Eskom “Greatest Hindrance” To SA Economic Growth – Cosatu

Eskom came under fire at the KZN Economic Council Summit in Durban when Cosatu parliamentary convenor Matthew Parks highlighted the negative impact the parastatal was having on the country’s economic recovery.
The country’s largest trade union’s parliamentary coordinator, Matthew Parks, highlighted how SEOs such as Eskom, SAA, the Post Office and others were not structured in line with the economic growth needs of the future.
Parks described Eskom, which still generates 95% of the country’s electricity  as “the greatest obstacle to economic recovery” and the “greatest threat to fiscus and state sovereignty.”
“Eskom has a bloated management. The economy needs reliable and affordable electricity and tariff hikes are suffocating the economy,” Parks said.
He said Eskom’s burgeoning debt burden of R424 billion was unsustainable and the government should intervene to avoid “Eskom implosion and economic chaos”. He said debt relief should focus on maintenance and generation investment.
Parks said bloated management at Eskom should be reduced, while those accused of corruption, and wasteful expenditure should be criminally prosecute. However, he said Cosatu was against privatisation of Eskom.
There is a pandemic of wasteful and fruitless expenditure. We must review all contracts, including coal because we often find that looting is taking place,” Parks said.
Parks said new Independent Power Producers tariffs should be market related and not subsidised by Eskom, while  workers and communities should be supported to become the owners of renewable energy generation systems.
He added that all buildings should install locally produced solar panels and automobile manufacturing plans should convert to producing electric and hydro-powered vehicles.
Parks said other SEOs, such as SAA had collapsed because of “corruption, mismanagement and structural changes” while others such as the SABC and the Post Office faced the risk of failure.
He said bail outs were unsustainable and the structure of SOEs needed to change to meet future needs.
“The 1950’s model for SOES does not work to meet the needs of the 21st century,” Parks said.
“SOEs must serve the strategic needs of the state and fulfill the roles the private sector cannot or should not fulfil. SEOs must not be a burden to the state or a hindrance to the economy,” he said.