{"id":876254,"date":"2026-09-20T14:00:00","date_gmt":"2026-09-20T12:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=876254"},"modified":"2026-09-18T15:06:43","modified_gmt":"2026-09-18T13:06:43","slug":"state-owned-company-lost-almost-r1-billion-building-flats-that-are-now-completely-empty-and-abandoned","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/876254\/state-owned-company-lost-almost-r1-billion-building-flats-that-are-now-completely-empty-and-abandoned\/","title":{"rendered":"State-owned company lost almost R1 billion building flats that are now completely empty and abandoned"},"content":{"rendered":"\n

Eskom spent almost R1 billion on a housing development near Kusile Power Station that was never completed and has never housed a single worker, leaving 366 flats empty and abandoned.<\/p>\n\n\n\n

The Ogies Housing Project in Mpumalanga was intended to provide accommodation for artisans, builders, and technical contractors working on the construction of Kusile, one of the world’s largest coal-fired power stations.<\/p>\n\n\n\n

The project was supposed to reduce Eskom’s transport costs by allowing workers to live near the power station rather than being transported to and from the site.<\/p>\n\n\n\n

However, construction was halted before the development could be completed, with Eskom attributing the failure to extreme project mismanagement and poor contract performance.<\/p>\n\n\n\n

The project was originally budgeted at around R160 million. By 2020, Eskom had disclosed an impairment write-down of R918 million related to the development.<\/p>\n\n\n\n

The housing project became one of the most significant write-offs associated with the wider Kusile development.<\/p>\n\n\n\n

Unlike expenditure on a functioning asset, Eskom ultimately received no practical benefit from the flats, which remained unused.<\/p>\n\n\n\n

The Kusile and Medupi power stations were intended to help stabilise South Africa’s electricity system after load-shedding began in 2007.<\/p>\n\n\n\n

However, both experienced major delays, design problems, construction difficulties and cost increases.<\/p>\n\n\n\n

Kusile was originally scheduled for completion in 2017 at an estimated cost of R121 billion. Eskom said in its 2026 annual report that the project is now expected to be completed in 2028 at a total cost of R233.4 billion.<\/p>\n\n\n\n

The Ogies development was one of several surrounding projects that added to the financial burden of the Kusile build.<\/p>\n\n\n\n

The housing project was eventually put up for sale in its unfinished state after Eskom determined that it had no use for the development. However, the utility was unable to find a buyer.<\/p>\n\n\n\n

Discussions with the Department of Human Settlements are now focused on whether the abandoned development could instead be converted into social housing.<\/p>\n\n\n\n

Irregular expenditure still a concern <\/h2>\n\n\n\n
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In 2021, Parliament estimated that the utility had been forced to spend billions of rands on rental accommodation and employee transport due to problems with accommodation for Kusile workers.<\/p>\n\n\n\n

The Ogies project remains an example of how poor project management can turn infrastructure intended to reduce costs into a major financial liability.<\/p>\n\n\n\n

The financial problems have not disappeared despite Eskom’s recent improvement in its overall financial position.<\/p>\n\n\n\n

For the year ended 31 March 2026, the utility reported a profit of R30.3 billion, helped by improved plant performance and lower diesel expenditure.<\/p>\n\n\n\n

However, Eskom also disclosed R4.9 billion in irregular expenditure incurred during the 2026 financial year. <\/p>\n\n\n\n

A further R36.8 billion in irregular expenditure from previous years was confirmed through the audit process.<\/p>\n\n\n\n

The auditors also raised concerns about the completeness of Eskom’s reporting of irregular expenditure under the Public Finance Management Act.<\/p>\n\n\n\n

Potential irregular expenditure can take an average of about 20 months to be assessed and confirmed, meaning some problems only appear in later governance reporting.<\/p>\n\n\n\n

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Ogies Housing Project photos<\/h2>\n\n\n\n
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\n","protected":false},"excerpt":{"rendered":"

Eskom spent almost R1 billion on a housing development near Kusile Power Station that was never completed and has never housed a single worker.<\/p>\n","protected":false},"author":92,"featured_media":876260,"comment_status":"open","ping_status":"","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"posted","_sma_x_autopost_error":"","_sma_x_post_id":"2101642795656114631","_sma_facebook_post_id":"191437357620492_2211059756381090","_sma_instagram_post_id":"17962969058984930","_sma_x_attempts":1,"footnotes":""},"categories":[23],"tags":[1164,9296,853],"class_list":["post-876254","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-eskom","tag-kusile-power-station","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/876254","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=876254"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/876254\/revisions"}],"predecessor-version":[{"id":876263,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/876254\/revisions\/876263"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/876260"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=876254"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=876254"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=876254"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}