Ratepayers’ outstanding payments balloon metro’s debt by R22bn over seven months
Tshwane’s debt has grown by billions over the past seven months as the metro’s own employees are destabilising operations to collect revenue, crying about their own predicament in the current economy.
Tshwane will aim to collect about R22-billion owed by ratepayers following two months of destabilisation in the capital, which has not made it easy for the metro to push itself out of its financial predicament.
Since September 19, 114 000 accounts in the economically depressed metro have not been serviced for water and electricity benefits.
Due to the culture of non-payment, the city’s debt has risen from R17-billion in 2021 to R20.8-billion in March this year.
Tshwane’s debt has further grown from March 16 to September 19 as follows: by R2-billion owed by residents; by another R2-billion owed by businesses; by R3-million owed by city employees; and by over R11-million owed by embassies, while its councillors’ debts have decreased by about R900 000.
The metro says it plans to collect every last cent owed, as its budget is 86% self-funded and the rest is made up of grants.
Metro spokesperson Selby Bokaba said the budget was based on a projection of revenue, which it was striving to collect from its customers.
“It’s true that collection has been low in the last two months or so due to the strike, but Tshwane is in full swing and will be ramped up once the strike is over.”
He said despite this deficit, the metro managed to reduce its loans by 36% between the end of August and mid-September, indicating progress.
The over R22-billion is spread over the following categories as of September 19:
– Businesses: over R5-billion
– Residents: over R12-billion
– Government: over R1-billion
– Embassies: over R18-million
– Councillors: over R2-million
– Employees: over R29-million
– Indigents: over R1-billion
– Inactive accounts: over R1.6- billion.
Bokaba said 72 157 business accounts were in debt, of which 13 417 were 30-90 days overdue, while 16 176 accounts were overdue by 365 days plus, accumulating a total of R4.6-billion.
He said 85 161 residents’ accounts were 30-90 days overdue, while 141 251 accounts were more than 365 days overdue, with debt standing at R11.3-billion.
From the governmental accounts, 1 686 owed a total of R399-million which was 30-90 days overdue, while 3 391 accounts owed a total of R68-million which was more than 350 days overdue.
From 3 456 Tshwane employees’ accounts, a total of R11-million was 30-90 days overdue, while 78 accounts were more than 365 days overdue at a total of R6.6-million.
From 12 councillors’ accounts, R44 842 was outstanding, while 25 owed a combined total of R1.4-million which was 365 days overdue.
Bokaba added that 488 lessees of city-owned buildings with expired leases owed a total rental amount of R85.6-million.
He said Tshwane would recoup the outstanding rental and utility service accounts arrears through the enforcement of the Credit Control and Debt Collection Policy.
This enforcement process included a collection of expired leases for rental and consumed services.
“Expired leases are continuing on a month-to-month basis. Their terms and conditions are still valid and enforceable by each party to the signed lease agreement up until any party to the lease decides to terminate the lease agreement.”
Bokaba said through the implementation of contract enforcement activities, the metro managed to issue contravention notices for outstanding rental amounts. However, some of the cases were undergoing legal processes to recoup the outstanding rental amounts and eviction of lessees from leased properties.
He said the debt of a company or individual, irrespective of leases having expired on one property, could also be consolidated to any of their active accounts in terms of Section 102 of the Local Government Municipal Systems Act, 2000.
The metro’s collection strategies were being extended to legal action being implemented by debt collectors.
It had however vowed to get its own house in order, as it had not been applying credit control measures to ensure money was received by its revenue department.
We are aggressively implementing #TshwaneYaTima campaign to improve revenue collection but first we want to ensure that we get our house in order in terms of billing issues. @CityTshwane pic.twitter.com/HnMPmhs2sK
— Mayor Cilliers Brink (@tshwane_mayor) July 4, 2023
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