Scores of companies, from large ones listed on the JSE to small-and medium-sized businesses, in six towns across SA face the untenable situation of being cut off from their electricity supply, despite having paid their accounts. This is due to the municipality in which they are located defaulting on its payment to Eskom, sometimes for many successive years, with debts running into billions. One of the top defaulters, for instance, is Maluti-A-Phofung, in which the Free State town of Harrismith is located. This municipality hasn’t paid Eskom since 2011 and now owes a staggering R2.7bn. In total, municipalities owe R13.6bn and households in Soweto, which pay Eskom directly, owe a further R12bn. Debt owed by municipalities is climbing rapidly. In the past year, it grew by 30%. There are several causes of the problem.
The first is an old one the government has shown zero commitment to tackling. People in townships don’t like to pay for electricity, mostly because they are used to ...
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