Seizure of assets will hit basic services, warns Emfuleni municipality
The municipality is trying to sign an interest-free re-payment agreement with Eskom, as it is currently struggling with an interest burden of R368 million on its Eskom debt.
The Sheriff of the court repossess furniture at Emfuleni municipality offices for failing to pay Eskom money,11 March 2020. Picture: Nigel Sibanda
Following Emfuleni Local Municipality’s (ELM) property seizure, the municipality has warned that basic services would be disrupted after some of its furniture and vehicles were seized to repay unpaid debt owed to Eskom, reports Vaal Weekblad.
“At this stage, the municipality does not anticipate any interruption of electricity supply, except in cases of scheduled load shedding.”
The municipality said it had made regular monthly payments to Eskom of R1.6 billion in 2018 and 2019, and so far this year has paid almost another R1 billion.
The statement explained how ELM is trying to sign an interest-free re-payment agreement with Eskom, as it is currently struggling with an interest burden of R368 million on its Eskom debt.
“In November 2019, the Emfuleni Local Municipality submitted a debt re-payment plan, which Eskom has to date not responded to,” the municipality said.
An empty Emfuleni Local Municipality building as assets are seized. Picture: Nigel Sibanda
A contributing factor to Emfuleni’s big debts was Vanderbijlpark’s 1987 decision to grant large power users in the area much cheaper electricity tariffs.
Emfuleni generates more than 60% of its revenue from electricity tariffs, most of which is collected from these large companies.
Some of these companies are now paying Eskom directly – at far lower tariffs than the municipality is charging. This has added to Emfuleni’s precarious financial position.
Gauteng cooperative governance MEC Lebogang Maile is to intervene in the Eskom and Emfuleni Municipality payment debacle.
The DA Gauteng provincial leader John Moodey has called on Maile to place ELM under administration.
According to Eskom’s spokesperson Sikonathi Mantshantsha, Emfuleni owes Eskom R2.3 billion. In 2018, a court judgment ruled that Eskom could recover R165 million in this debt from the municipality.
Moodey called on Maile to immediately dissolve the Emfuleni Municipality following the reports.
“The DA first called on Maile to dissolve Emfuleni in August 2019 after the endless sewage mess in the Vaal. Emfuleni lost both of its previous mayors to scandals,” he said.
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