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Following backlash after the issue on Friday of a special Government Gazette by Minister of Finance Enoch Godongwana, which revealed that Eskom would be exempt from declaring its irregular, fruitless and wasteful expenditure, Treasury has asserted that transparency and accountability are not compromised with the move.

Godongwana has granted a partial exemption to the ailing power utility from disclosing irregular spending in its annual financial statements, for three years.

However, Eskom is still required to disclose financial and non-financial information on irregular, fruitless and wasteful expenditure in its annual report.

Treasury argues that the new reporting is in line with President Cyril Ramaphosa’s response to deal with State capture and corruption.

“By allowing Eskom to report on irregular and fruitless and wasteful expenditure in its annual report and not in its financial statements, the National Treasury ensures that reporting transparency and accountability is not compromised and still made public as currently required, while mitigating the risks that could arise if these transactions are reported in the annual financial statements.

“The exemption also gives Eskom additional time to comply with the new reporting requirements on irregular and fruitless and wasteful expenditure. Eskom is not exempted from ensuring that it takes effective and appropriate steps to prevent irregular and fruitless and wasteful expenditure,” Treasury assured.

It explained that a major risk of having non-material, non-corrupt transactions reported in the annual financial statements was the higher likelihood of a qualified audit opinion, which it said other listed companies did not face. This would trigger loan covenants, which could further increase Eskom’s cost of borrowing and may result in additional fiscal pressure from Eskom’s debt burden if it was not able to negotiate lender waivers for these covenants.

Treasury said the exemption would allow Eskom to continue to fund its balance sheet and maintain accountability, transparency and reporting requirements without adding pressure on the fiscus and without limiting borrowing powers.

Eskom welcomed the exemption, which it said it had been seeking from Public Enterprises Minister Pravin Gordhan for several months.

Eskom acting group CEO Calib Cassim said the utility was committed to complying with applicable legislation and that it would cooperate with all relevant authorities.

“PFMA [Public Finance Management Act] compliance remains a priority as Eskom continues to address irregular, fruitless and wasteful expenditure, including appropriate consequence management proceedings. This exemption will assist in the dialogue with credit rating agencies, the lender community and key stakeholders. Eskom will abide by the conditions and strict monitoring requirements imposed by National Treasury in granting the exemption,” said Cassim.

All other institutions are still required to report irregular and wasteful expenditure in annual reports and in annual financial statements, as required by the PFMA.

Treasury stated that Eskom was not exempted from taking effective and appropriate steps to prevent irregular and fruitless and wasteful expenditure, or from taking appropriate criminal or disciplinary steps because of any losses incurred to date.

All material losses through criminal conduct and any losses recovered or written off from irregular expenditure will still need to be reported in the annual financial statements.

Treasury pointed out that Eskom was still bound by the onerous reporting requirements of International Financial Accounting Standards and JSE Debt Listing Requirements.

“In addition, as part of the Eskom debt relief arrangement, the Minister of Finance instituted various additional reporting obligations onto Eskom, which the entity will be required to report regular updates on to Parliament and oversight structures. It should be noted that the actual conditions are not set out in ...

ActionSA leader Herman Mashaba has congratulated Democratic Alliance leader John Steenhuisen on his re-election and extended a hand of partnership in working together to remove the African National Congress (ANC) at the upcoming polls.

Steenhuisen beat his opponent Mpho Phalatse at the party's 2023 elective congress held in Johannesburg at the weekend.

Mashaba said his party welcomed the remarks made by Steenhuisen in which he appeared to distance the DA from plans to work with the ANC, and instead embraced the idea of working with like-minded opposition parties to present a united front to voters in the 2024 general election.

Steenhuisen announced that he would be approaching like-minded political parties to sign a “Moonshot pact” to unseat the ANC at the polls in 2024.

“ActionSA has long maintained that to #FixSouthAfrica we cannot partner with those who broke it in the first place. Instead, we need to unite those that believe in unseating the ANC behind a collective effort to do so. This is the only way we can build an inclusive and prosperous future for South Africa,” said Mashaba.

The ActionSA leader announced that he had been in discussions with the Inkatha Freedom Party, Freedom Front Plus and the African Christian Democratic Party about forming a united coalition bloc in 2024 for some time now.

However Mashaba said while his party welcomed Steenhuisen’s commitment to these discussions, they would caution him against attempts at making this a DA-led process.

