Winning The Power Struggle
The suspension last week of four Eskom executives should be supported. The allegations that have led to them being asked to step aside are serious. In the light of the crisis Eskom faces, withholding information from the government and/or supplying information that cannot be relied upon is unpardonable. It is indeed prudent of the Eskom board to institute an inquiry to establish the true score at the electricity utility. Although the Eskom board has been at pains to point out that the inquiry will not be directed at any particular individual, in circumstances of this nature, where the government as shareholder has expressed frustration over a number of issues, surely someone must be held accountable.
Public Enterprises Minister Lynne Brown is on record as saying she is frustrated with electricity plants going off line unplanned, the lack of a maintenance plan, the lack of information about the true financial position of the state entity and a seeming lack of appreciation by Eskom executives about the challenges/problems the organisation faces. But how political leadership and Eskom executives characterised the situation at Eskom might just be a problem in itself. Eskom is not facing challenges. It is facing a crisis. But when the organisation's corporate plan "merely continues with business as usual" as Brown has reportedly said, then it indicates the utility's leadership might be oblivious to what they are facing. So, we need to start at the beginning and correctly characterise what the utility faces.
At any rate, you don't set up a war room, as the government has done in this instance, unless you have a crisis on your hands. Of course, it does not take a rocket scientist to figure out that the Eskom crisis goes beyond the four executives. There has been underinvestment as Eskom over many decades. For the record, it did not start in the past 20 years but much earlier than that. Prior to 1990, only a third of South Africa's population had access to electricity. Electricity generation capacity was, like any infrastructure provision, racially determined. The underinvestment started right there. By the end of the second decade of democracy, more people had access to electricity, thanks to the democractic govenrment's ambitious electrification programme.
At a time when the entity was supposed to be capitalised to cope with the government's national electrification programme, that did not happen. Also, Eskom has traditionally supplied electricity cheaply to industrial consumers. Those tariffs were negotiated during the apartheid era. The special pricing agreements the utility had with big users, particularly in mining, has contributed to the mess Eskom finds itself in today. The state entity was in effect subsidising some of our big mining houses, some of which are now based oversees. Charging rates that are below market prices was never going to be sustainable. Add to that the massive debt that residents, municipalities and business owe Eskom and you have a disaster that was waiting to happen.
For all these past sins, the current Eskom executives cannot be held accountable. But previous mistakes cannot be used as absolution for current shortcomings. Brown says she has been looking for critical information from Eskom and this has not been forthcoming. The cash-flow challenges are said to be changing from month to month, making it difficult for the shareholder to formulate a true picture of Eskom's cash situation. Surely these cannot be blamed on the previous shortcomings of the shareholder or former executive leadership at the state entity.
There is currently a management at Eskom that makes decisions daily. It must be held accountable for its actions or inaction. If a lack of accountability is allowed (something we are getting used to in our country), then every effort towards improving performance of Eskom will not yield the desired results. The ability to execute and deliver results is directly linked to the accountability attitudes and practices in place in an organisation. Through the load shedding we have experienced, we have already seen how a lack of accountability can cost both a country and an organisation. Without prejudging the issue, we should welcom the Eskom board's decision to suspend the executives while trying to get to the bottom of what is happening at the state entity.
Building on the government's narrative about a war toom for Eskom, it would be worth reminding ourselves that if choosing those who could win wars was compromised by any consideration that has nothing to do with the art of war, we would lose that war. I do hope the end result of the inquiry will give us the right soldiers and generals in this war, be they from outside or from the current crop of Eskom leadership.
