The City of Ekurhuleni is alleged to be on the brink of collapse, with claims that a syndicate operating within the metro is milking the council dry by tampering with the accounts of the municipality owed millions of rands by residents and businesses.
This is according to the municipality’s high-ranking official, who preferred to remain anonymous as they are not authorised to communicate with the media.
Sunday World has established that there is also a motion of no confidence proposed to remove the mayor, Nkosindiphile Xhakaza.
Xhakaza is said to be questioning illegal activities within the metro over revenue collection and the billing system, which have resulted in the city losing millions of rands over unpaid bills emanated from the debt owed by residents and businesses in the east of Johannesburg.
Last September, it was reported that the city was set to lose close to R15-billion in revenue, as Ekurhuleni was planning to write off a huge debt owed to it by residents and businesses.
Sunday World understands that the city has approved the proposal to write off 70% of the debt, which included rates and taxes, municipal bills, and other bills owed to Ekurhuleni by residents and businesses.
Last September, EWN (Eye Witness News) reported that the metro was owed R25-billion, with 80% of the debt owed by residents.
The MMC of finance in the metro, Jongizizwe Dlabathi, was quoted as saying that the debt write-off was necessary as it was going to reduce “consolidated consumer debt”.
He stated that the city’s books had been “increasing exponentially”, saying the bill was previously sitting at R18-billion, and rose to R23-billion, which resulted in the debt reaching R25-billion.
Loss of revenue
Despite the challenges in dealing with the crisis of the billing system that saw the debt balloon to billions of rands, residents continued to have faulty meter boxes, resulting in a huge loss of revenue.
In the long term, investigations by Sunday World since last September have established that in many residential areas, meter boxes were faulty, despite the municipality awarding millions of rands of projects to debt collection and meter reading companies.
Last October, the Ekurhuleni spokesperson Zweli Dlamini told Sunday World that the metro had a panel of service providers working specifically on ensuring the success of collecting revenue and the digitisation on behalf of the city.
“The systems are developed by various service providers on the panel with the aim of ensuring that the city collects all the revenue owed to it,” said Dlamini.
He emphasised that the metro subscribed to clean governance, and therefore all tenders are awarded in line with the city’s supply chain management process and the Municipal Finance Management Act.
“It must also be pointed out that to promote transparency in the awarding of tenders in the City of Ekurhuleni, the tender adjudication process is open to the public and any other interested party — a practice that has been going on for years.
“It must, however, be noted the panel of service providers tasked with revenue recovery, management, digitisation, and enhancement have increased revenue collection in the region of billions of rands in a clearly defined monitoring period.”
Revenue collection
Dlamini also stated that the city had also relaunched the Siyakhokha Siyathuthuka revenue enhancement programme in an effort to encourage the culture of payment of services in the city to recover billions of rands that are owed in unpaid bills, where he claimed that in August, the municipality had collected R3.4-billion.
“Furthermore, there are a multitude of contracts and agreements in place with numerous service providers and contractors across multiple departments in the City of Ekurhuleni that have worked in successfully achieving the objectives of increasing revenue recovery and reducing operational expenditure.
“Once again, this then hinges on the name of the specific company being referred to.”
This week, Dlamini refused to comment and referred Sunday World to Dlabathi to explain.
“Kindly contact MMC for Finance Ald Jongizizwe Dlabathi through his PA Bianca,” said Dlamini.
“This matter was dealt with in committee, which means no officials were part of the meeting but [the] MMC can clarify the matter.”
Despite reading our questions, Dlabathi did not respond at the time of going to print.
