15 February 2018

Zimbabwe: Decisive Action Needed On Debt Collection

Harare City Council should make a decisive action on strategies to recover the money it is owed by business and residence so that it can use the revenue generated in various developmental projects for the residents who are yawning for improved service delivery.

Mr Speaker Sir, Harare City Council is now owed more than $725 million by ratepayers and yet councillors had been wasting time haggling whether to engage debt collectors or not and at the very least which debt collection firm to use.

Policy inconsistencies regarding debt collection continue to cost the cash-strapped local authority.

Political meddling from Harvest House, the MDC-T headquarters appear to be taking the better of decision making with the latest being the recall of Harare mayor Councillor Bernard Manyenyeni.

At the centre of controversy, Mr Speaker Sir, is whether city fathers should retain Wellcash Debt Collectors or not after city fathers declined to renew the firm's contract at the expiry of its contract in December last year.

Councillors at the moment remained divided on what strategy to use to recover money it is owed, from residents and business, which if it is paid would go a long way in improving service delivery and make strides in returning the capital to its sunshine status.

A heated debate ensued, Mr Speaker Sir, during full council meeting's deliberations last month on the subject as councillors haggled on whether to retain Wellcash debt collecting firm or not or better still on what other strategies were available to recover owed money.

For the record, several State entities like Government departments, local authorities and hospitals had been using debt collectors and that have improved in a significant way revenue collection.

This is despite, Mr Speaker Sir, possible legal bottlenecks that come with such an arrangement. What residence want, at the immediate instance, Mr Speaker Sir, is improved service delivery through effective and efficient debt collection mechanism that compliments efforts to return the city to its glamour.

Mr Speaker Sir, the portfolio committee on Local Government, Public Works and National Housing chaired by Engineer Michael Madanha should intervene and get to the bottom of the matter on why city fathers were lacking unanimity on debt recovery strategies.

As at December 31 last year, properties in high-density suburbs owed the city $171,6 million, while low-density suburbs carried a $189,6 million debt. Industrial or commercial properties were indebted to the tune of $322 million.

Also, Government owes the city $29,4 million, while Chitungwiza, Norton, Ruwa and Epworth owe $10,2 million, $3,1 million, $96 647 and $12,9 million, respectively, accordingly a report by this publication last week.

City of Harare's corporate communications manager Mr Michael Chideme is on record saying the city was only collecting $12 million from potential monthly collections of $22 million.

Notably, Mr Chideme said through Wellcash Debt Collectors, it had gone up to about $15 million, but it has now gone down to $12 million.

From December 5 to January 15, they brought in $4,5 million.

Mr Chideme said that while cash inflows improved following the engagement of Wellcash, council had to accommodate the views of the residents who felt they were hard-pressed for cash, hence, the non-renewal of the debt collectors' contract.

He urged customers to pay their bills.

Mr Speaker Sir, while the committee or anyone else for that matter would not want to delve into what appears to be operational issues of an entity such as a local authority, but once service delivery begin to suffer Parliament is duty bound to intervene as part of its oversight and representative role.

Issues that need to be interrogated, Mr Speaker Sir, is why Harare City Council, in its wisdom replaced an effective debt collection strategy at its own detriment.

Was there no politics at hand that saw city fathers declining to renew Wellcash Debt Collectors, considering that by their own admission, was doing a splendid job in terms of revenue collection.

At the moment, Harare City Council is struggling to timeously pay its workforce, not to mention that service delivery is not at its best. One of the reasons that it has advanced for poor service delivery is that residents and business were not paying their dues.

It goes without saying that city fathers have been citing non-payment of rates by residents as the reason for poor service. One then wonders, Mr Speaker Sir, why city fathers would abandon a strategy, which for all intends and purposes was improving its fortunes.

If there were plausible reasons for abandoning that strategy, the committee should be told and more importantly, if such reasons outweigh the evident benefit of improved revenue collection.

What is required, Mr Speaker Sir is decisive action to be taken by the city fathers in pursuance of improved revenue collection whose effect would be to enhance service delivery.

If the retention of Wellcash or any other debt collector is improving the bank balance of the capital city, why in all fairness, Mr Speaker Sir would city fathers abandon such a method before getting a better and more effective strategy.

Was it not prudent, Mr Speaker Sir to abandon that method after they had secured an alternative, sustainable and more effective strategy.

What good reason would Harare City Council opt to lose $3 million every month given that they were now collecting $12 million instead of $15 million per month before they severed ties with the Debt collecting firm.

These are some of the issues, Mr Speaker Sir, that the Portfolio Committee on Local Government, Public Works and National Housing should be interrogating.

Residents are not very much worried about which strategy city fathers used, but what they are preoccupied with is service delivery.

If service delivery is compromised because, at the face of it appears to be politically motivated or better still poor judgment by city fathers, legislators as representatives of the people should come in.

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