Pretoria - Tshwane mayor Randall Williams yesterday officially declared the metro bankrupt, saying National Treasury found its liability exceeded assets by R3 billion.
Williams spoke at length about the financial turmoil of the municipality during a council sitting yesterday.
This was during a debate by political parties about his R39bn budget tabled last week.
Williams was slated by parties such as the FF Plus and EFF for the sharp tariff increases on electricity and water.
He told his critics the electricity and water increases were not within the City’s control, blaming Eskom and Rand Water for the high costs.
In terms of his budget, water and electricity will go up by 8% and 14.59%, respectively.
In justifying his tight budget, he said: “As the City stands currently, it is insolvent. We got a letter from the National Treasury that the City is insolvent. The current liability of the City amounts to R14bn, and the current assets of the City amount to R11bn. So that means the liability exceeds the assets by R3bn.”
He said if the City was a business its creditors would have applied for it to be liquidated because of its financial crisis.
Williams further bemoaned the fact the City’s cost to employees amounted to 50% of the budget “and that unfortunately is the result of the mismanagement that has been ongoing since 1994 by the ANC”.
Earlier on, the ANC chief whip Aaron Maluleka took a swipe at Williams for the ever-growing debtors’ book due to some residents defaulting on payments of municipal services.
The debtors’ book has grown from R12.6bn to R17.6bn in the current financial period.
“The debtors’ book has been growing and it is not stopping and there is little innovation that is coming from this administration to avert and curb debt growth,” he said.
He suggested the elderly, who are unable to pay, must be removed from the debtors’ book and be registered as indigent to obtain free municipal services.
He further proposed that the City bring back the war on leaks projects to curb water losses and save money.
Williams hit back by saying the problem of debtors’ books increased during the period when the departed administrators appointed by the ANC-led Gauteng provincial government were in charge of the City.
EFF regional leader Moafrika Mabogwana said: “It is a shame that the DA administration is prepared to spend R120 million on debt collectors in order to intimidate and harass residents who have been hard hit by the hardships of the Covid-19 lockdown. The City must freeze all interests on all the outstanding debts as a way of encouraging residents to make payments.”
Despite his criticisms of Williams, he said the EFF supported the budget because it accommodated contracted security guards, who would be insourced by the municipality. “However, because we want security guards to resume work and start earning proper salaries from R400 to R11 700, we are, therefore, going to support this budget.”
Cope councillor Nkwana wa Nkwana suggested that the City reconsider its procurement policy, saying services such as grass-cutting must not be put out on tender but done in-house. He also said the Rooiwal and Pretoria West power stations must be revamped and recommissioned to supplement Eskom power shortages.
At the end all political parties expressed their vote of confidence in Williams’s budget to be passed.
Pretoria News