JOHANNESBURG, April 30 (Reuters) – South African state utility Eskom will start a fresh round of wage negotiations with trade unions next week, it said on Friday, warning any disputes could impact its ability to supply electricity.<\/p>\n
Eskom struggles to power Africa\u2019s most industrialised nation because of repeated faults at its ailing coal-fired power stations and is choking under more than 460 billion rand ($32 billion) of debt.<\/p>\n
The last round of negotiations in 2018 led to power outages after workers reacted angrily to Eskom\u2019s initial refusal to hike wages and protested. The company later offered above-inflation increases, and a three-year agreement was signed.<\/p>\n
Eskom has not disclosed its position ahead of the talks, but said in a statement it hoped to reach an agreement that was financially sustainable and in the best interests of its employees and the public.<\/p>\n
If the talks from May 4 to June 3 turn fraught, there may be \u201ca negative impact on our infrastructure and operations, which may compromise our ability to supply electricity,\u201d it added.<\/p>\n
Eskom will be negotiating with the National Union of Mineworkers (NUM), the National Union of Metalworkers of South Africa (NUMSA) and Solidarity.<\/p>\n
The NUM is demanding a salary increase of 15% in the 2021\/22 financial year but would also consider a multi-year agreement, NUMSA wants a one-year 15% salary increase and Solidarity is seeking a 9.5% annual increase over multiple years. Inflation is currently around 3%.<\/p>\n
\u201cThe talks starting next week will determine the duration of the settlement,\u201d Eskom\u2019s spokesman told Reuters.<\/p>\n
The 2018 wage agreement was for salary increases of 7.5% in 2018\/19, 7% in 2019\/20 and 7% in 2020\/21, and exacerbated the dire state of Eskom\u2019s finances. The utility expects to make a loss of about 22 billion rand in the year to the end of March 2021.<\/p>\n
Unions argue Eskom\u2019s woes are chiefly linked to corruption and mismanagement over many years, and that workers should not lose out as a result.<\/p>\n