CHDM blows thousands

Interest on Eskom ’ s unpaid bills is costing the Chris Hani District Municipality hundreds of thousands.

Mayor Thembisile Bobo told council on Wednesday that interest of R237,811 run up in the 2023/24 financial year was fruitless and wasteful expenditure.

The numbers were set out in a debt recovery report tabled by Bobo.

Bobo said: “The Municipal Finance Management Act defines fruitless and wasteful expenditure as the expenditure that was incurred in vain and would have been avoided had reasonable care been exercised.

“It is expenditure that has yielded no benefit by the municipality.”

His numbers showed that R25,730 was squandered on interest in the first quarter (July to September 2023); then there was a respite with no interest being levied in July.

“But the culture of nonpayment kicked in August (R510) and bit harder in August when the council had to pay Eskom R22,2201 — just in interest.

From October to December 2023, the interest bill more than doubled to R55,640.

October was a shocking month of non-payment with the municipality incurring interest of R4,7 91. Payments seemed to recover in November (R830) but picked up in December (R6,899).

The big crash came in the third quarter. From January to March 2024 when the municipality racked up interest to Eskom of R156,440.

In January they were penalised R21,112 for nonpayment of their power bill, but in February they failed to pay both their electricity and telephone bills.

In that month, they were hit with an Eskom interest bill of R123,105 and owed Telkom R4,053.

In March the municipality again shelled out R8,169.

Bobo said: “During the council meeting held on November 24 2023, council approved the write-off of an amount of R86,693 which was the (council’s) opening balance from 2023 and the interest incurred in the first quarter of the financial year, which is R25,730.”

He said the opening balance and the current year expenditure came from the interest charged by Eskom on the municipality’s “late payments”.

He said interest charged by Eskom in the second quarter (R55,640) was submitted to the municipal public accounts committee (MPAC) “for investigation and we await for the final outcome”.

He said his municipal management was at work reviewing this fruitless and wasteful expenditure, drilling down to departments who all had to submit to the finance department their plan on how to recover the money.

Councillor Nosipho Papiyana, seconded by councillor Nobantu Macingwane, successfully proposed that the council noted and accepted the report on fruitless and wasteful expenditure, and the recovery plan.