ANC suggests Eskom sells equity to pension funds

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Enoch Godongwana. Picture: City Press
Enoch Godongwana. Picture: City Press

Johannesburg - The African National Congress (ANC) thinks Eskom should sell some equity to pension funds to improve its cash flow, said Enoch Godongwana, who heads the ANC’s Economic Transformation Committee.

“In order to address Eskom’s cash-flow situation, we need to mobilise funding from the Public Investment Corporation (PIC) and the retirement in return for equity,” Godongwana said by phone on Friday. The proposal is not yet public policy.

Eskom has to fill a R225bn funding shortfall in the five years through March 2018 as it builds more power plants to end months of electricity cuts.

The shortages are likely to persist for the next two to three years, Public Enterprises Minister Lynne Brown said on Thursday.

While Brown said privatising a basic service such as power provision isn’t a good idea, the National Treasury on May 13 said it was investigating options to increase private-sector participation in electricity generation, including selling a stake in the utility or some of its power stations.

Apart from the state-owned PIC, which is Africa’s biggest fund manager, Sanlam, Old Mutual and Coronation Fund Managers are among the biggest administrators of pension investments in South Africa.

Johannesburg-based Business Day reported the news earlier.

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