8 January 2018

Zimbabwe: Chitungwiza Levies 6 Percent On Debts

Chitungwiza Municipality is now levying six percent interest on all overdue accounts for both residential and commercial ratepayers, acting finance manager Mr Robert Nyikadzino has said.

The interest is being charged on all accounts that are in arrears for 60 days and above.

Mr Nyikadzino said the move was aimed at improving the local authority's revenue inflow, which will help it offset the $68 million debt owed to various creditors.

"We have started charging six percent interest on all properties which have outstanding balances," said Mr Nyikadzino. "This was after we published notices as per Urban Council's Act in December 2017 to the effect that we are going to charge six percent interest starting January.

"This is effective on accounts that are in 60 days arrears; as we speak, our information and technology team is working on the modalities that will be used to effect the charges.

"This means bills which will be coming end of this month will reflect the six percent charge."

Mr Nyikadzino said council had not been charging interest of late, but was forced to do so as creditors were charging council for late payment.

"As of end of December last year, residents and commercial (firms) were owing council a total of $63,4 million; loosely put $37,4 million and $26 million, respectively," he said.

"We owe our creditors around $68 million. The creditors are more than the debtors, which means we are not in a sound position.

"Therefore, we are encouraging our debtors to try and liquidate their debts in a way that will help us in the creditors' figure. As we go on, we are raising bills to cater for the difference,"

Mr Nyikadzino said the only option available for council was to engage a debt collector.

"We have been encouraging our debtors to come and make payment plans, but the turnout is very low," he said. "We are in the process of engaging a debt collector and soon after, we will unleash them as our last resort, although it was never intended."

Mr Nyikadzino said the writing off of debts in 2013 dealt council a major blow as even loyal residents were now reluctant to pay their bills.

"The accumulation of debts started from 2013 for residents, while for the commercial (sector) was around 2009 during dollarisation," he said. "We would like to applaud Government's stance of encouraging residents to pay bills and rates, reiterating that there is no other cancellation of debts as from now onwards.

"This is likely to be a pushing factor for residents to pay their bills."


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