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The Standing Committee on Appropriations is conducting a three-day oversight visit to Eskom in the Gauteng Province. The oversight visit follows the adoption of the committee’s report on the Special Appropriations Bill [B10-2019], and the committee’s call for National Treasury (NT) to tighten conditions attached to the R59 billion support to Eskom, as provided for in the Bill.

Eskom plays a pivotal role in the South African economy and its increased financial and non-financial challenges pose serious risks to economic growth, the fiscus and South Africa’s sovereign rating status. The entity continues to produce unsatisfactory audit outcomes and indicators of financial health and sustainability. The committee will thus on Monday, 14 October 2019, receive a briefing from the Auditor-General of South Africa (AGSA) and NT on key financial matters at Eskom over the past five financial years.

On Tuesday, 15 October 2019, the committee will engage with Eskom’s group executives on these financial performances, as well as the operational and financial challenges currently facing the entity. Eskom’s Board of Directors are expected to brief the committee on the entity’s state of affairs, the plans to get Eskom back on the path of financial stability and the conditions attached to the R59 billion support to Eskom. Notwithstanding the impact of Eskom’s restructuring on its labour force, the committee will also engage with Eskom’s labour representatives on the likely impact of the restructuring on employees and other labour-related challenges within the entity.

Irregular and wasteful expenditure contributes greatly to the financial challenges of the entity. As at April 2018, the entity finalised more than 95 percent of the 1 049 outstanding disciplinary cases related to procurement breaches. Approximately 12 percent of these cases resulted in employee exits. The committee will thus on Wednesday, 16 October 2019, engage with the group executive of human resources on, among other things, the impact of this and the termination of contracts on Eskom’s operations. 

On Wednesday afternoon, the committee will also engage with the general manager of procurement on non-compliance with applicable legislation, the potential risks and mitigating factors, as well as the challenges and costs associated with long-term contracts.

Felicia Lombard
14 October 2019