Mettler slashes millions in fees

2010-09-03 00:00

THE “sloppy management” that has seen the Msunduzi Municipality overpaying millions of rands on insurance and bank fees will soon end as part of the latest cost-saving steps taken by the city’s turnaround team.

Administrator Johann Mettler said the team has reduced the insured value of municipal buildings from R8,5 billion to R3 billion. This has allowed annual premiums to come down from R3,7 million per year to less than R2 million. It also reduced risk cover to the minimum, cancelling payment of R500 000 per annum.

Mettler told the executive committee that the municipality was paying bank charges of R2,4 million per year, which he described as “ridiculous”.

“No one had gone to the bankers to review the bank charges. Even I as a private individual review my bank charges. Why was this not done by this large institution?” Mettler asked.

Other cost-saving measures being investigated include payments on software licences and why cost-of-living allowances were paid to 200 non-employees of the municipality. Mettler said this amounted to R24 000 per month, an issue that was uncovered only last week.

The Democratic Alliance’s Bill Lambert said Mettler’s description of “sloppy management” is the understatement of the year.

“This was much more than sloppy management,” he said.

Mettler’s good news was that Operation Pitbull — the clampdown on electricity thieves — is netting about R1 million per day. The operation has collected over R9 million from the start of the clampdown until August 30.

Government departments have also been paying up. The municipality had invoiced government departments R4,6 million on their utility bills for the past month and received R17,6 million.

Mettler said this showed that there is movement on the arrears. However, the municipality is not letting down its guard and will disconnect government departments when warranted.

The Exco meeting adjourned early for members to attend the provincial legislature where the joint committees of finance, public accounts and co-operative governance presented their assessment of municipalities.

Belinda Scott, chairperson of the finance portfolio committee, urged the national Treasury to consider a cash injection for Msunduzi Municipality, saying there is no way the municipality will become sustainabile on just its current revenue enhancement drive.

The national Public Works Department got a drubbing as the worst defaulter on municipal debt. Scott had asked the Minister of Finance, Pravin Gordhan, to deal with the recalcitrance of this department to pay its debt.

The MPLs also criticised poor forensic investigations within municipalities.

The Cooperative Governance Department was told to be more pro­active regarding the quality of such investigations and the time it takes to implement the recommendations, and to take action against errant officials.

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