Eskom: No performance bonuses - only 13th cheques

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(Gianluigi Guercia, AFP)
(Gianluigi Guercia, AFP)

Eskom has not paid any performance bonuses in the past two years, nor has it applied to the national energy regulator to allow for R1.8bn in performance bonus pay.

The power utility on Tuesday morning issued a statement hitting back at claims made in court papers filed by Nersa, as reported by City Press.

Eskom lodged a court application, which will be heard next week, to have Nersa revise its decision on electricity tariffs for the next three years. Nersa regulates the electricity, piped-gas and petroleum pipelines industries. Its role involves setting tariffs which Eskom can charge customers.

According to the report, Nersa contended that Eskom planned to pay performance bonuses valued at R1.8bn for the financial years 2019 to 2022.  

The report caused an uproar on social media as South Africans objected to the supposed performance bonuses given that Eskom can't keep the lights on. 

Eskom however, in its statement, hit back at claims in the report. "Eskom has not applied to the National Energy Regulator of South Africa (Nersa) for R1.8bn to pay performance bonuses, as reported in a Sunday newspaper," Eskom said.

"In keeping with a board decision reflecting the poor performance of the business, no performance bonuses have been paid to employees in the past two years," the statement read.

"The application included a provision for an annual bonus for the three-year period – which is equivalent to a 13th cheque which forms part of the Eskom basic conditions of service and cost to company – i.e. employees' normal remuneration package," Eskom said.

For employees who do not have the 13th cheque as part of their conditions of service - there is an option for them to structure their package in a way that they will receive a 13h cheque, without increasing their overall compensation, Eskom said.

"Nersa in its decision incorrectly disallowed these contractual costs and hence they do not form part of the allowed revenue granted to Eskom," the power utility said.

In an interview with CapeTalk radio on Monday, Chief Operations Officer Jan Oberholzer also said that the report was untrue. "I can confirm in the last two years, no performance bonuses have been paid," Oberholzer told host of the show, Kieno Kammies.

He explained that Eskom has a set of criteria in place that must be met before performance bonuses can be paid – in the past two years, these have not been met.

As for the court application against Nersa, Eskom asserted it does not have anything to do with performance bonuses. Rather it is for the court to review Nersa's tariff decision to deduct the R69bn government has provided to the power utility over the next three years. "The court application does not include any other aspects of the MYPD4 [the Multi-Year Price Determination] decision," Eskom said.

Meanwhile, Eskom's new CEO Andre de Ruyter officially started working at the power utility on Monday.

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