There is no fi­nan­cial cri­sis, says city’s head of trea­sury

The Star Early Edition - - METRO WATCH -

THE CITY OF Joburg’s fi­nances are sound. This is ac­cord­ing to Seth Muk­w­evho, act­ing group head of trea­sury.

“The city is com­mit­ted to con­tin­u­ous im­prove­ment of ser­vice de­liv­ery to res­i­dents and all our stake­hold­ers. To this end, fi­nan­cial sus­tain­abil­ity is key to mu­nic­i­pal op­er­a­tions. The city would like to give in­vestors and all other stake­hold­ers as­sur­ance that there is no fi­nan­cial cri­sis and the mu­nic­i­pal­ity re­mains fi­nan­cially sus­tain­able and able to meet all obli­ga­tions as they fall due,” he said.

With ref­er­ence to the billing is­sue, it is best un­der­stood within its con­text. Mayor Her­man Mashaba said the billing re­gion­al­i­sa­tion project, im­ple­mented in Fe­bru­ary 2017, re­sulted in some cus­tomers be­ing billed twice in one month. The project was aimed at re­duc­ing the time be­tween con­sump­tion and pay­ment for ser­vices through the re-align­ment of the billing por­tions by the ge­o­graphic re­gions of the city.

In to­tal, 41 208 cus­tomers were af­fected (out of 1 094 976), but all in­ter­est and penal­ties charged on those ac­counts have been re­versed.

Of note is that no fur­ther penal­ties will be charged un­til the ac­counts have been nor­malised.

“More­over, the city has in­sti­tuted ro­bust credit con­trol man­age­ment to en­sure that the mu­nic­i­pal­ity re­cov­ers billed monies from all cus­tomers who are in ar­rears, and we are pleased to an­nounce that great strides in col­lect­ing out­stand­ing monies are be­ing made,” he said.

The mu­nic­i­pal­ity’s re­demp­tion strat­egy is in place to make sure that bor­row­ings to the tune of R2.733 bil­lion will be re­deemed in the 2017/18 fi­nan­cial year. The re­demp­tions will be through the debt re­demp­tion fund, whose bal­ance is more than R4.3bn, he said.

“De­spite South Africa’s weak economy, the city’s credit rat­ing was re­cently af­firmed by Moodys at Aa1.za/P-1.za, which is an af­fir­ma­tion of the con­fi­dence in our abil­ity to man­age its fi­nances. The city is an ag­ile and re­spon­sive or­gan­i­sa­tion and con­tin­ues to ex­pe­ri­ence strong rev­enue growth, un­der­pinned by its sta­tus as South Africa’s busi­ness cap­i­tal and main fi­nan­cial and eco­nomic cen­tre. “Our fi­nan­cial man­age­ment sys­tems re­main rel­e­vant to re­spond to dy­nam­ics of the economy,” con­cluded Muk­w­evho.

Mu­nic­i­pal­ity is fi­nan­cially sus­tain­able

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