ANC municipalities’ corruption and wasteful expenditure has allowed for electricity crisis

16 January 2017

Today, Eskom acting CEO Matshela Koko announced that power had been cut to the Naledi and Ventersdorp municipalities for failure to pay outstanding debts, with further cuts planned for other municipalities starting on 18 January.

This is an undeniable crisis for the residents of these municipalities, who will now be denied important services. Hospitals and clinics will be unable to function, and small businesses will experience major losses, hurting the local economy and inevitably resulting in job losses.

This crisis did not appear out of the blue. It is the consequence of years of poor financial management, corruption, and wasteful expenditure. This is precisely what happens when a government puts its friends and cronies first, and the people last.

It should indeed be asked why the relevant MEC’s did not do more to ensure that a crisis of this magnitude did not reach such levels. It is no doubt the result of a failure of government by the ANC at all levels of government. The ANC simply doesn’t care about fighting corruption and wasteful expenditure.

The DA is determined to bring this to an end. It is high time that the relevant provincial MECs in these provinces be called to account, and the national departments be required to now step in and resolve this crisis, in terms of s139 of the Constitution.

To this end, the DA in Parliament, and in relevant Provincial Legislatures, will seek urgent hearings on the growing crisis, with the aim of ensuring that the matter be resolved as soon as possible, and with limited impact on residents.

We moreover reiterate our call for an urgent joint portfolio committee meeting, with Public Enterprises, Treasury and COGTA all at the same table, so that this issue can be resolved once and for all.

The truth is that the blame for the ongoing electricity crisis and dispute between Eskom and a number of municipalities lies firmly at the feet of the African National Congress (ANC). There is no question that the municipalities facing cut-offs and electricity restrictions were mismanaged, and that funds that should have been utilized to pay down the outstanding amounts to Eskom, were utilized for other purposes.

For example:

- In the Nala Municipality in the Free State, the Auditor-General estimates that that R23 million was wasted (2014/15 financial year). This is in addition to numerous other failed projects, including R70 million that was wasted when much needed toilets for the community were never connected to the sewage system.

- The eMalahleni Municipality in Mpumalanga owes Eskom more than R1 billion, yet the mayor still wants to spend more than R1 million on luxury vehicles, as well as performance bonuses for municipal officials. The municipality admits that its credit control and revenue collection are a shambles, yet little is done to address this issue.

- In Madibeng in the North West, unauthorized expenditure exceeded R440 million, irregular expenditure amounted to R362 million and fruitless and wasteful expenditure was R1.5 million according to the 2014/15 Auditor General’s report. Again, this could have significantly eased the Eskom debt crisis in this municipality.

It is clear that the ANC has no interest in serving the citizens and businesses of the municipalities they control, and would rather spend money that should address the basic needs of the municipality on luxuries and waste.

Where the DA has taken over municipalities owing money to Eskom, such as in Modimolle/Mookgophong, payment plans have been put in place to ensure that this debt is curtailed, and these plans are rigorously adhered to.  Luxuries were dispensed with, in favour of basic service delivery, and clean, transparent and accountable financial management.

The DA is committed to ensuring that all consumers, whether residential or business, who pay their electricity bills on time, receive the services they are owed by their local government. We will continue to fight for better government, and more specifically, better management of municipal finances.

Residents in all these municipalities can rest assured that we will do everything possible to ensure that the situation is resolved as soon as possible, all those implicated in mismanagement are held to account.

Issued by Kevin Mileham, DA Shadow of Cooperative Governance and Traditional Affairs , 16 January 2017