BHP Billiton and Eskom: DA notes judgment compelling Eskom to release pricing agreements

The Democratic Alliance (DA) notes the judgment handed down on Friday by the South Gauteng High Court in the matter between Media 24 and Eskom (see Reuters report). The court's decision to compel Eskom to make a range of documents available to Media 24 regarding secret pricing deals is significant, as in so doing the court signalled that it did not recognise the verbal agreements and understandings that Eskom has used in the past to keep important information from the public. This is therefore a positive development that will hopefully help to improve the transparency of Eskom's various dealings in the future.  

The particulars of this case are important for several reasons. Firstly, the fact that Eskom had attempted to stop details of pricing agreements between it and BHP Billiton from entering the public domain raises questions about the nature of these agreements. The DA has suspected for some time now that BHP Billiton had, through previous pricing agreements, established an arrangement whereby it received electricity at preferential rates.

Furthermore, if this is indeed the case, the recent escalation in electricity prices for average consumers would therefore effectively amount to an indirect subsidisation of BHP Billiton's electricity costs by ordinary consumers. This would obviously be an unacceptable and unfair arrangement and we hope that Media 24, which should shortly be in possession of the pricing information, will be able to bring the facts about this deal to light.

Secondly, this case sets a precedent that prohibits Eskom, or any other state institution, from using verbal confidentiality agreements as smokescreens to prevent the release of information that should be in the public domain. The fact of the matter is that entities such as Eskom should be accountable to the public, and public representatives in Parliament, and if similar information is requested it should be made readily available.

Thirdly, this case has striking similarities to a recent interaction between the Minister of Energy and the DA in Parliament. The DA believes that there is a possibility that Eskom has entered into potentially disadvantageous electricity supply agreements with neighbouring countries; but we require more information to determine whether this is indeed the case.

Therefore, the DA submitted a parliamentary question to the Minister of Energy regarding Eskom pricing agreements, only to be informed that the "commercially sensitive" nature of this information prohibits Eskom from releasing it. The question and reply can be read here.

In light of Friday's ruling, the DA will now be resubmitting these parliamentary questions and, if necessary, will also submit applications under the Promotion of Access to Information Act (PAIA) to gain access to this information. Naturally, if these pricing agreements with our neighbours do indeed include written confidentiality clauses, the Minister is not obliged to disclose that information, but if they do not, Friday's ruling obliges her to make this information publicly available.

State institutions, such as Eskom, need to be accountable to the public and, as such, transparency is a vital requirement. The DA will use every measure at its disposal to ensure increased transparency and accountability at Eskom and other state institutions. 

Statement issued by Pieter van Dalen MP, DA Shadow Deputy Minister of Public Enterprises, August 7 2011

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