Govan Mbeki Municipality ends council term with Eskom debt exceeding R7b
The last meeting of the current administration was held on October 16. The November 4 local elections are bound to bring in several new faces.
The Govan Mbeki Municipality held its final ordinary council meeting of the 2021–2026 administration on October 16 at Lillian Ngoyi Centre in Secunda, as the current council term draws to a close on November 2, ahead of the local government elections scheduled for November 4.
The meeting provided an opportunity for councillors from different political parties, municipal leadership and officials to reflect on the past five years of local governance, including service delivery pressures, infrastructure challenges and municipal financial concerns.
Addressing the council, Speaker Fikile Magagamela expressed appreciation for the contributions made by councillors, the executive mayor, members of the mayoral committee, municipal management and officials throughout the five-year term.
Magagamela acknowledged that the administration had navigated a challenging period characterised by service delivery demands, infrastructure constraints and the need to strengthen institutional stability and municipal governance.
She emphasised that, despite political differences, councillors had continued to operate within democratic structures with the shared objective of improving residents’ lives and advancing the municipality’s vision of becoming ‘A Model City of Excellence’.
“As the 2021–2026 administration approaches the conclusion of its term, the municipality acknowledges the contributions of all councillors, political office-bearers, municipal officials and stakeholders who have played a role in the governance and development of the municipality,” said Magagamela.
During the meeting, Doctor Mtshali, MMC for Corporate Services, who acted on behalf of Executive Mayor Nhlakanipho Zuma, tabled reports on payments made to Eskom and Rand Water for September.
Mtshali reported that the municipality paid R39m to Eskom in September, maintaining the same monthly payment made in August.
“The consistent payment of R39m is based on the three-month arrangement (July to September) agreed upon with Eskom and informed by the Distribution Agency Agreement (DAA) engagement,” said Mtshali.
He added that interest on the principal debt decreased by R3.012m, from R36.186m in August to R33.174m in September. According to Mtshali, the reduction was attributed to consistent payments made to Eskom over the past three months.
“Management continues to prioritise Eskom payments within available funds while engaging Eskom to deal with both old debts and current account management through the DAA process.
“As a result, management is implementing revenue collection measures, including credit control, to work towards settling Eskom’s current accounts in full,” he said.
Despite these payments, the municipality’s total debt to Eskom has exceeded R7bn.Democratic Alliance councillor Portia Mpatlanyane expressed concern over the sharp increase in the municipality’s Eskom debt during the current administration’s term.
ALSO READ: 13-year-old drowns in Standerton
She said the municipality owed Eskom about R2bn when the council took office in 2021, but the debt had increased to R5bn within two years and now exceeds R7bn as the term ends.
“It is shocking because when we took over from the previous council in 2021, our municipality was owing Eskom R2b, and within a short period of three years, we were already owing Eskom R5b. Now, at the end of our five-year term, we are leaving the municipality with R7b debt to Eskom.
“We need not sugar-coat things. People need to take responsibility, and the incoming council needs to be decisive and strengthen the monitoring of the administration’s work,” said Mpatlanyane.
In response, Mtshali said the municipality was in the process of finalising the DAA with Eskom to address the outstanding debt. However, he said certain matters still needed to be agreed upon by both parties before the agreement could be signed.
The council also received an update on the municipality’s payments to Rand Water. Mtshali said the municipality paid R41.33m to Rand Water in September, compared with R54m in August.
The amount billed for September was R51.95m, including VAT, compared with approximately R50m in August. No interest was charged in September. However, the municipality’s outstanding debt to Rand Water increased from R822.35m to R832.96m as at September 30.
Mtshali explained that the difference between the amounts billed and paid reflected the timing of payments under the signed agreement, which provides for a 60/40 payment split and full settlement of the current account within 45 days.
ALSO READ: Secunda man gets contract to further develop his app
