South Africa’s ongoing electricity and water crises have once again taken center stage, with Wayne Duvenage, CEO of the Organisation Undoing Tax Abuse (OUTA), shedding light on the root causes and potential solutions. In a recent conversation with Alec Hogg, Duvenage emphasized the critical role of government responsibility, efficiency, and accountability, especially in essential services like electricity and water. He also urged citizens to support organizations like OUTA, which fight for transparency and systemic change.
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Electricity Woes: Eskom’s “Death Spiral”
One of OUTA’s main targets has been Eskom, the country’s embattled electricity supplier. Over recent years, Eskom’s inefficiencies and escalating costs have not only drained public coffers but also burdened consumers with steep price hikes. As Duvenage explained, “Eskom’s in a death spiral,” with high operating costs, excessive debt, and a misaligned approach to its core mission of providing affordable and reliable electricity. This bleak trajectory, he argues, began with poor decisions over a decade ago.
Duvenage highlighted a series of missteps that led Eskom to its current crisis. A key turning point was the construction of power stations Medupi and Kusile, which exceeded their budget by a staggering margin. Originally estimated at R70 billion each, these projects ultimately tripled in cost. While the headcount at Eskom rose by 50%, reaching almost 50,000 employees, the energy output stagnated. Despite these bloated expenses, Duvenage noted, “there were no additional electrons being put into the grid.” OUTA’s repeated calls to the National Energy Regulator of South Africa (NERSA) to hold Eskom accountable for spiraling costs and inefficiencies have largely gone unheeded.
One of the key concerns is Eskom’s reliance on costly primary energy sources. As Duvenage pointed out, the shift away from long-term, tied coal contracts has been detrimental, with Eskom now locked into high-priced agreements. Former Eskom CEO Brian Molefe’s decision to “buy bread instead of owning the bakery” has left Eskom with unsustainable supply contracts and an inability to control primary costs effectively. The rising cost of energy has forced South Africans to look to private alternatives, further exacerbating Eskom’s financial struggles.
The Role of Government in Eskom’s Decline
The government’s response to Eskom’s challenges has been substantial financial support, including a R500 billion bailout to address debt and maintain operations. However, Duvenage cautioned that such bailouts are merely treating symptoms without addressing the underlying mismanagement. “Government doesn’t bail anyone out. We do,” he stressed, highlighting that the taxpayers are footing the bill while Eskom’s structural issues remain unsolved.
Read more: Sean McLaughlin speaks to OUTA CEO Wayne Duvenage: An optimistic vision for SA
Poor leadership and a lack of accountability at the state level have deepened Eskom’s woes. Duvenage lamented the long-standing issues with maintenance and managerial oversight, which have led to declining operational stability. “The system comes down,” he said, attributing this collapse to “poor management, poor leadership, and putting people into positions of power who were unfit to run the organization.” Unless government officials prioritize efficiency and cost control, Eskom’s challenges will persist, disproportionately affecting the country’s most vulnerable citizens who cannot afford private energy solutions.
South Africa’s Water Crisis: A Ticking Time Bomb
Duvenage also addressed South Africa’s water crisis, which OUTA has actively been working on through its Water Community Action Network (Water CAN). While the country’s water resources are under threat from aging infrastructure, ineffective management, and rising demand, there has been limited action from local and national governments to mitigate the impending disaster. The situation, he explained, mirrors the failings of Eskom.
OUTA’s Water CAN project uses citizen science to monitor water quality and identify critical issues, as municipalities and national regulators have fallen short. By providing test kits to communities across the country, OUTA is helping South Africans understand the quality of their water and where it is most vulnerable. Duvenage also stressed the importance of water infrastructure maintenance, particularly in urban areas like Johannesburg, where water loss through leaks has become severe.
The lack of accountability in local government is exacerbating these challenges. Many municipalities, Duvenage argued, fail to maintain wastewater treatment plants and other essential water infrastructure. He noted, “raw sewage pumping into our rivers is not a problem for them.” Rather than allocating resources to fix wastewater facilities, municipalities have chosen to invest in other projects, often leaving water issues unaddressed. Duvenage warned that if this trend continues, South Africa’s water crisis could escalate beyond control, with severe health and environmental consequences.
National Intervention and the Need for Systemic Change
The appointment of new Water and Sanitation Minister Senzo Mchunu has brought some hope. However, Duvenage emphasized that overcoming South Africa’s water challenges will require systemic change at both the national and local levels. He suggested that special-purpose vehicles be created to manage essential infrastructure like wastewater treatment plants, as municipalities have repeatedly proven incapable of doing so effectively. Without urgent intervention, he warned, local governments will struggle to finance necessary repairs, and national government will eventually need to step in.
The complexity of the water crisis requires solutions beyond the municipal level. Mchunu, Duvenage said, must find a way to “usurp the executive powers of local government,” which often lacks both the will and the resources to address these pressing issues. He proposed that the national government explore international funding options and take direct control of critical water infrastructure to ensure sustainable management.
Supporting OUTA: A Call to Action for South Africans
In closing, Alec Hogg endorsed OUTA’s work, urging South Africans to support the organization financially. OUTA’s efforts have been instrumental in exposing corruption and inefficiencies in government and advocating for better management of public resources. A monthly donation, Hogg suggested, would help OUTA continue its vital work, from opposing unnecessary electricity rate hikes to tackling the water crisis.
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