PRE-PAID meter systems for water and electricity will be made compulsory for industry, commerce and low-density residential areas starting next year, Finance minister Patrick Chinamasa has said.
by VENERANDA LANGA
Chinamasa told Parliament during presentation of his 2016 National Budget last Thursday that prepaid meter systems were the way to go to avoid incidences of debt accumulation by local authorities.
“As government works with local authorities to realign their cost structures and improve on service delivery, it will also be necessary that we strengthen the culture of compliance with statutory dues, critical for municipalities to fulfil their mandates,” he said.
“In this regard, government notes the initiatives to introduce prepaid revenue collection arrangements in electricity are already contributing positively towards cash flows to the Zimbabwe Electricity Transmission and Distribution Company (ZETDC)”.
Chinamasa said the positive cash inflows to ZETDC, through prepaid metering, were an opportunity for local authorities to collaborate with them regarding to sharing of information communication technology and collection platforms they used in revenue collection.
“This prepaid system will align service delivery to revenue collections, that way avoiding incidences of debt accumulation. I am proposing the initial phase embrace compulsory prepaid meters for industry, commerce and low-density residential areas,” Chinamasa said.
Local authorities were also encouraged to develop bankable projects and programmes for financial support through issuance of municipal bonds.
The chief treasurer also expressed concern over local authorities’ failure to offer quality service, saying this was caused by inappropriate cost structures and slowdown in revenue collections.
“Government, through the Minister of Local Government, is challenging local authorities to realign their cost structures in line with revenue streams. The human resources cost structure of local councils has, in a majority of cases, been the biggest impediment to service provision,” he said.
“Hence, government requires local authorities to comply with the 30/70% remuneration guidelines in managing human resources costs in councils, along the same lines as State-controlled entities. This should be a priority for councils in 2016 to align the salaries and wages of their workforces to the economic realities of the current times.”
Chinamasa said meaningful recovery of service delivery was dependent upon improved and sustained financial management efficiency.