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By Tonderai Saharo
THE debt owed by residents and rate payers to Masvingo city council is spilling out of control with the local authority engaging the services of debt collectors in a bid to recover in excess of $380m.
Presenting the city of Masvingo mid year budget performance report, the local authority said the debtors book continues to balloon and stood at ZWL$380 121 900,65 as at 30 June 2021
A significant rise from a opening balance of ZWL 155 281 076,06.
Residents contribute 42 percent of the total debt while industry and commerce are at 26 percent with institutions including government departments contributing 32 percent of the debt.
“This limits the Council’s capacity to deliver its obligations as conferred by statutes.
“Delayed collection of revenue negatively impacts on service delivery as council loses out on the purchasing power of the money as the economy experiences inflationary pressures. Council’s ability to invest in infrastructure and equipment is curtailed while maintenance of infrastructure also suffers,” reads part of the report.
The local authority said it has endeavours to enhance its revenue collection with engagements with major debtors such as Government institutions and discontinuation of services as measure to recover what it is owed.
” Engagement with individual debtors has also been intensified seeing the number of debtors enlisted on payment plans rise to over 1 400. Council has also enlisted the services of two law firms to assist in the collection of delinquent debt and screening of lists for handover to these law firms is in progress,” the local authority said.
Meanwhile the local authority also accumulated arrears with its various suppliers and service providers amounting to $51 million as at 30 June 2021.
Top on the list is the Local Authorities Pension Fund (LAPF) and ZETDC who are owed $17,7 million and Z$12,6 million respectively.
The city fathers said their failure to remit to its creditors is due to low revenue collection experienced during the first quarter of the year.