EXPLAINER: Everything you need to know about government's Eskom bailouts

In addition to the Special Appropriations Bill, Treasury Director General Dondo Mogajane on Wednesday briefed the select committee on appropriations on the 2019 Appropriation Bill. He also explained the extent of government's financial support to Eskom.The Appropriations Bill provides for a R23bn allocation to Eskom, which Treasury announced in the 2019 National Budget.

Mogajane said an emergency R17.652bn, authorised to Eskom in April this year to prevent it defaulting on its debt, was not to be confused with the Special Appropriations Bill dealing with the R59bn allocated to Eskom. The special bill's process in Parliament is separate to that of the 2019 Appropriation Bill, which Treasury wants passed before July 31, 2019.In documents made available to the committee, Treasury explained why the emergency R17.

As the loan was government guaranteed, failure of Eskom to meet its obligations would lead to consequences for both the power utility and the fiscus. So far government has transferred R13.5bn of the R17.562bn. The balance will be disbursed in accordance with Eskom's cash flow requirements.The remaining balance of the R23bn government allocated to Eskom is R5bn. This money will be disbursed after the 2019 Appropriation Bill is passed by Parliament and once the president assents to it, Mogajane explained.

Eskom can now be better positioned to raise funding from the market, if lenders see it has the backing of its shareholder. For now, it was important that government created certainty to lenders.

Fin24 State Owned Enterprises are terrific! Imagine what a bailout of the whole of ZA would cost if the Black Bolsheviks (EFF) gets a hold of everything!

Fin24 Please disclose exactly how these amounts were arrived at.

Fin24 Is this to fund management ridiculous salaries

Fin24 Ok

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