Wednesday, 24 July 2013

A non- politicized take on Chombo’s Debt Relief for Residents and Ratepayers.


By Takura Zhangazha

The outgoing Minister of Local Government, Rural and Urban Development, Ignatius Chombo two days ago issued what amounted to a controversial edict. In it he instructed all local authorities to essentially write off all the service provision debt that has been accrued by residents and ratepayers since the introduction of the United States dollar to council billing systems. 

The instruction from central to local government is controversial mainly because it was issued a week before the holding of harmonized elections and also after Minister Chombo  had dissolved all elected councilors and replaced them with appointed commissioners. In some circles it has been described as an 'electoral' debt relief. 

In announcing his decision, the minister cited sections of both the Urban Councils Act and the Rural District Councils Act. The legality of this is perhaps something that some residents and ratepayers may take up with our courts of law, but the long and short of it is that in this case, it’s the politics that count. Moreso given the fact that the edict is probably seen from a Zanu Pf perspective as being a vote acquisition strategic move for most urban areas. (I am however sure that they know that it won’t ultimately win them seats but may marginally increase their vote count in MDC strongholds.)

The MDC-T has in turn politically defined the move as a vote buying gimmick that betrays what it calls ‘desperation’ on the part of Zanu Pf.  The Newsday editorial also defined the move as ‘populism at its worst’ while the Daily News one called the move catastrophic. The Herald was the only paper to have a front page headline story on the issue thought it is yet to write an editorial on the same.

There is however a socio-economic mechanics to the announcement, particularly if effected. Ever since the ‘dollarisation’ of the Zimbabwean economy, major parastatals and government departments converted what was owed them by users of their services into US dollars. This was before the full formal expansion, availability and integration of foreign currency for  ordinary citizens.  As a result payment of utility bills, be they for electricity, council rates/rentals or even medical aid was and remains erratic nationally. This is why in most instances every other quarter one parastatal or local government authority would either announce or re-emphasize what they referred to as ‘payment plans’ for end users of their services.

Such a  development indicated an inability of the said government related organizations to re-coup their revenue and not for lack of trying. Closure of water and electricity has been fairly commonplace even with the effecting of ‘payment plans’ which a good number of citizens can still not meet or strictly adhere to. The end effect has been that either way, even if a bill states an amount owed, it would still not be paid either in full or in terms of the payment plan. Either way therefore the councils or parastatals even with payment plans have been unable to recover a greater percentage of what they are owed.

The big factor in all of this, apart from the inability and not intransigence of a majority of ratepayers, has been the changeover from the Zimbabwe dollar to the US dollar billing system. This left many residents with debts that they cannot pay in the immediate or the long term.  The blame for such a state of affairs lies with those who, in central government were in charge at the time of the economic collapse of 2007. It also however lies with those that joined government in the aftermath of the Global Political Agreement (GPA) and who have since failed to resolve the matter. And this pronouncement by Minister Chombo will essentially relate to a bit of mathematical assumptions. 

It is generally agreed that most of our urban and rural district councils are living from hand to mouth particularly where it comes to paying salaries of employees and immediate running costs for water treatment as well as refuse collection. Now the jury may be out on the direct impact of  not having revenue for July 2013 will have on councils but the bigger issue is about the debt owed prior to this month (and for many years). The onus of proving this however resides with both the relevant ministry and the local authorities in question.

What is however forgotten is that the debts are cumulative. Whatever one owes does not mean one is not charged for services utilized for the month in question. This also means that the councils do not stop charging residents and ratepayers in the next month for services rendered. What is lost therefore is essentially one month of revenue which was in any event not going to be paid in full. Therefore either way, whatever payments were being made prior to the announcement local councils have revenue in their coffers.

It is the continual large debts that are owed by residents over the years that will not be reflected on the bills come next month. And that can only be a good thing for social and economic justice. No matter who propositions it.  The government, which made this pronouncement, has an obligation to meet the shortfall that will emerge as a result of its directive. It will have to foot, among other costs, the wage bill of council workers for this month.

In the final analysis, this is a matter that remains controversial but talks to the challenges residents and ratepayers have been facing. That it has been politicized by an outgoing Zanu Pf minister is cause for concern, but that does not take away its resonance with a majority of economically disadvantaged citizens in various urban and rural district councils. It should have been done well before the elections by elected councilors and not by way of edict by a minister.

*Takura Zhangazha writes here in his personal capacity (takura-zhangazha.blogspot.com)