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    Eskom goes after dodgy contractors

    March 15, 2023 - Business Day


      Eskom goes after dodgy contractors

      Eskom going after dodgy contractors, says chair

      Denene Erasmus and Hajra OmarjeeEskom chair Mpho Makwana has expressed his determination to fight graft at the cash-strapped power utility, saying one of the board’s immediate goals is to crack down on rent-seeking maintenance contractors.

      "We have started a process of identifying them and seeing the patterns of how they work and we will be rooting them out," Makwana told Business Day in an interview, adding that evidence from an investigation showed that the contractors were taking advantage of their relationship with Eskom for their own benefit.

      Since this is an ongoing investigation, Makwana did not want to divulge information about the power stations or companies being focused on.

      His comments come weeks after Business Day and other news platforms reported portions of findings of a private investigation commissioned by sacked CEO Andr& xE9; de Ruyter. Those findings paint a picture of an environment in which criminal cartels with links to senior government officials are allegedly lining their pockets with lucrative contracts.

      But Makwana, who has led the reconstituted board since September last year, said De Ruyter did not share information about the investigation. As a result, the board had been unable to probe the allegations.

      "How do we get to the bottom of it? It is a private investigation that we have no insight into. De Ruyter and those running the investigation will have to produce reports and evidence and hand it over to the state or to Eskom. Then we can have something to talk about. Now we have nothing tangible that we can talk about."

      The former SA head of Saatchi & Saatchi, one of the biggest names in the global public relations industry, also defended Eskom’s workforce of 41,000, saying it was made up of "a majority who wanted to work hard and earn an honest living". They were being undermined by "a "small minority that wants to […] earn a quick buck".

      Part of the reason some Eskom workers might have chosen to collude in tender fraud might be traced back to the conditions that were set as part of previous government bailouts to Eskom, Makwana said.

      Disgruntled by the unilateral changes in employment conditions, which meant they would no longer get bonuses or "proper increases", a minority probably decided to "reward themselves" by finding ways to beat the procurement system. Part of the board’s work to rebuild Eskom was to inspire confidence in the majority of Eskom employees who were honest and hard-working, he said.

      Makwana also gave an update on the efforts to recoup looted money from Eskom, which featured prominently during the state capture public hearings.

      He said the utility had been fighting back with some success. This included more than R2.5bn recovered from unlawful payments to global consulting firm McKinsey and technology company ABB SA.

      Jointly with the Special Investigating Unit, Eskom was also pursuing R3.8bn through civil action against 12 defendants who played a central role in state capture, including seven former Eskom executives and directors.

      "Money is being recovered; people are being arrested, Makwana said.

      "We have made progress in reversing the negative effects of corruption in Eskom."

      Eskom’s new chair, Mpho Makwana, at the power utility's Megawatt Park head office in Johannesburg. Picture: FREDDY MAVUNDA/BUSINESS DAY


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