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Eskom managers plead with Ramaphosa to intervene

20 January 2018 - 15:48 By Kyle Cowan
Deputy President Cyril Ramaphosa. File photo.
Deputy President Cyril Ramaphosa. File photo.
Image: Moeletsi Mabe

Senior Eskom management have written to Deputy President Cyril Ramaphosa pleading with him to take urgent action to replace the board and install a new executive management team.

A memorandum addressed to Ramaphosa on Friday seen by TimesLIVE was signed by more than 220 senior staff and raised concerns over "current governance‚ ethical leadership and financial issues" facing the embattled power utility.

On Saturday morning it emerged that former finance minister Nhlanhla Nene and current Telkom chairman Jabu Mabuza were among those being considered for appointment as the new chairman of the Eskom board.

Both men were lobbied for at high-level meetings attended by Ramaphosa‚ President Jacob Zuma‚ Finance Minister Malusi Gigaba and Public Enterprises Minister Lynne Brown on Friday night.

An official announcement is expected later on Saturday.

"As Eskom Guardians [employees] it is extremely painful for us to see our once highly-regarded and top-performing organisation dragged from one reputational crisis to another‚" the memo reads.

"It is clear that issues of governance‚ ethics and leadership are at the centre of Eskom's current crisis‚ and are having a devastating impact on Eskom's liquidity and financial sustainability."

The memo further raises serious concern over a lack of "decisive and bold action" against allegations of fraud‚ corruption and maladministration.

Eskom has been at the heart of allegations of state capture by the Gupta family‚ who have reportedly siphoned billions from the state-owned entity in a series of dodgy deals and kickbacks.

Among the demands‚ which those that signed want resolved by January 31 or "whichever date coincides with the Eskom interim financial results"‚ are:

- Urgent legal action to be taken against all employees that have brought Eskom into disrepute‚ and "golden handshakes" should not be considered.

- The appointment of a "credible" Eskom board‚ and

- A re-constitution of the Eskom executive management team‚ including the appointment of a permanent group chief executive and chief financial officer.

The current CFO‚ Anoj Singh‚ was suspended last year amid allegations of wrongdoing in his involvement regarding R1.6-billion that was paid to global consultancy McKinsey and Gupta-linked Trillian without valid contracts being in place.

His suspension also came as a result of Eskom receiving a qualified audit opinion‚ which triggered clauses in loan agreements with investors such as Development Bank of South Africa.

The clauses included that Eskom may not receive qualified audit opinions or default on any of its loans‚ or face the loans being recalled.

This week it was revealed that the R1.6bn was the first amount the NPA's Asset Forfeiture Unit (AFU) would be attempting to recover as part of its greater state capture investigation.

The AFU obtained a preservation order from the North Gauteng High Court against the funds by arguing that the money fell within the ambit of the Prevention of Organised Crime Act as proceeds of crime.

Also on Saturday news broke that current chairman Zethembe Khoza had on Friday submitted a resignation letter to Public Enterprises Minister Lynne Brown.

"I think it's in [the] good interest of the country... after all the noise‚ it's better for me‚" Fin24 quoted him as saying.

Eskom is yet to release its interim financial statements for the six months ending September last year amid reports that the finances at the utility are in dire straits.

Two spokespeople for Ramaphosa's office could not immediately be reached for comment.

There was a meeting on Friday of about 400 senior managers from Eskom‚ including all managers of power stations‚ with executive management‚ called in response to this memo. Among their concerns was the reinstatement of former acting CEO Matshela Koko‚ who was recently cleared of disciplinary offences of awarding huge contracts to his daughter on grounds that he had declared his interests.

At the meeting acting CEO Sean Maritz and acting CFO Caleb Cassim addressed the managers.

- Additional reporting by Carol Paton