News24 Wire
2 minute read
8 Dec 2020
9:45 pm

Social compact signed to use govt workers’ pensions for Eskom debt

News24 Wire

The social compact signed at Nedlac on Tuesday 'is an endorsement of Cosatu's proposal to use public servants' pensions to cut Eskom's debt of more than R500 billion'.

Minister of Public Enterprises Pravin Gordhan during the release of a Special Paper on Eskom, GCIS, Pretoria, 29 October 2019. Picture: Jacques Nelles

The government has to continue clamping down on corruption at Eskom and other state-owned enterprises (SOEs) to root out old and new patronage networks, Public Enterprises Minister Pravin Gordhan said.

He also said that future procurement for additional energy should be done correctly, as “coal-powered stations, nuclear and some of the renewables don’t adequately account for the demand that we anticipate in the near future as the economy recovers from the second wave of the [Covid-19] pandemic”.

Gordhan told a hybrid Nedlac summit, hosted at the Hilton Hotel in Sandton on Tuesday morning, that the labour, government and business forum that is Nedlac should “more transparently discuss how different types of patronage networks have been established, both old and new, and how these patronage networks continue to disable and handicap the kind of recovery plans that we have for important entities and utilities, such as Eskom itself”.

He said this demands a change in the operational culture of the embattled power utility, but “equally that other constituencies, including business in particular, need to see a distinct shift to more ethical practices in their interaction with state-owned entities”.

Gordhan said the government had a “total commitment” to act within the provisions of the social compact signed at Nedlac on Tuesday, which is an endorsement of Cosatu’s proposal to use public servants’ pensions to cut Eskom’s debt of more than R500 billion.

He said the Covid-19 pandemic had a negative impact on Eskom’s ability to undertake the right type of maintenance, but a functioning power utility was critical to the government’s economic recovery plan after the damage brought about by the lockdown – and also before.

Gordhan said Eskom had been trying to remove itself from the “grips of state capture, both by political forces [and] by economic players as well” in the past two and a half years, while undergoing a restructuring process.

“There’s still significant resistance to change by ex-managers of Eskom and some within Eskom itself,” he said.

Cosatu general secretary Bheki Ntshalintshali welcomed the social compact and said electricity would help with economic growth.

He said it was necessary to give people jobs, so that they could pay for their electricity.

In a statement, Cosatu said continued forced power cuts, or “loadshedding”, is a risk to jobs and the economy.

They listed the 35 key components of Cosatu’s plan to help stabilise and rebuild Eskom, which includes ensuring workers’ job security, tackling corruption and wasteful expenditure, reducing a “bloated management and exorbitant perks”, reviewing Eskom’s contracts, and ensuring that quality coal is supplied to the power utility.

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