Gauteng Premier Panyaza Lesufi wants Eskom to scrap Soweto’s debt and this goes for all townships

It seems Gauteng Premier Panyaza Lesufi is on a mission to remove Soweto's debt to Eskom. Image Via Twitter

It seems Gauteng Premier Panyaza Lesufi is on a mission to remove Soweto's debt to Eskom. Image Via Twitter

Published Oct 31, 2022

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It seems Gauteng Premier Panyaza Lesufi is on a mission to remove Soweto's debt to Eskom.

Moreover, the premier argues that South African townships, hostels and informal settlements should receive ‘debt forgiveness’ from government and, as such, its parastatals like Eskom.

In a tweet last week, Lesufi called on Finance Minister Enoch Godongwana to address these debt needs.

“Minister Godongwana, we truly appreciate how you respect negotiations,” Lesufi said.

“Can we safely assume that the Soweto Eskom Electricity debt and that of other townships is also scrapped, as per our intensive lobby? To start developing townships, the debt must also go.”

It should be noted that according to News24, by the end of September 2022, Soweto owed Eskom close to R5 billion (estimated R4.7billion).

GOVERNMENT HAS DONE THIS BEFORE

There have been cases where the government has forgiven debt and settled billions. The government has said that it will cough up billions to settler Sanral's e-toll debt, and it seems that Lesufi wants the same for Soweto and other townships.

In fact, it should also be noted that the state utility has already scrapped billions in unpaid electricity bills. In 2020 Eskom wrote off almost R8 billion from Soweto’s overdue debt, according to News24.

THE PREMIER EXPANDS ON HIS ARGUMENT

The premier argues that he would like to redevelop townships from their current state and into “centres of growth.”

“Our argument remains, if Eskom debt is taken over by the central government, what our people owe Eskom in townships, informal settlements, and hostels must also be scrapped.”

“We need to reposition our townships, informal settlements and hostels so that they can be centres of growth.”

“Our freedom will be meaningless if our townships, informal settlements and hostels remain the way they are. To start to develop our townships, informal settlements and hostels, we need to take bold steps that will make these areas the new economic growth points”, Lesufi said.

REACTION

It comes at now surprise that many people on Twitter reacted to Premier Lesufi’s comments. This is what a few South Africans had to say:

— 🇿🇦🇿🇦Patriot (@jaybo_1) October 27, 2022
— Kerry Cullinan (@kerrycullinan11) October 27, 2022

THIS MAY NOT BE THE BEST TIME!

This may not be a right time for Eskom to scrap billions of rands worth of debt, given its current financial position and its need for more funding from government.

Eskom is currently scrambling to find funding of R72 billion to upgrade its power grid amid investor scepticism about recovering debt, if you can believe it.

Eskom's quest for a R72 billion injection over the next five years to upgrade over 2 890km of extra high voltage lines and 60 transformers would hit a snag as the power utility does not inspire the confidence of international funders.

Eskom's managing director for transmission, Segomoco Scheppers, said last Friday the entity is placing a strong focus on the implementation of these projects over the next five years.

“The analysis carried out reflects a requirement of close to R72.2bn will be required to expand and strengthen the transmission grid over the next five years,” he said.

Scheppers said: “This requires that some challenges beyond Eskom’s full control, such as the lead time to obtain servitudes, among other relevant authorisations, as well as the resource capacity in the country, be urgently addressed.

Read more on this here!

HAVE YOUR SAY

— Business Report (@busrep) October 31, 2022

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