Eskom has attached a bank account belonging to the Matjhabeng local municipality, which includes the Free State town of Welkom, in response to R3.4-billion in outstanding debt for the provision of bulk electricity.
In a statement, the state-owned utility said it had secured a court order in 2014 against the municipality, which resulted in the account being frozen.
“Eskom is in the process of establishing the balance and transferring the funds in the account to Eskom to help recover some of the money owed by the municipality,” it said.
“Eskom will continue to explore all available legal avenues to ensure that outstanding municipal debt is recovered. This step on the part of Eskom is a result of the repeated failures by the municipality to adhere to its payment obligations for the bulk supply of electricity. Since 2020, Eskom has only received five payments from the municipality amounting to R66.5-million, against a total bill of R1.3-billion for the period.”
Failed to honour
It said it has launched “numerous” court processes since 2014, when the municipality’s outstanding debt totalled R372-million, and employed other collection mechanisms to recover the funds. “The municipality has consistently failed to honour its obligations and payment agreements, as well as court orders, resulting the debt escalating to R3.4-billion over the period.
“Total outstanding municipal debt of R31-billion as at end-July 2020 continues to threaten Eskom’s sustainability. Municipalities have a responsibility to fulfil their financial obligations for the bulk supply of electricity,” Eskom said. — (c) 2020 NewsCentral Media