Treasury backtracks on controversial Eskom exemption
Finance Minister Enoch Godongwana has told members of Parliament that Treasury has withdrawn the controversial exemption granted to Eskom – for now.
Godongwana briefed parliamentary committees, including the standing committee on public accounts and the auditor general committee, following widespread criticism over the gazette notice detailing the Public Finance Management Act exemption which allows the power utility to not disclose wasteful and irregular expenditures in its financial annual statements.
The finance minister told MPs the move has been paused pending further consultation with the auditor general.
“We have heard these comments, and yesterday we had an intensive discussion with the AG. In that discussion, there were some comments by the AG which have got to be part of the framing of the gazette. In light of these comments, and the comments of the general public, we have decided to withdraw the gazette for now.”
JUST IN: Finance Minister Enoch Godongwana has withdrawn the exemption granted to Eskom from reporting irregular, wasteful and fruitless expenditure in its annual financial statements #EskomExemption pic.twitter.com/7YeORk5Wpd
— Jacaranda News (@JacaNews) April 5, 2023
Godongwana said the exemption was not intended to hide the information, as it would still be reflected in the utility’s broader annual reports.
“The intention is to allow Eskom to have better financial statements, but at the same time create an environment where there’s transparency on corruption and irregular expenditure.”
While the withdrawal has been welcomed by parliamentarians, Treasury has been asked to explain how it came to the decision.
Standing Committee on Public Accounts chairperson Mkhuleko Hlengwa described the decision as malicious compliance with the law.
“Eskom has not formulated a credible, functional, and sustainable audit action plan in response to the audit outcomes that gives any confidence that they are dealing with the areas of material concern – including, but not limited to, irregular expenditure – and now to clean and sanitise the books of Eskom we come with manipulation of the law on a key area that has been persistent for the past five years as contained in the audit report.
“Nothing has changed at Eskom, and clearly, nothing will change, and so the cop-out is to say ‘exempt us’.”
Godongwana has also been asked to clarify what he means by “for now”, with the Inkatha Freedom Party’s Narend Singh saying any talk of such an exemption for Eskom should be scrapped.
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