DA: EC municipalities owe Eskom R186 million
Municipalities in the Eastern Cape, excluding metros, owed Eskom more than R186 million in arrears as at January 18, the Democratic Alliance said on Sunday.
This included the five municipalities – Maletswai (R44.4 million), Gariep (R29.4 million), Nxuba (R32 million), Ikwezi (R10 million), and Inkwanca (R997,000) – that were threatened with disconnection by the power utility in December if they did not service their debts, DA MPL Bobby Stevenson said.
According to the reply to a question Stevenson posed in the legislature to finance MEC Sakhumzi Somyo the reasons for the arrears were that these municipalities had a low revenue base, illegal connections, and problems with billing systems. He also conceded that proceeds from electricity sales were used to fund other spending.
“This situation is a direct result of poor management in municipalities where consumers pay for electricity and these funds are channelled elsewhere. This is totally unfair and cannot be tolerated. Our municipalities need to be liberated from poor financial management,” Stevenson said.
In December, the DA laid criminal charges against the municipal managers of Ikwezi, Gariep, Maletswai, and Nxuba for failing to pay funds collected for electricity to Eskom.
“I want to challenge the MEC to state what action is being taken against these municipalities for poor financial management and for contravening the Municipal Finance Management Act,” he said.
The DA acknowledged the meetings held on government level with Eskom to avoid disconnection to municipalities. However, municipalities could not rely on bailouts, such as the R55 million paid by the provincial government in December 2015 and January 2016 for Maletswai, Gariep, Nxuba, and Ikwezi. Residents and businesses could not be made to suffer by having their electricity cut off due to poor financial management.
“Red lights are flashing in a total of 18 municipalities when it comes to payments to Eskom. In addition to the five municipalities above, Makana owes (R41 million), King Sabata Dalindyebo (R23 million), Nxuba YeTemba (R1.3 million), and Sunday’s River (R1.3 million). They need to get their financial management right.
“If we want the Eastern Cape and our municipalities to flourish, we need to grow the economy and create jobs. Sound financial management plays a huge part in creating the right climate for job creation,” Stevenson said.