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Deputy President David Mabuza told Parliament on Thursday afternoon that he was in support of the proposed reforms to Eskom, saying stabilising the entity and curbing load shedding was the most important thing government could do to avoid a downgrade in the country’s credit rating.
Mabuza was replying to questions from Members of Parliament in the National Assembly. The original question came from Democratic Alliance chief whip John Steenhuisen, who asked what measures government planned to take to avoid future ratings downgrades.
Mabuza told MPs that government was already acting to secure the confidence of ratings agencies and, by extension, investors.
He mentioned the drive to collect R1.2trn in investment, easing the cost of doing business and the recently appointed presidential economic advisory council, but said fixing Eskom was the biggest priority.
"The special appropriation bill to give financial assistance in this and the next financial year will assist in keeping Eskom afloat while work is underway when it comes to restructuring Eskom," said Mabuza.
'I do believe in that plan'
DA MP Geordin Hill-Lewis pressed Mabuza in a supplementary question on whether he bought into government’s proposed reforms for Eskom and the economy at large, to which Mabuza replied: "I do believe in the process of restructuring Eskom. So, in short, I do believe in that plan."
Economic Freedom Fighters MP and music legend Ringo Madlingozi challenged Mabuza, asking: "Will you do what is necessary to lift our people out of poverty, such as expropriating land without compensation, or will you do what the ratings agencies say?"
Mabuza said South Africa's economic reality dictated that the Eskom reforms should take place if investors and ratings agencies are to believe that the economy will see better days in the near future.
"Ratings agencies are external bodies that will assess you as a country. Unfortunately, those who want to invest in the country will take those opinions very seriously. You can ignore the opinions of ratings agencies at your own peril, but it would make more sense to listen and respond," Mabuza said.
He said other measures government should act on included expenditure re-prioritisation, austerity measures and reducing the wage bill.
"The road ahead in getting the economy to grow will not be an easy one, but our resolve and determination is greater. I am sure we will turn the corner," he said.
