Eskom contends that the amount due to Oracle is only R166m, and it applied to the high court to prevent the software giant from ending its technical support before the contract expires in April 2022.
Eskom contends that the amount due to Oracle is only R166m, and it applied to the high court to prevent the software giant from ending its technical support before the contract expires in April 2022.

The mind boggles as to how Oracles’s alleged R7.3bn Eskom bill was slashed to under R400m

By Editorial Time of article published Apr 7, 2021

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On Monday just as everyone was enjoying the Easter holiday, and some were driving home from the long weekend, Eskom sent out a strange press statement, trying to calm our collective nerves.

The beleaguered state-owned power utility wanted to assure the public that the lights would remain on despite it losing a legal challenge against Oracle Corporation, one of the world’s largest software companies.

At the heart of the legal dispute was an initial claim from Oracle, which is contracted to Eskom, that it had been underpaid by about R7.3 billion.

Eskom disputed that amount and it was reduced to under R400 million. Now Eskom contends that the amount due to Oracle is only R166m, and it applied to the high court to prevent the software giant from ending its technical support before the contract expires in April 2022.

While Eskom lost its application against Oracle, it has vowed to appeal against the high court judgment to the Supreme Court of Appeal in Bloemfontein.

This is but one contract entered into by Eskom which, on the surface, seems excessive when one considers that Eskom requires government support of R1bn a week to keep the lights on.

Question marks surround the issue of how an initial demand of R7.3bn was whittled down to just under R400m. Eskom’s current debt burden is about R480bn – owed by mostly impoverished and mismanaged municipalities.

Add this to the fact that Eskom’s plan to bail out coal supplier South32 (in the process of being sold to Seriti Resources) is all but up in smoke as the Treasury baulks at the R40bn price tag.

A simpleton might look at these problems and suggest that the government break up Eskom into a million pieces, and sell off the parts that make the most business sense.

But the success of Eskom – its ability to supply power constantly – is crucial if we are to grow our battered economy.

And ordinary South Africans are paying the price for years of looting and mismanagement, literally, after Eskom’s recent price hikes as the monopoly seeks to plug the holes in its balance sheet.

The Star

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