eMalahleni municipality’s sums don’t add up

The presidency is aware of the situation in eMalahleni local municipality.

That bit of good news broke on September 14 when local attorney Johan Coetzee received an answer from the state attorney after he wrote a letter to the president Cyril Ramaphosa, reports Witbank News.

Coetzee is heading the Save Emalahleni Action Group, which goes to great lengths to compel the provincial and national government to intervene in the municipality’s matters.

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The municipality failed in two major aspects. They allowed their Eskom debt to escalate to over R2 billion and implemented a financial system a year ago which still sends out faulty consumer accounts.

Coetzee said: “The total debt to Eskom now stands on R2,145,631,050.21. Since December 2017, the short payment on the monthly Eskom accounts is approximately R496 million. For the last three months, the short payment was approximately R283 million, and the municipality still maintains that there is now serious financial crisis in their affairs.”

Municipal spokesperson Kingdom Mabuza said in a June council meeting that it was reported from July 1 last year to April 30 that Eskom billed the municipality a total of R897,739,586.03 for bulk electricity supply. During that period, Eskom was paid R402,658,709.67.

He said the municipality is in arrears of almost R2 billion, of which R191,100,000 is for arrangements made and Eskom’s whopping interest of R117,815,140.62 levied on the overdue account for the 2017/18 financial year. Despite the gloomy picture, there are encouraging signs as the municipality managed to collect R92 million in August.

“Low levels of payments for services are making it almost impossible for Emalahleni local municipality to stick to the Eskom payment arrangement. The situation is so dire to an extent that residents and businesses cannot be guaranteed that power will remain on,” Mabuza said.

Municipal manager Sizwe Mayisea stated in an affidavit on August 27 that the main reason why the municipality’s financial problem deteriorated, and why it has not been able to pay its current accounts to Eskom since July 2017, was that the payment rate of by the municipality declined from 93% in the 2016/2017 financial year to 73% in the 2017/2018 financial year.

The letter from the state’s attorney Kantoro Isaac Cowe.

These figures are in sharp contrast with figures the municipality released on July 2.

None of the 34 wards has reached 80% payment rate. Only four wards are above the 70% payment mark. They are ward 24 with 70.28%, ward 21 with 72.17%, ward 33 with 76.63% and ward 34 with 71.30%. Eight wards are above the 50% payment rate and 14 wards below 20%. Wards one, two, three and four don’t even make a 4% payment rate.

The simple average payment rate on these figures is approximately 30%.

“It is impossible for the municipality to pay back the amount due to Eskom in the foreseeable future,” Coetzee said.

State attorney Kantoro Isaac Chowe asked Coetzee and his team to make themselves available for a meeting with the Minister of Cooperative Governance Dr Zweli Lawrence Mkhize’s representatives in order to put in place a structured engagement to charter the way forward.

Mabuza said although they are not opposed to anyone writing a letter to the president, they continue to urge local groups, associations, and political parties to engage with the municipality for possible solutions to deal with low levels of payment.

He again urged the public to come forward with revenue enhancement strategies.

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