Following a notice issued on 2 July 2024 to the National Treasury and Emfuleni Municipality, Emfuleni has been removed as a beneficiary of the Municipal Finance Management Act (MFMA) 124 Debt Relief program due to multiple breaches. As a result, the Sheriff of the Court has attached Emfuleni’s four bank accounts, ensuring that funds collected for electricity are paid directly to Eskom.
The municipality failed to comply with the debt relief program’s requirements, prompting this action.
The account attachment guarantees Eskom receives payment for the electricity it supplies, ensuring uninterrupted service to Emfuleni’s customers.
Eskom said in a statement today that it had exhausted all legal and mediation efforts to recover payments for services rendered since 2018.
“Collecting municipal debt is a key focus for Eskom. The company will employ various strategies to recover owed funds, enabling investment in maintaining and strengthening electricity supply, fostering socio-economic growth, and reduce the need for interventions such as loadshedding,” said Eskom.
“Eskom cannot financially sustain the electricity debt of the municipality without severely impacting its own operations and the citizens of the country. The municipality’s failure to pay for bulk electricity compromises Eskom’s financial stability and its ability to provide affordable electricity.”
As of 31 August 2024, Emfuleni owes R8,052,093,269.36 for bulk electricity. This amount represents ~10% of the total R82 billion owed by municipalities and places Emfuleni among the top three municipalities in debt to Eskom.
Municipal debt remains one of Eskom’s biggest challenges. As of the end of March 2024, municipal arrears stood at around R74.4 billion, with an increase of approximately R15.9 billion during the last financial year (1 April 2023, to 30 March 2024).
