De Ruyter says place turned untenable, as Gordhan pledges to cope with Eskom ‘termites’

• Minister Pravin Gordhan says programs launched under André de Ruyter’s stewardship will not be interrupted if he leaves the energy company.
• The minister implored Eskom workers to continue to oppose the corruption that is undermining efforts to limit load shedding.
• Gordhan also expressed his gratitude to de Ruyter, who felt he had to back down from his untenable position.
• For more financial news go to News24 Business front page.

While pledging to continue outgoing CEO André de Ruyter’s anti-corruption efforts, Public Enterprises Minister Pravin Gordhan has pleaded with Eskom workers not to take bribes and to fight back against corruption that is hampering efforts to limit load shedding.

The minister spoke about De Ruyter’s resignation at a media briefing. Gordhan assured that the programs begun under de Ruyter’s supervision would continue, including cleaning up corruption. Eskom was one of the main arenas where the state capture project unfolded. Corruption continues to plague the company.

Gordhan cited recent reports that engineering multinational ABB had paid South Africa over R2.5 billion for the bribe it was involved in to secure contracts to build Kusile.

Gordhan said there are still “termites” within Eskom, but law enforcement would identify them and make sure they land in orange uniforms much faster than they currently do.

Both Gordhan and CEO Mpho Makwana praised De Ruyter’s professionalism in running the utility.

De Ruyter told the media it was a privilege to lead Eskom but felt his position had become untenable.

News24 previously reported that Mineral Resources and Energy Minister Gwede Mantashe accused Eskom of “actively agitating to overthrow the state” by not dealing with load shedding. Mantashe has also openly criticized whether de Ruyter is the best person to run Eskom, questioning his skills and expertise.

Gordhan defended De Ruyter against Mantash’s allegations:

“Regarding the fall of the state [comment] and [whether De Ruyter is a] Traitor, the clear answer is no. I will not qualify it in any way. Whatever comments one may have about a person, it is totally unfair and inappropriate to use that type of language for someone who tried their best to get Eskom out of the mess it was in. The more knowledgeable people know the mess didn’t start in 2019…or 2012. It started a long time ago and there’s a long list of people to be held accountable for decisions they didn’t account for right way.”

“In light of recent media reports, I am unfortunately in a position where I do not believe this position is tenable,” said De Ruyter. De Ruyter said his position required the support of “the broader political economy”. That support is also critical to “enabling Eskom’s success,” he said.

“Accordingly, I have decided to step down in order to allow the shareholder and Board of Directors the opportunity to nominate a candidate for the position of Group CEO who may be better suited and better resourced for the strategic and operational objectives at hand.”

Gordhan warned employees against accepting bribes or “handouts” from people. Most recently, a contractor’s worker performing maintenance at an Eskom power plant was arrested for sabotage. The worker was told that there would be maintenance and repair work if he carried out the task.

He urged Eskom employees to remain committed to serving South Africans rather than paying their own pockets.

Now is the time to stand against corruption, now is the time for you to support South Africa as a country, and now is the time for us to recognize that we work for the 60 million people of South Africa, not just for ourselves and not just for our pockets.

– Minister for Public Enterprises Pravin Gordhan

Other programs going ahead include legally separating the transmission entity and appointing its board – which should have the right mix of skills, Gordhan said. Eskom would also continue to address load shedding by supporting the addition of new generation capacity to the grid – be it in the form of solar, wind, battery, pumped storage and even gas.

Details of Eskom’s debt resolution, with the state assuming a large part of it, will also be announced in the next budget in February 2023. Gordhan assured the lenders that their money is safe and they can contact both the board and his ministry to raise any concerns they might have.

Gordhan also assured that Eskom and the country remain committed to a just transition and plans to convert old coal-fired power plants like Komati to renewable energy.

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De Ruyter has two months’ notice but is staying until March 2023 to ensure a handover to his successor.

READ | De Ruyter exit: Concerns about energy transition, $8.5 billion pledge from rich countries

Asked about Mantashe’s comments, Makwana dodged the question, saying it was not in his “sphere” to determine whether or not De Ruyter was a traitor. Gordhan, meanwhile, said the answer was a resounding no.” Gordhan said it was “unfair and inappropriate” to use such words to describe De Ruyter, who had tried his best to get Eskom out of a mess.

Gordhan noted that South Africans are right to be frustrated with load shedding, but the crisis began many years before De Ruyter joined the utility.

“There’s a long list of people who can be held responsible for decisions they didn’t make in the right way,” he said.