BUDGET 2015: Govt commits to saving Eskom, SAA

Nhlanhla Nene, Finance minister

Nhlanhla Nene, Finance minister

CAPE TOWN, (CAJ News) – THE South African government is committed to reviving the fortunes of power utility Eskom and subsequently the country’s power sector, Finance Minister Nhlanhla Nene has said.

Nene was presenting the Medium Term R1.3 trillion Budget Policy Statement on Wednesday.

At a media briefing before tabling the budget, the Minister said that the fiscal allocation of R23 billion to Eskom, as announced in President Jacob Zuma’s State of the Nation Address recently, will be paid in three installments, with the first transfer to be made in June.

“All we are doing in this budget is to reaffirm the package. All we are doing is re-affirming our commitment to the package.

“The R10 billion will be realised around June and the other one before the end of the year,” Nene said at the briefing.

Delivering his Budget Speech, he said that a special appropriation bill would be tabled once the finances had been raised.

In addition, government is in talks with business and is considering a wide range of options to improve energy efficiency and manage demand for electricity.

The measures under consideration include expanding the use of smart meters, buying back power from large industrial users and varying tariffs by time of use, he said.

Lack of reliable power services is among the biggest challenges the country is dealing with.

Meanwhile, Nene said government has also moved in to address the financial position of the national carrier, South African Airways (SAA).

“We have made guarantees of R14,4 billion available to SAA of which the airline has drawn R8,3 billion. Measures to achieve operational efficiencies and restore profitability are now in progress,” said Nene.

SAA reported a net loss of R2,6 billion in 2013/14 as a result of high operating costs, losses on several international routes and valuation adjustments.

It was reported it was shelving domestic routes.

– CAJ News

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Posted by on Feb 25 2015. Filed under Featured, Finance, Finance & Banking. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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