CoGTA’s ‘so-called negotiations’ were a cold comfort to Eskom
"The facts of the matter entail a delinquent municipality, which has failed to discharge its constitutional statutory and financial obligations."
In making her decision as to whether to award costs against Eskom, Advocate Sidwell Shangisa urged Judge Elsa Bezuidenhout to consider that CoGTA (Department of Cooperative Governance and Traditional Affairs) was ‘part of the problem’.
“The facts of the matter entail a delinquent municipality, which has failed to discharge its constitutional statutory and financial obligations. That failure is the golden thread which runs throughout. The involvement of the MEC [of CoGTA] is a cold comfort for Eskom,” said Shangisa. “Despite professing to render support to the municipality, the bill [to Eskom] continued to accumulate.”
Shangisa laid into CoGTA for not intervening and taking over some of the administrative functions, when the local municipality was unable to pay its debt. He argued that ‘endless negotiations’ were not a practical way to deal with non-payment.
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“Instead, there is not a word of disapproval or discontent made by CoGTA concerning the misappropriation of ratepayers’ money, instead of paying properly for electricity. CoGTA could have intervened. Instead, we have a dysfunctional municipality which has not availed itself to any constitutional remedies, except the nebulous, undifferentiated, open-ended, indefinite, so-called negotiations which bring no end in sight to the accumulation of unpaid debt, to the detriment of the ratepayers,” stated Shangisa.
He went on to blame what he called the obstructionist attitude of the MEC, for the matter ending up in court.
“Why else would they seek a cost order against another state organ, which is drowning in debt because municipalities, like Newcastle, are not paying it?”
CoGTA in turn accused Eskom of acting in bad faith when it made the decision to interrupt power supply, when negotiations with the municipality were still underway.
“The Newcastle Municipality had fallen on hard times,” explained Rall. “During a meeting which was held on September 2, it was agreed that certain steps would be taken. This process had already commenced with the council revising its budget to fit in line with reality and to be less wishful.”
“In the face of attempts to resolve the issues between the parties Eskom took the decision to proceed. That was done in bad faith and resulted in completely unnecessary litigation. It ended up in hundreds and hundreds of pages of affidavits from when we started… and we now have a case where if Eskom wanted to take any action, it would have to start afresh,” he added.
Rall countered Shangisa’s allegation that negotiations had no end in sight, saying CoGTA’s involvement led to concrete steps being taken to improve the municipality’s financial position.
“The proof of the pudding is in the eating,” said Rall. “Two months ago, the municipality could only pay Eskom R30-million a month. Today, we have a situation where the municipality is prepared to take a court order which compels them to pay 100 percent of the current bill.”
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