A statement issued by DA spokesperson on Public Enterprises, Natasha Mazzone, alleges that Eskom wants government to cover its R100 billion debt.
DA MP Natasha Mazzone said in a statement on Wednesday, 5 December 2018, that her party would write to the Eskom chairperson about an alleged R100 billion Eskom to governemnt debt swap.
“We will be requesting that the Eskom board present this information to an urgent Public Enterprises Parliamentary Committee meeting,” Mazzone said in the statement. The party alleges that the power utility has approached government to place R100 billion of its debt onto their balance sheet.
Mazzone also commented on the load shedding recently implemented by Eskom. “South Africans are literally in the dark given the current power outages in the country, we cannot be left in the dark around this debt deal,” said the DA’s shadow minister of public enterprises.
She said the alleged debt swap would have major consequences for the economy and for service delivery. “Based on our preliminary calculations this debt swap would add between 1.5 per cent and 2 per cent to the government’s debt to GDP ratio,” she said. “This would deviate critical resources away from basic service delivery, social grants, health care and education towards servicing Eskom’s debt.”
In March this year, Eskom CEO, Phakamani Hadebe, said, when presenting the organisation’s financial results, that they had been experiencing a major debt crisis. “Eskom continues to face significant financial and liquidity challenges in the short term, mainly due to the high debt burden, low sales growth and increased finance costs,” Hadebe said.
He said the power utility had a tough road ahead. “There will be financial pressure until 2020 as we transition towards financial and operational sustainability requiring resolute tough and decisive leadership,” the CEO said in March 2018.
Mazzone said the DA’s strategy for a turnaround would be more effective. “Eskom desperately requires a complete restructure with a split into a separate generation and transmission entity, as proposed by the DA,” she said.