Parliament passes law to split Escom
Parliament yesterday passed a law that will facilitate the split of Electricity Supply Corporation of Malawi (Escom) into two entities with some legislators fearing for jobs among employees and high tariffs for consumers.
Speaking after Minister of Natural Resources, Energy and Mining Bright Msaka presented the Electricity Amendment Bill, Dowa East member of Parliament Richard Chimwendo-Banda (Malawi Congress Party-MCP) said there are several areas that needed not to be overlooked.
He said: “When MSB [Malawi Savings Bank] was being sold, government assured us that there will be no loss of jobs and months after the deal was settled, hundreds of people lost their jobs. These people have their families who are crying up to now.
“Subsequently, are we sure the disbundling of Escom will not push the [electricity] tariffs even higher. This is a concern which must be addressed, otherwise Malawians will be the ones to suffer if things happen to the contrary.”
Kasungu West MP Alex Major (MCP) also wondered if the splitting of Escom will resolve the current electricity supply challenges facing the country.
He said: “Another important issue which is being left out is that these companies—to be born from the split of Escom—are profit-driven and might, therefore, go to areas where the tariffs are better and in the process neglect other areas which could be bad for this economy.”
But in an interview later, Msaka said he could not assure Malawians if the law will push the tariffs either up or down.
However, he said people will not lose jobs as 34 companies are set to join the power sector and will need the very same people.
Said Msaka: “What I know is that this Bill will help by helping to generate power and further ensure that power is available to Malawi. We are liberalising the market; hence, bringing in more players which will push the tariffs down. Our selection will also depend on those who will least charge Malawians. We want to make Malawi competitive to the Sadc and global market.”
According to the minister, the passing of the Bill was part of the Power Sector Reform Project (PSRP), a component of the $350.1 million (about K243 billion) Millennium Challenge Corporation (MCC) energy compact that seeks to improve generation and distribution infrastructure.
