Trimming the brass at Eskom is not enough

Parastatal electricity producer Eskom has become such a murky quagmire of debt, inefficiency, corruption and bad management that it is difficult to see any future for it which will not be painful: for the corporation itself and the rest of the country.

People can’t see the light at the end of the tunnel because of load shedding.

So, it was interesting to see, just before Christmas, the stories about Eskom retrenching a clutch of senior executives as part of a cost-cutting, restructuring and rationalisation campaign.

Eskom spokesperson Khulu Phasiwe confirmed 10 executives in the uppermost category, known as the “F band”, were in the process of being let go.

There are a further 600 executives in the “E band” below – who earn salaries competitive with the private sector – whose fate will also be up for discussion as the company moves to reduce expenditure.

The reality is that over the past decade, Eskom’s staffing numbers have risen out of all relation to the inflation rate, the increase in power consumption or the increase in revenue for the corporation.

Experts say it is a bloated, inefficient organisation, made more so by the ANC’s use of it as a place for “cadre deployment”.

But while the move to trim executive salaries may look like a step in the correct direction – towards improving profitability – there are other, even more pressing, issues which need to be tackled to pull it towards viability.

Among those are its coal supply contracts – and the prices it pays for this essential generation ingredient – as well the huge debt burden, which has been spiralling out of control.

And, finally, the money Eskom is owed by municipalities all over the country.

Changing that culture of nonpayment is critical to the future success of the power supplier.

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