The decision of Eskom to ask the National Treasury to consider the release of a top coal mining company from its long-term contractual obligations should be opened to full public scrutiny. In this instance, the National Treasury is considering releasing a public company from a 14-year obligation.
Should the company be released from this, Eskom is likely to lose a R40-billion advantage. Should the National Treasury agree to this, it would be putting yet another load on the backs of the South African people and is likely to result in other coal companies pleading to be released from their contractual obligations as well. Why not? The company concerned is in very good health.
Eskom’s tariffs have increased by more than 500% in the last ten years and the utility has received permission to raise the tariffs still further this year. Eskom is also suffering great hardship, along with the South African people, and the way should not be opened for public companies with strong balance sheets to be given relief in this way. 