By Tabisa Mntengwana
20 January 2012

OVER R63-million of indigent debt will be written off by the metro in an effort to help disadvantaged rate payers.

There are 62 000 indigent consumers in Buffalo City, which has already issued a list of more than 24nbsp;000 households that are eligible for their debts to be written off. These debts range in size from just a few rands to up to R43 000.

Speaking about the initiative, council Speaker Luleka Simon said that residents should contact their ward councillor to verify their eligibility with the relevant documentation before 24 January 2012.

According to a municipal report, the writing-off of debt was tabled at the last 2011 council meeting, in line with the Municipal Systems Act and the Credit Control By-law. "The matter is again coming before council on 31 January 2012," reads the report.

"The debt is in respect of rates and service charges collected on a monthly basis and the accumulated balance after the monthly indigent subsidy grant and rates rebates have been applied," reads the report.

Indigent households are given 50kwh of free electricity and six kilolitres of free water each month, in addition to a monthly municipal services rebate.

They use the free electricity and do not buy any electricity during the month. "The collection methods via the electricity metering system did not yield any results in such cases."

According to the metro's credit policy, the debt of indigent consumers cannot be handed over to debt collectors or attorneys, provided that the debtors are registered on the municipal indigent database.

"The policy seeks to ensure that no legal action is taken against indigent debtors as this will place an additional burden on the poorest of the poor," explains the municipal spokesperson, Samkelo Ngwenya.

He adds that the law states that the council may, on recommendation from the municipal manager or any duly delegated official, write off any debt or portion thereof, provided that the council is satisfied that the debt or portion thereof is irrecoverable or that it will be in the best interests of the municipality to accept part payment of the debt in full and final settlement.

According to the report, the total debt owed to the City, excluding VAT, that is deemed to be irrecoverable in respect to indigent debtors, includes electricity at over R600 000, rates of R6,6-million, sewerage of R8,7-million, sundries of R4,2-million, refuse of R11-million and water of R31,7-million.

The debt relates to debtors who were registered as indigent as at 30 June 2011. Only limited credit control and debt collection can be taken to recover debt in respect of indigent debtors after the indigent subsidy and rates rebate have been granted.

Within a monthly billing period, the indigent debtor is expected to pay the balance of the account, failing which the debt is transferred to the electricity pre-payment metering system and the debt is placed on G block type. The G block type means that the indigent debtor still has access to electricity purchases; however, for every rand tendered for electricity, R0.40c goes to the outstanding debt.

A list of names, account numbers, addresses and the total debt outstanding is available from all metro ward councillors, and residents are urged to verify their particulars with their local ward councillor.

To verify your status as indigent the following documents are required:

• Identity document;
• Proof of indigence; and
• Residential proof.

Verification should be made no later than 24 January. "Failure to do so may result in that debt not being written off." The Buffalo City Indigent Office is on Oxford Street in East London.

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