Eskom sits as an albatross around the neck of the fiscus – Trevor Manuel

Former finance minister Trevor Manuel told the commission of inquiry into state capture on Thursday that, in his view, Eskom has become a burden to the country’s fiscus.

Manuel said the power utility had been among the strongest and leading institutions in the world with an impressive credit rating, which was able to generate surplus energy, all of which has changed, in particular, “in the last decade”.

Eskom, Manuel added, was the bedrock of South Africa’s industry because it generated cheap power which was readily available, with surplus generated provided to the poor.

Furthermore, in its heyday, the entity by managing the strength of its balance sheet did not impose a burden on the country’s fiscus “neither for cash injects or for guarantees, all of that is gone”.

“If you look at the position of Eskom now … it is clear that Eskom sits as an albatross around the neck of the fiscus,” Manuel told the commission.

However, he said the utility had to be supported and could not be allowed to fail.

Manuel said that in the last decade Eskom had had 12 CEOs, six chairpersons, 60 directors, and 30 executives at a cost of R514 million.

Manuel earlier told the commission that the public finance management act (PFMA) was meant as a control to ensure that public funds are not misused.

“When there is reckless spending, the poor are denied services because there are no controls in place,” Manuel said, adding that state capture sought to “loosen” those controls.

He added that the collapse of state-owned enterprises (SOEs) in the last decade reflected the fact that the powers given to SOEs were exercised without the necessary care and attention to detail.

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