Financial Mail reports that Eskom says its above-inflation wage settlement with trade unions will not affect its future tariff trajectory because it is making savings in other areas, such as diesel consumption.  

The power utility has agreed to give lower-paid employees an increase of 10% and higher-paid employees 8.5% in each of the next two years.  The housing allowance has increased by R260 to R2,860 a month in the first year and by R140 to R3,000 in the second year.  The settlement is both above headline consumer price inflation of 6.3% and the 7.06% average annual increase in manpower costs allowed by the National Energy Regulator in its multiyear price determination decision for Eskom’s tariff increases from 2013/2014 to 2016/2018.  Spokesman Khulu Phasiwe commented:  "Eskom will absorb the costs related to the wage increment by continuing with its cost-cutting measures, which have been ongoing for three years now."

• Read this report by Charlotte Mathews in full at Financial Mail

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