He added that for a ‘grand coalition’ against the ANC to succeed in forming a stable government, coalition partners must approach these discussions in a spirit of mutual respect and humility.

“We thus urge the DA to engage as equal partners and focus on building a strong and united coalition platform that paves the way for stable and effective government that turns around the legacy of ANC failure and corruption,” added Mashaba.

African Transformation Movement (ATM) leader Vuyolwethu Zungula reiterated its stance for South Africa to be withdrawn from the Rome Statute - and to refrain from arresting Russia's President Vladimir Putin.

In a letter seen by News24, Zungula wrote to President Cyril Ramaphosa, Minister of International Relations and Cooperation Naledi Pandor, and Justice Minister Ronald Lamola.

News24 previously reported that the ATM had requested the government's stance on whether Putin would be arrested, should he travel to the country.

The International Criminal Court (ICC) issued an arrest warrant for Putin on 18 March, for alleged war crimes.

South Africa, the host of the Brics summit to commence in August, and a signatory of the statute, could be required to conduct the arrest, should Putin attend.

Russia is not a signatory of the statute, and the government has requested a legal opinion on the matter.

On Sunday, the ATM called on Ramaphosa, Pandor and Lamola to resume the process of withdrawing from the statute.

The process was revoked by the high court in 2017, which ruled in favour of the Democratic Alliance (DA), due to a failure to obtain approval from Parliament.

Former international relations and cooperation minister Maite Nkoana-Mashabane first submitted the notice to depart from the ICC in 2016.

The ATM's letter read: "Consequently, the above-mentioned depositing of the instrument of withdrawal was found to be unconstitutional and invalid.

"In order to remedy this technical defect pointed out by the high court, the ATM is calling on you to urgently resuscitate the earlier submission by the 5th Administration, seek approval from Parliament, and on exactly the same grounds that were submitted before, resubmit the withdrawal from the Rome Statute of the ICC accordingly."

In the letter, Zungula cautioned the government to reconsider any plans to proceed with Putin's arrest.

Zungula said: "And we cannot stress this point enough, South Africans do not intend for this country to be a war-zone, like Eastern Europe."

He added that Putin's absence would "undermine" the summit and the ongoing de-dollarisation process, including "playing to the Western narrative" that its alliance partners, India, Brazil, and South Africa, have isolated it.

At Thursday's opening of the South Africa-Russia Joint Inter-Governmental Committee on Trade and Economic Cooperation in Pretoria, Pandor declared her support for Russia.

Despite pleas from Western countries, South Africa has maintained its non-aligned stance, refusing to cut ties with Russia.

News24 reached out to the Presidency and Pandor's spokesperson for comment, which was not immediately available. This story will be updated with their comment.

Following a special government gazette, issued on Friday, exempting Eskom from declaring its ‘irregular, fruitless and wasteful’ expenditure, opposition parties have expressed their distress over the move, as they believe this will enable the power utility to hide its underlying malfeasance.

The exemption is understood to have been at the request of Eskom board chairperson Mpho Makwana and he is yet to canvass the necessity of this exemption. ActionSA is in direct opposition with National Treasury’s decision asserting that this “is a clear abuse of power.”

According to National Treasury, Eskom would still be required to disclose all information required by the International Financial Reporting Standards (IFRS) and general debt listing requirements. Further, Minister of Finance Enoch Godongwana has set conditions in place including the canvassing of Eskom annual reports and financial statements detailing irregular expenditure.

“Minister Godongwana’s assertions that the exemption was based on technical accounting grounds, when viewed within the context of the State of Disaster and [Electricity] Minister [Kgosientsho] Ramokgopa’s views that crime and corruption is not a significant issue at Eskom, paints a clear picture of an ANC [African National Congress] abusing State mechanisms to hide the true impact of corruption and crime on our energy crisis. With this newest move, the ANC-aligned criminal syndicates will be given full license to continue looting at the utility,” argues ActionSA president Herman Mashaba.

Democratic Alliance (DA) MP Dr Dion George has called on National Treasury and Godongwana to withdraw the exemption.

“It is unacceptable to hide material information from auditors in the hopes of obtaining a better audit outcome. Finance is based on trust and this exemption further erodes confidence in our already battered economy,” he said.

The DA has noted the “closing balance of irregular expenditure amounting to R67.1-billion on March 31, 2022 in Eskom’s latest annual report”. The party is concerned that the lack of transparency attributed to the exemption will exacerbate the issue.

