HomeLocal NewsRedcliff seeks $17m bailout

Redcliff seeks $17m bailout

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The financially distressed local authority is appealing to central government, the banking sector and industry for $17 million to save the steel-manufacturing town from collapse.

In a document to the government prepared by town clerk Elizabeth Gwatipedza, Redcliff says without this grant, all council systems would collapse leaving over 50 000 residents without service delivery.

“Service delivery has collapsed. Employees have not been remunerated for the past 20 months. Employee morale has reached all time low.
Performance is at its worst. Litigations grow by the day resulting in huge labour bills. Poor sanitation and increase in diseases has become the order of the day.

“It is in view of this scenario that the municipality is seeking a financial bail-out to the tune of $17 million in order to avert a disaster,” said Gwatipedza.

The local authority’s purse is supported by revenue collected from 8 500 households and has 293 employees who gobble an average of $1,4 million a year in salaries and wages against revenue collections which have averaged $500 000 in the past three years.

The town released a $7 million budget for 2012 which council says would be insufficient unless immediate action on resuming operations at New Zimsteel was taken.

“The constraint in cashflows has had a negative impact on service delivery since the income collected by the municipality is not even adequate to cover employee cost which constitutes 30% of total revenue,” said Gwatipedza.

The local authority has since set up a Save Redcliff Campaign, headed by Gwasirai Nzeda from the finance committee and comprising other councillors and local businesspersons, who are going around with begging bowls in an effort to raise money to roll out major projects which they hope could save Redcliff.

Council says it will use $6 million of the money to rehabilitate its old and obsolete water and sewer system which has cost it millions of dollars owing to leakages.

A total $800 000 would be directed to plant and equipment which would be used to service stands for sale.

Redcliff owes its workers $4,4 million in salary arrears. The local authority also owe Kwekwe City Council $3,9 million in water debts and faces a bleak future if the bailout grant is not made available.

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