City Power has confirmed that it owes contractors R1.2 billion in outstanding payments, attributing the delay to financial constraints and pending transfers from the City of Johannesburg.
In a statement, the Johannesburg municipal-owned entity explained that its operational revenue, which includes payments to contractors and suppliers, depends largely on funding from its shareholder, the City of Johannesburg.
“As a municipal-owned entity, City Power’s operational revenue, including payments to contractors and suppliers, is dependent on financial support from its shareholder, the City of Johannesburg,” the statement read.
“Limited funding has been received in recent months, which has not been sufficient to cover the full operational costs of the entity, owing to the broader financial pressures faced by the city. These constraints have, in turn, affected City Power’s ability to settle all outstanding obligations within the desired timeframes.”
The entity said it has allocated R56 million for release this week as part of its effort to reduce the payment backlog. A comprehensive review of all outstanding invoices is underway, prioritising older payments and expediting verification processes to eliminate administrative delays.
To improve transparency and communication, City Power has scheduled engagement sessions with contractors between October 16 and 22 to provide updates, clarify procedures, and address outstanding concerns.
On Wednesday, a protest took place outside City Power’s head office in Reuven. The demonstration was reportedly linked to payment disputes involving some contractors who participated in the Vlakfontein housing electrification project.
City Power clarified that the project was funded by the Department of Human Settlements, with the entity acting only as the implementing agent. “The responsibility for paying contractors lies with the department,” it said.
