Durban - The audit committee of eThekwini Municipality has urged the metro to urgently resolve the dispute with Durban ratepayer organisations that are withholding rates payments or risk a financial crisis.
The chairperson of the audit committee, Siboniso Shabalala, issued the warning as he briefed the City’s Executive Committee regarding the latest audit committee report on Tuesday.
The warning comes as the Westville Ratepayers’ Association (WRA) revealed that R400 000, meant to be paid for rates and services to the municipality, has been diverted to a trust account as part of the rates boycott by irate residents.
Shabalala described the situation with ratepayers as concerning.
“We are aware of the situation with the ratepayers, and we are calling on the municipality to quickly resolve the issue, or it could have serious financial implications for the municipality.”
Asad Gaffar, the chairperson of the WRA, said they opened the trust account on August 4, and more than R400 000 had been deposited into it by Monday, August 7. The association is leading the rates boycott on account that the City had failed to properly consult residents before imposing the tariff increases that came into effect on July 1. The association said close to 3 000 organisations from across Durban had indicated support and intended to join their rates boycott.
Other ratepayer organisations had announced that they intended joining the boycott because the municipal tariffs were steep and residents could not afford them. Furthermore, they claimed that service was not in line with the high tariffs being charged.
Gaffar said, “Remember that we are supposed to launch on August 1, but we managed to launch and open the account on August 4.
“Since we launched, people have just been depositing money into the account. On the latest count, about R400 000 had been deposited.
“As we were able to only launch on the August 4, many people had already paid for this month (July – possibly out of fear of having their services cut), but they have told us that, as of the month (of August), they will be depositing their payments to the trust accounts,” he said.
However, other ratepayers organisations have changed tack. Carl Lortan of the Sydenham Ratepayers’ Association, which previously backed the rates boycott, said the community agreed to continue paying rates.
“We believe the route of non-payment will create a huge problem for City management. But that does not mean we still can’t hold them accountable for the mismanagement of funds,” he said.
DA councillor Thabani Mthethwa said they sympathised with ratepayers over the lack of service. “It is grossly unfair to pay for the services they don’t receive. We, however, encourage each ratepayer to seek thorough legal guidance before embarking on this process.”
IFP councillor Mdu Nkosi attributed the current crises to the City leadership’s unwillingness to listen. “We had told them that the issue of tariffs was going to be a problem, that is why we did not vote (in favour).”
ActionSA councillor Alan Beesley said the rates boycott was gaining momentum. “This is understandable, with service delivery in the municipality at an all-time low as well as the unwillingness of the mayor and his leadership to meet with the various ratepayers associations that are calling for a rates boycott.”
Municipal spokesperson Gugu Sisilana said it was now a legal matter as the City had received communication from attorneys representing the association and would, therefore, not comment further.
Mayor Mxolisi Kaunda said he would meet with the WRA members tonight in a bid to resolve the matter. However, he warned residents against withholding rates, saying such action could only be taken after a court has found that a municipality is dysfunctional and cannot deliver services.