The cash-strapped Chitungwiza Municipality is owed over $30 million as more businesses and residents default on paying rates due to the worsening economic situation.
by Albert Masaka
According to the Chitungwiza finance committee, as at December 25 last year, businesses owed the council $20,8 million, while residents were in $18,5 million arrears.
Chitungwiza, which has struggled to pay its workers for the past 33 months, is also facing legal suits and garnishee orders of its bank accounts from statutory bodies like the Zimbabwe Revenue Authority (Zimra), among others, a report by the finance committee stated.
The municipality owes nearly $64 million to creditors.
Chitungwiza has made payment plans with the Zimbabwe Development Fund getting $10 000 monthly, Local Authorities Pension Fund ($20 000 per month), National Social Security Authority ($64 000 per month), Zimra ($30 000 per month) and City of Harare ($12 000 per month), the report reads.
To adhere to the payment plan, arrangements with City of Harare and Zimra, the municipality said stop orders had been arranged with its bankers for the payment of $3 000 daily to clear the council debt.
The municipality has no water body of its own and relies on supplies from Harare.
Revenue collected during the month of December amounted to $1,037 million compared to $1,040 million in the previous month.
The potential figure on billable income for the month was $1,6 million, representing a 48% collection rate on billable income.
The municipality also received 40% profit sharing from Clyna Trading for the month of December amounting to $24 023,71 up from the $11 000 the previous month.
Chitungwiza and Clyna, in February last year, entered into a five-year public-private partnership deal, which included the provision of an e-tolling parking system and the construction, management and marketing of vending stalls on a built, operate and handover basis.
The salaries account was the biggest benefactor in terms of expenditure with $855 440,43, followed by the rates account which spent $257 424,31, while the heath account had $11 711,79 and the education account had the least with $201,77.