Further discontent was expressed by nonprofit organisation Greenpeace Africa communications officer Chris Vlavianos, who asserted that this decision gave Eskom free rein to avoid transparency. He added that the announcement had raised more questions than answers.

The African National Congress (ANC) and Economic Freedom Fighters (EFF) used their majority in the Ekurhuleni council to elect African Independent Congress (AIC) councillor Sivuyile Ngodwana as the new mayor.

Ngodwana bagged 129 votes, defeating Democratic Alliance (DA) councillor and former mayor, Tania Campbell, who received 75 votes.

Campbell was removed from office hours before a motion of no confidence, sponsored by the ANC and EFF.

Both political parties, which together hold a majority in the council, described Campbell's stint as mayor as shambolic and regressive for service delivery in the city.

The removal of Campbell on Thursday came after the ANC and EFF cooperated in other hung metros in Gauteng, where they have effectively installed mayors they backed. A metro is defined as hung when no political party has an outright majority.

Campbell was always vulnerable to removal because of the DA's minority governance in the metro, and this was despite its coalition with the Freedom Front Plus, Inkatha Freedom Party (IFP) and African Christian Democratic Party (ACDP).

In October 2022, the ANC and EFF joined forces to remove the former mayor, but because they could not agree on who should lead, the EFF helped vote Campbell back in office to spite the ANC.

The ANC needed the EFF's council seat numbers to win back some control in Ekurhuleni after the party received fewer seats in the council, following the 2021 municipal elections.

In a compromise, first tested in Johannesburg, the EFF and ANC have backed smaller political party candidates for election as mayor.

As in Joburg, the two political parties will likely see some members elected to mayoral committee roles in a power-sharing move in Ekurhuleni.

Ngodwana is the only member of the AIC in the Ekurhuleni council, making his election as mayor a surprise.

ANC and EFF councillors rejoiced in celebration once Ngodwana was elected.

The ANC also rejoiced at the removal of the DA from executive power in Ekurhuleni, describing the party's governance as "an unholy coalition".

It said Ngodwana's election would see parties in the council "work together in ensuring effective service delivery to residents", ANC Ekurhuleni regional chairperson Moipone Mhlongo said.

Meanwhile, the DA labelled Campbell's removal as something that marked the return of the ANC into power with the help of the EFF.

The party's deputy Gauteng chairperson, Fred Nel, said Campbell had ushered in a turnaround strategy to "undo the ANC's failures and decades of neglect".

Nel said the DA multi-party coalition had delivered essential services, such as water and electricity.

"Seventy kilometres of Ekurhuleni roads were rehabilitated, and over 5 000 square metres of potholes were filled, and the pothole backlog was significantly reduced. The government also implemented a fiscal framework to avoid a collapse of the City's finances," Nel said on Thursday.

EFF Gauteng chairperson Nkululeko Dunga said the new government in Ekurhuleni would be a people-centred and corruption-free one.

Days after his election, Tshwane Mayor Cilliers Brink has appointed a mayoral committee to help guide the City's focus on service delivery.

Brink won the mayoral chain on Tuesday with 109 votes against his competitor, Congress of the People (Cope) candidate Ofentse Moalusi, who received 102 votes.

His appointment comes weeks after political squabbling in Tshwane, which pitted the African National Congress (ANC) and Economic Freedom Fighters (EFF) against the Democratic Alliance (DA) and its coalition partners.

The ANC/EFF coalition had initially triumphed with the election of former Cope councillor, Murunwa Makwarela. But Makwarela resigned shortly after amid an insolvency debacle.

Since February, the City has been without a permanent mayor for longer than a week. The former DA MP, who the party transferred back to the local government to lead Tshwane, previously expressed the urgency to resolve service delivery issues.

News24 previously reported that he favoured a multi-party government and said the coalition was more stable with a majority in the council.

At a media briefing on Friday, Brink announced the 10 mayoral committee members, including five DA councillors.

The new MMCs are: Kingsley Wakelin (DA) for Corporate and Shared Services, Hannes Coetzee (ActionSA) for Economic Development and Spatial Planning, Themba Fosi (DA) for Utilities and Regional Operations, Ziyanda Zwane (IFP) for Environment and Agriculture, Peter Sutton (DA) for Finance, Katlego Mathebe (DA) for Roads and Transport, Grandi Theunissen (FF+) for Community Safety, Peggy de Bruin (Action SA) for Social Development, Ofentse Madzebatela (DA) for Human Settlements and Rina Marx (FF+) for Health.

