Govt to engage with labour over Eskom unbundling

Public Enterprise Minister Pravin Gordhan will meet with Eskom's board as a priority, to map a way forward for the entity, following President Cyril Ramaphosa's announcement that the power utility will be unbundled.

Ramaphosa on Thursday announced in the State of the Nation Address (SONA) that Eskom would be split into three entities – generation, transmission and distribution. All three companies will fall under Eskom Holdings.

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According to a statement issued by the department of public enterprises (DPE) on Friday evening, apart from meeting with the board, a public consultation process with stakeholders, particularly organised labour, will also start "as soon as possible".

"Given the importance of Eskom to the economy, it is crucial that all stakeholders – including market analysts – allow the respective organs of government to work through the institutional processes that will unfold between now and 20 February 2019, (and beyond) when the Budget is presented to Parliament," the statement read.

The DPE, National Treasury and the Presidency will work with the Eskom board which has been tasked with implementing the new Eskom structure and business model.

• READ: The Eskom break-up explained: What we know so far

The National Union of Metalworkers of South Africa (Numsa), one of three recognised unions at the power utility, has rejected the unbundling of Eskom, Fin24 reported previously. The union is concerned that the unbundling would lead to the privatisation of Eskom, which would lead to job shedding.

"That is the first phase to privatisation which will lead to massive job shedding and higher energy costs for the consumer. The decision to break Eskom up and sell it has been made," Numsa spokesperson Phakamile Hlubi-Majola told Fin24.

The Congress of South African Trade Unions (Cosatu) in turn has called for the president to make a commitment that the restructuring would not lead to job losses. "We appreciate the President’s commitment to a just transition. But he did not say what exactly does that mean. Workers only want one thing. Job security," Cosatu parliamentary coordinator Matthew Parks said in a statement.

Eskom CEO Phakamani Hadebe told SABC's Stephen Grootes in an interview following the SONA that the president has committed to not selling off key assets.

"The president also stated that the key assets of government will not be sold- that talks of generation, transmission and distribution. It won't be sold. He made a commitment," Hadebe said.