Gauteng MEC for Economic Development and Finance, Lebogang Maile, held a media briefing regarding his plan to save the Emfuleni municipality. 

This is after the court's attachment of Emfuleni's four bank accounts for owing over R8 billion to Eskom.

EMFULENI IN CRISIS

Maile said today they met with the mayoral committee led by the mayor and managers of the municipality, as well as the treasury.

"This is a follow up to a meeting we had on Wednesday on the 18th and the basis for these meetings was for the Gauteng provincial government to gain a comprehensive understanding of the municipality's finances and to be able to ascertain the nature of the assistance that can be provided."

He said the key issues deliberated upon include the municipality's debt to Eskom from the audit outcomes of the 2022/2023 financial year.

"On the 11 of September as you know by now the Sherif of the court successfully attached the Emfuleni's four bank accounts on instruction from the power utility Eskom, which is owed just over R8 billion by the municipality. This was done to ensure that the money collected for electricity is paid directly to Eskom."

Maile said the amount owed by the Emfuleni local municipality represents approximately 10% of the total R82 billion owed by the municipalities and is among the top three municipal debts to Eskom.

"This situation is of concern to the Gauteng provincial government. Firstly without its bank accounts, the municipality will be unable to pay for critical services impacting on its service delivery mandate, because they must also pay other services like water, security, rental, fuel for vehicles etc."

He said secondly, the inability of the municipality to sell electricity directly to the consumer means it is unable to generate much needed revenue.

"This will plunge the municipality into a cycle of debt. Thirdly the failure of Eskom to collect debt owed has devastating consequences that affects the broader provincial economy. The municipality's failure to pay for bulk electricity comprises Eskom's financial stability and its ability to provide affordable electricity. Under these circumstances Eskom is compelled to increase electricity tariffs which will adversely affect households that are already under strain."

CHANGE THE GAME PLAN

Maile said at this critical point Gauteng treasury needs to intervene in the matter of Emfuleni local municipality.

"We are already saying to the municipality your structure is too big, you must look at reducing it significantly and we are suggesting that they scrape vacancies that are not important. They must now implement strict measures, unfortunatel,y if they are to get out of this situation. We will help them but it requires the municipality to be decisive and take responsible action."