Parastatals and government departments owe eThekwini R230m

The eThekwini Municipality is grappling with parastatals and state departments who owe the city over R230-million.

The report revealed entities‚ including the National Ports Authority‚ Transnet‚ the Passenger Rail Agency of South Africa (Prasa)‚ the Department of Human Settlements and the Ingonyama Trust‚ collectively owe the City R231.3-million. This amount includes R216.6-million in arrears and R14.6-million current debt.

Various factors‚ identified by the report’s authors‚ led to difficulties in recovering the bad debt.

Government departments and parastatals own a number of properties within the municipality and in a number of instances‚ these departments and parastatals raise objections against the value of these properties.

In most cases they do not pay for rates until the objection and thereafter an appeal process is finalised.

Deputy City Manager of Finance Krish Kumar said progress had been made regarding the recovery of debt.

Addressing concerns that the City was lenient towards government departments and parastatals but not residents who were in arrears‚ Kumar said the City always acted fairly.

“We only disconnect when there is a breakdown in the relationship. We have issued disconnection notices to parastatals. We follow due processes regarding disconnection and endeavour to treat all customers fairly‚ whether it is residents or a parastatal.”