Municipal debt to Eskom reaches R17-billion

CAPE TOWN - The debt owed to Eskom by South Africa's municipalities continues to grow and had now reached R17-billion, Cooperative Governance Minister Zweli Mkhize told MPs on Tuesday.

"We have noted that debt stood at R14.3-billion and currently has gone up to R17-billion -- and that's just for Eskom -- and a similar rise is there for the water aspect," Mkhize said.

He was briefing Parliament's standing committee on public accounts on the work of an advisory panel established to look into the systemic problem of municipalities' debt owed to Eskom and water boards for bulk electricity and water provision.

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While the panel had concluded its work "on the electricity side", more work needed to be done on the debt owed to water boards.

Mkhize said a report had been tabled in the interministerial committee (IMC) on governance and administration, and the IMC would meet again this month to process the report and its policy recommendations. 

Some of the recommendations include installing prepaid smart electricity meters, establishing an independent collection agency for municipal debt and revenue, and reviewing the interest rate charged by Eskom to bring it in line with the Public Finance Management Act.

The act stipulates a standard interest rate must be levied on debt owed to the State.