SA municipalities are owed a whopping R165bn: Salga

Municipalities should urgently and aggressively enforce credit control management measures to recover billions owed to them.

This includes disconnecting government properties and businesses when there is sufficient merit, in line with policies.

This was a resolution taken by the SA Local Government Association (Salga) after its national executive committee meeting this week.

Salga revealed on Thursday that debt owed to municipalities for municipal services already delivered amounted to R165.5bn as at June 30 2019 — up from R143.2bn the previous year.

It said the largest component of debt related to households, which accounted for 71.7% of the debt, or R118.6bn.

Salga said the government owed municipalities R10.3bn for water and electricity, while businesses owed municipalities about R23bn.

The association said municipalities owed Eskom R25bn for electricity, and R14.9bn to various water boards.

Salga said it was evident there was a clear link between the ability of a municipality to service its debt, including that to Eskom and the water boards, and the inability of a municipality to collect from government, business and households for services delivered.

Salga also resolved that municipalities should conduct a rigorous analysis of gross debt and decide which debt was realistically collectable.