The National Treasury has outlined a strategy to cover municipal electricity debt.
On top of taking over R254 billion of Eskom’s debt, taxpayers will also be footing the bill for a separate debt relief programme run by National Treasury to bail out municipalities that can’t pay their electricity bills.
As of the end of 2022, South African municipalities owe Eskom R56.3 billion – a figure which is increasing daily. Eskom has flagged municipal debt as one of the key drivers of its finance issues. Under these conditions, there are various initiatives for municipalities to determine cost-reflective tariffs, use water and electricity as collection tools, maintain revenue collection in terms of a minimum average quarterly collection from proper rates and service charges, as well as enforce accountability through consistent monitoring and reporting to the National Treasury.
Eskom could also continue legal proceedings with non-paying municipalities and attach the municipal bank account.
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