Scopa to summon ministerial task team over municipal debt
Scopa has resolved to summon the team of ministers that’s trying to find a solution to soaring municipal debt.
Eskom is owed R13.8 billion for bulk electricity services, which board chairperson Jabu Mabuza says is putting the power utility’s sustainability at risk.
Scopa met on Wednesday with Eskom, the Department of Co-operative Governance (Cogta), the SA Local Government Association (Salga) and Treasury.
Scopa chairperson Themba Godi says the committee wasn’t satisfied with the responses it got and now wants to meet with the inter-ministerial task team. Godi says that Scopa will also summon the 10 municipalities that together are responsible for more than R9 billion owed to Eskom.
Eskom’s resorted to cutting the power supply to municipalities that renege on payment agreements but often faces court interdicts to block this. Board chairperson Jabu Mabuza says a new approach to collecting municipal debt is needed urgently.
“We need to face the harsh reality. Financial sustainability for Eskom will remain difficult for as long as we are unable to secure our debt. We have compromised our credit strategy thus far and continuing to do so will have serious consequences. We need bold decisions and an understanding that all stakeholders are required to do the right thing.”
Over and above the nearly R14 billion owed to Eskom, municipalities owe a further R25 billion for water and other goods and services.