/ 11 May 2011

Non-payment hits revenue collection in Gauteng

Municipalities in Gauteng, the country’s richest province, continued to struggle to collect revenue due to non-payment for services such as water, electricity and waste removal, according to Gauteng Premier Nomvula Mokonyane.

In Gauteng’s local government performance review, which looks at the performance of Gauteng-based municipalities over the 2006 to 2011 period, Mokonyane noted that service charges for municipal services were the largest source of income for municipalities over the past five years.

In the past five years, municipalities generated 55% or R110,95-billion of the total revenue from municipal services, while property rates, grants and subsidies accounted for 15% and 16% respectively, according to the review.

Municipalities generate income from a combination of property rates, tariffs, services such as water and electricity, as well as grants and subsidies from national and provincial governments.

Water and electricity purchases and the revenue generated from such services showed a steady increase over the past five years, Mokonyane said.

The review also noted that in Gauteng, 12 municipalities had implemented the Municipal Property Rates Act.

All districts, with the exception of the West Rand district municipality, did not implement the Act.

Municipalities that have implemented the Act had experienced “sustainable revenue growth”, the review said. — I-Net Bridge