EVIDENCE that the government made a huge mistake when it ordered all local authorities to write off debts owed by ratepayers in June last year continues to manifest every day.
Faced with elections whose outcome was not certain, the Zanu PF side of the then inclusive government through the Local government minister Ignatius Chombo instructed councils to cancel debts accumulated since dollarisation in 2009.
Zanu PF’s arguments were that the conversion from the abolished Zimbabwe dollar to the multiple currency system was not done properly.
Chombo insisted that the bills that continued to accumulate were unfairly calculated.
The trick to some extent worked for the party as it made some headway in urban areas which were previously a stronghold of the MDC formations. However, five months after the elections that ushered in an exclusively Zanu PF government, chickens are coming home to roost.
Local authorities such as Bulawayo and Harare are now struggling to pay workers on time. Bulawayo City Council also failed to pay workers bonuses last year and has pointed the finger at Chombo’s directive.
More worryingly, the local authority recently indicated that it was unable to play its role in rescuing the Local Government Pension Fund (Lapf), which sent out a distress call to its members last year.
According to the latest council minutes, Lapf wrote to council last December indicating that a valuation of the scheme’s assets against liabilities showed it had a deficit of $256,4 million.
Councils were then asked to inject money to the fund if it was to remain afloat.
Based on the accumulated employer contributions as at December 2011, Bulawayo was asked to pay $66,3 million and $28,5 million respectively.
Council has since indicated that it is not in a position to pay that amount of money and again blames Chombo’s directive for its incapacity.
Local authorities from across the country are singing from the same hymn book, but Harare and Bulawayo are the most affected because they have a bigger pool of ratepayers and have to pay more when providing services. The government must now be seen moving to sort out the mess it created.
One of the easiest steps would be to ensure that government departments that owe councils millions of dollars in unpaid bills move with speed to pay their debts. The government has to consider some kind of rescue package for the struggling local authorities before the situation deteriorates.