Govt inaction on Treasury’s Eskom report risks Stage 10 load-shedding

Those who have studied it say conclusions reached in National Treasury’s 600+ page forensic investigation into Eskom are deeply worrying. Including the immediate threat of an even more desperate electricity shortage should a couple of already dysfunctional water treatment plants tip over the edge. The IRR’s chief executive John Endres shares his insights, highlighting how government’s inaction on risks identified in the report threatens to expand the R2trn loss which SA’s economy has already suffered. He spoke to BizNews editor Alec Hogg.

Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.

Watch here

Relevant timestamps from the interview

00:00 – Introduction
00:46 – The Institute of Race Relations
02:03 – Eskom report
03:05 – The investigation going forward
03:49 – Is there any information that is redacted in the report?
04:16 – The major conclusions from the report
08:30 – Cadre deployment
10:43 – Good intentions but unforeseen consequences
12:00 – Any urgent actions advised
14:40 – Likelihood of the water treatment plants being addressed
15:28 – Would De Ruyter feel vindicated by this official report?
20:35 – Conclusion

Listen here

Edited transcript of the interview ___STEADY_PAYWALL___

Alec Hogg: Today, we’re discussing a recent report on Eskom with John Endres, the chief executive of the Institute of Race Relations. The report, initiated by the Treasury in 2018, spans 614 pages and provides crucial insights into the operational challenges faced by Eskom. John, can you shed light on why the IRR is regarded as South Africa’s premier think tank?

John Endres: Certainly, Alec. The Institute of Race Relations, founded in 1929, has a long history of utilizing data gathering and analysis to understand and predict the complexities of our nation. Our independence sets us apart, allowing us to provide candid analyses without compromising on harsh truths.

Alec Hogg: Indeed, your independence is a notable strength. Moving on to the Eskom report, could you highlight its key findings and the unique circumstances that led to its creation?

John Endres: Certainly. The report, spanning 614 pages, emerged from a four-and-a-half-month investigation initiated by the Treasury last year. Despite the extensive length, it focuses on the operational aspects of Eskom, pinpointing challenges in management systems. The key conclusion is the urgent need to empower power stations and streamline procurement processes to enhance efficiency.

Alec Hogg: Your insights align with the pressing need for reform. Let’s delve into the report’s assessment of Eskom’s transmission grid and operational challenges. What did the experts identify?

John Endres: The report commends the transmission grid’s efficiency in managing load shedding but highlights concerns over the ageing infrastructure. However, the crux of the issues lies in the generation side, where bureaucratic complexities impede effective operation. The experts emphasise the necessity to empower power station managers and simplify procurement processes for meaningful change.

Alec Hogg: Your detailed explanation underscores the systemic challenges Eskom faces. Shifting focus, does the report touch on redacted information, akin to past cases, or is it transparent in its findings?

John Endres: Unlike previous cases, the report reveals no redacted sections, ensuring transparency. The authors aimed to engage civil society and the media, fostering a comprehensive understanding of the findings without concealment.

Alec Hogg: That’s a positive aspect of the report. Now, turning to a comparison with earlier revelations, does the report align with findings from Andre de Ruyter’s book, which faced scepticism from some quarters?

John Endres: The report echoes many of the concerns raised by De Ruyter. It underscores the management challenges within Eskom, validating his observations. However, the report goes further in providing specific recommendations for improvement.

Alec Hogg: The practical recommendations are crucial for addressing Eskom’s issues. Lastly, as South Africa approaches elections, how do you anticipate the political landscape impacting Eskom’s reform?

John Endres: Recent polling suggests a significant shift, possibly placing the ANC in the low 40s. This opens up numerous possibilities, including the potential for a government of national unity. However, the key challenge lies in ensuring governance prioritizes the nation over internal political dynamics.

Alec Hogg: John Endres, Chief Executive of the Institute of Race Relations, shedding light on the challenges and opportunities for reform within Eskom.