Public Enterprises Minister Pravin Gordhan says reverting to giving Eskom loans will instil discipline and ensure that the power utility lives within its means and manages its finances better.<\/p>\n
He said this when reacting to Finance Minister Tito Mboweni\u2019s Medium Term Budget Policy Statement outside the National Assembly on Wednesday.<\/p>\n
In his speech, Mboweni said any cash injection aimed at supporting the cash flow for embattled power utility Eskom will be in a form of loans, and not equity.<\/p>\n
To meet unanticipated cash needs, National Treasury brought forward R26 billion in 2019\/20, R33 billion in 2020\/21 and R10 billion in 2021\/20.<\/p>\n
\u201cLoans impose a particular discipline on you that if you borrow money, you have to pay it back and manage your cash in a way in which you live within your means, constantly bearing in mind that you have repayments to make. So it imposes a different kind of discipline.<\/p>\n
\u201cEskom has had loans before\u2026 which later were converted to equity. It\u2019s good to bring back discipline and begin to do all the things we said we would do,\u201d said Gordhan.<\/p>\n
Difficult times come with sacrifice<\/strong><\/p>\n Meanwhile, Public Service and Administration Minister Senzo Mchunu welcomed the announcement to cut down on government perks and wastage.<\/p>\n During his speech, Mboweni announced measures to freeze the salaries of executives in a bid to cap the ballooning government wage bill as well as banning business class travel for members of the executive across all spheres of government for all domestic flights.<\/p>\n \u201cThe statement as a whole by the Minister of Finance is realistic in seeking to make South Africans aware of the real situation. The situation itself is quite a serious one if you look at the fiscus and our economy, especially on the side of non-growth.<\/p>\n \u201cWe can\u2019t cry. We can\u2019t complain. We have to exercise leadership. We have to take responsibility, which I think the statement is making very clear.<\/p>\n \u201cThe good thing is this involves sacrifice on everyone\u2019s part. It involves the elected representatives at all levels. Tomorrow, we will have a better South Africa,\u201d said Mchunu.<\/p>\n
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