Fin24

Debt owed to municipalities up

2012-08-02 20:09

Cape Town - The debt owed to municipalities continues to climb daily, the SA Local Government Association said on Thursday.

A report released by National Treasury earlier this year put the debt at R76.6bn, up from last year's R63bn.

Salga CEO Xolile George told reporters at Parliament that debt collection was not an easy process.

"In the past two budget forums convened by the minister of finance, we made substantial representations in terms of making sure financial players like Treasury appreciate the complexity of debt collection," he said.

When it came to reconciling debt, systems did not interface with each other.

Municipalities were mostly owed money by household and institutional debtors, such as schools and provincial governments.

"Where the complexity lies is if you have institutional debtors," he said.

"You have a school in a given ward. The school owes water, the school owes electricity. When it comes to the reconciliation of debt there's a huge complexity that by the time you go to education and you want to cut [off] a school, you find the property is not on the asset register of a school, it's on the asset register of public works."

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