Cash-strapped Gweru engages debt collectors

25 Aug, 2021 - 00:08 0 Views
Cash-strapped Gweru engages debt collectors

The Herald

Freedom Mupanedemo Midlands Bureau

The cash-strapped Gweru City Council has hired debt collectors in a bid to recover money owed by residents amid revelations the council owes service providers over $280 million.

A debtors and creditors’ list seen by The Herald indicates that Gweru City owes the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), the Zimbabwe Revenue Authority (Zimra), TelOne and the Local Authorities Pensions Fund (LAPF), among others.

Gweru City owes ZETDC $196 174 605, the LAPF $37 654, 810, Zimra $42 657 403, TelOne $1 067 573, and others $6 310 610.

It is understood that some creditors are now threatening to sue the council.

City spokesperson, Ms Vimbai Chingwaramusee, confirmed the figures owed to service providers. She said residents owe council over $900 million in unpaid bills, hence the decision to engage debt collectors. As at July 31, Government departments owed council $58 783 254, heavy industrial site $55 790 193, light industrial site $39 099 711, domestic $541 966 683, commercial $130 923 905, others $99 243 463 taking the total debt owed to council to $925 807 210.

Ms Chingwaramusee said council was engaging the debt collectors to force debtors to settle their bills.

She said if council debt was paid in full, they would be in a position to pay their creditors and remain with some money to improve service delivery.

“We continue issuing final demand letters and for those who do not respond, we take the legal route culminating in the issuance of summons,” said Ms Chingwaramusee.

Mayor Josiah Makombe attributed the ballooning debtors’ bill to reluctance on the part of rate payers.

“The budget has been underperforming due to lack of will by residents and other stakeholders to pay their bills,” he said.

Mayor Makombe said due to non-payment of bills by ratepayers, council was now struggling to clear its debt with service providers, particularly Zimra, ZETDC and LAPF.

“Residents might be interested to know that on the 17th of May 2021, ZETDC switched us off at our water treatment plants over the debt and only restored supplies after we had committed ourselves to a monthly payment plan of $13 million,” he said.

In June, Mayor Makombe said Zimra garnished the council’s accounts over $44 million and council paid $14 253 098 for the tax collector to lift the garnishee.

While revenue collection increased in the first half of the year, monthly collections remained low, said mayor Makombe, with $464 889 027 collected.

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