Ramaphosa: Pension money not at risk to bail out Eskom

Ramaphosa: Pension money not at risk to bail out Eskom

President Cyril Ramaphosa says the pension funds of South African workers are not at risk as government considers the idea to use the savings to bailout power utility Eskom.

President Cyril Ramaphosa
Image courty: GCIS

Ramaphosa says trade unions, business, communities and government are hard at work to find money to save the cash-strapped Eskom.

"They would like to do this in a manner that does not put workers' pensions at risk and that does not compromise the integrity of the financial system," says Ramaphosa.

Ramaphosa delivered his State of the Nation Address (SONA) on Thursday evening.

Union federation Cosatu has proposed a plan to use R250 billion of pension money to pay Eskom's debt in return for a range of undertakings by the government.

The plan was favourably received by President Cyril Ramaphosa.

Meanwhile, the Public Investment Corporation (PIC) says it's concerned about not being consulted regarding a proposed bailout for the ailing Eskom.

The R2 trillion fund manager adds its willing to engage about a solution for ensuring that Eskom does not pose a systemic risk to the economy.

"This requires both a drastic reduction in costs - including a review of irregular contracts - and measures to mobilise resources that will reduce Eskom's debt and inject fresh capital where needed," says Ramaphosa.

Ramaphosa also announced several strategies to lessen the load on the volatile power network.

Municipalities in good financial standing will be able to procure their own power from independent power producers.

A pronouncement will be made soon that will enable the development of additional capacity from renewable energy, natural gas, hydro power, battery storage and coal.

Ramaphosa also told Parliament  the dreaded power blackouts "will remain a possibility for the immediate future".

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