“… (R)ooting out the culture of corruption in Eskom and businesses working with Eskom is still a challenge and there seems to be no limit to the greed that permeates that whole ecosystem,” Public Enterprises Minister Pravin Gordhan told the Standing Committee on Public Accounts (Scopa) on Tuesday, 7 November. 

“Greed is a powerful motive force in terms of undermining institutions like Eskom under all sorts of pretexts.” 

Central was “changing the culture of corruption”, although much had already changed following findings of the Zondo Commission and the appointment of a new board, said the minister. 

But corruption would continue until law enforcement agencies and the prosecution services put people behind bars.

The responses came to DA MP Benedicta van Minnen’s question about what had changed at Eskom, given that Tuesday’s briefing to MPs was not materially different from presentations of the previous four years on issues ranging from debt, staff disciplinary proceedings and vetting, to coal quality and syndicates.

Eskom, from its board chairperson to executives and the minister, maintained changes were under way – and had to be protected.

“Getting electrons on the grid”, municipal debt and diesel costs threaded through Tuesday’s Scopa meeting, with Eskom hammering home how much the morale of its staff had improved.

Christmas incentives

The parliamentary meeting came in the wake of Electricity Minister Kgosientsho Ramokgopa’s Christmas bonus comments during Monday’s visit to the Arnot power station. According to a Newzroom Afrika clip, the electricity minister told staff: 

“Continue the good work … the better the performance, the better the incentives. You’ll see it in your pockets. Once you give us the kind of progress, the kind of improvement that we want, you’ll see your families will be happy, you are going to enjoy a better Christmas…” 

Scopa chairperson IFP MP Mkhuleko Hlengwa raised this “parallel announcement” as an example of potentially crossed lines. 

Gordhan said Public Enterprises had overall responsibility and promised to raise the matter with his Cabinet colleague, but sidestepped a direct answer on the incentive talk. 

“If there are to be any financial measures taken, ultimately the (Eskom) board has to be consulted on those measures,” he said.

Everyone at the Scopa meeting agreed that more electricity must get to the grid. 

But some 14,000km of transmission lines and 8,000km of distribution lines were needed, according to Eskom acting CEO Calib Cassim, who acknowledged that, because of grid constraints, independent power producers of bid windows five and six could not be connected.

Previously, this transmission expansion was estimated to cost around R210-billion, which Eskom could not borrow due to the conditions of its R254-billion bailout from the February Budget.

Transmissions boss Segomoco Scheepers said local expansion on the grid is being pursued by adding, for example, a transformer. This meant an additional 13 gigawatts could be added.

Gordhan added that while further work on the transmission side needed to be done, a plan was in place: “It will take off in the next few weeks and then we will look at the financing…”

Municipal debt relief

On the R58.5-billion municipal debt and the municipal debt relief, MPs were not quite convinced of the scheme’s fairness as those councils that paid up were effectively being punished, according to DA MP Alf Lees, questioning the potential for repeat defaults and the scheme’s sustainability.

But Eskom talked up the possibility of getting an extra R4-billion into its coffers. That’s because participating municipalities must stay current for 12 months, effectively a ban on accumulating more debt. Only then would Eskom write off a third of a municipality’s debt.

“We’ve already seen some improvement, but it will take time for us to know exactly how it will work,” said Cassim.

That 28 of the 67 municipal applicants had been approved emerged in the recent Medium-Term Budget Policy Statement that also highlighted National Treasury’s review of local government finances, including how councils charged for electricity. Announcements are expected.

Read more in Daily Maverick: Eskom posts record R23.9bn financial loss

But amid all of Eskom’s positivity, one niggle emerged – diesel costs that run into tens of billions of rands.

“We have said PetroSA should not be making a margin on the sale of Eskom. That margin is still there … in essence, Eskom is subsidising PetroSA,” said Gordhan.

The minister repeated that a permanently appointed CEO for Eskom would be in place by year-end, while, after questions from MPs, Eskom board chair Mteto Nyati said he’s accepted the post to ensure change continues.

“We have to maintain the gains we got and continue to make improvements. This country cannot afford to go back, we have to move forward…” Nyati told MPs.

“It is the time for me to do my bit for the country.” DM