Municipalities and government departments owe Eskom more than R50 billion

Debt owed to Eskom by municipalities and government departments stands at more than R50 billion, according to President Cyril Ramaphosa.

Ramaphosa revealed these staggering figures during a question and answer session in Parliament on Thursday afternoon.

Non-payment will be dealt with accordingly

He said the government has made it clear that not paying for services is unacceptable and would be dealt with accordingly.

“For this reason, we have established a multidisciplinary revenue committee, of which Eskom forms part, to address payment of debt to the utility by municipalities and organs of state.”

Department of Public Works and Infrastructure involvement

“To assist municipalities across the country to pay what they owe Eskom, the Department of Public Works and Infrastructure pays the services charges and property rates for its properties on behalf of client departments,” said Ramaphosa.

He revealed that in September, the department paid R575 million for property rates and municipal services and processed invoices to the value of R51 million to Eskom.

Furthermore, where there are disputes, the department pays what is not disputed and engages the relevant municipalities for amounts and accounts disputed.

“The Department has made significant progress on the reconciliation, verification and settling of debt owed to municipalities.”

“Because of its concurrent function, for the last two years the department has been coordinating reports from the provincial public works departments on a quarterly basis to verify if the public works sector pays its municipal debt,” he added.

Issues could be communicated

He also indicated that where there are challenges, the department engaged through established provincial forums with municipalities to resolve disputed accounts.

“In conclusion, regular engagements are taking place with relevant departments and treasuries to resolve all outstanding debt.

“The department of Cooperative Governance and the South African Local Government Association are part of these consultations for amounts that may be incorrectly reported.”

Meanwhile, Finance Minister Enoch Godongwana denied reports that he suggested that the National Treasury planned to take over a portion of Eskom’s debt.

“Further, his point was that the fundamental purpose of the National Treasury’s plan to takeover a portion of Eskom’s debt is to allow the utility to focus on and invest in increasing its generation capacity,” the Ministry said in a statement on Thursday.

ALSO READ: Godongwana says reports Treasury will take over portion of Eskom’s debt are ‘inaccurate’

Compiled by Siphumelele Khumalo