South Africa’s Cosatu Calls for Removal of Eskom Board, Gordhan

(Bloomberg) --

South Africa’s biggest labor group called for the entire board of Eskom Holdings SOC Ltd. to be dismissed, along with Public Enterprises Minister Pravin Gordhan, citing mismanagement of the state-owned utility’s operations and finances.

“This board has been there for two years and they don’t have a strategy or turnaround plan and they don’t seem to have a funding plan except to dismantle Eskom,” Sizwe Pamla, the national spokesman of the Congress of South African Trade Unions, said by phone on Friday. “On top of that we have load-shedding, so heads must roll.”

South Africa’s Cosatu Calls for Removal of Eskom Board, Gordhan

The debt-laden state utility, which is overseen by Gordhan, shed as much as 6,000 megawatts from the national grid last month, the most yet. It resumed rolling blackouts on Jan. 4, despite assurances from President Cyril Ramaphosa that there would be no power cuts until Jan. 13. While it eased the cuts on Friday, Eskom said the grid remained vulnerable to unplanned outages or breakdowns.

Deputy President David Mabuza said Eskom and Gordhan had misled Ramaphosa when they told him there would be no power cuts until mid-January, News24 reported earlier this week.

The crisis is beginning to taint Ramaphosa’s credibility, Pamla said. “This was supposed to be an era where things would be done differently,” he said. “When we hear a deputy president say we were misled it also calls into question President Ramaphosa’s credibility and this is a crisis that is now dragging him into the situation.”

The utility, which is saddled with debts of about 450 billion rand ($32 billion) and depends on government bailouts to operate, says it may need further help to survive. While cabinet appointments are the president’s prerogative, Cosatu, which was instrumental in Ramaphosa’s rise to the ruling party’s top spot, is lobbying for Gordhan’s removal, Pamla said.

“If Gordhan is unable to hold these board members accountable then as the political deployee, he must fall on his sword,” Pamla said. “We can’t bully him but we are putting this forward to President Ramaphosa for his consideration.”

Department of Public Enterprises spokesman Sam Mkokeli didn’t immediately respond to a text message or phone calls seeking comment.

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