Political parties in Parliament expect Finance Minister Tito Mboweni to table how cash-strapped Eskom will be financed.
Experts believe that there’s no escaping, government having to bailout Eskom again. While Mboweni is stuck between a rock and a hard place in his effort to find money to fund Eskom, the ANC believes that he mustn’t cut pro-poor programmes.
Chairperson of Parliament’s Portfolio Committee on Finance Yunis Carrim says, “A key issue is how much will be given to Eskom and on what terms and where will this money come from. Even though it’s in the interest of the poor that Eskom performs, the budget for pro-poor programmes cannot be reduced. Focus should be on non priority programmes and we need of course the overall strategy to turn around Eskom of which any budgetary allocation as the President indicated will only be a mere path.”
Energy analyst Chris Yelland says he expects the Finance Minister to announce a short-term intervention to rescue Eskom. However, he says it would be critical to place conditions on any money the power utility will receive from government.
Yelland spoke of his expectations from Mboweni, who is expected to deliver his maiden main Budget Speech in Parliament on Wednesday.
“In the short term, I can see no other alternative, but for government to step in and give Eskom a bailout as a sum of money or R100 billion which has been talked about. That’s what Eskom would like from government and unless Eskom gets this, it would put Eskom in severe financial circumstances.”
“I am hoping and expecting that there will be a short term intervention. But very important that there should be conditions attached because it is no good just throwing money at a problem.”
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