Mashatile to answer questions on Eskom, grey list

Deputy President Paul Mashatile will for the first time on Thursday take a seat in the National Assembly during a hybrid plenary for oral reply to MPs’ questions.

Mashatile will be subjected to six questions covering matters of national importance including the Financial Action Task Force (FATF) grey list, the municipalities’ debt to state-owned power utility Eskom and water entities, and the illegal theft of electricity and water.

Said the Presidency: “The questions that have been asked relate to the resolution of municipal debt to Eskom and water entities, government’s response to illegal electricity connections, sabotage of critical economic infrastructure, and shortages in the availability of animal vaccines, among others.

“The deputy president will therefore reiterate measures that government has taken thus far to resolve municipal debt to Eskom, as well as update the NCOP [National Council of Provinces] on developments since he answered questions on the issue in the National Assembly on March 23 2023.

“He will also apprise parliament of the government’s commitment to implementing measures to protect infrastructure critical to the delivery of water, electricity, sanitation, and other public services.”

The grey list

In February, the international financial crime watchdog FATF added South Africa and Nigeria to its grey list due to poor anti-terrorism and money-laundering controls.

South Africa has been a member of FATF since 2003, and a mutual evaluation report highlighted vulnerabilities in the country’s system to curb money-laundering.

Finance Minister Enoch Godongwana said at the time that the country had made substantial progress in addressing these weaknesses, but still needed to prepare for the worst.

Two laws were enacted to address the technical deficiencies in the legislative framework.

FATF said that although the country had made progress, it would still be monitored.

“When the FATF places a jurisdiction under increased monitoring, it means the country has committed to resolving swiftly the identified strategic deficiencies within agreed timeframes and is subject to increased monitoring,” it said.

Intervention for Eskom debtors

About 96 municipalities across South Africa owe Eskom an estimated R56-billion. The power utility is facing multiple problems of its own including financially unsustainable models and an inability to provide electricity to communities.

In February, Godongwana announced that the government would absorb 70% of Eskom’s debt as part of its intervention plan.

The plan involves leveraging a R254-billion debt relief package and requires participating municipalities to meet strict criteria including making regular payments and installing smart prepaid meters.

Defaulting municipalities that fail to apply for debt relief face having their electricity operations taken over by the National Treasury and their distribution licences revoked.

Illicit electricity market

Electricity thieves within Eskom and City Power in Johannesburg have allegedly been selling electricity tokens illegally, causing the power suppliers to lose millions of rands and resulting in huge financial losses for the power supply entities.

Criminal syndicates use social media to lure potential clients and collude with managers and employees of Eskom to defraud the system.

Sunday World reported in January that investigators say the criminal activities are hampering Eskom’s efforts to recover from bankruptcy as it fails to collect revenue.

These criminal syndicates operate on a large scale from different areas across the country and even sell electricity to pensioners at pay-point stations, including big factories and workshops, and illegal mining companies.

The method used by the syndicates is called “Pepeta”, which allows clients to buy one electricity voucher and get another free of charge.

Investigations into the matter have revealed that staff members at Eskom IT customer care divisions work with syndicates to fully operate vending machines offline.

For more information read: Financial crime watchdog adds SA to group of greylisted states

Phosa’s SUM offers solution for municipalities to clear Eskom debt

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