Joburg customers may get a 100% debt write-off on municipal debt, city confirms

The City of Joburg has confirmed to The Citizen, certain customers who are deep in municipal debt may get a 100% debt write-off and their accounts cleared.

The city said it is aware that some customers are deeply in debt with the city for services due to the impact of the Covid-19 pandemic, including the non-payment culture some residents have adopted.

It said the only debt write-off programme that has been approved in council is debt rehabilitation.

MMC for Finance Julie Suddaby told The Citizen the city wants to help citizens who are overwhelmed by municipal debt.

“The programme is designed to help our residents get back on their feet and establish a healthy payment relationship with the city for the services we deliver.”

“Customers whose only income is a government pension well as customers who are registered as indigent on our data base might qualify for a 100% write off of some of their 90 day and older debt. These customers must first apply for our Extended Social Package (ESP) before applying for Debt Rehabilitation,” Suddaby said.

Suddaby answered a series of questions posed by The Citizen

Who does the debt write-off apply to?

Anyone whose property value is less than R2.5m who is in arrears to the city for 90 days and longer can apply for debt rehabilitation. Old Aged Homes, Orphanages and Bodies Corporate were included in the categories of customers who qualify to apply in the council sitting of 26 April 2022.

Those whose applications are accepted and who earn less than R22k will have 50% of their 90 day and older debt written off immediately and the balance will be written off progressively over 36 months provided they pay their current amount in full and on time.

It is important for our customers to know that the closing date for applications is 30 June 2022.

What about the other municipal customers who have huge debt burdens?

Those customers who don’t qualify for the debt rehabilitation programme should speak to the city about a payment plan. We understand that sometimes people get into financial trouble, and know that some customers don’t want to pay for services.

What our residents need to understand is that if you don’t pay your rates and taxes, the city of Joburg cannot deliver services. 100% of our operational budget and 40% of our capital budget is sourced from our own revenue.

If Joburg customers don’t pay for their services, the city cannot deliver services and cannot provide the infrastructure required to deliver those services. If a customer has fallen on hard times, they should approach the city before it gets out of hand and negotiate a payment plan.

When does the debt write-off come into effect?

It is already in effect. Applications in this third phase of the debt rehabilitation programme have been open since 1 March 2022. Important qualifying criteria were amended in a council meeting on 26th April.

It is more important for customers to realise the application process will close at 4pm on 30 June 2022.

Where is the budget for the debt write-off coming from and how much is the write off? 

The adjustment budget that was passed in February this year was necessary in part because we did not receive the revenue that was expected.

Some projects had to be deferred into the new financial year. It is very important that our customers understand that if they don’t pay, we can’t deliver and everyone in the city is negatively affected. We are all in this together.

How many customers or residents will get the debt write-off?

We will only how many customers will benefit and what the value of the benefit will be once all accepted applications have been processed after the closing date on 30 June 2022.

Additional information

The city is holding information sessions in person and online to inform customers of the changes to the qualifying criteria.

I would like to take this opportunity to encourage everyone who needs assistance to attend at least one such session in order to get as much information as possible, so they can apply quickly. 30 June will be upon us before we know it.

City of Joburg Budget Speech

Suddaby is expected to deliver her maiden budget speech for the city of Johannesburg on 25 May 2022 at the Constance Bapela Council Chamber in Braamfontein.

The city said the budget speech outlines the city of Johannesburg’s overarching plans, programmes and priorities to improve service delivery to its residents and various stakeholders.

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