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Patrick Chitumba, Midlands Bureau
GWERU City Council (GCC) missed its revenue collection target by over $2 million from January to July with debts ballooning to $55 million from $47 million, a council report has shown.

During the period the local authority collected over $11 million from the projected $13 million.

According to the council’s financial performance report covering January to July period, the local authority continues to face challenges characterised by continuous increase in debts resulting in failure to carry out planned activities in the budget and to pay suppliers.

“Council continues to face financial challenges characterised by continuous increase in debtors from $47 992 797 to $55 678 533. This is an increase of $7 715 736. This has resulted in our creditors reaching unprecedented levels of $40 882 002.

“Our objective is to collect $23 000 000 by December 31, 2017 and this translates to $13 416 667 for the seven months to July 2017. Actual collections as at July 31 were $11 250 111 giving an adverse variance of $2 166 556. Hence concerted efforts are required to collect the shortfall in the remaining months of the year,” reads part of the report.

“The revenue collection target is also depressed due to the fact that there are certain lines that were expected to contribute to council coffers but the revenue lines are stalled due to pending legal hurdles ($98 705), Zesa ($23 000 000). Council is in four months’ salary arrears and the staff does not have adequate protective clothing due to financial challenges.”

The council has introduced an SMS platform to send out bills to consumers in an effort to move away from printing physical statements. It said the major challenge with this model was to get mobile numbers from clients. So far the local authority has only managed to collect 700 cell phone numbers out of 25 000 clients.

The report states that constrained revenue inflows has crowded out service delivery as most of the revenue collected was channelled towards fixed costs, the major one being employee costs. Manpower costs account for 63 percent of total expenditure.

“There is a need to bring the ratio to be within the recommended 30:70 ratio. Sundry payments used 30.81 percent of the collections of which the major items were electricity $499 160, water and sewer repairs $232 532, vehicle repairs $181 505, pensions $122 336, travel and assistance $119 734, purchase of pick-up trucks $100 380, legal fees $98 705, telephone $84 965, bank charges $54 155, conferences $56 320, councillors allowances $51 340, insurance $32 468,” reads the report.