Africa Economy News South Africa

South Africa: Fallout over power utility CEO’s graft claims

South Africa’s troubled state-owned power utility Eskom appointed an interim chief executive Friday after a fallout with its outgoing head over a media interview he gave.

Andre de Ruyter alleged ongoing corruption at the company linked to the ruling party, and said there was a lack of will from government to stop the graft and solve the country’s electricity crisis.

Africa’s most developed economy is experiencing its worst rolling power blackouts in 30 years due to frequent breakdowns at Eskom’s aging coal-fired power stations. Those problems are largely blamed on years of corruption and mismanagement at the utility under the ruling African National Congress party.

De Ruyter resigned last year and was scheduled to leave at the end of March. But he was removed from his position immediately after the interview with a private TV station aired on Tuesday night in which he accused the ANC and unnamed government ministers of covering up corruption at Eskom and only being interested in their re-election hopes in 2024.

“They want what will win them the next election, not what will keep the country going for the next two decades,” de Ruyter said of the ANC.

De Ruyter said Eskom, which is deep in debt, was losing $50 million a month to corruption. When asked by his interviewer if Eskom is a “feeding trough” for the ANC, de Ruyter replied: “I would say the evidence suggests that it is.”

The interview led to him being asked to leave immediately and his notice period scrapped. The board appointed its current chief financial officer, Caleb Cassim, to act in the position until a permanent CEO is appointed.

Allegations of corruption and mismanagement have dogged Eskom for years and were recently laid bare during a judicial commission of inquiry, which implicated senior ANC ministers and former President Jacob Zuma.

De Ruyter’s allegations come as South Africa’s 60 million people have electricity switched off at their homes and businesses for up to eight hours a day in rolling blackouts. There are warnings the power cuts could be increased to 12 hours a day. Eskom has historically supplied more than 80% of the country’s electricity.

Earlier this month, President Cyril Ramaphosa declared a state of disaster to deal with the energy crisis, describing it as an existential threat to the country’s slumping economy.

The measure allows the government to cut red tape in procuring additional electricity capacity on an emergency basis and exempt certain essential services like hospitals from power cuts,. Ramaphosa also announced that he would appoint a minister of electricity.

In his budget speech this week, the country’s finance minister announced the government would guarantee about $13 billion of Eskom’s total debt of $23 billion.

The Democratic Alliance, the largest opposition party, described de Ruyter as a “national hero” for speaking out about corruption at Eskom, which has lost billions to graft over the years.

ANC Secretary General Fikile Mbalula criticized de Ruyter and challenged him to produce proof of his corruption allegations against the party and report it to law enforcement authorities.

De Ruyter claimed last year that he had survived an attempt on his life when someone slipped cyanide into his coffee a day after he had submitted his resignation as Eskom CEO. He has said that Eskom has become a target for organized crime syndicates as well as corrupt politicians because of the massive amounts of money it receives from government and other sources.

Source : AP News