Cape Town - Deputy President Paul Mashatile says the debt of municipalities owed to Eskom was rising and stood at R56.3 billion as at the end of December 2022.
“It is clear we need a debt relief strategy that will acknowledge the inherent risk of unviable municipalities,” Mashatile said on Thursday when he was responding to oral questions in the National Assembly.
He also said Eskom would provide incentivised relief to municipalities whose debt was unaffordable.
“The relief will come with conditions to ensure there is no repeat of debt building up over time. Some of the conditions include the installation of pre-paid meters to correct the underlying behaviour of non-payment and operational practices in affected municipalities.”
Mashatile also said municipalities should use the money that they were allocated effectively.
“If this is not the case, there should be consequences.”
Mashatile said the National Treasury was preparing a Municipal Finance Management Act circular dealing with a relief strategy regarding the municipal debt owed to Eskom.
The circular was expected to be released later this month and its implementation would start in April.
“Under the National Treasury the multi-disciplinary revenue committee is continuing with its task of ensuring all municipal debts are coordinated, tracked and resolved on an ongoing basis.”
The deputy president also said accounting officers were required to settle all contractual obligations and pay all monies owed, including inter-governmental claims within 30 days of submissions of invoice or specific period agreed with creditors or suppliers.
“The culture of non-payment not only by municipalities but all organs of the state and individual household customers is concerning.
“We can't over emphasise the need to discourage the culture of non payment for public services.”
Cape Times