Eskom’s Integrated Report 2015 on the entity’s financial performance for the 2014/2015 financial year shows clearly that the power utility is in a financial crisis‚ with revenue having fallen from R7 billion to R3 billion during the period under consideration‚ the Democratic Party says.
The report also reveals that an amount of R51 million was incurred on fruitless and wasteful expenditure – and that the entity had a high failure rate in terms of performance targets met‚ DA spokesperson for public enterprises Natasha Mazzone said on Sunday.
Yet‚ Eskom still spent an exorbitant R50 million on executive salaries over this period‚ with an additional R10.8 million being paid out for long-term incentive bonuses. This amounts to R1.4 million per executive member‚ Mazzone added.
“The current executives at the helm of this failing entity are performing dismally. It is extremely unjustifiable that they are receiving these exorbitant pay checks and bonuses‚” she stated.
She said the DA would write on Sunday to the Chairperson of the Portfolio Committee on Public Enterprises‚ Dipuo Letsatsi-Duba‚ to request that Public Enterprises Minister Lynne Brown and Deputy President‚ Cyril Ramaphosa‚ who chairs government’s energy “war room“‚ appear before the committee to give a “full explanation for the dramatic decline in income and massive increase in costs”.
“It is they who must take full responsibility for the poor management at Eskom.
“Minister Brown must also explain to the committee why these unacceptably high salaries remain in place – and what she is going to do to decrease these salaries to a more appropriate level for the future‚” Mazzone stated.
According to the report‚ she said‚ the net profit of the group after tax declined from R7.1 billion in 2014 to R3.6 billion in 2015‚ with Eskom putting this down to the increased usage of the Open Cycle Gas Turbines and subsequent fuel costs incurred through using diesel to power these turbines.
“Of the 37 performance targets‚ Eskom only met 51 % of its performance targets.
“Of those targets not met‚ the most significant are:
•The Energy availability factor: Target was 80%‚ Actual was 73.73%
•Generation capacity installed and commissioned: Target 433 MW‚ Actual 100 MW
•Interest cover: Target 0.69‚ Actual 0.44
•Debt/Equity: Target 2.48‚ Actual 2.70
•Free funds from operations as % of gross debt: Target 7.63%‚ Actual 2.37%
•Outstanding maintenance backlog: Target 1‚ Actual 2
•Unplanned capability loss factor: Target =10%‚ Actual 14.22%
“In November last year‚ the DA called on Minister Brown to freeze bonuses for Eskom executives’ until performance at the parastatal improves. In March this year‚ we called to an end in large bonuses to Eskom executives and repay them.
“It is now high time this matter is addressed. The current energy crisis has caused economic growth to grind to a halt‚ leaving unemployed South Africans very little hope of finding work‚” Mazzone asserted.
Eskom forks out R50m in salaries for top executives‚ says DA
Eskom’s Integrated Report 2015 on the entity’s financial performance for the 2014/2015 financial year shows clearly that the power utility is in a financial crisis‚ with revenue having fallen from R7 billion to R3 billion during the period under consideration‚ the Democratic Party says.
The report also reveals that an amount of R51 million was incurred on fruitless and wasteful expenditure – and that the entity had a high failure rate in terms of performance targets met‚ DA spokesperson for public enterprises Natasha Mazzone said on Sunday.
Yet‚ Eskom still spent an exorbitant R50 million on executive salaries over this period‚ with an additional R10.8 million being paid out for long-term incentive bonuses. This amounts to R1.4 million per executive member‚ Mazzone added.
“The current executives at the helm of this failing entity are performing dismally. It is extremely unjustifiable that they are receiving these exorbitant pay checks and bonuses‚” she stated.
She said the DA would write on Sunday to the Chairperson of the Portfolio Committee on Public Enterprises‚ Dipuo Letsatsi-Duba‚ to request that Public Enterprises Minister Lynne Brown and Deputy President‚ Cyril Ramaphosa‚ who chairs government’s energy “war room“‚ appear before the committee to give a “full explanation for the dramatic decline in income and massive increase in costs”.
“It is they who must take full responsibility for the poor management at Eskom.
“Minister Brown must also explain to the committee why these unacceptably high salaries remain in place – and what she is going to do to decrease these salaries to a more appropriate level for the future‚” Mazzone stated.
According to the report‚ she said‚ the net profit of the group after tax declined from R7.1 billion in 2014 to R3.6 billion in 2015‚ with Eskom putting this down to the increased usage of the Open Cycle Gas Turbines and subsequent fuel costs incurred through using diesel to power these turbines.
“Of the 37 performance targets‚ Eskom only met 51 % of its performance targets.
“Of those targets not met‚ the most significant are:
•The Energy availability factor: Target was 80%‚ Actual was 73.73%
•Generation capacity installed and commissioned: Target 433 MW‚ Actual 100 MW
•Interest cover: Target 0.69‚ Actual 0.44
•Debt/Equity: Target 2.48‚ Actual 2.70
•Free funds from operations as % of gross debt: Target 7.63%‚ Actual 2.37%
•Outstanding maintenance backlog: Target 1‚ Actual 2
•Unplanned capability loss factor: Target =10%‚ Actual 14.22%
“In November last year‚ the DA called on Minister Brown to freeze bonuses for Eskom executives’ until performance at the parastatal improves. In March this year‚ we called to an end in large bonuses to Eskom executives and repay them.
“It is now high time this matter is addressed. The current energy crisis has caused economic growth to grind to a halt‚ leaving unemployed South Africans very little hope of finding work‚” Mazzone asserted.
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