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Unions oppose potential split of Eskom

Cosatu says splitting Eskom would not solve its governance and debt issues.

South African trade union federation Cosatu said on Tuesday that it opposed a proposal to split power firm Eskom into three different entities, arguing this would not solve the struggling utility’s governance and debt problems.

Cosatu Deputy General Secretary Solly Phetoe said the proposal to split Eskom into three firms was made by a task team appointed by President Cyril Ramaphosa at a meeting with members of the ruling African National Congress.

Phetoe said the task team’s plan to save Eskom meant that thousands of the utility’s staff could lose their jobs, an assessment that Cosatu said it could not support.

Ramaphosa is trying to turn around the ailing company – which supplies more than 90% of South Africa‘s power but is drowning in R420 billion ($31 billion) of debt – and has promised to announce a plan to shore up its finances.

“We don’t support unbundling as the only option to turn around Eskom,” Cosatu’s Phetoe said at a news conference.

“It doesn’t suggest that when you unbundle you shall have resolved the governance problems that Eskom has been facing. When you unbundle you have not resolved the debt that Eskom is owing,” Phetoe said.

Read: Eskom sees R20bn FY loss, seeks higher tariff hikes

Cosatu is planning a nationwide strike on February 13 to try to prevent large-scale layoffs, including at Eskom. 

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