Fin24

Eskom price hikes unavoidable - Gigaba

2012-11-13 10:20

Johannesburg - The 16% electricity tariff hike every year for the next five years is unavoidable, Public Enterprises Minister Malusi Gigaba said on Tuesday.

"It [the tariff increase] is not fair, [but] it is necessary," Gigaba said at a business breakfast in Fourways.

"Given the challenges that we have... we need to ask South Africans to bear the collective pain to fund this build programme and go through this painful process."

In October, Eskom submitted an application to the National Energy Regulator of SA for a 16% tariff hike every year for the next five years.

Gigaba said the poor needed to continue to be shielded. They would be charged a single-digit flat rate determined by municipalities.

Eskom asked municipalities to be considerate of their mark up when charging more for electricity, as it was a source of revenue, Gigaba added.

Share your thoughts and tips on how you are coping.

Comments
  • Jeremy - 2012-11-13 10:28

    "The poor need to be shielded." Well, guess what, we'll all be poor if Eskom is allowed to raise its rates by 16% a year for the next 5 years. And, by the way Mr Gigaba, maybe we'd be more inclined to "bear the pain" if government was more honest and more careful about its own spending. How about saving R200 million by stopping work on Nkandla for starters?

      arthur.salvado - 2012-11-13 10:36

      And pay back all the wasted millions and golden handshakes. Give the money back guys. It's not your money. Taxpayers should say " enough is enough .... no more "

      gift.mushi.9 - 2012-11-13 10:43

      Does Gigaba pay Elacricity? Obviously, Electricity hike is unavoidable because he does not feel it's pinch. Now I understand why working class strike for 20% increase in their wages, because they want to make provision for ever-unavoidable escalation of basic constitutional needs, e.g. e-tolls, elecricity, food prices, etc.

      charlesbronson.bronson - 2012-11-13 10:49

      Eksdom, you are all the same as your corrupted useless tax thief Jacob "Compound Zuma. Thief's!!!!!

      shirley.steenkamp - 2012-11-13 10:49

      Start using the huge bonusses given to executuves etc in Eskom,stop laying all your high costs due to bad management,future planning and overall lack of forsight into the needs of this growing population on the average Joe! People are spending more on power than food!!! Yet somehow the fat cats are not preturbed by this and continue to grab their bonus with their fat hands!!!!!!!

      debduplessis - 2012-11-13 10:50

      Implement the Australian system expereinced in Sydney 1st hand ... we install solar pannels, generate the power - we pay for our electricity BUT what we generate for Eskom is off set THUS making it cheaper & affordable for all!

      stirrer.stirrer - 2012-11-13 10:53

      Quick solution: Stop being "nice" to BHP Billiton, which uses 10% of Eskom's capacity at a very low cost, subsidised by the ordinary user like us. Let them pay the same as us, or shut them down. We don't need them. Stop exporting power to Zimbabwe at low cost. We don't owe them anything. Do they even pay for what they use?

      james.bondiski - 2012-11-13 11:19

      ANC AND ESKOM RETURN FIRST WHAT WAS STOLEN !!!.... ......................./´¯/) ....................,/¯../ .................../..../ ............./´¯/'...'/´¯¯`•¸ ........../'/.../..../......./¨¯\ ........('(...´...´.... ¯~/'...') .........\.................'...../ ..........''...\.......... _.•´ ............\..............( ..............\.............\...

      karel.dutoit.50 - 2012-11-13 11:21

      15 Jun 2012 – Eskom's profits soared to R13.2-billion on the back of increased tariffs

      arthur.hugh - 2012-11-13 11:43

      How about they suffer with us, the public, by forfeiting their millions of Rands Xmas bonuses every year for the next 5 years? If not, go shove it.

      mlucejko - 2012-11-13 11:45

      "Incompetence" costs money, lots of money!! Sadly it's the South African Tax Payer and Electricity user that is paying for their "Incompetence" !!

      allan.dewet.9 - 2012-11-13 12:01

      Can they, the Gov and eskom advise the puplic % by % how they derive at this figure??? including the profit split between Eskom and the minister/ gov

      johan.wilsnach - 2012-11-13 12:10

      One of the major issues with Eskom is productivity and proper planning. These things are non existence. These are the hidden cost the consumer don't know about and for this reason it is easy to pass this cost onto the consumer. What a price to pay for incompetence.

      heathway.master - 2012-11-13 16:03

      South African tax payers, all is not as hopeless as they are portrayed to be. Man is a very inventive creature, especially when he is faced with economic blackmail. The very clever overseas engineers however have devised the perfect solution to such a situation. Many European countries have installed solar panels on their roofs, which turn water into steam and drive electrical turbines that charge up a series of batteries. These provide electricity at night, as well as all hot water. Large industrial plants also have a battery of solar panels that can generate 4 megawatts of electricity, totally adequate to drive all their plant and equipment. All this energy comes at no cost once equipment installed. If SA does same, Eskom will eventually become obsolete, and their only function will be to supply electricity to the non-paying masses. They will then have to fire the millions of oxygen thieves in their employ.

      armand.horn.58 - 2012-11-13 16:05

      The problem is that we the 20%odd that is really working and paying their dues will have to subsidize the other 80%. How long do you think this wonderful idea can last??

      marc.hugo.75 - 2012-11-13 22:35

      Quite so Jeremy. And what is the definition of poor? And are the poor shielded from the other economic realities? Bread prices? Maize meal? Fuel prices? And what is the incentive for them to have smaller families if they continue to be shielded from the normal expenses of life - wherein the productive pay for the unproductive - and improvident. Where the careful and thrifty pay for the foolish extravagance of the "poor". Are these "poor" the loyal voting pool of the ANC. Is the productive part of society paying for these people to ‘like’ the ruling party? Is the ruling party siphoning excessive Rands for services from me and my fellow South Africans for the ANC to feather their electoral nest? Rhetorical questions of course - the answer is "yes". I and my fellow productive South African's patience are wearing thin on this communist rubbish. Want to experience our seething rage oh governing one? You won't know what hit you.

  • customdesign - 2012-11-13 10:29

    Easy to say when the taxpayers are building you a 20 million rand mansion

      derek.swart.98 - 2012-11-13 12:12

      Actually it's R200 Million!!!

      customdesign - 2012-11-13 13:10

      200 million for Zuma, and 20 Million per home for his cronies- amounting to 1.6 Billion.

  • andres.dewet - 2012-11-13 10:30

    There is a tremendous difference between what is unavoidable for ESKOM and what the economy can currently absorb! Why is this not being discussed and alternative solutions found. We cannot simply say: "ESKOM's bottom-line NEEDS it." Not at a juncture when the economy struggles to recover, job-creation stubbornly low and certain municipalities use electricity mark-ups as cash-cows.

      lacrimose.wolf - 2012-11-13 11:02

      Had Mbeki's govt allowed Eskom to develop their infrastructure back in 2005 we would not be here today. We were asked in 2007 to suffer through this gross ineptitude for 5 years but they knew back then it would be 10, not 5. We are now paying 2012 --> prices for work that should have been done back in 2005.

  • sandy.sutherland.58 - 2012-11-13 10:30

    You mean to say - to fund our lavish lifestyles, parties, huge bonuses etc... we are going to have to rape....er....I mean increase the tariffs by 16% a year - sorry but you would have to be stupid to believe that this is true - I find it amazing that Eskom starts threatening rolling blackouts as we near the time they have to ask for these 'raises' but as soon as they are approved it never happens - so if the situation is so dire then how come we did not have the blackouts - basically it is a legalised form of what the Mafia would call a protection racket!

  • richard.laros.77 - 2012-11-13 10:30

    Let me understand this... we, the tax paying (burdened) South Africans, must allow you, the inept ANC government, to allow Eskom to increase electricity tariffs by 16% every year for the next 5 years. And all the while the executives at Eskom will continue to pay themselves fat bonuses on the increased revenue, and the inept bunch of cretins running this country will continue to steal from the same tax payers through every corrupt means possible. Well OK, why didnt you just say so. I am not sure what is worse, Eskom or the ANC, however I think they are sometimes just indistinguishable from each other.

      arthur.salvado - 2012-11-13 10:40

      Ali Baba and the humpteen thieves. One and the same. Problem is that we keep providing the funds for them to steal. Must demand that they give our money back first and then let's look at the finances and determine what is required. Bunch of thieves they are .

      Jeremy - 2012-11-13 10:53

      Well said Richard! I believe the head honcho at Eskom gets around R400 000 a month. Plus shares and bonuses no doubt! Time for us all to protest against government killing the golden goose via Eskom and e-tolls!!!

  • juven.rittles - 2012-11-13 10:31

    Eskom I really hope you have slashed give those millions to your executives becoz that would be so capitalists oppurtunistic and immoral•

  • haroldcecil - 2012-11-13 10:32

    Sure it is unavoidable bc if it was avoidable the ANC goverment and Jacob was not gonna have money 2 pay 4 Nkandla gate

  • terrylee.heuer - 2012-11-13 10:33

    I just bear the pain everyday of having a Govt like this!!!

  • nomkhosy.ramabele - 2012-11-13 10:33

    Why there is no competition for energy supply in SA?

  • beth.cameron.94 - 2012-11-13 10:34

    Yes, of course it's necessary. Necessary for the head honchos to receive multi-million rand bonuses for being crap in their jobs!!!!

  • rowan.maulson - 2012-11-13 10:35

    Crap of the highest order. Yes Eskom need increases, but 16% per year for 5 years? (followed by another 2 MYPD's).. no bloody way. All they are doing is making renewable energy sources (like Solar) more and more cost effective for the residential market. Eventually they will loose large swathes of that income because we will all go off the grid as much as possible.

      robqb - 2012-11-13 11:47

      And they WILL tax you on your electricity savings.

  • john.dough.5836711 - 2012-11-13 10:35

    Bloody economic terrorists!

  • BigChiefPlumbPudding - 2012-11-13 10:36

    At some point solar energy will become more economical and people will disconnect from Eskom. Keep pushing the price up and that day will come sooner. Also, your rates will eventually impact negatively on the economy. When this happens, please don't blame apartheid. Finally, please don't dish out Million rand bonuses if you're so clearly short of money.

      arthur.salvado - 2012-11-13 10:47

      You ask them not to dish out millions in bonuses. That's a problem because that's all they do. If they stop then eish, what must they do for the rest of the time. ?

      karel.dutoit.50 - 2012-11-13 11:20

      15 Jun 2012 – Eskom's profits soared to R13.2-billion on the back of increased tariffs Does this look like they are short of money?

      cynic.martian.3 - 2012-11-22 12:34

      On top of that, they allow Soweto to fall R3.3Bn in arrears. Please collect that money first before you increase any tariffs!

  • werner.nel.712 - 2012-11-13 10:37

    It is avoidable, stop buying power back from big business at peak times. Increase the rate for exports, Privatise and list on the JSE to attract investment...

  • jenipher.lavender - 2012-11-13 10:39

    I would be less inclined to complain about all these increases if i felt that tax moneys was being put to good use and there was still a shortfall or defecit thereafter. It is not fair though to ask us tax payers for more money for the shortfall or deficit whilst our hard earned monies is not being put to good use and is being poured down the toilet through corruption. THAT is what makes it a bitter pill to swallow!

  • rurapenthe - 2012-11-13 10:40

    At some point is going to be cheaper to setup an array of wind turbines or solar panels in your garden/roof ...

      denise.wilshire - 2012-11-13 11:06

      Clean energy is the way to go, but unfortunately our Government cannot tax us on the wind in our hair or the sun on our backs YET! They do not have shares in those two factors either, so they are not interested in supporting a change to those obvious avenues of energy generation!

  • dragonfire47 - 2012-11-13 10:42

    yeah, to finance your first class holidays and crates of johnny blue, thieving trash of the universe

  • waz7710 - 2012-11-13 10:44

    Just say it in plain English......In 5 years we will be paying 80% more into the governments pockets! Not for electricity though but to make the fat cats Fatter!!

      ernst.lederer.56 - 2012-11-13 12:46

      Not 80% more but 150!!!

  • justin.pretorius - 2012-11-13 10:44

    Everyone will be poorer in this country soon. companies are now considering leaving Well done Eksdom!

      justin.pretorius - 2012-11-13 11:30

      @arthur.salvado read my comment again. Not implying anything - COMPANIES ARE LEAVING OR HALTING INVESTMENT! The only solution is to go on riots and destroy property

  • brionyl.french - 2012-11-13 10:46

    With salaries lucky to go up by 5%, inflation 10% and Electricity 16% thats 11% more than we can afford, unless your in government getting fatter and fatter

  • aspruyt - 2012-11-13 10:46

    It is totally avoidable. I am removing myself from the equation in the next few years. No more abusing my tax money you incompetent faks.

      craig.b.johnston.7 - 2012-11-13 12:33

      with you there.i`ll be gone in 5 years too,not paying 4 grand a month for a freakin water and lights bill.

  • mart.botha - 2012-11-13 10:47

    A very large and exremely bitter pill to try and swallow when you consider that the blame for the current and future requirements fall squarely on the shoulders of an inept and corrupt revolutionary turned criminal organisation.

  • larry.piggott1 - 2012-11-13 10:47

    ANC economics. Loot, Burn and destroy. I dont know how this will help the poor.

      robqb - 2012-11-13 11:53

      The ANC IS there for the poor. They want to be fair and make all of us poor first.

  • nhlapop - 2012-11-13 10:47

    Sell Zumas home to cover the cost. Now u mad Malusi, bloody agent. Do you know how this increase is going to affect those who cant even use electricity to cook, just for lights. Yet government is going to spend billions to upgrade ministers houses, including Inkandla on the list. Not only Zuma to step down after MANGAUNG THE WHOLE CABINET.

      brendan.vogt.1 - 2012-11-13 10:56

      No Nhlapop, if you live in COSMO, you get all the elecricity you want and you only pay R100.00 a month. I'm seriously thinking about moving to COSMO

  • debduplessis - 2012-11-13 10:48

    Absolute nonsense... just stop giving it away for next to nothing to rest of Africa, large businesses & paying out MASSIVE bonuses --- charge all the same fee structures & will be cheaper for us ALL!!! Hikes are unnecessary!

  • zelda.dickson - 2012-11-13 10:49

    Starting at the top with the CEO and the likes taking a pay cut on their exorbitant salaries.

  • yolanda.r.haripersad - 2012-11-13 10:50

    The middle class will have to struggle and pay these tarriffs, but what happens to the mining and manufacturing sector?? Their rising costs will be passed to All South Africans, how will you protect the poor then?

      joe.irwin.50 - 2012-11-13 18:09

      Exports are going to suffer also. There are many small to medium sized companies who are big users of electricity. I doubt if 50% of them will be around in 3 to 4 years time.

  • brendan.vogt.1 - 2012-11-13 10:52

    "Given the challenges that we have... we need to ask South Africans to bear the collective pain to fund this build programme and go through this painful process" "And us taxpayers ask you idiots to bear the collective pain of NOT receiving those Multi Million Rand bonuses. We know it will be a painful process but please try and bear the pain" !!!!!!!!!!!!!!!!

  • mari.theologo - 2012-11-13 10:52

    I will have to close my business as I already only keeping it open to only pay staff wages and electricity bills!!! Enough is enough!!!

  • ndokweni - 2012-11-13 10:52

    Jah that how politic works

      denise.wilshire - 2012-11-13 11:11

      That is why the WHOLE country needs to be educated what it means to have a vote. The majority voted yes to this band of inept people. They sit in the seats of power, making our lives impossible while they and their friends and families grow richer every day! While they do all of this, we watch our beloved, once thriving economy slide down the drain.

  • donald.perumal - 2012-11-13 10:54

    @Gigaba There are so many things you can do to help the public: 1. The Municipalities should freeze all profits on electricity the next five years. 2. Eskom shoiuld freeze all bunuses and increases for the same period. 3. The theft of cables/elctricity should be stopped. 4. The "unnecessary overtime "claimed by Eskom workers" should be monitored and those that are corrupt should be brought to book. 5. Parties for families and unnecessary expenditure should be curtailed. That should save us alot of money.

  • coontly - 2012-11-13 10:55

    How is the average person supposed to survive on an average salary with these exorbitant increases. Inflation = 6%, Salary increase = 6%. Yet Eskom wants to increase electricity by 16% : How can this be allowed? Inflation is a lie in SA. It is probably 13% .

      mari.theologo - 2012-11-13 11:22

      I have a small business 15 people working for me I can't afford bigger increases than the law stipulates no more savings left working from day to day to keep it open stress is unbelievably high people have no spending power its awful being in this situation I am a employer which employees get a salary but I don't! Can't just close and walk away! Would like to though!!

      afrikeni - 2012-11-13 11:30

      They will just change the CPI basket and give as little weighting to electricity as possible. In those next 5 years inflation will not pass 7%, wanna bet?

  • hitting.thefan - 2012-11-13 10:58

    You know what I have no savings, I live from month to month and yet I am not considered poor. The system is flawed and the burden are being placed on a so-called middle/class that are having financial troubles of there own. When I loose due to financial strain are they gonna shield me. These parastatals run in-efficiently then we as the middle/upper class have to pay for the massess!!! The system is stacked against us!

  • tshidiso.mathang - 2012-11-13 10:58

    You forgot to mention another rip-off in E-tolls, Bishop Tutu said it long time ago that this government no longer represent the will of the people. If they not killing people they demolish houses and milk the tax payer to the last cent.

      heini.botes - 2012-11-13 11:09

      Yah, let's see come 2014......promise you, not much would change 60%+ again for cANCer. Talk about daft

  • Ze Don - 2012-11-13 10:58

    It's time the ''poor'' start paying for electricity, that might motivate them to use less! By protecting the ''poor'' the few of us that do pay end up having to pay 30%+ increases!

  • denise.wilshire - 2012-11-13 11:03

    These hikes are completely avoidable if our genius government would allow other role players to enter the energy supply arena. Since there is NO competition in this area ( there are a few others in the same boat too ) we will continue to experience the total lack of expertise, vision, dishonest and unwise spending because they do not have he skills to manage such a complex set up. Of course we should spend as much money as possible lining the pockets of those who sit in the gilded seats at Eskom management and our coal mining sector who keep those out dated, run down power stations belching fumes and polluting our environment, running. Just think of the lucrative contracts streaming into the private pockets of people related to Eskom and Government officials. The mind boggles. YET WE PAY AND WILL CONTINUE TO DO SO UNLESS THIS ORDER IS CHANGED. Just to add fuel to the proverbial fire, they are mismanaging the construction of 2 more electricity supply dinosaurs. The contracts are so far behind and the original quotes are way in excess of the original figures. But of course I am racist for pointing out that our government does not have the skills OR morals to run this country efficiently. They are however, running it into the ground! Just look how far we have sunk since 1994!

  • peter.kowalski.566 - 2012-11-13 11:03

    R4Billion a year lost do to complete incompetence of Eskom Management?? Why not try a sort this out 1st before you ask the consumer for more money that your staff are going to continue to throw down the toilet!?

  • peter.kowalski.566 - 2012-11-13 11:05

    Do the right thing and allow IPP's to compete on an even keel to produce power in SA - Instead of maintaining a monopoly that is killing SA's economy - wake up Gigaba!!

  • leonch - 2012-11-13 11:11

    Wonder how much they spent on this breakfast alone...

      Adele Reid - 2012-11-13 12:13

      'SHOCK'ing ...

