Eskom remains, if not the biggest risk to South Africa’s economy, then one of the greatest. That’s agreed. What is not agreed is what to do about it.
The Eskom Special Appropriation Bill is separate from the provisions to regularise the R23-billion Eskom received in February’s Budget — R17.6-billion of this amount was advanced in April as emergency funding after Eskom ran out of money — in terms of the Appropriation Bill that will be passed by Parliament before the end of July after the Budget vote debates.
Eskom’s unbundling into transmission, distribution and generation entities, which President Cyril Ramaphosa announced in February’s State of the Nation Address has stalled, as has the appointment of the chief reorganisation officer. This came against strong lobbying by Eskom to have R100-billion of its debt moved to the sovereign’s books, and the governing ANC wanting the government asset manager, the Public Investment Corporation ,Daily MaverickEskom had pushed South Africa to the brink of economic collapse. The power utility had run out of money and could not meet its obligations after an anticipated R7-billion from the Chinese Development Bank was delayed.
Mogajane told MPs Eskom finances had to be addressed, but one could not loosely talk of restructuring as the power utility’s debt came in different forms, from short-term to long-term bonds and short-term funding. “We have to look at Eskom’s capacity to look beyond today… So you need a new Eskom with a new business model and new structure.”