Public Enterprises Minister Pravin Gordhan.
The government is reviewing the Eskom board and working on ways to strengthen it, according to Public Enterprises Minister Pravin Gordhan.
Gordhan spoke to the Mail & Guardian on Thursday afternoon — the day after he fielded questions from MPs about the ailing state power utility, which recently announced yet another week-long round of load-shedding.
Last month a meeting of parliament’s standing committee on public accounts with Eskom’s board and executives turned sour, when board member Busi Mavuso said the power utility’s management was being scapegoated for its collapse.
Eskom’s ageing coal-fired power stations are at the centre of the elecitricity crisis in South Africa, which has endured 14 years of rolling blackouts that have punished the economy.
“What we will not accept and what we will not agree to, in spite of all the challenges we are facing as an organisation and all the efforts that have been put in place, is to have this board and [Eskom chief executive] André [de Ruyter] as the fall guy for the mess that this organisation is currently experiencing,” Mavuso said.
Mavuso, who is also the chief executive of Business Leadership South Africa, was asked to leave the meeting. The department of public enterprises called her comments “regrettable”, adding that her conduct was unbecoming of an Eskom board member.
‘Creating a safe space’
On Thursday, Gordhan said De Ruyter — who has faced widespread backlash for the state of Eskom while he has been at its helm — is in need of capable reinforcements. “As far as management is concerned, no CEO anywhere in the world or in any company works on his or her own,” the minister said.
“It is about the team that you have put together. And I think there will have to be a reinforcement of the expertise that are available within Eskom in the near future, in order for the multiplicity of tasks and processes that are unfolding to be managed efficiently.”
On Tuesday, Eskom’s chief operating officer, Jan Oberholzer, warned the country could face more blackouts as winter approaches. “We are working hard to restore all units but our demand is higher than our supply, which we have seen at the start of May due to colder weather conditions.”
Last year was the worst year of load-shedding on record. According to data from the Council for Scientific and Industrial Research, counted together, the 2021 outages clocked 1 169 hours.
Oberholzer said the country was on track to experience fewer days of load-shedding. There were 29 days of load-shedding between January 2021 and April 2021, compared with 25 over the same period in 2022.
Gordhan said he expects the Eskom board and management to do much better this year “and actually get a firmer grip on what the root causes are of some of the problems. But also, who are the troublemakers that remain within Eskom — who are either guilty of corruption on one hand or guilty of operational inefficiencies on the other.
“At the same time, there are enough skills around for us to bring new skills in. The key is to make Eskom in its new form, and as it is transforming, a good place for professionals to work. And a safe space for professionals to work.”
The minister also spoke on the legacy of state capture at Eskom, which was laid bare in the fourth instalment of the Zondo commission of inquiry’s report. “One can go on and on” about state capture’s effect on the power utility, Gordhan said.
‘It can be fixed’
The report, Gordhan added, “clearly indicates that Eskom was a target of state capture”.
Chief Justice Raymond Zondo found that there was a scheme by the well-connected Gupta family to capture the power utility by installing their associates in positions of strategic importance in its board and management. This enabled the Guptas to divert Eskom’s resources and enrich themselves, their entities and their associates, Zondo noted.
Eskom’s alleged capture, Gordhan noted, resulted in a number of competent employees being either kicked out or forced to leave to avoid compromising their integrity. “That means that, operationally, the more experienced and knowledgeable people that Eskom actually needs today … are not there any longer.”
Zondo said in his report that the way board members and executives at state-owned companies are appointed has to change. “The evidence heard by the commission has revealed quite clearly that part of the reason why some of the state-owned companies have performed as badly as they have and why some rely on government bailouts year-in, year-out is the calibre of some of the people who are appointed as members of the boards of these companies or who are their chief executive officers and chief financial officers.”
The commission, Zondo said, will make recommendations with regard to how boards and executives should be chosen.
“We look forward to that,” Gordhan said on Thursday.
“The sum total of all of that,” he added, “is that we have a damaged institution. But it is not a broken institution. It can be fixed. But it’s going to take extraordinary efforts to do so. Corruption is still a factor. Outside interference might still be a factor as well.”
“So a whole lot more work needs to be done. But, at the same time, there is excellent work going on.”
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