Eskom, South Africa’s state-owned power utility, has been plagued by a costly energy crisis in recent years. However, it is not just the energy shortage that has been draining the company’s resources. Shockingly, Eskom has revealed that it has lost over R203 billion to corruption since 2018.
This staggering amount of money lost to corruption highlights the extent of the problem within the company. A lack of maintenance, proper governance, and dodgy dealings have all contributed to Eskom’s critical condition.
Public Enterprises Minister Pravin Gordhan recently provided a breakdown of the losses, stating that R203,156,237 had been lost to corruption, fraud, and bribery.
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Since the findings of corruption at Eskom by the State Capture Commission, chaired by Chief Justice Raymond Zondo from 2018 to 2022, Minister Gordhan has been working tirelessly to turn things around.
The Department of Public Enterprises has formed working groups with the Special Investigating Unit (SIU), state organs, and other enforcement agencies to address the issue of maladministration within state-owned companies (SOCs).
One of the key initiatives implemented by the department is a civil litigation strategy to recover funds associated with the losses sustained during the state capture era and other forms of administrative corruption.
Through these efforts, R5.2 billion has been successfully recovered, excluding amounts related to ongoing investigations conducted by the SIU.
The process to recover outstanding amounts through the Asset Forfeiture Unit or in accordance with court orders is still ongoing. Some of the notable cases include:
- A R1.1 billion dispute with SAP, which has resulted in a R500 million settlement agreement that is currently before the court.
- A R1.56 billion settlement with ABB South Africa.
- R150 million recovered from improper contracts awarded to Deloitte out of a total of around R207 million.
- R1 billion recovered out of a R1.7 billion dispute with McKinsey and Company.
- R595 million recovered from Trillian.
Eskom is not the only state-owned company that has fallen victim to corruption. South African Airways (SAA) has also suffered significant losses since 2019.
Minister Gordhan estimates the bill for corruption at SAA to be R23,056,231.17. However, there is some positive news as R17,209,114 has been recovered so far.
Transnet, another state-owned company, has referred R2.1 billion lost to corruption and fraud to law enforcement agencies for recovery. Out of this amount, R1.6 billion has already been successfully recovered.
The revelations of the massive losses due to corruption at Eskom and other state-owned companies highlight the urgent need for stronger measures to combat corruption. It is crucial for the government to continue its efforts to hold those responsible accountable and recover the funds that have been lost.
Additionally, there is a need for improved governance and transparency within these companies to prevent future instances of corruption. This includes implementing stricter oversight mechanisms, conducting regular audits, and promoting a culture of ethics and integrity.
Ultimately, addressing corruption within state-owned companies is vital not only for the financial stability of these organizations but also for the overall economic development and well-being of South Africa.
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