In a statement, Brink said: "I'm pleased to introduce this strong team of individuals who are fit for purpose, ethical, and ready to serve the people of Tshwane. It's important that we have a competent team that can hit the ground running."

He detailed five of the committee's priorities in the City in addressing these issues, which will "fast track service delivery for all". It includes implementing a "bold" recovery plan that focuses on stabilising the City's finances and reducing unscheduled water and electricity outages.

The remaining focus areas are improving basic service delivery, such as general cleaning, pothole repairs, and streetlight maintenance.

Attention will also be given to strengthening the Tshwane Metro Police Department and instilling professionalism through performance management systems.He called on the MMCs, who he described as strong and competent, to maintain "critical oversight" over their departments to ensure success.

Discussions about the adjustment budget due on 14 April are already under way, with planned budgetary workshops for next week prepared for the candidates.

Democratic Alliance (DA) federal congress presiding officer Greg Krumbock said on Friday that it is crucial that the party deliberate and vote on resolutions which seek to address the many issues that confront the people of South Africa, as it heads into its Federal Congress over the weekend, where it will elect a new leader.

The DA said all preparations are complete for the Congress, with nearly 2 000 delegates expected at the Gallagher Convention Centre in Midrand, Johannesburg on April 1 and 2.

In contention for the party’s top position are former Johannesburg mayor Mpho Phalatse and party leader John Steenhuisen.

Nominations for the candidates standing for election closed on March 13.

The party said it was pleased with the diversity of its candidates as well as the provincial representation and the age diversity, also confirming that the nomination process was thorough and democratic.

“We are a truly inclusive party with 45% of our delegates and activists being non-public representatives coming from our branches. The size of the event speaks to the tremendous growth of the DA over the years. The party has exponentially grown since 2015 when we had just over 1 200 delegates,” Krumbock stated.

He said deliberations at the Federal Congress must include resolutions on building the economy and creating jobs, urban and rural safety, and the restoration of the Parliament.

Krumbock said during the congress, the DA would discuss and vote on 43 resolutions that would drive its policy agenda and give practical expression to its values of freedom, fairness and opportunity.

The resolutions presented would build on and extend the party’s policy offering to create an inclusive society and the resolutions would also speak to key areas of exclusion with a focus on how the DA would address them as a party of national government.

The DA now governs millions of South Africans in several metros and local municipalities across the country.

Krumbock said the DA prided itself on its sound internal democratic processes, which he said would be showcased during this weekend’s Federal Congress.

He stated that the DA was now South Africa’s government in waiting, and the results of the DA’s Federal Congress would likely determine the future of South Africa and the country’s democracy.

He highlighted that opinion polls conducted by the Social Research Foundation, Rapport newspaper, and even internally by the DA and the African National Congress (ANC) have all pointed to the ANC losing its majority which would see South Africa, for the first time ever, face a national coalition government.

“Change is on the horizon for our country, and with the DA waiting in the wings, it is the leaders whom the party elects during the congress who will lead South Africa into a new coalition dispensation. When you look at it this way, you realise that the DA’s Federal Congress is a milestone event for South Africa, the results of which could reshape our country for generations to come,” he said.

Meanwhile, Krumbock explained that the party would be using the online OpaVote platform for its leadership elections.

He said the system was fast, explaining that the possibility of human error on the system was slim. He said the party had been using the system in the past three or four years.

“We believe it is a proven system. The DA has been using it for a number of years and in all those years we have never once had a query of dispute about the integrity of the system and the secrecy of the ballot.”

Deputy President Paul Mashatile is engaging with parliament in the expediating of a number of Bills which are a priority for the country, including the Draft Electricity Amendment Bill.

This was according to Minister in the Presidency Khumbudzo Ntshavheni who briefed the media on the outcomes of the Cabinet meeting held on Wednesday.

Cabinet approved the bill which must now go to Parliament.

The Bill will strengthen the role of the National Energy Regulator and allow measures to create a transmission system operator that includes the "provision of an electricity trading platform on a multi-market basis, and provide access to the transmission network on a non-discriminatory basis".

Government estimated that the Bills must be finalised by the term of the new year that begins on April 1.

Minister for Electricity Dr Kgosientsho Ramokgopa undertook visits to 14 power stations for first-hand insight of the challenges facing Eskom at a power station level.

The visits allowed Ramokgopa opportunities to engage with management, workers and unions at the coalface, with the aim to forge collaboration at a power station level, as part of the programme to improve generation capacity and ultimately address electricity shortage.

