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Eskom offices
Finance Minister Enoch Godongwana says escalating municipal debt poses a risk to Eskom’s improved financial performance. Godongwana was tabling this year’s Medium Term Budget Policy Statement (MTBPS) in Parliament.
Godongwana is pleased by the positive progress shown by Eskom this year. For the first time in nearly a decade, the power utility has reported a profit.
There are also fewer days of power cuts recorded this year.
“Not long ago, our country was on the brink of an energy crisis. Unreliable electricity supply threatened to derail our economy and the transformation of our society. I am pleased to say we have avoided this scenario and instead have begun a march towards a reliable supply of energy. Load shedding has significantly come down,” says Godongwana.
However, the Finance Minister is concerned about the devastating impact of municipal arrears on Eskom. The arrears have increased from R55. 3 billion to R94. 6 billion in a year, as recorded at the end of March this year.
Municipalities owe their creditors a total of R156. 1 billion, and in return, they are owed R427. 7 billion. Government departments are also among the culprits.
Godongwana is also concerned about other state-owned entities that are under financial distress, including Transnet, Denel and the Road Accident Fund.
To date, Transnet has received support of around R200 billion from government.
Video: Medium-Term Budget Policy Statement 2025
