This past week, the power utility attached the troubled Free State municipality’s bank account on the back of missed payments as per an agreement between the respective parties following court battles in 2018. At present Maluti-A-Phofung owes Eskom a mammoth R5,3 billion. The respective parties have to reach a payment agreement, come 7 August 2020 as ordered by the High Court in the province.

In 2018, the Harrismith Business Forum and thirteen other businesses launched a Free State High Court bid to prevent Eskom from introducing planned power interruptions over Maluti-A-Phofung’s mounting debt - at that stage, the debt had not yet reached the R3 billion mark. In that separate but related matter the business community in the area argued the planned interruptions, threatened the future of their businesses. The High Court not only ruled in the business community’s favour, suspending the planned outages indefinitely, but further ordered that government and all other stakeholders map out a recovery plan for this municipality. Judges Corné van Zyl, Mpina Mathebula and Jacobus Loubser’s order was in accordance with an agreement that was reached by the applicants and the respondents which include, Eskom, the National Energy Regulator of South Africa (Nersa), Ministers of Energy, Finance, Public Enterprises and President Cyril Ramaphosa. The recovery plan was mapped out by a consultative committee, which was made up of representatives from government as well as the business community. It was chaired by a representative nominated by the Minister of Cooperative Governance. It is yet to be confirmed if that recovery plan has been adhered to by the municipality at this point.

Meanwhile Eskom has indicated that outstanding municipal debt as of the end of June is R 30,9 billion. The utility says the debt is threatening its sustainability. This as Eskom recently reintroduced load-shedding.


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