South Africa’s state-owned power utility’s exemption from the Public Finance Management Act has been withdrawn "for now," Finance Minister Enoch Godongwana said yesterday.
Instead, Eskom will have to attend further consultations with their auditor and the auditor-general.
Last week Friday in the Government Gazette, Godongwana exempted Eskom from declaring its financial report on wasteful and irregular expenses that were not a result of corruption.
"Yesterday we had intensive discussions with the auditor-general (AG), and in that discussion, there were some contributions from the AG that need to be part of the framing of the gazette," Godongwana told News24.
"In the light of those comments and comments from the public, we have decided to withdraw the Gazette for now and have more detailed discussions with the AG and Eskom's auditors so that the framing is proper and the checks and balances are tightened."
The exemption was met by multitudes of criticism, claiming it would assist Eskom in achieving an unqualified audit and boost the utility’s credit.
Treasury was worried that thereafter a qualified audit would provoke Eskom’s loan agreements and increase the interest on their loans.
The ANC’s alliance partner, Cosatu, called it an approval of criminal activity, corruption and looting, while Dion George, DA’s spokesperson on finance, said that the party had immediately asked their legal team to look into the consequence of the exemption.
Not three hours after the exemption was posted, Godongwana announced that it was withdrawn.
Furthermore, the government withdrew the national state of disaster that was addressing the national energy crisis.
Eskom said on Wednesday that it would comment on these matters after their engagement with the government.
