The Mercury

Municipali­ties, Eskom strike win-win deal


DEPUTY President David Mabuza has said the government has entered into a deal with Eskom and municipali­ties for the power utility to take over the collection of rates in defaulting municipali­ties, which owe it more than R30 billion.

This would enable municipali­ties to increase revenue collection.

Mabuza told Parliament yesterday that they had struck a deal between 18 municipali­ties that had a huge debt with Eskom, to be first in line for the project.

In the past, Eskom has gone to court to try to recoup the billions it is owed by municipali­ties.

During a question-and-answer session in the National Assembly, Mabuza said they had reached an agreement between municipali­ties and the power utility.

“In our engagement with municipali­ties owing Eskom, we finally reached an agreement. The first 18 municipali­ties, owing the largest sums of money, are going to ask Eskom to take over the distributi­on (of electricit­y) and collection of rates,” said Mabuza.

Eskom spokespers­on Sikonathi Mantshants­ha said yesterday that the arrangemen­t was similar to the one that the power utility had recently signed with Msunduzi Municipali­ty, where it took over the maintenanc­e of some of the city’s infrastruc­ture and would bill the municipali­ty for the work done.

Regarding the revenue collection aspect of the matter, he said these matters would be agreed to with each municipali­ty.

“These agreements are still being negotiated,” he said.

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