Victoria Falls municipal debt balloons to $6M, defaults increase

via Vic Falls municipal debt balloons to $6mln, defaults increase | The Source March 4, 2014

The Victoria Falls Town Council says domestic debt has ballooned to $5,8 million as companies and residents continue to default on paying rates, threatening service delivery in the country’s prime resort town, an official said on Monday.

Municipalities across the country have experienced serious cash problems following a government edict last year to scrap debts owed by households. The economic slowdown has also impacted on firms and households’ capacity to pay council charges.

The town council cancelled debts of $3,6 million in May last year in line with the decree, but defaults have increased.

“The $5,8million is after the write off. A lot of people don’t want to pay and that is affecting on service delivery,” said acting Town Clerk Philip Ndlovu.

As a result, the council has engaged the services of debt collectors to recover the money, he said.

“We have held road shows, the councillors have been meeting the residents to try and persuade them to at least settle their accounts. We are also engaging the services of debt collectors but we did not want to take that route,” said Ndlovu.

On the other hand, Ndlovu said council owed its creditors $4,1million, the bulk of which was to the Zimbabwe National Water Authority (Zinwa), and that the town facing the risk of disconnection.

“We owe the Zimbabwe Electricity Supply Authority (Zesa) and Zimbabwe National Water Authority. Zesa is for electricity for water purification and street lights mainly. The Zinwa bill carried over from 2009 and we are still fighting to settle it,” he said.