NUM on executive cuts: Eskom cannot be run like 'spaza shop'

The National Union of Mineworkers (NUM) in the Highveld Region is angered and perturbed by what it calls "the unexpected announcement of retrenchments made by Eskom on the eve of Christmas celebrations", it said in a statement on Monday.

Fin24 reported earlier on Monday that Eskom had announced a reduction of its executive management from 21 to nine, in a bid to reduce costs and "improve profitability and drive the economy forward".

Eskom is saddled with R419bn of debt and has requested a bailout by government.

NUM national spokesperson Livhuwani Mmamburu told Fin24 on Monday that Eskom has indicated it will again advertise those positions that have been cut in the near future.

NUM claims the retrenchments have nothing to do with cost-saving measures, but amount to a "ploy to replace managers who are deemed not to be in the faction of the group CEO".

Eskom national spokesperson Khulu Phasiwe told Fin24 that the decision to retrench executives were already taken by the respective executive managers themselves earlier this year.

Starting at the top

"The biggest issue for management at the time was around affordability - how to contain Eskom's very high cost base. The executives themselves wanted to show commitment to corporate reduction. So, instead of cutting at the base, they said let us start at the top," explained Phasiwe.

He said some of the executives were close to retirement anyway, while others indicated they would like to leave Eskom.

Phasiwe said positions would be advertised, but at a lower grade – that of general manager – and not at executive level. He said some of these positions were key for Eskom, like the heads of transmission, generation and distribution, as well as corporate affairs.

Phasiwe said regarding allegations that further job cuts at lower levels could follow, that the Eskom chair has been clear that the focus must only be at management level.

Mmamburu told Fin24 that NUM was also not happy with media reports that Eskom was allegedly considering the sale of smaller assets to billionaire Patrice Motsepe's African Rainbow Capital, "according to people familiar with the matter".

"We are against the selling of any Eskom assets," said Mmamburu.

"No one shall be allowed to run Eskom as if it is his own spaza shop," NUM said in its statement.

In response to these allegations by NUM, Phasiwe said Eskom was in the process of selling one of its non-core assets – a mortgage loan company used for staff. The decision to sell it had already been taken about five years ago, but due to "turmoil" at Eskom, the process has not been finalised yet.

Phasiwe said bids had been received from interested parties and these are currently being adjudicated by Eskom. He said he was not in a position to say anything more in this regard.

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