The Minister of Electricity and Energy, Dr Kgosientsho Ramokgopa, met with leaders from Tokologo Local Municipality, the Acting Premier of the Free State, and Eskom officials to address the pressing issue of municipal debt.
This meeting, held as part of ongoing efforts to strengthen cooperation between Eskom and municipalities, focused on finding solutions to the growing debt crisis.
MUNICIPALITY DEBT AT R92 MILLION
Municipalities across South Africa owe Eskom an estimated R92 billion. This debt impacts Eskom’s ability to supply electricity reliably and hinders service delivery to communities.
Smaller municipalities like Tokologo face unique challenges in managing their financial obligations, often struggling to collect enough revenue to cover costs.
Minister Ramokgopa highlighted how the debt problem affects not just Eskom but the broader financial stability of local governments. He pointed out that resolving this issue is critical for ensuring a sustainable energy supply.
Key agreements were reached during the meeting:
- Rates and Taxes Invoice: Tokologo Municipality will invoice Eskom for outstanding municipal rates and taxes. Eskom has agreed to pay this amount, separate from the municipality’s electricity debt.
- Current Account Settlement: Eskom will issue a new bill reflecting only energy charges based on actual consumption. Tokologo Municipality has committed to settling this account.
- Bill Verification: An independent review of disputed electricity bills will be conducted. Both Eskom and the municipality agreed to honor the results of this process.
LASTING SOLUTIONS FOR MUNICIPALITIES
The Minister described these steps as a significant breakthrough. He praised the willingness of both parties to work together, emphasizing that collaboration is key to finding lasting solutions.
This is not the first time Dr. Ramokgopa has stepped in to address municipal debt. Similar interventions have taken place in municipalities like Maluti-A-Phofung in the Free State, Emfuleni in Gauteng, and Emalahleni in Mpumalanga. Common issues include disputes over billing accuracy, high interest rates on overdue payments, and poor revenue collection by municipalities.
While progress is being made, the challenge is far from over. Minister Ramokgopa reported that his efforts were part of a broader strategy to assist municipalities in meeting their obligations while ensuring Eskom remains financially stable.
The Minister has promised to keep the public informed about further developments as similar interventions are rolled out nationwide.
DO YOU THINK THESE MEASURES PROPOSED BY THE MINISTER WILL FINALLY HELP SOLVE THE MUNICIPAL DEBT CRISIS?
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