Eskom CEO Phakamani Hadebe says Eskom will continue to tighten the screws on implicated former and current employees and suppliers who have drained the utility of its resources and plunged it into debt.
He told Parliament on Tuesday that Eskom would also sue Gupta-linked Trillian later this year in a bid to recover R600-million it is owed.
“In December, we will be going to court to face up to Trillian to demand our R600-million,” Hadebe told a joint sitting of Parliament’s Portfolio Committees on Energy and Public Enterprises.
Trillian was paid R698-million by Eskom in 2016, at the instruction of consulting firm, McKinsey. Eskom says it has recovered R1-billion from McKinsey including interest. McKinsey earned the money from Eskom without a valid contract.
Eskom is slowly beginning to claw back after a tumultuous decade, in which it had ten different CEOs and three boards and was wracked with corruption.
“We are aware that in as much as there has been some form of stability, the truth of the matter is that we are not yet out of the woods and there is still going to be a journey over the next two years of cleaning up this whole institution,” Hadebe told Members of Parliament.
Eskom chairperson Jabu Mabuza has warned that the fight against corruption within Eskom is far from over.
“There is a concerted fight back by those executives that we have dismissed. They continue to have some of their tentacles back into the system. We need not kill ourselves in understanding that the fight we are dealing with is much more solid than the transgressions that can be sorted out by disciplinary processes.”
Public Enterprises Minister Pravin Gordhan has also said the committee should call former managers before the committee to explain their conduct.
“Outside, they are still trying to call the shots at Eskom. Some of them have stated things publicly. Some have appeared before you already. Also, call the relevant investigating police persons and the National Prosecuting Authority to explain to us and to you when they are going to face the consequences of what they have done.”
Hadebe said Eskom’s approach should not be "business as usual".
“The next two years are going to be tough. The transition to financial and operational sustainability will demand painful decisions but it will demand decisive leadership, especially when talking about procurement policies and procedures.”
He said a review had been done on three of its power stations to see if controls had improved. He said controls had been tightened "at the top, but further down we have to ensure tighter controls as we go forward".
Hadebe said ten implicated senior executives had exited the utility. Eskom was speeding up outstanding disciplinary hearings related to senior executives. Eleven criminal cases had been opened, five of which involved nine senior executives.
A total of 1 049 disciplinary cases had been opened since April 2018, of which 628 had been finalised, resulting in 75 employees leaving the company.
“The implicated employees are being subjected to internal processes while plans are in place to pursue criminal prosecution, recover money and other punitive action against implicated suppliers.”
Whistleblowers had been very effective. Hadebe said Eskom now had a stringent policy in the approval of sole source and emergency procurement.
“The biggest challenges are in supply chain management and procurement processes. We will be strengthening internal processes on procurement planning, contract management, proactive risk management and mitigation,” said Hadebe.
“Our approach should not be business as usual. Despite this difficult year, we have experienced green shoots and stories that are motivating us to see that our goals will be achieved. We have all of a sudden been able to attract investors back.”
Gordhan said Eskom needed to get onto a different path and completely reposition the business. It also had to keep in step with massive changes that are happening in the electricity technology field globally.
“We need to ask: What would Eskom look like in ten years time, if not five years . . . the structure, function, sources of electricity and the manner in which electricity is distributed.”