Phakamani Hadebe, Eskom Group Interim Chief Executive Officer conceded today, 30 January 2018, that the state-owned company was facing significant financial challenges stemming from poor leadership, lack of proper corporate governance and its weak capital structure.
“We are where we are because of poor leadership across the spectrum of Eskom. Decisions that were supposed to be taken were nor taken,” says Hadebe.
Speaking during the release of Eskom interim results for the six months ending 30 September 2017, Hadebe says that the power supplier had performed well operationally, but that the company was in dire financial straits.
Eskom chairman Jabu Mabuza says that he had met with South African Public Entreprises Minister, Lynne Brown, to agree on clear defining roles between the newly-elected board of the state-owned power utility and the department in a bid to avoid duplication.
There have been recent instances of mixed messages between the Eskom board and Brown, who represents the Eskom shareholder, where the power utility’s executives allegedly misrepresented facts about the state of the utility to the minister.
Eskom reported that its liquid assets had declined to ZAR9 billion at the end of September 2017 from ZAR30 billion a year previously due to tariff increases of only 2.2 percent and a 1.9 percent decrease in electricity sales volumes, offset by cost containment measures.