# Mboweni confirms R59 billion Eskom bailout

- Link: https://dearsouthafrica.co.za/2019/07/23/mboweni-confirms-r59-billion-eskom-bailout/
- Published: 2019-07-23T13:48:03+02:00
- Author: dearSA

##  The minister also said the debt and restructuring of Eskom will need to be addressed.

Finance Minister Tito Mboweni on Tuesday presented his plans to parliament to provide
financial support to struggling energy utility Eskom.

Mboweni introduced the Special Appropriation Bill in the National Assembly, which
will offer the parastatal a lifeline in the current and next financial year.

This will lead to a R59 billion bailout from government in two instalments: R26bn
in the 2019/20 financial year followed by R33bn in the 2020/21 financial year.

“I stated in my budget vote 7 for the National Treasury that Eskom presents the 
biggest risk to the fiscal framework because of its financial problems and negative
impact on the economy,” Mboweni said.

“Given the high risks of a systemic failure if Eskom were to collapse, government
is urgently working on stabilising the utility, while developing a broad strategy
for its future.

“Eskom faces serious financial and operational challenges, which to a large extent
were caused by the governance challenges that the entity previously experienced 
which resulted in a decline in investor confidence.

The minister also said the debt and restructuring of Eskom would need to be addressed.

Mboweni said a team of officials had considered a number of options as a solution
to the company’s debt challenges in order to ensure its sustainability.

He will be appointing a chief restructuring officer, who “will be mandated to test
these options with the ratings agencies to establish what impact each will have 
on the fiscus and recommend the appropriate one for implementation”.

Article from The Citizen