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GEPF says it will not invest in Eskom purely to save SA and any investment in the utility would have to generate a return

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GEPFBL Premium reports that the Government Employees Pension Fund (GEPF) will not invest more in Eskom solely for the purposes of saving SA, but would require that the power producer meet its investment criteria in terms of the management of the entity and the provision of a return.  

This was indicated by the fund’s principal executive officer Abel Sithole in an interview on Wednesday.  Sithole was in Parliament to brief the standing committee on finance on the GEPF’s annual report for 2018/2019.  The asset manager of the GEPF is the Public Investment Corporation (PIC), which, as of October last year, had assets under management of R1.87-trillion on behalf of the GEPF.  Union federation Cosatu has proposed using R250bn of the assets of the GEPF to settle more than half of Eskom’s R450bn debt in return for certain guarantees regarding retrenchments and the restructuring of the utility.  Cosatu’s argument is that, given the risk that Eskom poses to the economy and the harmful effects of load-shedding on business, the GEPF should invest money in the utility in the broader interests of the country.  However, the proposal has generated a storm of controversy with the Federation of Unions of SA (Fedusa), trade union Solidarity and the DA strongly opposed to it.  The GEPF has not been presented with a concrete proposal based on Cosatu’s plan.  The GEPF already has about R84bn invested in Eskom bonds and about R500m in bills, which are basically cash.  Sithole said the answer to the question of whether the GEPF would consider investing in Eskom was a complicated one, but “the devil will be in the detail.”

  • Read the original of the report in the above regard by Linda Ensor at BusinessLive (paywall access only)


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