THE BULAWAYO City Council lost more than $90 000 in legal fees following the directive by government for all local authorities to write off debt owed by residents.
The local authority cancelled $46 million it was owed by residents following a directive by Local Government minister Ignatius Chombo in the run-up to the July 31 general elections.
According to the latest council report, chamber secretary Sikhangele Zhou reported on November 4 that the legal costs incurred by council after the debt write-off were $20 622,17 in return of service and holdovers, $625 in summons issued and later retrieved and $810 in judgments and writs.
Council also lost $70 742,95 in messenger of court fees bringing the total amount to $92 800,12.
“Accounts with a value of more than $10 000 were handed over to lawyers for collection through the High Court.
“These were mainly industrial and commercial debtors,” the report read.
It also noted that an additional three law firms had signed new contracts to do collections on behalf of council.
These were Mlweli Ndlovu&Partners, who signed an agreement on January 17, R Ndlovu&Company in November 2012 and Job Sibanda&Associates on January 17.
“One other law firm had had its case load withdrawn in view of the low record of recovery.
The agreement provided for appraisals to be done at regular intervals.
“Generally, collections had been conducted fairly among the firms and an average collection rate of 51% under difficult conditions of commercial and industrial debtors struggling to survive.
“Under normal circumstances, the above costs were debited to the debtors’ accounts and council would now bear the costs and there would be no recovery.”
In the run-up to the July 31 elections, Chombo directed local authorities to scrap all outstanding debts as at June 30 2013 in what observers viewed as an attempt at urban vote-buying by Zanu PF.
Chombo said the move to scrap the debts was in line with Zanu PF’s pro-poor policy championed by President Robert Mugabe.