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Wednesday May 10, 2017

Joburg billing crisis 'worse than thought'

There is a billing crisis in the City of Joburg - and it is worse than initially thought.

These are the words of the member of the mayoral committee (MMC) responsible for finance, Rabelani Dagada, who confirmed to The Star that the city was still receiving about 15 000 new complaints each month.

As at March 17, there were 44 000 queries being dealt with.

"This number is increasing because of constant estimations of consumption, which are often thumb-sucked by meter readers," Dagada said.

"It was embarrassing to write off R8 billion debt two years ago which was said to be non-traceable, but which could have been traced. It is not necessarily corruption - it could be that the data is incorrect," he said.

A service provider would soon be appointed to gather and fix the data of residents. They would analyse the errors on the system and find long-lasting solutions, he said.

The process initially involves the development of the indigent list to ensure the poorest of the poor receive free basic services without charge.

The second objective is to ensure that the property valuation system is improved. In the last property valuation, the city had to file 60 000 objections against its own service provider.

And Dagada warned the thousands of property owners whose properties are undervalued and who are, therefore, paying less that they will be traced. He believes that many commercial properties, including some upmarket shopping centres, are grossly undervalued to the tune of R1 billion.

He would fix this by getting in more valuers and drawing up more frequent supplementary valuation rolls.

The MMC added there were thousands of customers, mostly commercial, who were not being billed by the city to the tune of about R5bn.

An outsourced billing task team would be set up to identify properties which don't receive bills. It would entail staff physically getting into their vehicles to verify what was on the property, said Dagada.

"All round, we will be collecting more money aggressively, which will not make us popular. This has to be done as we estimate that out of 150 properties, only about 120 are sent bills," he said.

"We get customer information from City Power, Johannesburg Water and the development planning department which is not always accurate. Many people connect themselves to our services and, therefore, do not receive bills. Some are honest and set up trusts for this so they have the money when we catch up with them."

The third remedy was the improvement of revenue collection. During the month of March, the city collected a record R3bn, which was well over the target of R2.6bn.

Dagada said he was confident that the city would reach a R4bn collection by the end of December.

Last month, the city also reconstituted the back office unit within the revenue department where internal staff, as opposed to external staff, are dealing with queries.

The MMC intends moving meter readings away from City Power and Johannesburg Water to centralise them within his group finance office so that they can be under his watch.

He also wants to bring the disconnections and reconnections department back under his wing so that he can ensure the audits are done properly.

"I have heard of reconnections taking up to four days by City Power," he said.

Dagada also intends to reduce the estimation reading period down to two months.

According to the city by-laws, electricity readings can be estimated only for three months and water for six months.

"People are getting ridiculous estimates for many months at a time, resulting in unrealistic readings," he said.

Customer care is another area Dagada is addressing. "It is currently weak, so we are undergoing training for the front-line staff."

Another weakness is the way the invoices are presented.

"We are not using the best accounting practices, but we are on it. People cannot understand their accounts because they are so complex - there is a lot of confusion out there," he said.

Dagada said he had "grossly" underestimated the amount of work needed to fix the billing crisis. He thought it would take about six months, but now estimates it will take between 18 and 24 months.

"For us to be able to carry out service delivery in terms of infrastructure, customers have to pay their municipal bills. We need the money for roads and other infrastructure which, if neglected, will result in property values dropping," he concluded.

The Star


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