Eskom Will Remain In State Hands – Ramaphosa

South African President Cyril Ramaphosa during his 2019 State of the Nation Address. PICTUREGCIS

CAPE TOWN: There is no single solution to the problems at Eskom, but it will remain 100% state-owned, says President Cyril Ramaphosa. 

Eskom in its current form has a number of challenges that need to be addressed as part of the whole of Government effort: The unbundling of the business is starting to address the structural challenges.

Financially, the reference to cost-cutting should be understood not to mean retrenchments. The preferred strategy in reducing human resources costs will be to offer voluntary packages to staff.

We further need to look at the benefits and perks received by Eskom staff including those offered through Eskom Finance Company (EFC).

We need to jointly ask ourselves whether it makes sense for Eskom to have this business unit and be offering to its staff below market rates finance packages, whose losses are ultimately underwritten by the State.

There are sound, valid and compelling reasons to separate Eskom into different entities. It is not a path to privatisation, as the honourable Malema will have us believe.

The restructuring will reduce the risk of a massive Eskom, that at times has in its current form, been termed too big to fail, placing government in a position where all its eggs are in one basket.

It will align Eskom with international electricity trends, where the vertically integrated electricity utilities have been broken up to enable better regulatory oversight through a single buyer model, increase competition in the generation and distribution space.

A unitary Eskom has proven to be difficult to lead. It has gone through a number of board and executive leadership iterations without trending towards a sustainable operational path.