KZN municipalities face having to write off at least R1.6 billion owed to them, the SA Local Government Association said.
|||Durban - KwaZulu-Natal municipalities face having to write off at least R1.6 billion owed to them, the SA Local Government Association said on Tuesday.
“Municipalities will have to develop a policy of writing off that debt,” Salga's KwaZulu-Natal chairman Sibusiso Mdabe told reporters at Salga's provincial assembly.
The R1.6bn is almost 15 percent of the total R11.2bn owed to municipalities by residents, businesses and government.
Mdabe said all of the debt was three months and older.
KwaZulu-Natal premier Senzo Mkhize told delegates that R6.4bn was owed to municipalities by consumers, that business owed R2.5bn and the government almost R700 million.
He said the failure to pay these debts, which were for rates, the provision of services and electricity and water, would seriously affect municipalities' ability to render services.
“We are prepared to encourage all departments to pay their debts,” he said.
The amount owed to municipalities had increased by 13.1 percent, from R9.9bn at the end of the 2011/12 tax year to the R11.2bn recorded at the end of the 2012/13 tax year.
Ethekwini Metro Municipality (Durban) was owed R5.5bn, and the uMgungundlovu District Municipality, which includes the provincial capital of Pietermaritzburg, was owed R2bn.
Mchunu said that R3.5bn, or 31.4 percent of the money owed to municipalities, was for water they had provided. About 31.2 percent was for unpaid rates.
KwaZulu-Natal's human settlements and public works MEC told delegates that the province was slowly implementing a policy of densification.
He said the spread of settlements and houses in the province made it extremely costly for municipalities to provide services such as piped water and electricity.
He said the department hoped to create what he called nodal points of development, drawing people into much closer proximity.
Referring to the current pattern of settlements in rural areas, he said: “It is not going to be sustainable over the long term.”
Sapa