Municipalities have until March 2015 to settle Eskom debt
State-owned power utility Eskom has requested all default municipalities to settle their arrear debt to the utility by March 31, 2015, Public Enterprises Minister Lynne Brown said in a Parliamentary reply.
Responding to a question by the Congress of the People, in light of a statement by Cooperative Governance and Traditional Affairs Minister Pravin Gordhan in August that Eskom was owed about R10.85-billion by local municipalities as at the end of June, Brown said she had asked the utility to work closely with the Department of Cooperative Government and Traditional Affairs, National Treasury, provincial premiers and provincial treasuries to engage default municipalities.
She noted that Eskom was legally bound by the Public Finance Management Act to manage debt and had a robust credit management policy in place, which was applied to recover debt.
To date, acknowledgement of debt letters and realistic payment plans had been signed with some municipalities, while, as a generic payment plan, Eskom had requested all defaulting municipalities to firstly honour their current accounts before settling their arrear debt by March 31.
“In engaging with municipalities and other relevant government departments, Eskom takes into account the possible impact on citizens and residential, commercial, industrial and other consumers of any action it may take,” Brown said.
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