E Cape municipality to write off R200m

2010-11-03 16:45

Johannesburg - The Nelson Mandela Bay municipality in the Eastern Cape will write off arrears of about R200m through its debt relief programme, it said on Wednesday.

The municipality had already written off R52.7m in June to assist account holders with debt older than five years, spokesperson Ongama Mtimka said in a statement.

The programme would relieve struggling account holders of "burdensome" debts and improve debt collection.

"The programme was primarily aimed at converting slow payers into good payers," he said.

Phase one of the debt relief programme entailed an automatic once-off write-off of 100 percent of interest and 50% of domestic arrears in excess of five years, Mtimka said.

The second approach was based on an application.

Assistance would be given to people according to their specific circumstances.

"This intervention, that has already started, is designed to assist any account holder, excluding assistance to the poor (ATTP) beneficiaries, proven to meet the prescribed set of rules," Mtimka said.

"The beneficiaries of the once-off write-off may apply for this option as long as they meet the pre-set rules and their arrear debt situation remains desperate."

The municipality was currently visiting communities to explain this programme and motivate qualifying account holders to apply, Mtimka said.

The municipality believes the programme will ultimately improve their debt collection rate.

Non-profit organisations in the area owed the municipality about R5m by April this year.

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