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Eskom goes after contractors over R4bn Kusile over-payment
One of the power stations that were meant to be the saviour of South Africa’s power supply is causing controversy, even before it’s in full working order. In an explosive letter, Public Enterprises Minister Pravin Gordhan named contractors that he says Eskom over-paid by R4 billion, in the construction of Kusile power station. Sikonathi Mantshantsha, National Spokesperson of Eskom joins CNBC Africa for more
Thu, 09 Jul 2020 17:45:20 GMT
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AI Generated Summary
- Eskom uncovers R4 billion over-payment scandal at Kusile power station, implicating contractors in fraudulent activities aimed at enriching individuals within the organization.
- Public Enterprises Minister Pravin Gordhan and Eskom's management team spearhead efforts to review major contracts and recover misappropriated funds to address systemic inefficiencies.
- South Africa faces potential power shortages as Eskom grapples with operational challenges and urges citizens to conserve electricity to prevent load-shedding.
In a recent turn of events, Eskom, the South African electricity public utility, has found itself embroiled in a scandal involving over-payments to contractors at the Kusile power station. The controversy, which amounts to a staggering R4 billion, was unearthed by the current management team at Eskom, led by Public Enterprises Minister Pravin Gordhan. The investigation revealed that the contracts in question were inflated beyond reason, leading to suspicions of criminal activities aimed at enriching a few individuals within the organization's ranks.
Sikonathi Mantshantsha, the National Spokesperson of Eskom, shed light on the matter in an interview with CNBC Africa. He emphasized that the over-payments were not a result of an innocent mistake but rather a deliberate attempt to defraud the organization. These revelations have prompted Eskom to review all its major contracts for any signs of irregularities and suspicious activity. Mantshantsha indicated that the company is committed to recovering any misappropriated funds to ensure accountability and transparency within the organization.
The issue at hand extends beyond just the Kusile power station, with mentions of similar challenges at Mujipi and the Angular power station. The ballooning costs of these projects, surpassing their initial budgets by more than double, have raised concerns about the rampant inefficiencies plaguing Eskom's operations. Mantshantsha underlined the importance of conducting thorough reviews and investigations to identify and rectify any instances of corruption or malpractice.
As Eskom grapples with the fallout from the over-payment scandal, another pressing issue looms on the horizon – the potential for power shortages in the coming days. Despite efforts to mitigate the impact of the COVID-19 pandemic on electricity demand, Eskom faces the risk of disruptions that could necessitate load-shedding measures. Mantshantsha acknowledged the inherent unreliability of the power stations and urged South Africans to be mindful of their electricity consumption to avert any imminent crises.
The intersection of financial mismanagement and operational challenges at Eskom underscores the urgent need for systemic reforms and stringent oversight within the organization. The revelations surrounding the Kusile over-payment scandal serve as a stark reminder of the far-reaching consequences of corruption and the imperative of accountability in the public sector.
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