Natasha Mazzone. Photo: Luke Daniel / thesouthafrican.com
Natasha Mazzone. Photo: Luke Daniel / thesouthafrican.com
Shadow Public Enterprises Minister Natasha Mazzone has let rip at Eskom this week after their dire financial numbers were released to the public on Tuesday. The company have posted one of the worst business losses in South African history, after losing R20.7bn during the 2018/19 financial year.
Despite fierce revitalisation efforts, sanctioned by President Cyril Ramaphosa himself, Eskom’s crippling financial and operational instability still remains one of the biggest single threats to South Africa’s economic prospects.
Natasha Mazzone slams ‘directionless’ Eskom
Turnaround strategies have been met with criticism, and industry experts are predicting a swift return to load shedding by the end of August. In a desperate bid to revive their fortunes, Eskom has put Jabu Mabuza in as their acting CEO – while he still holds the position of chairperson.
#AnnualResults2019: Chairman Jabu Mabuza "Today Eskom releases results that, while expected, are unfavourable. The organisation disappointingly incurred a net loss after tax of R20,7 billion for the year https://t.co/8Y9dCebFkw
— Eskom Hld SOC Ltd (@Eskom_SA) July 30, 2019
Mazzone, who rallied against the entire business operation of Eskom, labelled Mabuza’s move as “questionable”, claiming that the company are merely setting themselves up for even more failure:
“Eskom is a sinking ship. Jabu Mabuza, acting as an interim Acting CEO, shows there is no permanent captain to steer the ship through this storm. We cannot afford any form of board instability. The appointment of Mabuza as acting CEO will only bring his independence into question.”
“The board must hold the executive to account and perform proper oversight. Placing the responsibilities of two critical positions on one individual is a mammoth task and undoubtedly sets them up for failure. This decision violates any attempt to establish good governance at Eskom.”
Natasha Mazzone
Eskom losses and municipal debt in detail
Another source of discontent comes from the spiralling municipal debt owed to Eskom. Some regions are failing to get anywhere near their repayments, leading to a tense standoff between city councils and the government. The utility’s financial readings for the past year are nothing short of heinous:
- Losses for 2017/18: R2.3 billion
- Losses for 2018/19: R20.7 billion
- Rise in losses in the space of one year: R18.4 billion (up 800%)
- Total losses since 2017: R23 billion
- Municipal debt in 2017/18: R13.6 billion
- Municipal debt in 2018/19: R19.9 billion
- Rise in debt in the space of one year: R6.3 billion (up 46.3%)
- Total municipal debt since 2017: R33.5 billion
The problem with temporary solutions
Natasha Mazzone went on to suggest that interim CEOs simply do not cut the mustard when it comes to our ailing state-owned companies. She remains entirely sceptical of Mabuza’s new role, predicting a new wave of instability for the stricken electricity giants.
“Eskom’s financial trajectory is not sustainable. We cannot afford a recurrence of load shedding. This will have irreparable consequences for the economy and ordinary citizens. We have seen interim appointments time and again at state-owned entities (SOEs), which only leads to uncertainty and instability.”
Natasha Mazzone
