The Tshwane mayor said his administration is rebuilding a “broken” revenue collection to pay the R1.9b it owed to Eskom, which recently threatened legal action.

Mayor Cilliers Brink was addressing a recent media statement in which Eskom said the metro was chronically late in paying its financial obligations.

“We note the statement issued by Eskom pointing to the arrears,” he said.

“It’s no secret that Tshwane has financial and cashflow difficulties, including long-standing issues with debt collection and credit control.”

He said the metro was buckling under the debt but plans to strengthen its revenue drive.

“We are making aggressive revenue collection a number one priority. We are rebuilding a revenue management pipeline which, unfortunately, over the years has fallen apart.”

Brink said through the Tshwaneya tima campaign, the council members discovered how poor and broken the metro’s revenue collection system was.

“Tshwane is aiming to do at least a thousand disconnections every week and we have been on target to exceed this target.”

He said, however, the municipality would suffer a lag time as it was correcting systems, controls and other procedures.

The metro is failing to correctly dispatch bills effectively, identifying whether accounting changes were needed amongst other failures.

“The system is broken. We must look at what extent the system will require direct intervention from the political leadership to mend it.

“If there is one thing that caused Tshwane to be in major financial distress, it is the under-collection of revenue because of the breakdown of our systems and controls.”

Brink said finance MMC Peter Sutton and utility services MMC Themba Fosi were tasked to lead a team to ensure that credit control and debt collection policy was enforced.

He said this would assist in restoring controls.

He said contractors would also be investigated to ensure public funds were spent effectively.

“Contractors who do credit control for the City will be checked so that we don’t spend public money for things that aren’t delivered.

“I must stress that all our commitments are Tshwane’s long-term financial sustainability.”

“If we don’t get it right, Tshwane will cycle into decline. But we are determined to fight that and keep our promise.”

Eskom Gauteng senior customer services manager Mpumelelo Mnyani said that Tshwane had been regressing in its financial obligations to the utility.

The metro had failed to pay fully two of its monthly payments to Eskom and was scheduled to pay almost a billion by June 17 for May.

“The March invoice, which was payable on April 19 was short by R179m while the April invoice of R776m payable on May 18 remains unpaid. Eskom has issued the May invoice of R904m payable on June 17 to the City,” said Mnyani.

Eskom said it had engaged with Tshwane on numerous occasions regarding its failure to settle the debt owed.

“The power utility has appealed to the metro to immediately settle the March and April invoices and pay its monthly accounts on the due date.

“Eskom does not have the financial capacity to continue supplying bulk electricity to the city without the necessary payments.”

Mnyani said Eskom had in the past taken this matter to National Treasury and Cogta; however, regardless of all these efforts, the situation was worsening.

“Eskom is exploring all avenues available to it to recover this debt including, but not limited to, approaching the courts for relief,” Mnyani said.

Previously, Rekord reported that fate similar to what befell Emfuleni when Eskom obtained a R1.3b judgment to attach assets to offset arrears could befall Tshwane.

The Tshwane metro is buckling under its debt weight.

In 2021, Tshwane’s burgeoning debtors’ book stood at R17b and had worsened to R20.8b as of March 16 due to the culture of non-payment.

The metro blamed its inability to implement advanced technology to capacitate its collection effort on this high debt.