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| TOYS FOR THANDUMNEKLA: Three Denmark girls have made a significant difference to the lives of children at Thandumnekla Creche in Bhomela during their community service recently. After seeing the children at the creche, the girls wrote a letter to Lego in Denmark asking for toys. They delivered the toys days before they headed back home. |
by Johan Pretorius
05 March 2010
The Hibiscus Coast Municipality has reacted angrily to a letter in which DA Cllr.George Henderson claimed, amongst other things, that only 16% of all ratepayers were up to date with their payments, and that only R33-million of a budgeted R205-million had been collected in the first six months of the current financial year.
He alluded to the Umsinduze Municipality in Pietermaritzburg which recently only had cash reserves to last for a week, drew an analogy, referred to a looming crisis and said “the alarm bells are ringing”.
The letter in which he made these statements, was received by the Fever last week, but because of the seriousness of the allegations, we asked the HCM for comment before publishing it.
Chairperson of Finance and Budget Cllr W.W Mkhize said what transpired from Cllr. Henderson’s letter was his shallow understanding of financial records of the Municipality. “What we must say, is that these figures are for public consumption, and he, as a councillor, has first hand access to the information.. We urge him to debate facts rather than fiction.”
Cllr. Mkhize stated that the public was not a illiterate as Cllr. Henderson portrayed them to be. In his urge to score cheap political points, he crossed the line by claiming that people were not paying rates adequately and that the municipality was sliding towards bankruptcy. For the record, he said, the state of the Hibiscus Coast Municipality and its finances is was good.
“The fact that we have made a long-term loan is no reflection of financial constraints. This is a normal phenomenon in the area of funding your long-term structural assets. The loan in question was well-considered and consciously budgeted for in the original budget as unanimously approved by Council, which Cllr. Henderson was part of.
In the last six months that Cllr. Henderson referred to, we have in fact collected 81% of the total budgeted revenue, and not 16% as fantasized by him. Our investments are healthy and sound, and our collection systems and mechanisms are producing results and are effective.”
Cllr Mkhize went on to say that the shortfall on collection vs billing was currently sitting at 19%. As a municipality, whilst this was much better than many municipalities, and it was understood that the decline in payment was due to the impact of the global recession; it realised this was still 19% too much. The public was therefore urged to make arrangements to pay of their rates and show a patriotic attitude towards the municipality.
“As the ANC we continue in this municipality to provide responsible accessible and strong leadership. Those hypocrites who wish to score cheap political points must not play to the gallery at the expense of the credibility and integrity of our municipality. As the HCM does not belong to the ANC or politicians, but to all our people who have made this their home and future. As the Chairperson of the Finance Committee at the HCM I can categorically assure our people that the municipality is in a healthy financial position, and is far from being bankrupt. For this we salute the council our employees, and our ratepayers.”
THIS IS THE LETTER THAT CAUSED THE FURIOUS REACTION:
Warning Bells Ringing at HCM
Dear Editor
Last week the KZN Local Goverment MEC,Nomusa Dube, announced that the Umsinduze Municipality (Pietermaritzburg) will not be awarded Metro status, allegedly due to improper municipal configuration and its grim financial position. The MEC has revealed that the municipality only has cash reserves to last for one week. The blame for not getting Metro status must solely lie on the shoulders of the ANC for allowing the municipality to slip into this financial crisis, mainly due to an inability to collect revenue and through reckless over-spending.
What is the position at our local Hibiscus Coast Municipality? Us as councillors were asked at a Council meeting, held on 28 January, to approve the adjustment budget, which we duly did. However, the following alarming facts were revealed, and I feel it my duty to share this information with all the ratepayers:
Out of a budgeted total rates income of R205 million, only R33 million, or 16% were collected for the first 6 months of the current financial year i.e. 1 July 2009 to 31 December 2009.
If one analyzes these figures, the following is revealed: - Residential rates collected amounts to 12% of the budgeted amount supposed to be collected, Commercial and Industrial amounts to between 60 and 70% etc.
Why are these figures so low? My research has revealed the following:
If a ratepayer for whatever reason falls behind in payments, all subsequent payments are credited to the oldest month of non payment. This means that any ratepayer in arrears´s payments will not be reflected as current until the arrears amount is wiped out.
In other words only 16% of all the HCM ratepayers are up to date with their payments, indeed a very sorry state of affairs...!!!
The total rates in arrears are R84 million, if one add in electricity, refuse removal, and other services arrears, the total amount rises to R114 million. This is more than 25% of the total budget!
More than 50% of all outstanding rates are 6 months and more outstanding.
The question now is whether the HCM is in fact still solvent. It was revealed in the adjustment budget that the municipality will, for the first time in history, take a long term loan to fund certain expenditure.
The warning bells are ringing, and if the HCM doesn´t take speedy remedial action and also realize that rates are too high and becoming unaffordable, it might just join the ever growing list of insolvent municipalities, which cannot pay its accounts and employees and, where zero services are the order of the day .
What can be done about this looming crisis?
If and when ratepayers cannot meet their commitments, please try and arrange terms with the authorities. Remember outstanding rates may never be written off, in the end it will be claimed from your estate or when you sell your property.
The municipality has an indigent policy for poor ratepayers who cannot afford to pay, find out whether you qualify...!!!
The HCM has to apply its arrear rates policy to the tee.
The Democratic Alliance are calling for a ZERO rates increase in the budget for 2010/11. The figures above clearly show that we are killing the goose that lies the golden eggs ...!!!!
George Henderson
Democratic Alliance |
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