How world sees SA: Power monopoly Eskom removes CEO implicating politicians in corruption amidst worst ever rolling blackouts

In the below article the FT of London reports on Eskom’s removal of CEO, André de Ruyter, with immediate effect after he implicated senior politicians of the ruling African National Congress in corruption that worsened the country’s rolling blackouts. De Ruyter alleged that Eskom was under the grip of organised crime, with at least four crime cartels infiltrating the coal plants. He also claimed that a high-level politician was involved in corruption and that a senior minister had asked him to “enable some people to eat a little bit” after he expressed concern over the governance of $8.5bn in climate financing.

Eskom chief ousted after TV broadside against South Africa politics

By Joseph Cotterill

South Africa’s struggling Eskom power monopoly has removed its outgoing chief executive with immediate effect after he implicated senior politicians of the ruling African National Congress in corruption that is exacerbating the country’s worst ever rolling blackouts.

André de Ruyter, who survived an alleged attempt to kill him with cyanide-laced coffee last year, departed on Wednesday just a month before he was scheduled to leave anyway after resigning from the utility. Eskom is responsible for nearly all of South Africa’s power supply.

Eskom said its board had resolved that de Ruyter “will be released from his position with immediate effect” a day after the airing on South African television of an explosive interview in which he alleged that Eskom was in the grip of organised crime. An acting chief executive is yet to be appointed.

De Ruyter, who resigned in December after three years in post following a loss of political support from the government of President Cyril Ramaphosa, also told South Africa’s eNCA television that even worse outages might follow the power cuts of up to 12 hours a day that are already throttling Africa’s most industrial economy.

The cuts are being driven by the collapse of Eskom’s workhorse fleet of ageing coal power stations, alongside delay in investing in new supply. De Ruyter’s abrupt exit after revelations on the extent of looting of the coal plants, such as infiltration by what he claimed were at least four crime cartels, will increase concerns that the government lacks the political will to fight graft linked to Ramaphosa’s own party.

Read more: Eskom’s slow political death, SA probably in recession and greylisting a fait accompli – Economist Dawie Roodt

De Ruyter said he had raised concerns over the involvement of a “particular high-level politician” in corruption but had been brushed aside by a minister. He added that a senior minister had told him “you have to enable some people to eat a little bit” after he expressed concern over the governance of $8.5bn in climate financing that South Africa will receive from western governments to help fund the country’s transition to green energy.

In his last months as chief executive De Ruyter clashed in particular with Gwede Mantashe, the energy minister who controls power procurement. That culminated in Mantashe accusing De Ruyter of treason last year. “It seems rather odd a board would force out a CEO after an interview raising the widely known issue of rent extraction in and between the government and Eskom,” said Peter Attard Montalto, head of capital markets at Intellidex, the South African research firm. “A live wire has clearly been touched and the board has succumbed to political interference to remove him,” Attard Montalto added.

Pravin Gordhan, the minister overseeing Eskom and other state-owned companies, said before the announcement of de Ruyter’s departure that his comments in the interview were “unfortunate” and that “CEOs of any entity should not be involved in open political debates or assertions”.

Read more: Budget 2023 – Temptation resisted, Eskom mettle grasped. It could have been much worse.

In the interview, De Ruyter also sharply criticised the ANC itself over policies of state intervention, which he said bemused foreign investors. “The ghosts of Marx and Lenin still haunt the halls” of the party’s headquarters, he said.

Of his own brush with death in December, when he became violently sick on the day he resigned after allegedly drinking poisoned coffee in his office, De Ruyter expressed little hope that it would be investigated. Police sent to probe the matter had confused cyanide with sinusitis, he said.

As Eskom’s threat to the economy deepens, on Wednesday the South African National Treasury also announced a plan to backstop the majority of the utility’s R400bn ($22bn) debt burden.

The state will meet Eskom debt payments due in the next three years, and will take over a portion of the utility’s loans in future.