The City of Johannesburg’s Executive Mayor, Herman Mashaba, has stated that residents and businesses shouldn’t be punished for corruption at Eskom.
Eskom recently proposed a 15 per cent annual tariff increase over three years. After this proposal was made, Mashaba had an engagement with the community’s business owners and residents, in an effort to find the best means to address this challenge.
According to Mashaba, the engagement confirmed the mounting operating costs faced by businesses, with over 30 per cent of their expenditure going towards water and electricity charges. This is the city that produces the seventh largest gross domestic product (GDP) in Africa, accounting for 15,2 per cent of the country’s GDP, 40 per cent of Gauteng’s provincial economy, and 13,1 per cent of the country’s employment.
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The City has also not been immune to South Africa’s current sluggish economic growth, with its economic growth predicted to be only three per cent by 2021.
Businesses and industry identify the cost of doing business, which includes the cost and supply of electricity, as one of the main barriers to growth. As a result, investors are hesitant to start new ventures in South Africa, due to uncertainty regarding electricity supply and costs.
Eventually, it is the residents who’ll suffer, as businesses are likely to transfer their escalating costs to them. By further increasing electricity tariffs, meaningful economic growth will be hindered and all South Africans will be worse off.
“According to the service delivery mandate of the multi-party government of the City of Johannesburg, we are committed to being pro-poor. As such, I cannot stand idly by while consumers are punished for years of political meddling, mismanagement and corruption at Eskom.
“Members of the National Energy Regulator (Nersa) are required, in terms of section 9(f) of the National Energy Act 40 of 2004, to act in the public interest in the fulfillment of their duties. The City of Johannesburg is of the opinion that approval of the proposed increase will be a gross dereliction of this legislatively mandated duty to act in the public interest,” Mashaba stated.
He also mentioned that the proposed tariff increases would punish ordinary law-abiding residents, while corrupt politicians and individuals responsible for the state-owned enterprise’s downfall are allowed to walk free.
He added that he will attend Nersa’s public hearings on Eskom’s proposal, and will fight for the residents’ and community business owners’ voices to be heard.
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