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Minister of Cooperative Governance and Traditional Affairs Des Van Rooyen. Picture Credit: Gallo Images
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Resignation threatens Eskom funding

By Zukile Majova, Mfundekelwa Mkhulisi, Namhla Tshisela and Reuters | Nov 10, 2009 | COMMENTS [ 0 ]

ESKOM'S multibillion-rand expansion programme could emerge as the biggest loser in the management squabbles at the power utility, economists have warned.

ESKOM'S multibillion-rand expansion programme could emerge as the biggest loser in the management squabbles at the power utility, economists have warned.

Dawie Roodt of the Efficient Group said the resignation of Eskom chairperson Bobby Godsell yesterday could affect the power utility's efforts to attract funding from foreign investors for its R385billion expansion programme.

Godsell's resignation marked the end of a leadership squabble that erupted last week. Non-executive director Mpho Makwana has since been appointed acting chairperson.

Godsell announced that chief executive Jacob Maroga had stepped down amid calls for the board of the utility to resign.

Last night, Makwana was confirmed as acting chairman of Eskom's board.

Public Enterprises MinisterBarbara Hogan confirmed the receipt of Godsell's resignation.

She wished him well and thanked him for his commitment to Eskom in the past 15 months.

Makwana was taking the reins from Godsell "with the full support of the remaining members of the board", Hogan said.

"Godsell leaves as Eskom is in the middle of negotiations with the World Bank for a R23billion loan," Roodt said.

He said the political interference in the governance of the parastatal would scare away potential foreign investors.

"This kind of political interference is never good for investor confidence. Godsell's going is not so much a matter of losing a leader but losing someone with a valuable background," Roodt said.

Ulrich Joubert of Kruger International said: "International investors don't like political intervention. If Godsell resigned because of political interference in the management of the business then it is bad for Eskom and they will have to pay more to get the funding they need."

Political organisations expressed mixed feelings about Godsell's resignation.

The DA expressed dismay at his departure, saying the ANC had chosen "party loyalty over service delivery".

"Godsell was given a mandate to turn Eskom around. When he tried to address one of the biggest stumbling blocks to delivery - poor management of the utility - the ANC played the race card to defend its cadre," said DA leader Helen Zille.

The Congress of the People said it was "disturbed" by reports that President Jacob Zuma had interfered in the governance and running of Eskom.

"Whatever the decisions of the board of Eskom or its management, for the president to interfere in the matter of the continued leadership of the parastatal is absolutely unacceptable," Cope spokesperson Phillip Dexter said.

The ANC Youth League said Godsell's departure was "good riddance", saying it would advance transformation within Eskom.

ANCYL spokesperson FloydShivambu accused Godsell of behaving like an executive chairperson of a private company whose primary focus was to make profits.

"We are saying good riddance that Godsell has left. Eskom must now concentrate on generating electricity and continue with its expansion programme without worrying about people who are againsttransformation."


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