Kwekwe seeks bailout

11 Jun, 2021 - 00:06 0 Views
Kwekwe seeks bailout

The Chronicle

Michael Magoronga, Midlands Correspondent
SADDLED with a $110 million debt to the power utility, Zesa, the Kwekwe City Council now plans to engage the corporate world for assistance as it seeks to clear the arrears and avoid being cut off from supplies.

The power utility has slapped the local authority with an ultimatum to offset the debt, or risk being cut off.

Apparently, Zesa reportedly turned down a $1 million per month payment plan by the local authority, leaving the council between a rock and a hard place.

Speaking during a recent full council meeting, Acting Town Clerk, Dr Lucia Mnkandla, said they were contemplating engaging the corporate world to bail out the council amid weak revenue inflows.

She expressed gratitude to the Midlands Provincial Affairs and Devolution Minister, Larry Mavima, whose intervention saved the council from power disconnection.

“We have people who are willing to help out with the payment of the bill, that is if we put our house in order.

“We are a very rich city, which should not be seen struggling to pay such debts. Let’s just put our house in order and speak with one voice,” said Dr Mnkandla.

Lately the local authority had intensified disconnecting water supplies from defaulting ratepayers.

Speaking during the same meeting Mayor Councillor Angeline Kasipo said the local authority was yet to recover from the effects of the Covid-19 induced lockdown, which has resulted in dwindling cash in-flows.

“As it is we are only collecting about 42 percent of the targeted income and it has become a challenge for us to offer services effectively,” she said.

“As a result, we have been failing to settle the Zesa debt hence it has ballooned to this figure. They have written to us giving us an ultimatum to pay or else we risk being cut off,” said Cllr Kasipo.

The development comes at a time when the council is owed more than $500 million by ratepayers. Redcliff owes Kwekwe $45 million while Government institutions owe total of $23 million with Zisco at $16 million.

“As of 31 March, this year, we were owed slightly over $521 million by residents, businesses and Government departments.

“As a council we have taken several steps to recover the debt including sending messages, calling and holding meetings with our stakeholders encouraging them to come in and make payment plans,” she said.

“As a last resort, we have started disconnecting water for those who owe the council huge debts. We have no choice as the council because we need the money in order to continue operating.”

If cut off, the move may also affect the smooth flow of business in Kwekwe, a mining and industrial hub.

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