BCC faces lawsuits over US$ contracts

By Mthandazo Nyoni

THE Bulawayo City Council (BCC) says it is being sued by several companies for failing to pay them in United States dollars as per contractual agreements.

BCC concluded a number of contracts with its clients in US dollar terms, before government outlawed the use of foreign currency for domestic transactions.

This has resulted in the local authority failing to pay its clients in forex, a situation that has opened legal floodgates.

“As you know, we are not allowed to collect United States dollars. It brings us to a problem where we cannot import essential things like water treatment chemicals,” BCC financial director Kimpton Ndimande told delegates attending a recent ZNCC trade and investment conference.

“We have big contracts that we concluded in US dollars before that SI (SI 142 of 2019) came in and now we can’t pay that contractor in US dollars. That obviously brings us untold problems in the contractual area. We are sued left, right and centre, because they don’t care what the SI says. They want their money.”

Meanwhile, Ndimande said government should make available soft loans to local authorities for infrastructural development.

“Government should also give us money to take care of our vulnerable in society. We used to have appropriations from government for that,” he said.
Ndimande bemoaned high electricity tariffs, saying they were choking the city.

“Greening the city, we would like to see a lot more being done in the budget for greening. I can tell you right now that electricity charges are beyond the ability of the city,” he said.

The Zimbabwe Energy Regulatory Authority recently approved a 320% electricity tariff increase to 162,16 cents per kilowatt hour (kWh).

Ndimande pleaded with the government to scrap the 2% tax levied on electronic transactions, saying the tax was choking their operations.

“We would like to see that 2% tax scrapped. We are a price taker. Right now, a lot of you up there want us to pay this 2% twice. We pay it as a consumer, but then you want us to pay you for further transactions on that 2%. That’s what we are experiencing right now. So those are the things that affect us as a city. We would like to see this 2% in the budget set aside,” he said.

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