McKinsey to pay back Eskom's R1 billion

Sunday, July 8, 2018

McKinsey will pay back the R1 billion paid to it by Eskom under the Turnaround Programme, said the power utility. 

On Friday, the utility finalised a settlement agreement that will see McKinsey pay back the R1 billion paid to it by Eskom under the Turnaround Programme.

“This is a significant milestone for the Board as we seek to fulfil what we see as our non-negotiable mandate to root out financial mismanagement and malfeasance as a critical foundation to restoring transparent and effective governance,” said Eskom board Chairman Jabu Mabuza.

Since the appointment of the current board of Eskom early this year, focus has been on among others addressing governance related matters with urgency.

Eskom said while the process has taken longer than what would have been ideal, it was of importance that it ensures that an appropriate and transparent legal process was followed.

Eskom Group Chief Executive Phakamani Hadebe said that he was pleased that positive results were obtained in the matter.

“We are equally appreciative of the support and cooperation we have received from McKinsey and the Asset Forfeiture Unit. This for us further demonstrates that we are serious about consequence management and achieving a renewed culture of accountability and good governance which is key to our sustained success,” said Hadebe.

Turning his focus to Trilian, Mabuza said the company was not party to the settlement.

“As Trillian was not party to the settlement, Eskom will continue to pursue the recovery of the remainder of the payments made to Trillian through the legal review process that was launched earlier this year.

“Whilst this is the first, it certainly will not be the last as we are committed to continue to deal decisively with improper and irregular contracts,” said Mabuza.

In October last year, Eskom sought McKinsey and Trillian’s cooperation in respectively returning R1 billion and R564 million, which appears to have been unlawfully paid out to the companies in 2016 and 2017. -