Cogta MEC Hlomuka concerned about rising consumer debt in KZN municipalities – South Coast Herald
KZN MEC for Co-operative Governance and Traditional Business (Cogta) Sipho Hlomuka expressed concern over growing consumer debt in municipalities across the province, including Umdoni Municipality.
The latest audited figures released by Cogta indicate that municipalities in the province experienced an increase in consumer debt of Rand 3.47 billion between fiscal years 2018/2019 and 2019/2020: the debt rose from 23, 8 billion rand to 27.2- billion during this period, which represents an increase of 14.45%.
The increase, according to Hlomuka, is in part due to economic conditions that have deteriorated in the wake of the novel coronavirus outbreak which has seen households and businesses across the province struggle to pay for municipal services.
Hlomuka believes that the increase in consumer debt in municipalities places them in a precarious position as they must continue to provide essential services, such as waste removal, water, electricity and sanitation, in an environment of reduced income.
“We are concerned about the increase in consumer debt and, as a department, we are rolling out measures to help municipalities collect debts from their consumers,” Hlomuka said. These measures include:
- Support municipalities in reducing consumer debt through active citizen participation;
- Support for the indigent in reconciling registers with Operation Sukuma Sakhe and debtors’ data in some municipalities;
- Reconciliation of municipal billing data with debtor data, indigent data and assessment rolls; and
- Targeted support on public debt through engagement and facilitation in the resolution of payment disputes between ministries and municipalities.
Hlomuka also praised municipalities for proactively dealing with consumer debt by providing debt relief to consumers by requiring them to enter into a payment plan with the affected municipality and then forgetting the interest.
Cogta further identified the following municipalities for support, in particular, in consumer debt relief during the 2021/2022 fiscal year:
Newcastle, Jozini, Umdoni, Nkandla, Ubuhlebezwe, Alfred Duma, Endumeni, Abaqulusi, Umngeni and Mandeni.
This support will result in the development of a consumer debt collection plan with the municipalities concerned and support in its implementation and monitoring.
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