Eskom’s exemption withdrawal welcomed

05 April 2023

STATEMENT BY THE CITY'S MAYORAL COMMITTEE MEMBER FOR ENERGY, COUNCILLOR BEVERLEY VAN REENEN 

The City of Cape Town welcomes Finance Minister Enoch Godongwana's withdrawal of the exemption granted to Eskom.

The exemption related to specified provisions of the Public Finance Management Act (PFMA), which would have exempted the State Power utility from reporting its irregular, fruitless and wasteful expenditure for the 2021/22, 2022/23 and 2023/24 financial years. Some reports indicate losses of more than R20 billion over the past years.

Such an exemption would've further weakened the confidence of global financial institutions and corruption watchdogs in our country's ability to enforce accountability and compliance with strict financial management standards and legislation.

Only transparent governance and a clean administration will attract investors and contribute positively to our creditworthiness. The rationale for this decision is therefore flawed and questionable. It is therefore not surprising that it has been hastily withdrawn.

Notwithstanding Eskom's rolling blackouts and deepening financial challenges, the exemption would have also been an insult added to the injury of an almost 19% tariff hike that Eskom has implemented on struggling residents and businesses in South Africa.

We remain extremely concerned about Eskom's financial situation and its ability to end load-shedding. I urge the Minister of Finance to be more transparent about Eskom's financial sustainability as struggling communities deserve to know what the situation really is at the beleaguered power utility.  

End

Published by:
City of Cape Town, Media Office