Eskom’s top brass have had the infamy of reaping where they did not sow. That has been the opinion of corporate governance analysts or those with vested interest. Incredibly, in spite of the fact that high profile power station project delays at Kusile and Medupi had incurred stratospherical cost overruns, they still earned princely annual bonuses.
A statement from Eskom disclosed that the parastatal’s senior executives would forego their annual bonuses for the 2013/14 financial year as one of the measures to address a R225 shortfall. It quotes acting Chief Executive, Collin Matjila as saying: “The Board welcomed this move as the company is implementing efficiency intervention initiatives to achieve long-term financial sustainability.”
Eskom felt the effect of the failure of Nersa, the energy regulator, to approve a proposed tariff increase of 16%, which has left it with a wide funding gap. Only an increase of 8% was approved.
Albeit belatedly, Eskom Board’s decision is a welcome development in the current environment in which bosses in some loss-making parastatals have been criticised for earning huge bonuses.