KDM battles to collect electricity revenue as pandemic leaves residents strapped for cash

KwaDukuza municipality (KDM) has warned electricity account defaulters that their power will be shut off if accounts are not settled. 

The widespread economic havoc wrought by the coronavirus has left millions of people jobless and struggling to pay the bills.

As a result many households have fallen behind on their electricity, water and sewage bills making them eligible for disconnection.

According to the financial report for the district’s economic cluster KDM’s June 2020 billing was about R20 million lower than pre-lockdown as most businesses were closed during this period resulting in a decrease in electricity consumption and refuse removal.

The report states that KDM will barely be able to meet its Eskom and salary costs. 

While municipal revenue collection were already depressed before lockdown, the South African Local Government Association (Salga) at a recent portfolio committee meeting with Cooperative Governance and Traditional Affairs, highlighted a wide range of challenges faced by municipalities as a result of the pandemic’s economic impact. 

A major concern was the projected reduction in revenue collection – directly impacting on municipalities ability to meet their other obligations.

While municipalities heeded Salga’s call not to disconnect residents during lockdown, Eskom has threatened to cut off electricity to municipalities for non-payment.

KDM is one of many municipalities that act as intermediaries, buying electricity from Eskom and then re-selling it to their customers.

The sharp declines in revenue have cut deeply into municipal finances, creating havoc at a time when they are struggling to break even. 

DA Caucus leader, Madhun Sobram Sing said KDM’s collection rate over the lockdown period fluctuated from 68% to 76% in July. 

“This has put severe constraints on KDM. Bulk electricity purchases from Eskom have to be paid whether your collection rate increases or decreases.

Residents who are struggling to pay their debt must approach the KDM finance department and make payment arrangements.

A number of debt relief measures have been put in place, which have been widely advertised in all the local newspapers, to encourage those in arrears to make payment arrangements 

“As for disconnections, this is in line with credit control policy,” said Sing.

KDM spokesperson Sipho Mkhize said: “We were very clear from the beginning, that consumers not participating in the debtors relief scheme will be deemed to be affording the services. The only amnesty that council has approved is subject to a debtor participating in the Covid-19 debtors relief scheme and adhering to the agreement, so they would qualify for the write off of interest and admin charges. There is no payment holiday being granted to debtors and credit control action will be implemented to arrears debtors.

However, residents say they cannot get through to the credit control numbers listed on the notice.

A number of complaints have been posted on KDM’s Facebook page.

Anita Gomes said: “I have also emailed Zanelem@kwadukuza.gov.za, pearlm@kwadukuza.gov.za; lungelom@kwadukuza.gov.za; raeesab@kwadukuza.gov.za. No luck, this has been going on for 5 months now, sending two emails per week.”

Zachary Daliah said: “I have been trying to contact the offices for the past month and there’s no answer.”

Nicole Clay Gillan posted: “I have been trying to get in touch with the offices for ages, and there is no answer on the phones, and no replies to emails. I desperately need to speak to someone.”

The Courier made several attempts on Monday to get through to all the credit control numbers listed but had no success.

Out of the 6 numbers listed, 5 did not pick up while the 1 number was permanently engaged. 

Ward 22 councillor Tammy Colley advised residents unable to get though to KDM’s credit control to contact her or the other ward councillors so the matter could be escalated. 

Mkhize blamed the increased number of people coming to the KDM offices to deal with account issues.

KDM staff had been forced to leave their desks to assist with the surge. 

“I urge those who have complained to reach municipal staff on email as a due consideration of the amount of additional work that has be done to ensure that premises are compliant with regulations.”