The Congress of South African Trade Unions (Cosatu) on Wednesday added its voice to criticism of plans by electricity utility Eskom to increase its tariffs for electricity by more than the rate of inflation, possibly by as much as 16%.
This is despite a 46% increase in its profits, up to R3,7-billion in the past financial year, Cosatu said in a statement.
“This move confirms the union’s worst fears that the restructuring of Eskom into a public company, the first step on the road to privatization, would have damaging consequences for consumers, especially the poor,” Cosatu said.
The union federation added that what made matters worse was the fact that Eskom is a monopoly and consumers have no alternative source of electricity.
Cosatu said many thousands of poor families are already having their electricity cut off because they cannot afford the existing tariffs.
“Eskom boasts of the increase in the number of new homes they have electrified but this will be a meaningless achievement if consumers are cut off as fast as they are connected. Above-inflation increases will only increase the number of cut-offs as a result of people’s inability to pay the new rates.”
The union said this is likely to repeat the experience of Telkom, which has disconnected record numbers of telephone subscribers for non-payment.
The trade union Solidarity on Tuesday also criticized the price increases, saying they are not justified.
Cosatu reaffirmed its belief that the providers of essential services such as electricity must remain in public hands and make their main priority the delivery of the cheapest possible services as quickly and efficiently as possible, rather than maximising profits. – I-Net Bridge