Cape Town – Debt management actions are being intensified against those who can pay but choose not to, and against the frequent defaulters, to ensure sustainability and social stability, the City of Cape Town said on Sunday.
At the same time, the city was also assisting indigent residents, mayoral committee members for finance Johan van der Merwe said.
The city had maintained a 12-month moving average payment ratio of over 95% for rates and services over the past year. For the period ended April 30, the collection ratio was 95.2%. This was a great achievement for a South African metro, he said.
The city’s collection ratio had also been an area of focus which had yielded results and the city’s current billings were over R2.4 billion per month.
“We are proud that we’ve managed to maintain such a high collection rate. This shows that we are committed to sound financial management and good governance. We will continue to instill a culture of payment across our city and we thank all those customers who are making a positive contribution to our city by settling their accounts,” Van der Merwe said.
“However, debt management actions are being intensified, especially against those who are able to pay but choose not to do so and also against the frequent defaulters.
“The bottom line is that we need everyone to contribute their fair share so that we can become an even more successful metro. Those who are in financial difficulties must approach us. Hoping that the debt will go away or ignoring the problem is not the answer, especially as there is help on offer,” he said.
The city was also continuing a new SMS and email campaign reminding those to pay by the pending due date if they had not yet done so and encouraging those in arrears to pay up if they could or to approach the city to discuss payment options.
The city had already sent 55 000 SMS notices for 66 000 accounts payable. The total debts linked to these accounts as at June 12 were R362 million. Total payments received though this initiative amounted to R162 million.
“Those who have not paid or have not made arrangements to settle their debts will have their water restricted, electricity supplies disconnected, or will have arrears collected via any prepaid electricity purchases,” Van der Merwe said.
There were debtors who defaulted across the metro and in every suburb of Cape Town. For years the city had intervened to establish a culture of payment and had set progressive debt management policies and indigent relief in action.
“As a caring city, however, we also make allowance for residents who are unable to pay for basic services to make representation to the city for relief, and for those who are struggling to pay their municipal accounts to come to our municipal offices to enter into a debt arrangement,” he said.
Furthermore, the city’s credit control and debt collection policy made allowance for residents who were indigent or senior citizens to approach the city and access the range of benefits based on their total household income.
All those who were deemed indigent in terms of the policy had the benefit of a once-off debt write-off on condition that they agreed to the installation of a water management device and an electricity prepayment meter.
A water management device allowed for a daily water allocation in line with what the resident could afford and therefore reduced the scope for more unsecured debt to accumulate. Any leaks on the property were fixed free of charge as part of this incentive, which also aided water conservation.
“If any resident’s water is restricted, electricity supply disconnected, prepaid electricity purchases limited, or legal action instituted, then it is clear that they have ignored all of the notices that have been sent and have not made any attempt to obtain assistance from the city.
“Residents are encouraged to visit their nearest municipal office for advice and guidance as soon as possible should they have any queries regarding their arrears,” Van der Merwe said.