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As we were reminded during the latter years of the Zuma kleptocracy, South Africa is well-served by a flotilla of civil society NGOs. Among the very best is the Helen Suzman Foundation whose latest report on Eskom, issued yesterday, makes for riveting if depressing reading.
The HSF unpacks how corruption and incompetence during the building of Medupi and Kusile ballooned the utility’s debt to over R450bn. So Eskom now needs R45bn every six months to service its borrowings – four times more than the free cash it generates. Put another way, Eskom is short R6bn a month.
In February’s national Budget, R23bn was gifted to the utility by taxpayers for each of the next three years. But that will only cover four months of annual shortfalls. On HSF’s numbers and by Treasury’s admission, that’s woefully inadequate. Eskom, also, is unsellable. And no economy can function without electricity.
There’s only one solution: taxpayers will be forced to bail out this disastrous monopoly. Eskom is a sickening example of a hopelessly impractical “Developmental State” ideology. The Soviet Union collapsed in 1990 for very good reason. It’s high time all of South Africa joined the real world.
Cyril Ramaphosa: The Audio Biography
Listen to the story of Cyril Ramaphosa's rise to presidential power, narrated by our very own Alec Hogg.