Molefe still wants old job back
Former Eskom CEO Brian Molefe still believes he should get his job back and will today apply for leave to appeal against a damning court ruling that he must pay back the golden handshake of over R30 million he received.
Molefe will seek leave to argue his case before the Supreme Court of Appeal in Bloemfontein, that a full bench of the High Court in Pretoria had erred in ruling that former public enterprises minister Lynne Brown’s decision to reinstate him in May last year had been unlawful and irrational and that he should pay back his early retirement package.
In January, the court found that as an employee with a five-year fixed term contract, Molefe had not been entitled to receive any pension benefit, that any payments made to him were patently unlawful and that he had voluntarily resigned at the end of 2016.
The judges found Eskom’s decision to waive penalties and buy Molefe an extra 13 years of service totalling R30,1 million after only 15 months service at the age of 50 “stretched incredulity”, was unlawful and did not comply with the rules of Eskom’s pension fund.
They found that Brown and Eskom had acted irrationally by ignoring damning allegations in the public protector’s State of Capture report that Molefe had abused his position to benefit the Gupta family in the improper and possibly corrupt awarding of state contracts.
Molefe maintained the court had erred in finding that he had resigned and that his departure was unrelated to the early retirement agreement he concluded with Eskom.
He said the court should have found he was not entitled to early retirement on the basis of the agreement with Eskom due to a “common error”, that his employment had therefore not been terminated and the legal consequence of this was he should be reinstated.
He said the court had also failed to take into account the R4 million that was transferred to the Eskom pension fund by the Transnet provident fund, his contributions and the interest on it to which he was entitled when ruling on the amount he must pay back.
National power utility Eskom yesterday tried to allay fears that its regulatory clearing account application would lead to a 30% tariff increase, when it presented its case to recover costs already spent in the provision of electricity.
Public hearings into Eskom’s application to make up for revenue variances kicked off in Cape Town yesterday, and will take place across the country over the next three weeks. Eskom is trying to recoup R66.6 billion through its regulatory clearing account (RCA) applications to National Energy Regulator of South Africa (Nersa).
The RCA is a regulatory mechanism which allows Eskom to make up for the over or under recovery of costs as the multi-year tariff adjustments are based on forecasts.
Phakamani Hadebe, Eskom’s interim group chief executive, said the company’s sustainability depended on a sound regulatory environment aligned with exist- ing Nersa rules and other legislative requirements. “We therefore rely on Nersa to review our application in line with the multi-year price determination (MYPD3) methodology, which is a globally-accepted regulatory principle that reconciles variances between the projected and actual revenue and costs that Eskom incurred for certain elements,” Hadebe said.
“We have spent the money in the implementation of our mandate of providing electricity to South Africans by raising debt as it was not included in the revenue decision and need to repay those loans accordingly to ensure credibility with our lenders.”
Eskom’s application only covered costs incurred efficiently and prudently as allowed by the RCA mechanism, he added. “We are aware and mindful of people’s concerns. It is therefore important to note that Eskom is on a path of recovery on governance issues that have marred our organisation in the recent past.”
Calib Cassim, acting chief financial officer, said Eskom was not expecting a once-off adjustment, but rather a phasing-in of the liquidation over a few years to make it manageable for consumers. “We need to emphasise that this is a retrospective process where we apply to recover costs that have already been incurred by Eskom, but cover what the regulator deems efficient and prudent.”