Eskom’s new chief restructuring officer needs to be a ‘bad cop’

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Besides the obvious need to address debt and revenue issues — thousands of inevitable retrenchments need to be undertaken too

Of all the executives, government officials and consultants being recruited to tackle the mammoth task of rescuing Eskom, the toughest task could fall to the person who has to take it apart.

“They’ve got to have a guy who’s going to be the figurehead, the bad cop” to deal with over-staffing and take the other difficult decisions, and that’s likely to be the CRO, said Andrew Levy, managing partner of Andrew Levy Employment, which advises companies on labor relations. “The politicians — whether it’s Cyril or the cabinet or anyone else — can’t be seen to be in this arena, it’s too dangerous politically.

The unions also opposed plans Ramaphosa announced in February to split Eskom into generation, transmission and distribution units under a state holding company, fearing it will be the precursor to job losses and privatisation. The government says the break-up will make it easier to manage the utility, which isn’t selling enough power to cover its costs and is contending with massive construction cost overruns on its new plants.

Eskom came off second best in a showdown with workers last year. It sought to freeze salaries but was forced to backtrack in the face of illegal protests that shut down several of its plants and resulted in rolling blackouts, after public enterprises minister Pravin Gordhan intervened.Eskom and the department of public enterprises, which oversees state-owned entities , referred queries on the CRO to finance minister Tito Mboweni, who declined to answer questions on the appointment.

 

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