Staff Reporter
Eskom has agreed to release some of the money that has been frozen in the Maluti-a-Phofung bank account so it can meet some of its running costs.
This follows the successful attachment of the bank account belonging to the municipality this week after it failed to honour its debt for bulk electricity supplies which now stands at about R5.3 billion.
In a statement released Saturday, the national power utility said it had reached an agreement with the eastern Free State municipality to partially release some of the funds so assist it to meet its running costs.
“Eskom and the municipality on Friday reached an agreement to partially release some of the funds to assist the municipality to meet its running costs,” read part of the statement.
As part of this agreement, which has been made an order of court, the parties must conclude an agreement on or before August 7, 2020 to address the municipality’s R5.3 billion debt to Eskom and to service its monthly current account.
“Eskom has agreed to release R90 million to allow the municipality to pay the salaries of its workforce and to meet other running costs,” Eskom said in the statement.
“The bank account currently has a balance of more than R220 million . . .”
On Tuesday, Eskom executed a court order granted to help it recover the unpaid debt.
Following the attachment of the municipality’s bank account, the funds were to be transferred to Eskom to help recover a portion of the long-standing bet.
The account balance will remain attached until a repayment agreement that meets Eskom’s requirements has been concluded, or until the court orders otherwise.
“This step . . . is a result of the repeated failures by the municipality to adhere to its payment obligations to Eskom for the bulk supply of electricity,” the statement said.
“Eskom will continue to explore all available legal avenues to ensure that outstanding municipal debt is recovered.”
Eskom says its viability is continuously threatened by municipalities failing to settle to settle their bills on time.
As at June 30, the total outstanding municipal debt stood at R30.9 billion.