Friday, July 2, 2010

12.6 Million New Reasons To Dislike Eskom

Eskom is truly a unique organization which differentiates itself by taking conventional business wisdom and implementing entirely the opposite. If there were a book titled “Best Business Practice for Dummies”, it would no doubt clearly state that rule 1 of surviving difficult times is to cut back on unnecessary expenses and not to reward those who under perform.

In addition to the ongoing wage dispute and unions threatening to strike, the Public Utility has again made headlines this time for indulging in World Cup festivity at the expense of the consumer.

Let’s not forget that it was Eskom's dire financial footing, which led to a R27-billion World Bank loan in order to maintain the country’s electricity supply. It also resulted in the already battle weary consumer having to face the daunting prospect of subsidising it by way of large tariff hikes.

It is for this reason I am angered by news that during 2009 and 2010, Eskom purchased 1 110 World Cup tickets 700 of which were for hospitality seating valued at about R17 000 each. It has emerged that the decision to make the purchase which amounted to R12.6 million, was in fact taken in November 2008 four months prior to a financial year end that saw Eskom declare a R9.7-billion loss.

I cannot help wondering how many electricity consumers would dearly liked to have attended at least one World Cup game but simply couldn’t find room in their respective budgets for it. The same principle applies to households as with business, in difficult times you cut back on luxuries.

The self indulgent behavior of Eskom’s hierarchy is deplorable.

Ernest Roper


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