Eskom accepts fate after Treasury declines exemption on wasteful expenditure

Ailing state-owned parastatal Eskom has accepted its fate after Treasury denied it exemption from disclosing irregular, fruitless and wasteful expenditures in its annual financial statements.

On Wednesday, Finance Minister Enoch Godongwana issued a statement to say that he had declined the request.

Exemption declined

“It is the view of the Minister that Eskom needs to do more operationally to reduce the scope of fraud and corruption before such exemption can be considered.

“As Eskom attempts to recover from the devastating impact of state capture, and take steps against past and current corruption, it needs to ensure that its anti-corruption strategy is credible and has the support of key stakeholders like investors, lenders, suppliers, customers, and the public,” the statement read.

In April, Godongwana granted the parastatal the request, but backtracked on the decision following public outcry.

ALSO READ: EFF slams Godongwana for exempting Eskom from reporting expense irregularities

Irregular, fruitless and wasteful expenditures

Eskom interim Eskom spokesperson Daphne Mokwena said the utility has taken note and “accepts” the decision by Treasury to not grant the organisation partial exemption from certain sections of the Public Finance Management Act (PFMA) and Treasury regulations.

“The decision means that Eskom will continue to disclose financial and non-financial information on irregular, fruitless and wasteful expenditure and material losses from criminal conduct as per National Treasury instructions.

“Compliance to the PFMA and all applicable legislation remains a priority as Eskom continues to address irregular, fruitless and wasteful expenditure, and we will continuously implement measures to address all the issues that continue to have a negative impact on Eskom’s financial sustainability,” Mokwena said.

Debt relief bill

Meanwhile, the Eskom Debt Relief Bill is one step closer to becoming a reality after the draft legislation was greenlit by Parliament’s Select Committee on Appropriations.

The bill was adopted by the committee on Wednesday.

This paves the way for the proposed law to head to the National Council of Provinces (NCOP) for a debate and vote before it is sent to President Cyril Ramaphosa for approval.

ALSO READ: Eskom Debt Relief Bill moves a step closer to becoming a law