Demands in Eskom talks could cause financial instability

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Some economists say the unions in the Eskom wage talks are being ambitious by asking for a salary increase of more than 7%. The unions are still consulting their members on the employer’s revised wage offer this week.

This comes after all three unions, including the National Union of Mineworkers, National Union of Metalworkers of South Africa and Solidarity rejected Eskom’s latest 7% offer.

Eskom is reported to have tabled a new offer of 7.5% for this year and 6.5% for 2019 followed by 6.25% in the subsequent year.

Chief economist at the South African Institute of Race Relations Ian Cruickshanks says this could cause financial instability.

“The risk is potentially that Eskom is seen as not being able to afford the repayments and interest on servicing the debts that they have. It’s an ever-growing amount, and international credit rating agencies have already said that Eskom represents one of the greatest threats to the financial stability of the country.”

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