Eskom KZN has significantly reduced its municipal arrear debt, thanks to the support and leadership given by the KZN Department of Cooperative Governance and Traditional Affairs (CoGTA).
Municipal debt took centre stage when efforts by Eskom to collect revenue from owing municipalities were met with several challenges and were generally unsuccessful. Negotiations for payment arrangements mostly faltered or if successful, they were not followed through. This put an immense burden on Eskom as its revenue was constrained.
In the past three years, CoGTA has played a huge role in facilitating negotiations between Eskom and owing municipalities to the extent that one of them, Abaqulusi Municipality, cleared its R52.5m arrear debt in December 2020, which Eskom greatly appreciates. The Abaqulusi Administrator and his management team assessed how the debt would be settled and committed to ensuring that the current account would be settled simultaneously. The municipality diligently made progress and cleared the debt over the agreed period.
Eskom has noted progress in four other municipalities where CoGTA has been largely involved. These are Msunduzi Municipality, which has cleared its arrear debt, Inkosi Langalibalele Municipality, which will be making its last payment this month, Newcastle Municipality, which is adhering to the payment arrangement and has reduced its arrear debt by R38.3m, and Mpofana Municipality which has started honouring its payment arrangement. Eskom acknowledges the roles played by both CoGTA and the municipalities’ leadership in this regard.
There was a rocky start in negotiations with Newcastle and Mpofana Municipalities, however, the progress made shows that a lot can be achieved with determination and alignment of focus, and Eskom thanks CoGTA for this. We have come a long way and now have a recipe that works which will not only sustain, but also enable the economic growth of KZN.
In a letter of appreciation of the work done by the KZN CoGTA MEC, Mr Sipho Hlomuka and his team, the Eskom Distribution Group Executive, Monde Bala, noted, “Eskom would like to recognise the efforts of the MEC – CoGTA (KZN), together with his management team, for their perseverance and unfaltering assistance in ensuring that the Municipalities discharged their obligations. Eskom remains of the view that this collaborative approach between Organs of State and Local Government (municipalities) leadership is key in dealing with the challenges that we face as a country.”
Eskom looks forward to continuing and cementing this relationship with CoGTA (KZN) in the hope that other municipalities who face a similar challenge could be encouraged and empowered to successfully settle their overdue debts with Eskom.
For further enquiries please contact the Eskom Contact Centre on 08600 ESKOM/37566.
News supplied.