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.”
— City of Tshwane (@CityTshwane) July 7, 2022
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.
“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.
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.
The City of Tshwane has once again cut off the electricity to the Prasa House in Hatfield, Pretoria for failing to make payments for its R11 million bill. @CityTshwane @Eskom_SA #electricity #Power #eskom #Blackouts pic.twitter.com/opg4pmZCBl
— Pretoria News (@pretorianews) July 7, 2022