Eskom has told parliament that it expects to get only R1,26bn from the claim it submitted against the business rescue practitioners of Tegeta for contractual penalties owed to the power utility.
A figure of R5bn has been bandied about in recent weeks, but Eskom’s Dan Mashigo told parliament’s public accounts watchdog Scopa (Standing Committee on Public Accounts) on Thursday evening, that due to Tegeta having other creditors, Eskom bosses have been informed they were only likely to recover R1,26bn when the process of winding up the business is completed.
Mashigo explained that the estimated amount owed by Tegeta was R5,6bn and it relates to a penalty claim whereby in February 2018, the company placed three of its collieries, which supplied coal to Eskom, in business rescue.
He said there were already penalty claims before the companies were placed in business rescue which related both to quality and supply.
Post business rescue and on a monthly basis, when the mine did not supply the coal, it raised a failure to supply.
There are clauses in the contract which quantify for every time this failure happened what Eskom should claim, he said.
The majority of the penalties emanate from the post business rescue period and mainly for failure to supply. “Though they were in business rescue, the contract wasn’t suspended and we exercise our right to implement the contract,” he said.
Eskom is also hoping to recoup about R4bn in overpayments to four contractors at the Kusile power plant.
Eskom CEO Andre de Ruyter told MPs the matter first surfaced in October 2019 when parliament’s standing committee on appropriations was informed of an ongoing investigation by the special investigative unit (SIU) into overpayment to contractors at Kusile. Some of the companies are still operating at Kusile, MPs heard.
De Ruyter said the overpaid amounts — subject to contractual negotiation and in some cases dispute resolution — were an estimated overpayment of R1bn to to ABB SA, R735m to Nova Minerals, R1bn to Tubular Construction Projects and another R1bn to a fourth company. It is not clear how the companies were overpaid.
The overpayments are just some of the funds Eskom is trying to recover or has recovered from a range of other companies.
- R171m paid by auditing company Deloitte to Eskom on May 12. The power utility had launched court proceedings against Deloitte in October 2019 to recover R207m arising from task orders that were awarded irregularly without an open and competitive tender process.
Pursuant to a settlement agreement concluded between Eskom and Deloitte on March 20 2020, Deloitte paid Eskom R171m on May 12 2020, parliament heard.
A similar claim was issued against PwC whereby Eskom issued a letter of demand against the firm in April 2020 demanding the repayment of R95m that was allegedly unlawfully paid to PwC.
PwC was contracted by Eskom on a risk based contract to realise capex savings on its generation projects.
De Ruyter said had it not been for the lockdown, Eskom would have issued court papers to recover the money from PwC.
- MPs also heard that Eskom was working with the SIU to set aside the contract that was irregularly awarded to ABB.
The company said it also lost about R75,8m due to the negligence of its former general manager responsible for facilities. The manager was dismissed after a disciplinary hearing process and the company has instructed attorneys to recover the sum of R75,839,738.50 from the former employee.
- The company has also instructed its lawyers to set aside unlawful contracts and recover full values of all contracts that were awarded to Impulse International, a company in which the stepdaughter of former Eskom executive Matshela Koko was a shareholder. The company was awarded contracts worth billions of rand by Eskom.
De Ruyter said the SIU, Sars and the Hawks were also involved in this matter.
- Another company, Africawide, was awarded a contract by Eskom without an open and competitive tender process. Eskom documents show that the original contract value was R9m and was allegedly modified without National Treasury approval to R17m. Eskom is trying to recover the amount.
De Ruyter said as at March 31 2020, Eskom’s Industrial Relations Department had registered 141 disciplinary cases emanating from forensic investigations. Of these, 133 had been completed and eight were still in progress.
The completed “disciplinaries” resulted in 60 employees resigning during disciplinary processes and a further 18 being dismissed as a result of fraud and corruption.
Scopa also heard that prosecution related to two former Eskom executives who were arrested on corruption-related charges in December 2019 is still in progress.
De Ruyter said they were following through even on cases of employees who had resigned and trying to recoup money from them.
To date, he said, they had registered a total of 76 criminal cases from investigations.
Of these, 59 have been registered and were being pursued through other law enforcement agencies, including the SAPS, Hawks, SIU and commercial crimes unit.
“How much money can we recover? That’s the R100bn question,” said De Ruyter.
“It’s a long process, it’s a torturous process, it means in some instances we have to go to jurisdictions outside SA to recover money that was unlawfully expatriated from this country.
“We are working on that and we are building our legal cases and we will be pursuing individuals that we believe owe us money,” he said.
Officially Published by Times Live