City of Tshwane finally settles R878m Eskom bill

This after the power utility called the municipality out for what it called ‘erratic payments’ on Monday.
Image:: Waldo Swiegers/Bloomberg

The City of Tshwane has officially cleared its R878 million debt to cash-strapped power utility Eskom.

The city announced the news via a rather cheeky twitter post on Thursday, which read: “We hope that the power utility will provide the people of [the City of Tshwane] with constant and reliable power supply.”

On 4 July, the embattled power utility called out the municipality for failing to settle the nearly R1 billion bill, further complaining that the city’s “erratic payments” over the past year have left it unable to make good on its own debt, which totals R396 billion – of which over R46.6 billion is owed to the utility by municipalities.

Eskom had also refused to enter a payment arrangement with the city, citing its own financial struggles.

Read:
SA seeks legal advice on R396bn Eskom debt burden
No mercy from Eskom for cash-strapped City of Tshwane

“Out of the eight metropolitan municipalities in the country, the City of Tshwane is the only one with erratic payments,” Eskom said in a statement it put out earlier this week

“The city’s erratic payments over the past year have contributed negatively to Eskom’s increasing overdue debt (which is in excess of R46.6 billion), liquidity, financial performance, and the sustainability of the organisation, such that Eskom has to borrow to meet its financial commitments,” the utility added. The R46.6 billion debt here refers to its municipal debt, according to Eskom spokesperson Sikonathi Mantshantsha.

Eskom will be glad to have the city’s payment, especially as its coffers are now further strained as a result of a 7% wage increase deal it signed with labour unions earlier this week. The deal, which also allows Eskom workers R400 more for their housing allowance, will add a further R1 billion to the utility’s expenses.

Read:
Eskom barely dodges stage 7, as weeks-long recovery looms
Unions sign 7% Eskom wage deal

Cash-strapped city

Much like Eskom, the city has been faced with money issues due to ratepayers not paying their municipal bills.

Earlier this year the city launched its revenue collection campaign called #TshwaneYaTima. The campaign saw many businesses and government properties cut off from municipal services, helping it collect hundreds of millions of rands owed to it.

In recent days the city has relaunched the campaign, seeing it cut off electricity supply at Prasa offices due to its R11 million outstanding bill to the city.

AUTHOR PROFILE

COMMENTS   4

Sort by:
  • Oldest first
  • Newest first
  • Top voted

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

Gotta luv that .97c …

I once omitted the cents on a municipal bill and sure enough, got billed for it the next month. Reminding of my days in the agencies office of the now gone Natal Building Society when I couldn’t leave until it all balanced out, even though I offered to add the few cents out of my pocket.

Wow — Is a municipality paying its bills becoming headline news in SA??

Yip … it’s very unusual.

Like a prosecution for creating a multi-billion Rand stream of riots and looting in KZN and Gauteng. Or a certain ex-president having his “day in court”.

In a recent interview Eskom CEO AdR stated that munis, metros owe the utility R 42 B.
Absolute leader of the pack is MAP, Maluti-a-Phofung municipality, Qwaqwa, Phutadichaba, Harrismith, Kestell with a total debt of R 16.6 B. Has become a total dysfunctional cnr of the country. Police doesn’t get out of it’s office anymore, crimes reported but criminals released the next day.
Often no water or electricity. And little chance of any improvements soon despite that MAP 16, a group of previous ANC councillors, now independents united under that new name. They might have been duly elected, but will not get any cooperation of other parts of this govt, because they abandoned the mother party, and will be sabotaged all the way. So the next municipal elections people will be forced to vote ANC again.
This all from somebody living in that part of the country.
But in this small town it’s the same. An outspoken, critical ward councillor in die lokasie was ousted from the ruling party. Re-elected as an independent in his ward. But from that moment certain services were denied to his ward, like emergency drinking water delivery from tanker trucks, as the townships has very poor water supply. Residents were told, you voted independent, and passed by. So that ward voted obediently ANC again last November.

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Subscribe to our mailing list

* indicates required
Moneyweb newsletters

Instrument Details  

You do not have any portfolios, please create one here.
You do not have an alert portfolio, please create one here.
INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: