• A gazette exempting Eskom from reporting fruitless and irregular spending in its financial statements has been withdrawn.
• This comes after widespread criticism was levelled at government for giving Eskom a tool to potentially hide corruption.
• Enoch Godongwana has said he will engage with the auditor general as well as Eskom’s auditors to find an amicable solution.

On Friday government published a gazette which effectively gave Eskom permission to withhold disclosure of irregular expenditure and fruitless spending from its financial statements.

In defence of this bizarre move, the National Treasury attempted to justify the gazette by saying that disclosing this information risks triggering loan covenants, “which will likely further increase Eskom’s cost of borrowing and may result in additional fiscal pressure from Eskom’s debt burden should the entity be unable to negotiate lender waivers for these covenants.”

As one might expect, South Africans reacted negatively to the news that Eskom would be able to side-step a key transparency measure while the nation waits for the energy crisis to be addressed. While Eskom would still be required to disclose irregular expenditure and fruitless spending in its annual report, the potential for any sort of malfeasance saw citizens push back.

This morning, during a press briefing, Minister of Finance, Enoch Godongwana announced that the gazette granting Eskom the exemption had been withdrawn.

“Yesterday we had intensive discussions with the auditor-general (AG) and in that discussion there were some contributions from the AG that need to be part of the framing of the gazette,” the minister said.

“In the light of those comments and comments from the public, we have decided to withdraw the gazette for now and have more detailed discussions with the AG and the auditors of Eskom so that the framing is proper and the checks and balances are tightened,” Godongwana added.

At a time when government really should be working to increase transparency and accountability at Eskom, this gazette stood out like a Starlink array on the night sky. Together with comments made by Minister of Electricity Kgosientsho Ramokgopa in March that technical problems, and not corruption, were to blame for the troubles at Eskom, government sure is looking like it needs clear direction, and a public relations team.