Free State / 1 June 2015, 4:32pm / Louise Flanagan
Johannesburg - Three municipalities are facing power cuts from Friday over unpaid Eskom bills.
“So far, 17 of the top 20 defaulting municipalities have made payment plans in respect of their arrears debt. At this stage, only three municipalities are likely to be interrupted,” Eskom said.
The three that had failed to make arrangements to pay their arrears were Maluti-a-Phofung and Ngwathe municipalities in the Free State, and Msukaligwa in Mpumalanga.
Eskom intends to cut power to the defaulters from 6am to 10am and 5pm to 9pm on Mondays to Fridays, and on weekends from 7am to 10am and 5pm to 8pm.
According to the National Treasury’s Section 71 report on municipal finances, the three defaulting municipalities together owed Eskom R870 000 in arrears at the end of December, the latest report available.
In April, Eskom warned 20 municipalities that they faced interrupted bulk electricity supply from Friday for failing to make payment arrangements on their bills.
At the time, the total arrears owed by municipalities to Eskom for more than 30 days totalled R4.67 billion, with about R3.68bn of that owed by the top 20 defaulters.
Eskom could not give an update on the amount owed.
In March, the Treasury threatened to withhold one of the three annual payments of the equitable share grant to 59 municipalities, which had failed to make arrangements to pay arrears to Eskom and the water boards.
Nine of those municipalities made arrangements to pay their arrears, and by the end of March - the end of the financial year deadline for the payments - the Treasury had released payments to nine of those municipalities leaving 50 payments withheld.
On Friday, the Treasury said officials had so far met with 29 of those 50 municipalities, and 37 had now received their equitable share payment.
“Those municipalities that are being paid would have complied with the requirements as set out.
“Approximately R1.2bn has been paid out,” the Treasury said.
The Treasury said the payments would be withheld until the municipalities had complied with the rules.
“In order for the equitable share to be released, the municipality must comply with the initial requirements, that is, proof of payment to Eskom and/or the water board, a payment arrangement signed by the relevant parties which must be affordable and realistic, with a council resolution that acknowledges the arrangement.
“In addition, the municipality must submit a full list of their creditors to the National Treasury together with the total liability.
“Lastly, the municipality is also requested to consider being subjected to a voluntary financial recovery plan if the situation warrants it,” The Treasury explained.