, 09:49am / Siyabonga Mkhwanazi and Tshego Lepule
Cape Town - President Cyril Ramaphosa could face tough questions this week as political parties and parliament demand answers on the Eskom power crisis.
Parliament is expected to approve the Special Appropriations Bill this week which will set aside R59 billion to alleviate the embattled power utility’s debt.
The portfolio committee on public enterprises said on Saturday it wanted Eskom to urgently appear before MPs to account for the load shedding across the country following operational problems at two new main power plants.
Political parties are unconvinced Eskom has given the country an accurate picture of the power crisis, with Ramaphosa likely to face questions on the crisis in Parliament when he answers oral questions on Thursday.
Chairperson of the portfolio committee on public enterprises Khaya Magaxa said despite the statements by Eskom on the state of the country’s energy supply, they still wanted answers from the utility.
Magaxa said no mention of load shedding had been made when Eskom appeared before the committee two weeks ago.
“They did not say they are anticipating load shedding. Now that there is load-shedding. We have to call them to account (for) what has happened,” he said, adding that he would sit with the secretariat of the committee on Tuesday to draft a letter to Eskom inviting it to Parliament.
He said as this was an urgent matter, the meeting should happen soon.
Eskom chairperson Jabu Mabuza admitted in Parliament two weeks ago that businesses lose billions of rands during load shedding.
The construction costs of Eskom’s Medupi and Kusile coal-fired power plants have more than doubled over the past 10 years.
The DA, IFP and ACDP said they wanted to see action and an end to blackouts which were crippling the economy.
The DA’s Natasha Mazzone said: “The floundering, confusion and dishonesty can no longer continue. The public needs clear answers from Eskom and Public Enterprises Minister Pravin Gordhan on the state of affairs at the beleaguered power utility.”
Finance Minister Tito Mboweni is also expected to announce plans on Eskom’s rescue package in the Medium Term Budget Policy Statement next week.
Meanwhile, the Special Appropriations Bill is set to go before the National Assembly for approval on Tuesday, before heading over to the National Council of Provinces the following day.
The move has been decried by the Western Cape Legislature for the haste with which the bill has been put through.
Members have also raised the alarm over the possible impact the passing of the bill will have in terms of budget allocations to provinces, prompting the standing committee on finance, economic opportunities and tourism to call an emergency meeting with the heads of the Provincial Treasury.
Deidré Baartman, chairperson of the standing committee, said their concerns around the bill arose from annual report meetings where departments raised concerns of how budget constraints could affect service delivery.
“The Department of Health indicated a budget cut of 5% would translate to the budget for five hospitals, while the Department of Education said if they had to cut their budget by 5%, it would be equivalent to R1.2bn or their whole infrastructure,” she said.
Director for fiscal policy at the Department of Provincial Treasury Ndodana Nleya said: “The impact of the bill for Eskom is that the credibility and sustainability of the national fiscal framework is eroded which will adversely impact on national transfers, both provincial equitable share and conditional grants to the provincial government, impacting service delivery implementation in the province.”
While the bill will see R26bn paid out to Eskom for the 2019/2020 financial year and another R33bn for 2020/2021, energy expert Chris Yelland warned that while the bailout was necessary to ensure the power utility survives, it was not enough.
“Those are significant amounts, but not enough to get Eskom out of the hole it finds itself in.
“They are talking about other financial initiatives, which could be that government take over R100bn of Eskom debt and the minister of finance has mentioned the possibility of selling assets, so there are other measures being considered but the bailout itself is not sufficient.”
Yelland added that the recent urgent application filed by Eskom against the National Energy Regulator of South Africa (Nersa) is an attempt to resurrect itself from its financial problems.
“They are trying to claw back R100bn in legal claims against Nersa by increasing tariffs which they say were too low. And they want to claw it back over three or four years, which will mean additional increases over and above what Nersa normally decides and, ultimately, it is the customer who will pay for this.”
On Saturday, Eskom spokesperson Dikatso Mothane said the system remained constrained.