It is no longer news that there have been significant increment in many sectors of SA’s economy. Starting from personal tax increase, fuel levy increment as announced in the Budget) and now electricity bill increase. With these increments, many South Africans are apparently left to put in more effort in order to meet these necessities.
Following National Energy Regulator (Nersa)’s approval of a 9.4% electricity hike for 2016/17, the Congress of South African Trade Union has raised alarm, calling on the Energy Minister Tina Joemat-Pettersson not to remain silent. The union bluntly kicked against consumers being forced to cater for “Eskom’s sins” and inefficiencies.
Speaking further, the union postulated that “The public…can no longer afford to subsidize Eskom’s out of control increases twice a year. Eskom has been increasing electricity prices at two to five times the levels of inflation for more than five years now. Workers are lucky if they receive increases in line with inflation.”
Therefore, “the Minister for Energy must do her job and protect consumers from these exorbitant increases and also ensure that Eskom cuts its wasteful expenditure. Eskom pleads poverty and demands massive price increases yet it can afford to give R40 million to the New Age for its breakfast shows‚ to spend R30 million on end of year parties and pay huge bonuses to clearly non-performing executives.”
Cosatu said Eskom’s intention was simply to pass the bill to the municipalities, who would then add the extra amount to consumers bills. The union said it is not acceptable because already a fuel levy hike was announced in the budget and again, personal income tax was increased too.
So, “what government needs to understand and make clear to Eskom is that consumers cannot be expected to shoulder the whole cost of getting Eskom back on its feet. The recapitalisation of Eskom should be the responsibility of government through the fiscus. Government‚ as the shareholder‚ must also intervene in a big way to help Eskom get out of its financial problems and to raise the funds needed. They must force Eskom to cut fat‚ improve drastically its revenue collection capacity and manage contracts effectively to address its financial problems‚” Cosatu said.
Last November, Eskom had written to Nersa to recover R22.8bn, which the utility used forestall load shedding and possible power outage. Nersa chairperson Jacob Modise said this was after the body had an extensive consultation with government, unions, small and intensive users, who engaged in public hearings in six provinces.
The National Energy Regulator (Nersa) announced on March 1 that the 9.4% electricity hike for 2016/17 will be effected from April 1. Eskom opined that it is by this hike that it would be able to recover R11.2 billion from standard tariff customers.
Meanwhile, the National Union of Metalworkers of SA (Numsa) said Eskom’s 9.4% tariff increase may lead to job losses as it would hit struggling working-class consumers hard. The union lamented that already most people are struggling to meet up with rises in school fees, transport costs and food prices.