The South African Minister of Finance has decided to withdraw the exemption from reporting on irregular, fruitless and wasteful expenditure granted to state-owned power supplier Eskom, to allow for a period of further engagement and written technical input from all relevant stakeholders on the matter.
Minister of Finance Enoch Godongwana announced the decision to withdraw the exemption on Wednesday, 5 April 2023, during an appearance before a joint meeting of the Standing Committee on Finance, Standing Committee on Public Accounts, Standing Committee on the Auditor-General, and Portfolio Committee on Public Enterprises. The notice to withdraw the exemption is to be published in the Gazette on 6 April 2023.
On 31 March 2023, the Minister of Finance granted a partial exemption to Eskom Holdings SOC Ltd from section 55(2)(b)(i) of the Public Finance Management Act (PFMA) and Treasury Regulation 28.2.1 for a period of three years.
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Minister Godongwana explained to the sitting the reasoning for having initially granted the exemption: “The intention really was to allow the Eskom to have better financial statements, and at the same time create an environment where there remains transparency on corruption, and irregular expenditure, as well as all the other related issues. It was never the intention of the exemption to hide anything in this regard,” Minister Godongwana told the joint committee.
The exemption would still have required Eskom to disclose all irregular and fruitless expenditure in its annual report, and would have been subject to audit, but separately from the financial statements, so that the financial statements of Eskom would be more aligned with how listed companies generally report.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry