via Harare council plunged into debt after bill write-off | SW Radio Africa by Alex Bell October 29, 2013
The Harare City Council has revealed it is already over $200 million in debt, following a ZANU PF directive in July to write off outstanding rate bills owed by ratepayers.
The Council’s Treasurer Misheck Mubvumbi revealed on Monday during a budget consultative meeting that the amount owed by ratepayers was “at zero” after the directive to scrap debts, a move widely criticised as a vote buying exercise by ZANU PF.
According to Mubvumbi ratepayers, including residents and the industrial and commercial sector, have not resumed paying their rates, leading to a debt buildup of over $200 million by September 30th.
The NewsDay newspaper reported that the Council’s debt as of September 30th was made up of $40,1 million owed by residents, $130 million owned by the industrial and commercial sector, while the government owed $42 million. This brings the total owed in rates arrears to $212 million.
“We wrote off that debt in July and people were now at zero debt. The assumption was that after the write off people would come forward and pay their rates. We have made it clear that if they do not pay we are going to take stringent measures by way of summons going forward. Debts had become manageable because they had been written off and we expect people be paying their rates, but it’s astonishing that so much debt has accrued over the space of a few months,” Mubvumbi said.
Precious Shumba, the Director of the Harare Residents Trust said the real problem was not the failure of ratepayers to pay their debts, but the Council’s “shambolic billing system.”
“The City Council being led by people who care very little about what residents think,” Shumba told SW Radio Africa, adding that there was a critical need for the Council to rewrite its tariff structure.
He said residents, in particular, were being forced to bear the brunt of the Council’s mismanagement.
“They (residents) are unable to pay now, not because they do not want, but because the Council is charging what they can’t afford. The best they can do is pay what they can afford. So council losing potential revenue, with a shambolic billing system” Shumba said.
He added: “The root cause is the billing system which continues to penalise residents for being poor. They can’t afford the high rates, and considering the poor service delivery, most residents find no motivation to pay full amount. They’d rather pay what is appropriate, depending on the services rendered.”
COMMENTS
The Bible predicts doomsday but is vague as to when and where. Now we know. It’s mugabeland. 2015?? Start preparing
NI ZANU ZIMENEZI!
The council always talks about what the residents owe it, but never about what it owes the residents – like service delivery. The senior managers have all been there 30 years and pay themselves huge salaries and perks. They are not answerable to the residents or the elected city councillors but only to Minister Chombo.
When the debts were cancelled those who were paying appeared to be fools. So no one will now pay. there is every incentive not to pay. including bad service delivery. my real advise to CoH is to install quickly prepaid water meters. then pipo will pay them in advance. also make sure the rates are affordable take into account the av salaries of zim. also cancel debts for the commercial and industries becoz these too suffered from western sanctions and they are not able to pay workers.
bascially what is the purpose of stating revenue which has not been collactible for the past months or years. Its surprising that most municipalities in Zimbabwe do not have the common honesty of writting off debt which can not be collected, and common with policies that will generate revenue from other revenue streams rather they always want to use the rate as the only revenue stream. They would want to keep it in their books, and yet service delivery is hummpred by lack of money. in as much as it might appear ZANU PF vote buying, it makes sense for municipalities to state debt which it can still collect. Municipalities should have taken this directive as a best opportunity to clean their books, and come up with realistic working capital management models.
Zanu has set a very bad precedent here. A culture of something for nothing. cancelling debt was not an option, it was a disaster.