Londiwe Xulu
journalist
3 minute read
24 Jun 2022
09:14

Msunduzi Municipality in KZN to hunt down R5,3 billion owed in debt

Londiwe Xulu

Msunduzi’s leadership has vowed to crack down on defaulting debtors who now collectively owe the municipality R5,3 billion.

Msunduzi’s leadership has vowed to crack down on defaulting debtors who now collectively owe the municipality R5,3 billion.

This came up during Thursday’s executive committee meeting where a tabled report showed that residents owed Msunduzi R4,1 billion while the total debt for businesses sat at over R809 million. Government departments and entities owed the city R242 million.

Mayor Mzimkhulu Thebolla said they had taken a decision to embark on an aggressive debt collection campaign with deputy mayor, Mxolisi Mkhize.

Their plan, he said, was to start with disconnecting Msunduzi’s top 10 business debtors.

Thebolla said: 

“From this, we don’t want to hear that we are chasing away businesses. We will serve them notices and if they don’t comply, they will be disconnected so we can get the money that’s owed to us and provide services.”

Mkhize said they also had the challenge of unscrupulous business owners who stole electricity so that they ended up paying penalties instead of paying for services consumed.

“These same businesses will go to the media and say they are prepared to relocate from Pietermaritzburg if ever we are forcing them to pay.”

Mkhize said the City should rather let them leave if they do not want to obey the law. “We must be very radical in our approach and they must be forced to pay,” he said.

He said by doing so, the municipality would be able to reduce the debtor’s book and have money to deliver services.

Mkhize lamented on how Msunduzi had to take loans even though it could be generating enough revenue to fund all its expenses because “those that are utilising our services are not paying what is due to us.”

“It’s high time we become stricter to both government and businesses because when we are sitting with them they pretend … all is well,” said Mkhize.

Thebolla said one of the reasons the City requested assistance from National Treasury to review Msunduzi’s financial recovery plan was for the data cleansing of their customer register.

“In all the meetings, Exco and council, on the item that deals with the applied indigents we (councillors) always approve (debt) write-offs. I think one of the reason our residents owe us 76% (of the total debt) is that during Covid-19 people lost jobs and the economy declined and we made write-offs,” said Thebolla.

He added by offering discounts and write-offs, the municipality was losing money but its debtor’s book, however, had not been decreasing. He said there was a likelihood that in the next council financial report, the total debt would have increased despite all the municipality’s efforts to decrease it.

Thebolla said although government departments were part of their debtors, he believed they were owing Msunduzi less compared to what they owed to other municipalities.

He said: 

“We once disconnected all schools that fall under section 21 and we made national news because of that. I was being interviewed and it was said we don’t value the education of our children by cutting services. We had to explain we also have a government to run and a responsibility to provide services, and for us to do that we need to be paid.”

He added the R242 million owed by government could help with the provision of service delivery, including building a reservoir for people living in Elandskop.

DA councillor, Ross Strachan, said government departments were owing Msunduzi a lot of money and there was no reason for them not to pay.

“We need to start being aggressive with these government departments to get them to pay. They have money to pay and there shouldn’t be any reason why we shouldn’t be getting them to pay,” said Strachan.