The KwaZulu-Natal department of cooperative governance and traditional affairs (Cogta) is stepping in as mediator to get eThekwini municipality and the KZN department of public works around the negotiating table over an unpaid municipal rates deadlock that has spiralled into a service-delivery crisis across the city.
This follows the breakdown in communication between the two entities over a payment plan for the R500m in rates that the provincial department owes to the city.
This has resulted in the city disconnecting services, water and electricity to various government departments including the provincial offices of some departments, the education department’s Truro House and licensing centres.
On Monday, eThekwini mayor Cyril Xaba explained that the disconnections as well as handing over unpaid bills to debt collectors are some of the credit control measures the city is enforcing to recover all monies owed to it by residents, businesses and state entities.
He called on public works MEC Martin Meyer to settle the debt urgently.
“The department owes the city over R500m in rates, a debt it has already acknowledged … These funds could significantly improve our infrastructure.”
He said the city has a special debt relief programme to assist struggling customers in arrears.
Meyer detailed the impact of these disconnections on service delivery.
“You can’t renew a [driver’s] licence right now. RTI and metro police are out in full force so you don’t want to drive around without a licence, but you can’t renew it,” he told the Sunday Times.
“The department of education and parents need to make sure that their kids have a school to go to next year, [but] they can’t now because electricity at Truro House is cut. We can’t deliver services of public works, Cogta can’t do its job so service delivery is hampered.”
He said the huge debt is a result of a severe budget shortfall. The budget for rates has already been spent because the department only gets allocated half the money it needs to pay rates.
“We do owe eThekwini a lot of money, but it’s not because we don’t want to pay. The situation is that our rates bill for all municipalities in the province is roughly R1.8bn a year, but what I get in budget to pay rates is only R900m.”
First it was R100m, then R150m, and now they want R200m. We don’t have R200m. In our last proposal we offered R100m, we were willing to even stretch it to R120m, but unfortunately we haven’t had success with them accepting that as of yet.
— KZN public works MEC Martin Meyer
The department expects to get about R150m from the adjustment budget, which will be debated in the provincial legislature on Thursday, a sum Meyer says will not be enough because they have to spread the money across all the municipalities they owe.
“I can’t just pay all that money to one municipality; I must pay others as well. I have to share the money between all municipalities and this crisis of debt is true for each and every municipality in the province.”
Meyer said his department has been trying “desperately” to negotiate a payment plan with the municipality for two weeks.
He said the municipality only started responding after the department informed them that they’re planning to file an intergovernmental relations dispute with KZN Cogta, but now the city allegedly keeps shifting its upfront payment demands.
“First it was R100m, then R150m, and now they want R200m. We don’t have R200m. In our last proposal we offered R100m, we were willing to even stretch it to R120m, but unfortunately we haven’t had success with them accepting that as of yet.”
With the two entities locked in a deadlock, the department lodged the dispute on Thursday.
“Unfortunately, we’ve had to take this very unprecedented step. It rarely happens that this dispute is declared, but we just felt we had to do something because service delivery is suffering and that’s why we took this very serious step of declaring the dispute with eThekwini.”
The dispute can be triggered when departments or different spheres of government are not finding each other on a solution or one is unwilling to work with the other side.
“We wrote to Cogta and informed them that we’re unable to find a solution because eThekwini is not working with us. If Cogta accepts our request, MEC (Thulasizwe) Buthelezi will formally instruct both us and eThekwini to attend a meeting where Cogta will mediate and hopefully then we can force both sides to the table and find a solution,” he said.
“If that doesn’t work, unfortunately we will have to go to court and I don’t want to take eThekwini to court. It’s not good for either of us or the taxpayers. We’re just trying everything in our power to avoid that from happening.”
eThekwini municipal spokesperson Gugu Sisilana said the municipality does not discuss customer account information with third parties, but emphasised that all customers, including government departments, are expected to settle their accounts.
“Where arrears exist, disconnections are implemented in accordance with eThekwini municipality’s credit control and debt collection policy. These measures are standard practice and are applied consistently to ensure financial sustainability and the continued provision of municipal services to all customers,” she said.
KZN Cogta spokesperson Senzelwe Mzila confirmed the MEC has been in contact with that the dispute has been filed and that Buthelezi is working on a mediation process.
“The Cogta MEC has been in contact with the eThekwini mayor in an attempt to resolve the impasse.”
Meyer said the deadlock in negotiations appeared to be rooted in administrative, rather than political circles, adding that his relationship with Xaba remained strong.
“I’ve always had a very good relationship with mayor Cyril Xaba, I have a lot of respect for him. I don’t think the issue lies on a political level, I think it lies between officials at the administrative level. Communication is open between us but it’s not happening on the ground between the officials.”
He called on the city to reconnect utilities so that service delivery is not harmed, while the two government spheres work “in good faith” on finding a way to resolve the dispute and come out with a realistic payment plan.
“I just want to implore eThekwini: let’s not punish people on the ground for what is a dispute between us. Let the services happen and we will find a solution … We know we owe you money, we want to find a solution so let’s sit around the table, let’s find a solution, but let’s not harm service delivery to people.”
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