9 July 2019

Zimbabwe: Harare Council, Zesa in RTGS$200 Million Rate Tiff

Photo: New Zimbabwe
Harare Mayor Herbert Gomba.

Harare City Council and power utility, ZESA are involved in a stare down over rates they owe each other amounting to over RTGS$200 million, NewZimbabwe.com has learnt.

City Mayor Herbert Gomba told NewZimbabwe.com's current affairs programme, The Agenda, that besides the fact that ZESA was operating on city land without paying anything, the parastatal had stopped paying royalties a long time back.

He acknowledged council's debt to the power utility but maintained that they could not be bullied by ZESA as it owed more than it claimed was owed by council.

"We need to move away from the old tradition of getting municipal services and municipal land for free like what ZESA did," Gomba said.

"In fact, City of Harare and other municipalities should be the biggest shareholders in ZESA on the basis of what was taken away from them.

"We are also taking this opportunity to ask ZESA to pay their bills. They are owing the City of Harare in excess of RTGS$110 million. They stopped paying royalties about 25 years ago and we own most of the buildings that they are using or are working in."

Government moved all urban power stations into the hands of ZESA without compensation in the early 1980s.

The issue has seen Bulawayo City Council claim ownership of the iconic cooling towers in the city which the electricity supplier wants to destroy.

Council is arguing that it owns the land and will not see the cooling towers being demolished as they are an iconic creation that give identity to Bulawayo.

In Harare, Gomba said ZESA was ignoring its debt and maintaining that council should pay.

He added, "From the look of things, our figure is bigger than theirs... they have written to us saying we should be paying them RTGS$140 million and I have also asked our team to count what they are owing us in terms of royalties, rent that they are supposed to be paying us."

Both institutions are in dire need of a cash injection.

ZESA is struggling to deal with one of its worst power crises which has seen it implement a tough load shedding schedule of up to 15 hours a day across the country.

Unsustainable debts to its main supplier Eskom saw the South African power company cut its supply.

Harare City Council, on the other hand, is facing a water supply and purification crisis that are a constant threat of waterborne diseases.

Council is failing to raise enough foreign currency to buy chemicals for purification at its water works or replace old equipment that has resulted in an over 80% leakage of clean water.

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