NEWS
05/02/2018 16:51 SAST | Updated 05/02/2018 16:52 SAST

Pensions Used For R5-Billion Eskom Loan

The Public Investment Corporation has granted the embattled parastatal a short-term loan of R5-billion.

Siphiwe Sibeko / Reuters
Eskom's electricity pylons in Soweto.

The Public Investment Corporation (PIC) has granted Eskom a temporary lifeline by issuing a hefty R5-billion loan to fund the parastatal's operations during February.

Fin24 reported on Monday that the PIC, on behalf of the Government Employees Pension Fund (GEPF), advanced the R5-billion bridging facility to Eskom for one month.

The GEPF, managed by the PIC, is Africa's largest pension fund: it has more than 1.2-million active members, in excess of 400,000 pensioners and beneficiaries, and assets worth more than R1.6-trillion. Its core mandate is to manage and administer pensions and other benefits for government employees.

According to Fin24, Eskom approached the PIC, indicating that it was experiencing enormous liquidity constraints, which were threatening the company's going-concern status. Following the request, the PIC reportedly conducted its own due diligence – and allegedly obtained approval in line with its mandate and corporate-governance requirements.