Necsa opts to defer licence fees in bid to stay afloat

The Nuclear Energy Corporation of SA (Necsa) “is exploring various options to keep afloat deferred licence” fees for the first and pay employees salaries at the end of March, and have quarter of 2020.

Necsa had hoped to borrow R45m from subsidiary NTP Radioisotopes, but this request was reportedly declined.

Necsa is the custodian of the country’s nuclear programmes, which include a medical radioisotopes business that manufactures nuclear medicine for cancer treatment, and a fluoro chemical manufacturer.

The corporation is one of several state-owned companies that became dysfunctional during the Jacob Zuma administration.

It has posted losses every year since 2014, with the exception of 2019, during which an adjustment of assets was made to the balance sheet. Necsa’s next tranche of funding from the Treasury of R500m will become available only on April 1.

Salaries for the past three months have been paid from funds that were ring-fenced for particular projects.

NTP Radioisotopes declined to comment on the loan request, but insiders said that it had agreed this would probably have been in contravention of the Companies Act, which requires subsidiaries to pass the liquidity and solvency test before making a loan.

Necsa said on Monday that it was “prioritising the payment of salaries while negotiating deferment of settling some of its commitments with key contractors until it receives the grant allocation in April 2020”.

Among the payments that Necsa has deferred are licence fees to the National Nuclear Regulator (NNR).

Spokesperson Gino Moonsamy said on Monday that licence fees for the Pelindaba site and the Vaalputs national radioactive waste disposal facility for the first quarter of 2020 had been deferred by agreement.

Licence fees are used to pay NNR staff for services rendered to licence holders. Moonsamy said that the regulator was satisfied there would not be a knockon effect and that the NNR was confident it could meet all its commitments.

Necsa’s new board, chaired by former Eskom nuclear head David Nicholls, hopes to restore the nuclear-medicine facility, which was closed by the NNR, to its former status as a world market leader. “The board is determined to bring Necsa up to its full potential. It is an SA strategic asset and an important player on the global market as a producer of nuclear medicine, supplier of nuclear components and fluorochemicals,” Nicholls said.

The branch chair of the National Education, Health and Allied Workers’ Union at Necsa, Zolani Masoleng, said that unions would be meeting management on Friday.

Masoleng said the unions were confident that through reprioritisation of spending, salaries would be paid.

“From where we sit, we don’t anticipate any problem,” he said.

NECSA PRIORITISING PAYMENT OF SALARIES WHILE NEGOTIATING DEFERMENT OF SETTLING SOME OF ITS COMMITMENTS

THE BOARD IS DETERMINED TO BRING NECSA UP TO ITS FULL POTENTIAL. IT IS A STRATEGIC ASSET AND PLAYER ON THE GLOBAL MARKET