Phone call to Andre de Ruyter saved South Africa billions

Former Eskom CEO Andre de Ruyter said an anonymous phone call on a Sunday afternoon in May 2020 saved the power utility and South Africa billions.

In his book, ‘Truth to Power’, De Ruyter tells the story of an artisan working at Tutuka Power Station who called to alert him to a problem at the power station.

The employee told him of a substandard submerged scraper chain that was about to be installed on unit 5 at Tutuka.

Poor-quality submerged scraper chains were behind many breakdowns at Tutuka, and he asked for an investigation into the issue.

It soon emerged that the chains were made from inferior metal and manufactured using a substandard casting process.

However, this was only the tip of the iceberg. The investigation uncovered widespread corruption related to its equipment ordering and warehousing.

“We ended up writing off phantom equipment to the tune of R1.3 billion at Tutuka alone,” De Ruyter said.

The seemingly straightforward enquiry to see a key piece of equipment had opened a putrid can of worms.

“After an audit of all our power stations’ warehouses, we found that each had between R1.3 billion and R1.6 billion of stock just sitting around,” De Ruyter said.

“Multiply that by the number of Eskom power stations, and the impact of borrowing money to fund this non-productive working capital is immense.”

De Ruyter tightened the warehouse controls and implemented a modern inventory system using barcodes.

The new systems made it more difficult for equipment to be stolen or not delivered and helped cut down on unnecessary stock being ordered.

The phone call from the Eskom employee exposed two major problems that affected Eskom – submerged scraper chains of poor quality and lax warehouse controls.

“It would be no exaggeration to say that these two breakthroughs saved South Africa billions,” De Ruyter said.


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