The Standing Committee on Public Accounts (Scopa) held a successful meeting with the Inter-Ministerial Task Team (IMTT) on plans to resolve the impasse between Eskom and the municipalities that owe billions in electricity debt.
The meeting was held on June 14. IMTT will report back on the matter in September.
“Scopa also wants to emphasise that municipalities must honour their debt and their payment arrangements. The fact that both parliament and government are intervening does not mean that they should relax. Municipalities should also jerk up their financial management processes and systems and cut off waste of public money,” Mr Themba Godi, chairperson of Scopa said.
In a meeting with municipalities about their Eskom debt on June 13, Mr Sizwe Mayisela, acting municipal manager said the mining town has a growing population and high rates of poverty. Population had grown almost threefold in five years.
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The unemployment rate was high especially for the youth owing to technological innovation which meant the mines no longer use the traditional methods and thereby no longer employed a lot of people to operate the draglines for opencast mining processes.
“Emalahleni has a lot of people depending on social grants, increasing from 34 000 to 89 000 between 2012 and 2017. The unemployment rate increased from 25% to 27% in the same period. Among the youth, the unemployment rate is as high as 32%,” he said.
According to Mayisela the construction on Eskom’s Kusile Coal Power Station is winding down and a huge number of the people that relied on those jobs during the construction and development phase were returning to Emalahleni with no source of income.
Mayisela told the committee that former mining villages were refusing to pay for electricity previously paid for by the mines. Emalahleni has a large number of Eskom employees and the municipality is told that they are involved in illegal connections to electricity in the area. The town was teeming with Eskom electricians who are able to bypass the cut-offs by the municipalities.
There is also a culture of non-payment and resistance from the communities and local officials are threatened when they urge residents to pay. Councillors’ houses were being attacked for trying to encourage people to pay. These were huge challenges as non-payment of service charges by communities meant that raising enough revenue was an uphill task.
Mr Sizwe Mayisela acting municipal manager.
In only five years the Eskom debt escalated from R58-million to R1.7-billion
Executive Mayor Ms Linah Malatjie disputed the R1.7-billion Eskom bill and also took issue with the seasonal tariff structures which affects municipal billing and yearly financial planning.
The municipality was failing to understand how Eskom reached the figure and would want the entity to indicate how the debt escalated up to this level. She requested further engagement with Eskom for the revaluation of the debt as the municipality could not afford to repay Eskom R4-million per day.
She recommended the waiving of interest charges and agreements on flexible payment plans to ensure the debts are settled. She expressed the municipality’s commitment to implementation of cost containment measures and ensuring electricity users are billed properly.
