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Eskom board has demonstrated complete failure of leadership over Trillian scandal!

9 October 2017, Posted in Press Releases

The National Union of Metalworkers of South Africa (NUMSA) notes the decision by power utility Eskom to recover billions of rand which were unlawfully paid to consulting firms McKinsey and Trillian in 2016 and 2017.

McKinsey has been implicated in potentially corrupt dealings between Eskom and the Gupta-linked firm, Trillian. This follows serious allegations of corruption which were levelled against executives at the firm, by whistleblower and former CEO Bianca Goodson. Goodson alleged that Trillian earned lucrative consulting fees by allegedly facilitating access to top officials for consulting firms McKinsey and Oliver Wyman. Eskom is seeking to recoup R1,564 billion from McKinsey and Trillian respectively.

Eskom is a never ending story of corruption and state capture. It has admitted to lying to the media when it claimed that payments which had been made to Trillian and McKinsey were above board. The chief financial officer Anoj Singh has been suspended for allegedly defending payments to both these disgraced firms.

The money which Eskom is demanding from these two entities may be a drop in the ocean. It is possible that these firms received much more in the way of unlawful payments. Furthermore, the board has demonstrated that it is completely impotent and unable to steer the company out of this crisis. NUMSA is calling for an independent investigation into all these shady dealings. Those connected to these decisions in any way, must be suspended pending the outcome of a disciplinary process!

That is why NUMSA welcomes the decision by the South African Federation of Trade Unions (SAFTU) to lay charges against Trillian Capital Partners and its directors. SAFTU laid charges of fraud, corruption and money laundering against the firm. The federation is demanding that the South African Police Services (SAPS) and the Hawks prioritize a criminal investigation into the company.

Trillian and all those who may have colluded with Eskom should be brought before a court to answer all the charges. NUMSA repeats the call for the Gupta family to be investigated and all allegations regarding state capture to be ventilated in court. Those found guilty must be jailed for corruption.

We should also note these shenanigans are happening while Eskom is pursuing an immoral tariff increase of 19%. If this is allowed, it will make electricity even less affordable and accessible to the working class majority in South Africa.

The parastatal cannot justify such an outrageous increase, when the majority of South African’s are overburdened with high food and fuel costs. According to StatsSA at least 50 per cent of the population lives in poverty. And yet Eskom officials continue to abuse resources, with the help of the Gupta family and others, working with the corrupt cronies of the governing ANC, who are at the center of looting the state. We need to urgently deal with the root of corruption at Eskom and at all our SOE’s once and for all.

The Eskom board has demonstrated complete failure of leadership in dealing with problems plaguing the power utility. The former CEO, Brian Molefe’s re-appointment and subsequent removal, sparked a national scandal. Molefe was re-appointed despite the fact that he was implicated in allegations of State Capture by the Public Protector. At the same time, the Eskom board was accused of deliberately manipulating the pension process in order to guarantee Molefe a R30 million rand payout. The acting CEO Matshela Koko is facing disciplinary action following allegations of corruption, and Singh the chief financial officer has been suspended! What is truly shameful is that all these individuals were rewarded with generous bonuses, when in fact, it seems clear they were acting in their own selfish interests, instead of the interests of the public at large.

Eskom recently reshuffled some of its senior executives. Sean Maritz, Eskom group executive for information technology, has been appointed interim group CEO. Johnny Dladla who was acting as the CEO since June, has resumed his position as CEO of Eskom’s Rotek industries. Dladla was filling in as CEO after Molefe’s reappointment as CEO was rescinded. Workers are suffering because of a paralysis caused by the lack of an ethical, permanent head for the position of CEO, and yet Eskom is busy playing Russian roulette with the economy! We demand that Eskom appoint a permanent head to the position soon so as to bring stability to the entity.

We also demand an end to the Apartheid wage gap which continues to exist at Eskom between mostly white and African employees. The majority of white employees earns much more and receives better benefits than their African counterparts. The tragic irony is that even though several strategic positions are held by Africans in top management and board positions, those with the power to make changes, have chosen to continue to reinforce the racist wage gap. This apartheid-time horizontal income differential will be arbitrated in the CCMA Head Office on 26 October as NUMSA has declared a dispute against Eskom over this issue.

Workers and their families are suffering from the impact of corruption at various SOE’s including South African Airways, PRASA, RAF and PetroSA, to name just a few. That is why we are demanding that the boards of all SOE’s must be scrapped and democratized. The corruption at Eskom pre-dates the arrival of the Gupta family.  It is a sign of the extent of the corruption in the governing party which is willing to sell off national assets to the highest bidder.

Therefore we cannot trust the governing party to appoint board members who will act in the interests of the public. It is clear that the role of the board is to ease the looting of state coffers for politically connected individuals. We therefore repeat our demand that the boards of all SOE’s must be made up of trade union representatives, business, and government officials. This is the only way we can guarantee transparency, good governance and accountability.

Furthermore, Eskom should not be chasing profits. It must change its mandate from profit seeking to being operationally self-sufficient. Its focus should be to provide free electricity for the working class poor and their families who need it the most.

Aluta continua!
The Struggle continues!

Issued by
Phakamile Hlubi
NUMSA National Spokesperson (Acting)
0833767725