Eskom gets tough with errant municipalities, grabs cash and land
Eskom recently attached 139 farms worth R2.5 billion from Matjhabeng municipality in the Free State, signalling a new front in the war with delinquent municipalities.
Read: Eskom attaches 139 farms of FS municipal council
The electricity utility has been known to attach cars, computers and bank accounts in settlement of municipal arrears, but attaching farms as security for debts owed is something new.
As of July 31, municipalities owed Eskom R31 billion, with 80% of this owed by just 20 municipalities.
Asked what prompted the attachment of these farms, Eskom replied: “To collect this debt, Eskom is implementing the contractual conditions as per the supply agreement such as interrupting supply, pursuing legal avenues consistent with good credit management processes. So far, these 139 farms are the only property of this nature that Eskom is holding as security to cover unpaid debt.”
Farms valued at an average of R18m each
The farms were attached as security for Matjhabeng municipality’s R3.4 billion debt. The municipality values the farms at R2.5 billion, or R18 million each on average (bear in mind this is a gold mining country, and includes the town of Welkom).
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