No bonuses at Eskom amid R19.6bn in irregular expenditure

Eskom revealed at its financial results presentation on Monday morning that it suffered a net loss of R2.3 billion in the 2017/18 financial year, compared to the R888-million profit reported in the previous period.

CEO Phakamani Hadebe announced these results, saying the losses were compounded by alleged corruption and mismanagement, challenges of governance and negative investor sentiment plaguing the energy provider.

The parastatal’s chairperson, Jabu Mabuza, also said R19.6 billion in irregular expenditure had been documented there since 2012, with most of it coming from 2018.

“Eskom is undoubtedly facing one of the most difficult times in its history,” Mabuza said.

Mabuza also said the company remained focused on finalising investigations into suspended executives while also improving corporate governance.

“I believe that the action taken within a relatively short space of time against those who played a key role in some of the critical governance lapses over the past few years demonstrates how serious we are about rooting out corruption and irregular practices,” Mabuza said.

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“We will continue to pursue those engaged in wrongdoing and take corrective action within the South African legal framework. We are determined to clear the company of corruption in all its forms, with about 250 cases reported through Eskom’s whistleblowing channels currently under investigation.”

The power utility also reported that its net cash from operations had declined from R45.8 billion to R37.6 billion amid leadership and operational challenges.

Due to this financial disarray, Eskom said it would not pay any bonuses to staff, EWN reported on Monday.

The power utility is expected to soon hear whether workers will accept its latest wage offer after negotiations with labour unions over the past weeks culminated in two offers of increases above 7% between now and 2020.

Unions’ requests for bonuses to be included in Eskom’s wage proposals were shot down by the company on Friday, after it was explained that the bonuses were beyond their financial capacity.

“One of the things that was discussed with the unions is that unfortunately because the company didn’t perform well financially, we’re not in a position to offer bonuses,” spokesperson Khulu Phasiwe said.

Additional reporting by ANA.

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