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South Africans owe almost R87b to municipalities

The amount owed to municipalities could seriously impact on their ability to deliver services, Cooperative Governance and Traditional Affairs Minister Lechesa Tsenoli told journalists in Parliament on Thursday.

It meant municipalities would not have sufficient revenue to provide on-going services and improve on those that already exist.

South Africans owe almost R87-billion to the country’s 278 municipalities.?

Tsenoli blamed high levels of unemployment and the municipalities’ own ineptitude in collecting revenue for the high debt figure.

"One of the things that results from levels of poverty is many more people being unable to pay their rates; people have been losing their jobs," he said.

"We spoke about a million people losing their jobs in the country. Municipalities immediately pick up the consequences of those job losses."

Collection
Tsenoli said weaknesses in the systems for collecting revenue also played a role. He added that his department, together with national and provincial treasuries, were helping municipalities to develop strategies for effective collection, especially the smaller municipalities.

"For a small municipality to be owed even R150 000 is a lot of money for the things they can do," he said.

Tsenoli said residents owed municipalities across the country an overall amount of R86.9-billion, while the various government departments owe R4.2-billion to municipalities, down from R4.5-billion owed earlier in the year.

"This is the debt that relates to the problem of municipalities being unable to effectively specify the monies owed to them by specific departments," said Tsenoli.

"It does make it difficult for departments to pay the amounts. In many instances there are conflicts about how much a department owes the municipality."

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