Deputy President David Mabuza says the Department of Co-operative Governance and Traditional Affairs (Cogta) and Eskom are in talks to finalise the Service Agreement Plan which will see the power utility taking over revenue collection in some cash-strapped municipalities. Photographer Ayanda Ndamane African News Agency (ANA)
Deputy President David Mabuza says the Department of Co-operative Governance and Traditional Affairs (Cogta) and Eskom are in talks to finalise the Service Agreement Plan which will see the power utility taking over revenue collection in some cash-strapped municipalities. Photographer Ayanda Ndamane African News Agency (ANA)

Mabuza: Talks to finalise revenue collection agreement between Eskom and municipalities under way

By Tarryn-Leigh Solomons Time of article published Jun 19, 2021

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Deputy President David Mabuza says the Department of Co-operative Governance and Traditional Affairs (Cogta) and Eskom are in talks to finalise the Service Agreement Plan which will see the power utility taking over revenue collection in some cash-strapped municipalities.

The North Gauteng High Court in Pretoria granted a final order on June 8 that mandates Eskom to act as an agent for the struggling Maluti-a-Phofung municipality in Harrismith and execute electricity distribution on its behalf.

Mabuza was answering questions in the National Council of Provinces (NCOP) this week.

“Our expectation is that the concerned parties will reach an understanding on the modalities to give effect to the court order in the Harrismith Business Forum and Afgri Operations matter of the June 8 by concluding a working agreement that is in the best interest of the Maluti-a-Phofung Local Municipality, the residents and Eskom as soon as the end of this month.

“In terms of the court agreement, it is envisaged that Eskom will, subject to Nersa approval, start to operate as a service delivery agent within that municipality.

“This appointment is based on terms contained in the active partnering proposal which was submitted by Eskom to the municipality on December 8, 2020,” said Mabuza.

At this level, Mabuza says the turnaround time is estimated to be more than the two weeks as ordered by the court.

“Given the urgency of the matter, the department of Cogta is facilitating engagement between the affected stakeholders which include Eskom and the municipality to finalise the Service Level Agreement.

Mabuza said the purpose of the agreement is to allow Eskom to take over the distribution of electricity, collect the revenue after that.

“Eskom will then give to the municipality what is due to the municipality out of the revenue collected and also take revenue that belongs to Eskom.

“But also, in this case, Eskom is going to bring the necessary skills that will help to maintain the infrastructure that brings the electricity meaning the people.

“We are going to follow such a model who are all owing Eskom because municipalities on their own are unable to pay Eskom… so allow Eskom to distribute and collect the revenue.”

He has also appealed to the public to desist from vandalising infrastructure that brings water and electricity.

“Part of the challenges raised in the NCOP which led to our ongoing intervention in Maluti-a-Phofung Local Municipality were protests as a result of disruption of services like water, electricity and sanitation.

“Our experience thus far from the oversight visits that were undertaken as well as our interactions with local structures and provincial administrations reaffirm the effective intervention to address provision of services, a part which requires leadership and requisite skills.

“Apart from the government’s challenges resulting in the municipality being placed under administration, is prevailing distance between the municipality and the people.

“Part of our focus has been on facilitating inter-government collaboration, reinforcing public participation will resolve these prevailing challenges within the municipality.

“We are hopeful that this will continue, more so as the municipality implements a court order around the provision of electricity and it’s management going forward.

“This multi-sectoral partnership set up is critical.

“Any solution to prevailing challenges will be championed by the residents of the municipality to ensure their sustainability.

“This has been our emphasis during engagements.”

Mabuza said while the issue of reliable provision of water has been one of the pressing issues in the municipality, due to constant interruptions of electricity, they found that the sustainable resolution to this issue would depend on resolving the municipality’s escalating debt to Eskom.

Political Bureau

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