Tshwane ANC has called on the Gauteng MEC for Co-operative Governance and Traditional Affairs (Cogta), Mzi Khumalo, to take over the metro as its debts accumulate.

Party secretary George Matjila said on Wednesday the metro now owes Rand Water and Eskom a joint R2.4b (R1b to the former and R1.4b to the latter).

Eskom had earlier announced that it could no longer carry the metro’s debt because it was exacerbating Eskom’s own cash flow crisis.

Matjila accused the DA-led coalition of peddling lies to residents and businesses about its ability to meet its financial obligations and improve service delivery.

In November, the metro short paid its Eskom bill of R660m and failed to pay its December account of R780m.

Matjila said the recent Auditor-General’s report further exposed the deep-rooted financial difficulties in Tshwane and claimed that the metro could soon face a total blackout due to failure to pay for its electricity consumption.

“We would like to repeat our call to MEC Mzi Khumalo to take over the financial administration of the city through Section 139(5) of the Constitution before Eskom attaches its bank accounts.”

Matjila said in 2022, this happened in Emfuleni, and the municipality was allegedly unable to pay salaries in January ‘due to the takeover of the account by Eskom’.

He said the fact that Tshwane also owes Rand Water, points to a serious financial crisis.

“Tshwane owes Rand Water R1b and we will be in deep trouble if both entities run out of patience with the administration of the Tshwane [metro].”

Metro: Open about challenges

Tshwane MMC for Finance Peter Sutton said the metro had consistently proposed payment plans that Eskom rejected multiple times.

“We acknowledge the R1.4b arrear debt and we intend to make regular payments to service the account. Our finance team has consistently been engaging Eskom on a payment plan.”

Sutton said the metro understands the responsibility to pay creditors and has been upfront and honest over its liquidity challenges.

“We are currently implementing various interventions to address these financial challenges, however, we must also acknowledge the adverse impact Eskom’s load-shedding has on the city’s liquidity position.

“Our residents and business are battling economically due to load-shedding, which in turn contributes to low revenue.”

He said the city’s maintenance budget was also out of control as a direct consequence of load-shedding. “Eskom cannot ignore its adverse contribution to some of the metro’s financial liquidity problems.”

Eskom: Poor payments out of control

This week Eskom said Tshwane was several payments behind and called on it to pay its bills. “We call on the metro to do right by its residents and pay the bulk electricity account to enable Eskom to continue supplying electricity to the metro,” Eskom spokesperson Amanda Qithi said on Wednesday.

Qithi said Tshwane’s R1.4b debt was worsening Eskom’s cash flow crisis. “Tshwane’s poor payments continue to spiral out of control.”

Qithi added that despite several engagements with the metro to settle its November account by December 31, the bill remained outstanding. She said the Public Finance Management Act No 29 of 1999 required that institutions recover what is owed to them, hence Eskom sought the intervention of Cogta in the matter.

Eskom had previously been unsatisfied with Tshwane’s erratic payments on its bulk account.

The power utility earlier warned that Tshwane could face the same fate as Emfuleni should its debt remain unpaid.

Eskom said it was also closely monitoring all metro and municipal accounts and would follow a strict debt collection process should they not settle their bills on time.

Rand Water had yet to comment at the time of publication.