POLOKWANE – Although the Polokwane Municipality’s overall financial position appears to be in order, a matter of concern is that the local authority’s debt book has run out of control, reflecting an amount of more than R2.134b.

This is according to the mid-term institutional report for the period July 1, 2025 to December 31, 2025 that was tabled in the recent council meeting.

Municipality plans stricter control measures

The debt book is made up of R304m for organs of state, R421m for commercial clients and R1.371b for households, and the municipality agreed that the collection rate is below the norm, and the municipality will strengthen credit control measures to encourage customers to pay their accounts.

This includes charging interest on overdue accounts, disconnection of meters and handing over customers to debt collectors for further stricter measures.

Spending below budget

The report indicates that revenue amounting to R3.378b was billed, which represents 52% of the original budget of R6 446b and in terms of expenditure, R2.671b was spent, which represents 47% of the original budget of R5.724b. Expenditure on capital works amounted to R399m, reflecting 49% of the original budget of R823m.

Outstanding creditors amounted to R149m and the municipality budgeted R281.7m for indigent support, of which R100.1m were spent by December 31.

High water and power losses

Water and electricity losses were cited as a matter of concern and the audit and performance audit committee remarked that the impact of management actions to mitigate this challenge were minimal. The water loss over the period under review was 37.75% and the electricity losses reached 12.77%. Electrical losses comprise technical losses and non-technical losses.

Technical losses happen during the transmission process, that is inherent resistance of conductors to conduct electricity. Non-technical losses happen due to bridged meters, unread meters, wrong readings, meters not on the system, loading of networks and aged networks, the report indicated. Water losses also involve technical losses as well as non-technical losses. The technical losses are caused by bulk supply breakdowns and normal pipe bursts. The non-technical losses are caused by bridged meters, unread meters and wrong readings.

Loans and investments

An external loan with the Development Bank of Southern Africa amounted to R150.850m and matures in January 2032 while a loan of R153.830m at Standard Bank matures in July 2032. The municipality also holds three investments at Standard Bank amounting to R300 000, R250 000 and R250 000.

According to the report, the overall challenges around capital projects were poor performance of service providers leading to delays, delays in approvals of technical reports, disruption of projects by labourers and community and delays on allocation of service providers by supply chain management.

Vacancies affect performance

Vacant positions appear to be another reason for underperformance in some sectors and the municipality had 2 634 budgeted positions of which 2 039 were filled.