Jeremy’s weekly wrap: Eskom’s road to recovery

The results of the second sitting of the South African Institute of Chartered Accountants (Saica) qualifying exams have been the worst in six years, with only 14% of 1 144 candidates passing, a sharp decline from 40% the previous year. Saica CEO Patricia Stock joined me on Moneyweb@Midday and attributes this to several factors, including challenges faced by distance learning students and the difficulty of balancing work, family responsibilities, and studies.

While the poor pass rate is concerning, Stock emphasised the need for fresh thinking and a re-evaluation of Saica’s programmes to improve candidates’ chances of success, acknowledging the importance of the entire ecosystem, including employers, academic institutions, and Saica itself.

Stock also noted that while the low pass rates will affect the pipeline of chartered accountants in South Africa, Saica offers alternative pathways such as the Associate General Accountant (AGA) designation. Despite challenges, she assured that Saica will not compromise on quality or international standards, and new measures, such as extended exam durations, are being introduced to support candidates.

You can also listen to this podcast on iono.fm here.

South Africa’s growing cancer crisis underscores the urgent need for healthcare reform as the National Health Insurance (NHI) debate rages on. Dr Ernst Marais, COO of Icon Oncology, spoke to me about addressing this challenge by partnering with the Northern Cape Government and the Robert Mangaliso Sobukwe Hospital to provide radiotherapy treatment to over 500 cancer patients.

This collaboration has filled a critical gap in the Northern Cape, which previously lacked access to radiotherapy. The initiative showcases a successful public-private partnership where Icon Oncology uses its spare capacity to offer life-saving treatment at deeply discounted rates to the government, supported by a grant ring-fenced for cancer treatment.

The success of this initiative suggests that similar models could inform a broader rollout of NHI, though Dr Marais believes the current NHI framework needs significant refinement.

You can also listen to this podcast on iono.fm here.

Extortion, particularly in the form of “protection racketeering”, has become a widespread issue in South Africa, with criminal groups such as the “construction mafia” deeply embedded in various sectors of society. Martin Ewi from the Institute for Security Studies explained that these organised groups demand money from construction projects and businesses, instilling fear, and violence to ensure compliance. This crisis, which began in rural areas before spreading to urban centres, has reached alarming proportions, with South Africa scoring an 8.0 out of 10 in the Africa Organised Crime Index for extortion. Ewi spoke about the severity of the situation, citing beatings, looting, and even killings for those who failed to comply.

You can also listen to this podcast on iono.fm here.

And speaking to me at the Moneyweb Summit Eskom chair Mteto Nyati attributed the company’s recent turnaround to a fundamental shift in diagnosing and addressing the underlying problems of load shedding. Initially, the focus was on an ageing fleet, with solutions geared towards retiring assets and relying on private-sector renewables. However, Eskom’s new board redefined the problem and implemented a Generation Recovery Plan in March 2023, which is already showing results.

Key challenges remain, though, such as extending the life of Koeberg’s second unit and transitioning Kusile units from temporary fixes to permanent solutions. Nyati said stronger financial controls and leadership changes have played a crucial role in this progress.

Regarding Eskom’s financial stability, Nyati highlighted the reduction of the company’s R450 billion debt through support from National Treasury, which provided R243 billion. By lowering reliance on diesel and reducing interest charges, Eskom, he believes, is on a clear path to profitability. Nyati firmly stated that the company will not require any more government bailouts, emphasising that with the improved operational efficiency and cost savings, Eskom is poised to become profitable much sooner than expected.

You can also listen to this podcast on iono.fm here.

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