Ntshavheni highlighted that Cabinet joins the Minister in recognising that Eskom employees are key to solving the country’s energy challenges.

CLIMATE DISASTERS

Ntshavheni said that with the deepening impact of climate change, the role of science, technology and innovation in disaster mitigation, response and in some instances, prevention, has become more critical.

Last week four of the five municipalities in the O R Tambo district in the Eastern Cape experienced heavy downpours which caused flooding, with the coastal town of Port St. John’s being the most affected.

Ntshavheni said Cabinet reminded people who live in low-lying and flood-prone areas to always exercise extreme caution and follow weather warnings.

President Cyril Ramaphosa visited Port St. Johns on Tuesday to assess the government’s and civil society’s response to the situation following the extensive damage.

The President reassured communities of government’s support and applauded the work of emergency services who assisted in rescue efforts in the area.

Ntshavheni said the National Disaster Management Centre is coordinating government’s response in working with the Eastern Cape and the OR Tambo district disaster management centres to limit the negative impact of the floods on communities.

Cabinet noted the use of science in the response and mitigation efforts through work by the Council for Scientific and Industrial Research, the South African National Space Agency, the South African Environmental Observation Network and the South African Weather Service.

WHITE PAPER AND POLICIES

Cabinet approved the White Paper on Conservation and Sustainable Use of South Africa’s Biodiversity.

Ntshavheni explained that the White Paper will help the country take advantage of its rich biodiversity.

“It emphasises the importance of the biodiversity sector to South Africa’s economic growth, conservation and equity in the biodiversity economy. The White Paper also highlights the importance of protecting indigenous knowledge and biodiversity,” she said.

Cabinet also approved the Policy and Policy Direction on Rapid Deployment of Electronic Communications Networks and Facilities.

Its purpose is to direct the Independent Communications Authority of South Africa to prescribe regulations on procedures and processes for resolving disputes that may arise between an electronic communications network service licensee and any landowner during the deployment of electronic communications networks and facilities.

Efficient deployment of electronic communications networks is a priority for the government as it supports the country’s move towards the digital economy, she explained.

SA Tourism will no longer pursue a proposal to ink a controversial R900-million sponsorship deal with English Premier League club Tottenham Hotspur FC.

On Thursday, Minister Patricia de Lille said the SA Tourism board agreed with her advice not to proceed with the proposed deal.

She said that "the use of public funds must be carefully considered" in the current economic climate.

The South African Reserve Bank's monetary policy committee hiked interest rates by 50 basis points to 7.75%. Economists were expecting an increase of 25 basis points.

Three members of the monetary policy committee voted in favour of the 50 basis point hike, while two wanted a 25 basis point increase.

The latest hike brings the prime rate to 11.25% - the highest level since 2009.

On a new home loan of R2-million at the prime rate, the latest increase hikes the monthly instalment by around R680. Since November 2021, monthly payments on a R2-million home loan are almost R5 500 more expensive due to a raft of rate hikes.

Reserve Bank governor Lesetja Kganyago said that inflation pressures remain a risk and that loadshedding is pushing up the cost of living.

In February, headline inflation unexpectedly rose to 7% - the first increase in four months - due in large part to raging food prices. Food and non-alcoholic beverages annual inflation hit 13.6% - the highest level since April 2009.

Apart from local inflation, the local monetary authorities must also keep track of US interest rates, which have seen aggressive hikes. The gap between US and South African interest rates can't widen too much, otherwise foreign investors – who are on the hunt for solid interest rates - will shun rand-based assets. This will put more pressure on the rand, which is already one of the worst currency performers this year.

Kganyago warned that further rand weakness is likely, which would further fuel inflation.

Last week, the US central bank hiked its key interest rates by only 25 basis points following turbulence in the banking sector.

The Reserve Bank again cut its growth forecast – it now expects the South African economy to grow by only 0.2% this year. In January, it was still expecting 0.3%. As recently as November, it expected growth of more than 1% in 2023. Loadshedding will shave two percentage points off growth this year, Kganyago warned.

But the bank boosted its growth expectation for next year from 0.7% to 1%.

South Africa's economy shrank by 1.3% in the fourth quarter, much worse than economists expected and the largest contraction since the third quarter of 2021, when deadly riots in KwaZulu-Natal and Gauteng caused massive economic disruption. South Africa may well be in the midst of a recession, if the economy also declined in the first quarter.