R19bn irregular expenditure at Eskom denounced – SACP

Party calls on SOE to unpack financial implications of buying power from IPPs

SACP denounces R19-billion irregular expenditure at Eskom

24 July 2018

The South African Communist Party is deeply concerned about the massive R19-billion in irregular expenditure uncovered at Eskom, dating back to 2012, and the loss after tax of R2.3-billion, up from R0.9-billion in 2017. Investigation into the governance and executive decay that has been destroying Eskom must go deeper. No stone must be left unturned. This must form part and parcel of the turnaround strategy that is required to reposition Eskom to deliver on its developmental mandate. All private interests, including corruption and its normalisation of irregular expenditure must be dealt a heavy blow for Eskom to successfully play its developmental role.

The SACP is further calling on Eskom to unpack the financial implications and impact of the practice of buying power from independent power producers at a price that is higher than its average selling price. This is not sustainable and should have been avoided from the outset. To the extent necessary, incentives to encourage independent power generation should not have been designed at the expense of Eskom, which passes the cost on to the poor through its tariff structure and sky rocketing price increase applications to the National Energy Regulator of South Africa.

The SACP is committed to our Alliance’s shared perspective for Eskom and other state owned enterprises to be repositioned so that they can thrive and contribute robustly to our imperative of national production development and broader socio-economic transformation. This means Eskom must be repositioned to become South Africa’s mainstay of renewable energy production as opposed to giving away the transition to private profiteers.

Issued by Alex Mohubetswane Mashilo, Head of Communications & National Spokesperson, SACP, 24 July 2018