The Chairman of the Board of JIRAMA Hyacinthe Befeno Todimanana, sheds light on the current financial situation of the Crown corporation water and electricity.
“Efforts have been made, but we must keep them in the continuity in the medium and long term, given the name Hyacinthe Befeno Todimanana of important economic issues that depend on the Jirama in the country,” he says.
A general anger mounted following the latest revisions of the JIRAMA rate. How do you explain the rise of mechanism?
According to the texts, the tariff revisions should take place twice a year. Revisions either upwards or downwards. All proposed revisions must go through the Office of Electricity Regulation (ORE).
And that, months in advance because countless calculations and analyzes are performed by the ERO. And it is the ERO, after study and analysis which approves rate changes.
Historically, and until 2007, the rate of revisions have been applied according to the texts, if only for “erase” the impact of inflation.
Since 2008, for strictly political reasons, and let’s populism, successive governments have decided not to apply these rate revisions.
In 2009, for the same populist reasons, we decided to drop another 15% the electricity tariff. Since we sell at a loss. The result leads to a hole of more than 1500 billion ariary accumulated, supplemented more than 850 billion short-term debt ariary.
The state was forced to draw on social programs such as health, education, population, security, to subsidize the company. What is the current policy of JIRAMA?
We opted for reform, both financially and industrially, at a time when society must finally begin its shift to an energy mix more focused on renewable energy as heat.
Jirama has implemented a turnaround plan and financial restructuring and industrial early 2017, in order to achieve breakeven in 2020 to end subsidies and regain its financial and operational autonomy.
What can not be done without returning to the true prices, and that is why the president, Hery Rajaonarimampianina is the only one on the last twenty years to take on the inevitable increase in tariff.
How will it Jirama reach this breakeven? Jirama must take responsibility for the aberrations of policies dealing these problems, and making historic efforts on his side.
If the 2017 rate increases helped raise about 25 billion ariary more for our customers, we, on our side, saved more than 200 billion ariary by implementing a drastic reduction policy and optimizing costs, eliminating Antananarivo all plants running on diesel to replace them with plants in heavy fuel oil,
which costs about 40% cheaper, while making available to the interconnected network of Antananarivo (RIA) capacity production far exceeds the needs of the point, that no one has done in 20 years.
In February 2017, suffering from Antananarivo 5 hours load shedding daily. This is no longer the case today, although many brownouts due to the dilapidated state of the distribution network, illegal connections who blow transformers, flight lines or copper who blow protections line during thunderstorms.
We hope to finish it all before the end of the year 2018. When there are cuts, sometimes the employees JIRAMA sometimes make up to 20 km walk at night in the rain along the network see where the cut is located, and then repair!
So I refute malfeasance that convey the JIRAMA does nothing to improve things. I emphasize especially that 52% of the consumers of the Jirama benefit from a social rate, thus of a tariff to 141 ariary the kilowatt hour, a tariff which never moved.
If we kill the JIRAMA, and in the end we have no choice but to privatize it, I can assure you that 52% of customers JIRAMA who today are paying the social tariff will their invoice multiplied by 10, or 1500 Ar the kwh. This is indeed the price of kwh in unserved by JIRAMA localities.
What about the intermediate fare just launched a few weeks ago, following the discontent of consumers? We are still studying it. The smoothing of prices will always growling each other, but we get down to what the price is acceptable, especially for the 46% of consumers who pay hard this upward revision.
What is the debt restructuring Jirama? the Commiss Areas auditors have issued a refusal to certify the financial accounts from 2013, despite the audit. In 2017, we asked to audit the 2015 and 2016 accounts that have not been made. So we started from in the consolidation of accounts JIRAMA.
We need to contain the upward trend of our debts, as we continue to sell at a loss despite the companies increases and the upward trend in fuel prices, which is central to our operating costs on international markets.
On our 850 billion of debt, about 380 billion has been tripartite agreement with the state, about 150 billion were rescheduled following direct talks between JIRAMA and suppliers.
There are about 320 billion for which we are still seeking a solution through structured finance. We ask suppliers to be patient, because we’re working with the State, sole shareholder of the JIRAMA to give them visibility on the treatment of their commitments.
Our customers and the people must know that they are the ones who are paying the price of 20 years of carelessness and short-sightedness, or even mistakes, that nearly led to the bankruptcy of the Jirama, without any help.
Massive contribution made today by the State. The current system does not he done JIRAMA a cash cow, as happened for decades?
The President of the Republic, Hery Rajaonarimampianina gave us carte blanche to clean and straighten the company, and invites us every day to take all the necessary decisions in this regard, without political consideration.
Those who have not complied with their vis-à-vis the JIRAMA, those who stole and / or continue to steal JIRAMA or do not pay their bills for years with impunity, must answer for their acts before the justice because we make no exception.
Customers and partners JIRAMA, models JIRAMA employees who are the vast majority, citizens who now pay the errors of policy through subsidies, deserve that we take these measures to protect and save our national society, the only strategy that size that still belongs to the state, so the 100% Malagasy.
Jirama needs a political class that tells the truth to the citizens, it is also hard. About heavy fuel oil, Madagascar Oil-Will in the race suppliers? I specify that there was pressure in any form whatsoever, to the place of Madagascar Oil, potential supplier of fuel oil for JIRAMA.
We continue to discuss with them, to see how we could work together. Six thousand employees they are not redundant to run Jirama? Overwhelmingly, JIRAMA’s employees are very attached to our company and work well, unlike against truths are conveyed.
But they have to evolve with the changes afoot in the JIRAMA a consequence of the industrial model of change and reform in governance with a system based on merit only.
The majority should not pay for the bad apples. This position is understood and supported by most of our employees.
And everyone agrees on this, even our international partners supporting the JIRAMA is the national society to the highest technical expertise in Africa. It is in the Management we fish.
And payroll does not exceed 10% of the turnover of the JIRAMA. Wages and salaries of our employees are below standard in private companies of comparable size.
We plan in this perspective to improve their working conditions, whether in cash by developing remuneration based on the expertise and skills that will be assessed professionally and in kind by providing the necessary equipment for all Jirama the world can work in hygienic conditions and safely. Interview by Mirana Ihariliva