Eskom’s power grab in Emfuleni backfires

Eskom has suffered two bloody noses within a week for its collective punishment of local Government and consumers – including a Pretoria High Court judgment slamming it for attaching Emfuleni municipal accounts leading to non-payment of salaries and extensive hardship.

Simultaneously, the reeling bulk utility was also recently forced by the national Electricity Minister to backtrack on its public threats to cut off electricity supply to the City of Johannesburg, also allegedly for non-payment of bills and which would have impacted the paying public.

Both issues were a major repudiation of Eskom’s practice of taking action against indebted local authorities which severely impacts on municipal workers and the paying public, for its revenue-gouging practices against fellow State entities.

Eskom’s recent attachment of the ELM bank accounts resulted in delayed salaries for municipal employees and actually undermined the State by delaying a host of official payments as well, including to the SA Revenue Service, the Unemployment Insurance Fund (UIF) and several other statutory payments., the High Court found.

Service delivery to the paying public was also severely disrupted in Emfuleni due to the attachments – which according to the High Court was completely unjustified and uncalled for.

This was due to the fact that Eskom blatantly ignored the fact that ELM is on the National Treasury’s municipal debt relief programme – a fact that Eskom repeatedly denied despite at least two media statements by the Treasury to that effect.

Eskom further promoted this lie by widely insisting that ELM was no longer on the debt relief programme – which grants immunity on legal action to ELM on Eskom debt of R7 billion – and going ahead with bank attachments and refusing to lift them even to pay salaries.

This coincided with an extensive media smear campaign against ELM which Vaalweekblad can now confirm originated from both within the National Treasury and Eskom –  Treasury has also confirmed that the fired former CFO of ELM, Andile Dyakala, now works there as a consultant dealing with municipal debt.

It was alleged in a number of media reports that ELM had developed a fake budget and was engaging in asset stripping of its own assets – claims that were later proven unfounded but forced ELM to threaten News24 with legal action for defamation.

However, the attachment crisis was only resolved after the collective efforts of a number of National Cabinet Ministers – who also forced Eskom and ELM to sign a long-awaited agency agreement which allows Eskom to manage electricity infrastructure and revenue for ELM.

This agency agreement is now in the planning phase.

Local Government sources say it is completely unacceptable for Eskom to take on another state entity legally – and so waste huge sums of money – when internal resolution mechanisms exist within the State to deal with such conflicts.