The Democratic Alliance (DA) will table a motion at the next Gamagara council meeting calling for the Municipal Manager to take urgent action to avoid being kicked off Eskom’s Debt Relief programme, costing the municipality almost half a billion-rand.
In total, Gamagara municipality currently owes Eskom R650 million. However, since entering the debt relief programme 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.
Gamagara will forfeit its R387 million debt relief and remain liable for a further R111 million for outstanding payments plus interest, if it fails to finally address 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.
Termination from the programme will require Eskom to enforce strict credit control, including instituting legal proceedings to recover monies owed. This will mean the implementation of load reduction, further burdening residents and businesses who are still recovering from the high cost of loadshedding. It could also punish the poorest of the poor by blocking free electricity to indigents.
The DA will, at the soonest opportunity, table a motion calling on the MM to take responsibility for placing Gamagara in such a precarious position and for finding a speedy solution to this looming crisis. The MM must also hold the Chief Financial Officer accountable through disciplinary measures. DA provincial COGHSTA spokesperson, Gizella Opperman, has also written to the legislature’s portfolio chairperson of COGHSTA, requesting a stakeholder meeting on the future of the Eskom debt relief programme in non-compliant municipalities like 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.