- Eskom welcomes National Treasury’s exemption on the annual reporting of irregular, fruitless and wasteful expenses, and assures South Africans of its commitment to complying with applicable legislation
On Friday, 31 March 2023 Eskom received notice of exemption on certain PFMA disclosure requirements. Eskom has been engaging with various stakeholders from National Treasury and the Department of Public Enterprises for several months on its proposal to seek the Minister’s approval in relation to this exemption and departure application.
With the exemption, the irregular, fruitless, and wasteful expenses will now be reported in the Eskom’s Annual Report, as opposed to its Annual Financial Statements. The integrated report is tabled by the Minister of Department of Public Enterprises in Parliament.
Eskom will continue to respect and co-operate with supervisory authorities including the Minister of Public Enterprises as its Executive Authority, the National Treasury, the Auditor-General of South Africa, Parliament and other relevant ministries.
“PFMA compliance remains a priority as Eskom continues to address irregular, fruitless and wasteful expenditure, including appropriate consequence management proceedings. This exemption will assist in the dialogue with credit rating agencies, the lender community and key stakeholders. Eskom will abide to the conditions and strict monitoring requirements imposed by National Treasury in granting the exemption,” said Eskom’s Acting Group Chief Executive, Calib Cassim.
“Eskom continues to work with the various regulatory bodies to support delivery on the procurement of goods and services impacting our key operations,” said Eskom’s Chief Procurement Officer, Jainthree Sankar.
“Furthermore, Eskom is committed to a procurement system that is fair, equitable, transparent, competitive and cost-effective. Any exemption or departures are seen as an exception, not a norm,” added Sankar.
Eskom has made positive strides in the past three financial years to establish systems, procedures, checks and balances designed to reduce the extent and risk of fraud, corruption and irregular expenditure. The 2021/22 audited financial statements show a marked reduction in the incidence of irregular expenditure that originated in that year. Although more work is required, the systems and mechanisms implemented to address the causes of historical issues have proven largely successful.