State capture, mismanagement responsible for Eskom crisis: Ramaphosa

State capture and mismanagement have destroyed Eskom, ANC president Cyril Ramaphosa said on Friday night.

“The insecurity of the electricity supply continues to be one of the greatest impediments and risks to economic recovery in our country,” he said.

“Poor policy decisions in the past, together with inadequate maintenance, mismanagement and state capture have left our electricity system in a state of real disrepair.”

Eskom’s failure to provide uninterrupted electricity has put severe pressure on the ANC-led government especially with national general elections scheduled to be held in 2024.

Its CEO Andre de Ruyter this week tendered his resignation ahead of the ANC's 55th national conference where Ramaphosa is facing intense contestation.

He told the more than 4,000 delegates at the opening of the conference his government had over the past five years started the process of rebuilding the power utility.

Ramaphosa attributed Eskom's failures, which have led to stage 6 blackouts, to companies that had received received undue payments from the state-owned company.

These illegal payments, running into billions, to companies that had captured Eskom were being recovered, he said.

So far close to R3bn had been recovered while a further R5bn was being clawed back through legal processes.

“Apart from the immediate steps to stop state capture at Eskom and rebuild the utility, government has made significant policy changes to enable a more competitive, reliable, cost-effective and sustainable electricity industry,” Ramaphosa said.

“Government has made significant policy changes to enable more competitive, reliable, cost-effective and sustainable electricity generation. An important part of the work to reverse the effects of state capture is the recovery of funds that were paid illegally or improperly to a number of companies.” 

“To date, nearly R3bn has been recovered by Eskom alone and a further R5bn is being claimed in various court processes.”

The state capture commission found Eskom had entered into irregular contracts amounting to about R15bn.

Most of the companies were linked to the Gupta family which enjoyed a close relationship with then president Jacob Zuma.

All of this, Ramaphosa said, has led to load-shedding which will not end unless reforms are implemented.

The effects of load-shedding were being felt every day by households, businesses, schools, hospitals, government offices and people in general. 

He said load-shedding was severely constraining economic growth and transformation. It was also constraining job creation, poverty alleviation and development threatened the advancement of the national democratic revolution.

"Since the 54th national conference we have undertaken several far reaching measures to completely transform the country's energy sector," he said. 

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