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Oliver Kazunga, Senior Business Reporter
BULAWAYO residents should brace for a spike in rates after the city council revealed plans to increase next year’s total budget by 39,3 percent from $152,5 million to $212,5 million, citing macro-economic pressures.

With residents owing close to $100 million to council, the move is likely to worsen the burden despite endorsement by some stakeholders during yesterday’s consultative meeting.

In the proposed budget, council has set a revenue budget of $116,6 million up from this year’s figure of $104,5 million. Capital expenditure for 2019 has also been proposed at $95,9 million up from the current figure of $48 million.

Council director of finance, Mr Kimpton Ndimande, told stakeholders at the budget consultative meeting held at a local hotel, that the proposed budget increase was informed by the macro-economic factors.

“We looked at the needs of the city and the factors that then help us craft that budget. Officially the year-on-year inflation averages 4,29 percent and then the interest rate. When we go out to borrow for capital expenditure it averages 12 percent,” he said.

“Then we have got the problems that are bedevilling our country, liquidity crunch . . . and then there is rampant unemployment in the city and the debtors are growing in tandem with our creditors as well.”

Mr Ndimande said local authorities across the country were generally performing poorly with most of them technically insolvent because of reduced revenue inflows.

“We all remember the catastrophic write-offs that came out in 2013 and we are also cognisant of the fact that we are the price taker, you (industry and commerce) charge us for services and we just have to take that price and we have got limited space for increasing our charges,” he said, adding that BCC was cognisant of the need to improve its revenue generation as well as reducing the expenditure as much as possible.

Mr Ndimande said although capital expenditure budget was boosted by financing by the AfDB (African Development Bank) the revenue front was financed by local revenue sources.

“This necessitates us to put some charges of some five percent to accommodate the national increase that we have in our budget and that’s what we are praying you (ratepayers) to embrace today.

“For a city to progress we cannot keep it at $104 million revenue budget because things are moving on. As I speak water chemicals have gone up . . . and I’m not aware of anything that we (council) that we consume from industry that has not gone up,” said Mr Ndimande.

As part of the capital projects for next year, BCC plans to construct a clinic in Cowdray Park. The local authority also hopes to continue improving service delivery through the provision of clean water and improved sewer reticulation system, among others.

Stakeholders among them captains of industry and the academia from Bulawayo did not object the proposed budget. They urged the local authority to allow companies whose factories were lying idle to house potential investors with a view to promote investment in the city.

It was also highlighted that the council should give first preference to local firms when tendering some of its projects.

In his response Town Clerk Mr Christopher Dube said: “We should also move to protect our local businesspeople because if we do that we are moving in the spirit of devolution. We are a local authority and we should also as much as possible, try and protect our local businesspeople”. — @okazunga