Municipality struggling to collect

THE Enoch Mgijima Local Municipality (EMLM) continues to struggle to collect much needed revenue from its debtors after having under-collected by 24% in the 2016-17 financial year.

This lack of collection is negatively affecting quality service delivery to communities, the municipality has indicated.

The local authority’s section 52 (d) quarterly report, which details its finances, indicates that various government departments and entities owe the municipality millions.

Schools in the area collectively owe the municipality a whopping R1.9-million, the Department of Health owes R500000 for its clinics, and Frontier Hospital R3.3-million.

The Department of Public Works owes R2.5-million, the Department of Agriculture R199 492 and the Department of Social Development R221 087.

Komani Hospital owes R3.9-million and the Eastern Cape Development Corporation R110 916.

Frontier Hospital chief executive officer Sindiswa Tywabi said the hospital had since made arrangements to pay the municipality after the national budget adjustments were completed.

“The municipality had initially overcharged us and after the budget adjustments we agreed on the amount we would pay. We are in the process of paying the full amount. An order to make payment has been finalised.”

The municipality had planned to collect R13.5-million from property rates, but fell short of the expected R21.6-million. The local authority had also planned to make a collection of R65-million from electricity tariffs but only R43.4-million was recovered.

A leaked report to The Rep last year detailing the municipality’s financial woes indicated that from July to September, only R25.8-million was collected which fell short of the expected R68.5-million.

Upon realising that the municipality had been failing to effectively collect revenue for services, a revenue enhancement strategy was put in place, with the appointment of East London-based debt collection company REVCO.