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28 Nov 2014 00:00
Eskom power lines are not just visible in the outdoors, but in politics as well. (Madelene Cronjé, M&G)
Amid blackouts, rising costs, plummeting profits and credit-rating downgrades, it is concerning that Eskom could lavish a R43-million breakfast sponsorship on the Gupta family’s New Age newspaper. In interim results unveiled this past week, Eskom’s auditor red-carded the sponsorship deal.
Two days later it was revealed that the crisis-plagued enterprise has called on staff to volunteer for exit packages.
Of course, R43-million is a drop in the ocean of additional funding Eskom will need over the next few years.
A similar dynamic can be seen at SAA and, we suspect, in the PetroSA board fiasco. Parastatals are not primarily seen as drivers of development, as per the ANC’s pious rhetoric, or even as providers of services answerable to citizens. Their considerable resources are instead seen as a source of patronage.
The auditor’s flagging of the Gupta hand-out as an abuse of delegated authority appears to have unleashed a struggle in the Eskom board, which is formally responsible for good governance.
The audit and risk committee has little choice but to act; Eskom said this week that the matter was still under investigation.
The connected Matjila, however, has powerful allies. Board chairperson Zola Tsotsi apparently tried to block disclosure of the irregularity in the interim financials. Politics could again ensure that the auditor’s finding is glossed over and that no one faces the music. If the board fails to act, it will send out the clearest possible signal that other concerns have trumped the national interest.
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