/ 10 May 2013

Gigaba urges Eskom linchpin to keep powering on

Gigaba Urges Eskom Linchpin To Keep Powering On

After a spate of leadership upheavals at key parastatals, Malusi Gigaba, the public enterprises minister, said on Wednesday he had written to Eskom's board, backing its efforts to keep financial director Paul O'Flaherty on at the power utility.

O'Flaherty announced his resignation late last year, shortly after a mass exit by the erstwhile SAA board as well as its former chief executive and other executives. O'Flaherty's decision to step down came amid concerns over the state's increased involvement in the management of parastatals.

O'Flaherty is seen as central to the delivery of Eskom's R350-billion capital expansion programme, which includes the construction of the new Medupi and Kusile power stations.

The country is battling power shortages and the build programme has been beset by delays and labour unrest, but Eskom and Gigaba have given assurances that Medupi's first unit will come on line at the end of the year. Gigaba said the company would appoint a new financial director, but he wanted O'Flaherty to stay on as head of Eskom's capital projects.

"I have made it unequivocally clear that I want Medupi to deliver first power come the end of this year," Gigaba said at a briefing to the Cape Town Press Club.

"Paul [O'Flaherty] is central to that, he has been leading that process. He is an experienced manager and the rapport he has established with all stakeholders … is vital for [Medupi's] completion …"

O'Flaherty refused to comment on Gigaba's remarks. His term is set to end after the release of Eskom's annual results later this year. Gigaba said O'Flaherty was "a patriot" and he believed he would stay on at the company.

SAA and Eskom are facing funding difficulties, with the national carrier in the process of implementing a turnaround strategy aimed at returning it to financial stability. Eskom, meanwhile, has been granted a drastically reduced tariff increase by the National Energy Regulator of South Africa. Eskom applied for a 16% increase but was granted half that.

Gigaba said he "would be lying" if he did not anticipate further government support for Eskom and SAA.