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Eskom board’s decision to reinstate Molefe “a better option!”

The Eskom board’s decision to reinstate former Chief Executive Officer (CEO) Brian Molefe is a better option than a previous R30 million early retirement pay-out, says Public Enterprises Minister Lynne Brown.

“I believe the board’s proposal ultimately presents a significantly better value preposition to the South African fiscus than the previous pension proposal. I informed the board that I was satisfied with its re-evaluation process,” said Minister Brown at a media briefing in Cape Town, on Friday.

This after the board briefed the Minister on the outcome of consultations on the former CEO following the Minister’s rejection of a R30 million early retirement payment to Molefe.

“After considering various options, the board proposed that Mr Molefe return all monies received on his departure from Eskom and be reinstated as CEO effective immediately.

“In terms of the board’s proposal, Mr Molefe agreed to serve out the remainder of his original contract and to reconsider the terms of his contract that resulted in the previous pension arrangement. I informed the Board I was satisfied with its re-evaluation process and recognised the merit in its proposal – on the proviso of its legality,” said the Minister.

This as news broke that the board confirmed that Molefe would return to the power utility on Monday.

The Minister, however, added that the matter has raised an important broader issue relating to state owned companies.

“I’ve asked my department to work with state owned companies to ensure that the pension packages negotiated with executives at state owned companies are in line with the cabinet approved remuneration standards,” said Minister Brown.

Responding to a question, the Minister said Molefe would will serve out the remaining two and a half-years of his five year contract.

Molefe’s resignation from his post on 1 January 2017, followed the publication by former Public Protector Thuli Madonsela’s report into alleged state capture.

At the time, Molefe said his stepping down is not an act of admission or wrongdoing on his part.

At Friday’s briefing, the Minister said Molefe had not been found guilty of anything. “He has been accused of being captured, but he must be seen as innocent until proven otherwise.”

Speaking on the state of the utility, Minister Brown said Eskom has managed to remain resilient even at a time when the South African economy is stagnant. “There is a narrative to say that Eskom is in a bad state, the utility has been able to cover its costs (including) the build programme. It has been able to cover its costs by 90%. Eskom is quite resilient,” she said.

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