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Eskom new funding bill expected July 23

Eskom presents the biggest risk to the country’s fiscal framework says Tito Mboweni.

Finance minister Tito Mboweni aims to table a bill in parliament on July 23 to give struggling state power firm Eskom more money for the current financial year and next, to alleviate its acute liquidity problems.

Mboweni told parliament on Thursday that Eskom presented the biggest risk to the country’s fiscal framework and stressed that there were serious risks to the economy if it collapsed.

Eskom, which supplies more than 90% of the country’s electricity but has implemented severe power cuts this year, fails to generate sufficient profit to meet its debt-service costs and has required state cash injections to stay afloat.

Mboweni, a key ally of President Cyril Ramaphosa, added that the government would also provide financial support from its contingency reserve to ailing South African Airways, weapons manufacturer Denel and broadcaster SABC.

Read: SAA gets state funds after CEO, chairman quit

“This additional financial support cannot be a blank cheque to these state-owned enterprises,” Mboweni said. “We really and truly cannot go on like this.”

The minister said South Africa’s tax collection was underperforming due to a weak economic environment and the government would focus its short-term efforts on addressing rising debt and on stricter controls on expenditure. 

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When you forecast that your business or your grocery budget for that matter is going to drop what are you supposed to do?

Maybe the first thing you do is cut your spending.

How is it that this NEVER crosses their minds.

We cant go on like this but we do.

What they need to start with is put a moratorium on ALL price increases from Government and SOE’s and get them to cut cost’s until they meet their foretasted budget. Start with paying off people that do nothing and probably just steal.

These idiots budget money to create jobs that serves no purpose. How does that sort anything out. The latest is Environment dept. R 108 million for 68 000 jobs. That’s like R 1500-00 per job. What absolute rubbish.

End of comments.

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