Vic Falls Council debt worsens

VICTORIA FALLS — 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 $5,8 million is after the write off. A lot of people don’t want to pay and that is affecting on service delivery,” acting town clerk Philip Ndlovu said.

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

“We have held roadshows. 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.”

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

“We owe Zesa and Zinwa. 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.

Cities such as Bulawayo and Harare have also struggled to cope after they were forced to write off debts by Local Government minister Ignatius Chombo.

Last month, the Kwekwe City Council, which is saddled with a $12 million debt, said it faced a total service delivery shutdown as heavy industries based in the city and residents continued to default on rate payments.

Mayor Matenda Madzoke said his council could soon fail to offer basic services delivery.

The council is owed $18,4 million mainly by Ziscosteel, now NewZim Steel, ($12 million), ferrochrome producer Zimasco ($161,327), Lancashire Steel ($217 619) and Tor Steel ($151 512), among others.

In turn, the council’s debts stood at $12 601 112 as at December 31 last year, according to documents released by the council finance committee.

The municipality also has a power bill of $7 million, accumulated from 2009.
Other creditors are workers who are owed $3 418 536 in salary arrears and Zimra, which is owed $254 833 in unremitted income tax.

Source: Victoria Falls debt worsens (05/03/14)