Eskom declares dispute with Lesedi Local Municipality over R125m debt

Eskom declares dispute with Lesedi Local Municipality over R125m debt

Eskom has declared a dispute with the Lesedi Local Municipality after exhausting all avenues to recover the millions of rand the municipality owes the power utility.

The Lesedi Local Municipality’s current debt owed to Eskom was a R125 million as at 30 June 2023.This is compounding debt from June 2022 when the municipality started to default on its payments.


Lesedi refuses to pay

Eskom spokesperson Daphne Mokwena said the dispute has been declared in line with the Intergovernmental Relations Framework Act (IRFA).

“In January 2023, Lesedi submitted a payment proposal to Eskom to settle the arrear debt, which Eskom accepted on the condition that it would continue to service its monthly current account.

“However, the municipality defaulted on both the repayment and the current account by failing to settle the April 2023 invoice of R20 million that was payable on 29 May 2023, and only paid R7 million,” Mokwena said.

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Outstanding millions

Mokwena added that the May 2023 invoice of R21 million which was due on 29 June 2023 remains unpaid.

“Eskom has issued the June 2023 invoice of R38 million and that is payable on 27 July 2023. Failure to service debt by Lesedi Local Municipality and other defaulting municipalities burdens the power utility’s revenue streams, ultimately affecting service delivery.

“This further puts a strain on Eskom’s finances and its ability to operate effectively,” Mokwena said.

Tshwane Eskom debt

Last month, the City of Tshwane came under the spotlight again for defaulting on its Eskom bill which soared to R1.9 billion.

While Eskom had escalated the matter to National Treasury and the Department of Cooperative Governance and Traditional Affairs, it said there had been no progress.

The City of Tshwane said it had taken note of Eskom’s demand, pointing to the city’s debt.

Mayoral spokesperson Sipho Stuurman confirmed Tshwane’s systems and controls essential to the city’s long-term financial sustainability were “woefully inadequate”.

Tshwane has become a serial defaulter over the past two years.

In January, the auditor-general (AG) flagged it for “serious irregularities” and for failing to submit the correct financial statements for the July 2021 to June 2022 financial year.

ALSO READ: Pay up: Tshwane’s unpaid Eskom debt soars to nearly R2 billion

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