Gauteng pays municipalities R6.1bn for outstanding rates, taxes
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Gauteng Premier David Makhura’s administration has paid over R6.1 billion to municipalities for property rates and taxes, says finance and e-government MEC Nomantu Nkomo-Ralehoko.
Delivering the Gauteng provincial treasury’s 2021/22 budget vote, Nkomo-Ralehoko said the provincial government has paid more than R6.1bn to municipalities for property rates and taxes since the 2018/19 financial year.
”This is an average of R2bn per year, which also increased at an average of over R200 million year on year,” she said.
According to Nkomo-Ralehoko, the provincial government’s debt now accounted for the smallest portion of outstanding debtors to municipalities, representing in aggregate about 2%.
She said any outstanding amount affects the revenue generation and cash-flow positions of the province’s municipalities.
Nkomo-Ralehoko announced that the provincial treasury was working with the Gauteng cooperative governance and traditional affairs (Cogta) department and will continue assisting municipalities with the facilitation of government debt payments.
She added that in the 2021/22 financial year, the provincial government will increase its efforts to ensure that the arrears are drastically reduced.
The provincial treasury will also continue to work with Cogta through the debt management committee to assist municipalities to facilitate payments, according to Nkomo-Ralehoko.
She said the debt management committee will address several issues that result in delays in payments, including monthly invoices and statements not being sent to relevant departments on time or sent to incorrect departments and municipalities failing to resolve disputes.
Other challenges include payments made but not yet allocated by municipalities or allocated to incorrect departments accounts by municipalities and problems with confirmation of the ownership of properties for payment of property rates as payments can only be affected once the Deeds Office process of ownership have been finalised.
By the end of March 2021, the aggregate municipal consumer debts amounted to R230.7bn across the country, compared to R230.5bn by December last year, according to the National Treasury.
The government accounts for 6.7% or R15.5bn of the total outstanding debtors and this is down from the R20.7bn reported by the end of December.