Makana Municipality has been found in contempt of court for failing to comply with the terms and conditions of a 2019 order instructing it to pay Eskom.
In 2019, Eskom published notices warning that it intended to cut Makana’s electricity supply because of the municipality’s non-payment. The Grahamstown Business Forum (GBF) and Makana (then Grahamstown) Residents Association (MRA) took the municipality to court to get it to commit to regular repayments to Eskom. In the High Court in Makhanda, Judge Thami Bheshe ordered Makana to comply with a payment plan negotiated between Makana, Eskom and the GBF.
The last of the six payments was due before the end of March 2022. The debt to Eskom of R85 million in June 2018 had been reduced to R15m by the end of August 2021. This was done under the watch of former CFO Gerard Goliath and former Mayor Mzukisi Mpahlwa. Since the court order was issued in June 2019, the GBF, MRA and other civil society organisations have been monitoring the payments.
They sounded the alarm when just one month after the 2021 local government elections, Makana missed a R7.5 million instalment to Eskom. Makana explained that this was because it hadn’t received equitable share funds due to it from National Treasury. Equitable Share refers to the system by which nationally raised revenue is divided equitably between national government, the nine provinces and 257 municipalities. How it’s allocated takes into account the powers and functions assigned to each sphere of government and is central to the concept of cooperative governance.
However, in a response to questions from this journalist at the time Treasury said no equitable share payment was due to Makana because they had failed to meet the requirements for having unspent conditional grants rolled over.
By the end of March 2022, Makana Municipality’s outstanding account with Eskom had again ballooned to over R40 million. Amounts paid to Eskom did not cover current amounts due nor the payment plan ordered by the Makhanda High Court in June 2019.
The Grahamstown Business Forum returned to court and on March 9, 2023, Judge Justin Laing issued a draft order, by agreement, confirming that Makana Municipality was in contempt of the court order issued by Judge Thami Beshe in 2019. The current Municipal Manager Phumelelo Kate was ordered to report to the court every two months with proof that Makana is making the agreed on payments to Eskom.
