By Nkhensani Chauke
The Democratic Alliance (DA) is planning to table a motion during the upcoming Gamagara council meeting, calling for the Municipal Manager to take immediate steps to prevent the municipality from being removed from Eskom’s Debt Relief Programme, a move that could cost the municipality nearly half a billion rand.
According to the DA, Gamagara municipality faces significant penalties for its failure to adhere to Eskom’s Debt Relief Programme.
The municipality currently owes Eskom R650 million.
Since joining the debt relief programme in December 2023, Gamagara has been criticised for its lack of commitment, consistently ignoring warnings from Department of Cooperative Governance, Human Settlement and Traditional Affairs (COGHSTA) and the National Treasury.
The municipality has received monthly non-compliance certificates until September 2024 and has frequently underpaid its Eskom current account since June 2024.
Anne-Marie Caetano, a DA councillor in the Gamagara Municipality, confirmed the outstanding debt owed to Eskom.
She added that the municipality has demonstrated severe lack of commitment to the programme since joining in December 2023.
“Gamagara has shown a critical lack of seriousness towards it. It consistently ignored warnings from COGHSTA and Treasury and was issued with monthly non-compliance certificates until September 2024. It also persistently short-paid its Eskom current account since June 2024,” said Caetano.
She further said the municipality stands to lose R387 million in debt relief and will still be responsible for paying an additional R111 million in outstanding debts, plus interest if it fails to address the non-compliance issues by 16 March 2025.
“Putting the already cash-strapped municipality under more financial strain will have a catastrophic impact on service delivery. It could also result in Gamagara being placed under administration, given that the pre-condition of tabling an unfunded budget, was successful participation in the programme,” she said.
Caetano added that, if Gamagara is terminated from the programme, Eskom would be forced to implement strict credit control measures, which includes taking legal action to recover the outstanding debts.
“This mean the implementation of load reduction, further burdening residents and businesses who are still recovering from the high cost of load shedding. It could also punish the poorest of the poor by blocking free electricity to indigents,” she said.
The DA is set to submit a motion demanding for Lebogang Seetile to take responsibility and come up with urgent solutions to the challenges faced by the municipality.
“The MM must also hold the Chief Financial Officer accountable through disciplinary measures,” she said.
DA provincial COGHSTA spokesperson, Gizella Opperman, has reached out to the legislature’s portfolio chairperson of COGHSTA, requesting a stakeholder meeting to discuss the future of Eskom’s debt relief program in municipalities that have failed to comply, such as Gamagara.
“Gamagara’s local economy and its people depend on a sustainable supply of electricity and the municipality has no right to rob them of this through its own inability to properly manage its finances,” she said.
In October 2024, the National Treasury warned that municipalities’ slow compliance with conditions of the debt relief programme on arrears to Eskom, would risk delaying debt write-offs.
INSIDE METROS