  • gabriel.melim - 2012-11-13 11:13

    Let's start by reviewing the overheads of Eskom!! Performance bonusses are exactly that, i.e. a bonus paid for achieving positive results, not an amount paid in order to get a positive reaction from the receipient. Get rid of "passengers" on the gravy train before the train runs out of gravy. Maximise the output for the amounts being invested in people.

  • mnbain - 2012-11-13 11:15

    At this rate of inflation R100 worth of electricity in 5 years will cost 210 and this excludes the markups of the respective municipalities and the sliding scale of costs. In 5 years this is a 110% increase, saying its 16% makes it look a lot less ridiculous than the reality

      afrikeni - 2012-11-13 12:03

      They will never say it in plain English, " We asking you guys to pay twice as much as today in five years time!"

  • karel.dutoit.50 - 2012-11-13 11:17

    As you said it is NOT fair. But my opinion is that it is totally unnecessary. Your profits can cover this 16% increase.

  • denise.wilshire - 2012-11-13 11:18

    Gigaba said the poor needed to continue to be shielded. They would be charged a single-digit flat rate determined by municipalities. Just like the Taxis won't be charged for using the Tolls.... Get rid of Gigba! Get rid of Shabangu and anyone else who is unable to run a department in the Government..On second thoughts,GET RID OF THE GOVERNMENT. Vote with your head and not with your hearts. This government is USELESS TO THE PUBLIC OF SOUTH AFRICA.

  • andrea.seaton.16 - 2012-11-13 11:18

    After watching Carte Blanche on Sunday ! Forget it, get your house in order first, prove to the public that you know how to manage / balance your books then lets talk ! Enough of this daylight robbery ! Eskom, E-tolls, petrol price when will this end

      Sherwin Prim - 2012-11-13 11:40

      I think i smell a strike coming on... a tax- payers strike! The law government mathematics: Tax contribution is inversely proportional to service delivery. It's no wonder why our learners need math lit...need to get their heads around this concept.

      robqb - 2012-11-13 12:49

      Never!

  • marc.ross.965 - 2012-11-13 11:18

    I smeel a Zuma in the woodpile.

  • craig.ellis.56829 - 2012-11-13 11:22

    So after we "bear the pain" will you reduce electricity by 16% for the next 5 yrs? Thought so!

  • craig.ellis.56829 - 2012-11-13 11:23

    Problem is they have us by the balls, without electricity we are all screwed, boycott Eskom would hurt them the most

  • Tobie Vd Vyver - 2012-11-13 11:28

    If you manage Eskom better you will have more money for projects. We did some work on one of their power stations and there were workers literally sleeping the whole night through doing nothing. Nice to have people on the payroll that is useless...

  • denise.wilshire - 2012-11-13 11:33

    Nicely done Minister Gigba! "Gigaba said the poor needed to continue to be shielded. They would be charged a single-digit flat rate determined by municipalities." The numbers of poor are growing more rapidly than our economy. This is exactly what the government want. The poor cannot afford to buy newspapers, have internet or a decent education. The latter being engineered by the government. This makes them unable to keep up with the latest government scams, or use educated reasoning. The poor cannot join us on a forum such as this for open discussion. The poor can however think that THE GOVERNMENT actually cares for them, by virtue of such "flat rate " considerations. The poor will by virtue of this "gift" be voting for the current status quo. This is the masterplan for the ANC to stay in power! GENIUS!

  • henk.venter.754 - 2012-11-13 11:34

    if the ministers stop stealing by all the unauthorised spending of government money and corrupt tenders, the unlawfull spending of money on zumaville and the roads to it, there will be enough money for developments at eksdom! O and dont forget the huge bonusses the management will get due to the fact that they got it right to steal 16% more from the people! Furthermore, stop this illegal billing of the whites in former white areas just because they are white and bill everybody and let everybody pay for what they get and there will also be money! Even during apartheid we had to pay for electricity and DID NOT GET IT FOR FREE!!!!

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