KZN municipalities owed R5bn
2008-08-12 11:33
Durban - KwaZulu-Natal municipalities are owed more than R5.2bn in outstanding rates and service charges by residents, the Witness newspaper reported on Tuesday.
The province's head of Treasury Sipho Shabalala said that while non-payment was an issue, the bigger problem was the inadequate debt collection system within municipalities and an unnecessary reliance on debt collection companies.
"We are doing an analysis of these debt collection companies and find that they are more of a hindrance than assistance to municipalities.
"These companies retain 15 to 30% of the amount they collect. We say, therefore, use debt recovery agents with caution."
He conceded that state departments also owed vast amounts to municipalities. The Msunduzi Municipality was owed more than R100m by the government, the eThekwini Municipality was owed R400m.
- SAPA