News / Local
Bulawayo Council spends $60m in salaries
09 Feb 2014 at 08:53hrs | Views
THE Bulawayo City Council (BCC) is headed for a serious showdown with the Government, amid revelations that the local authority has for the past few years been submitting misleading budget projections because the bulk of the money collected through rates and rent was being channelled towards employees' salaries and allowances, Sunday News reported.
This comes against a backdrop of reports that council senior staff were awarding themselves unjustified hefty salaries and allowances, a move that has been condemned by both councillors and residents.
According to council documents, the local authority has for the past three years been collecting about $62 million in rates and rent per year but has continually submitted a budget that is almost double their collection average.
It has also been revealed that the council coughs out over $5 million a month on salaries, this meaning in a year, minus the thirteenth cheque; the local authority channels a minimum of $60 million towards salaries, leaving just a meagre $2 million for service delivery.
Further, according to these figures, the local authority has for the past three years been collecting about $5,2 million a month compared to its $5 million monthly salary figure.
A council confidential report, this paper is in possession of, notes that in 2011 council managed to collect $58 168 222, in 2012 $61 498 455 and last year the local authority collected $67 523 416.
However, in 2011 council submitted a budget of $178 million and in 2012, $188 million. For the year 2013 they decreased the budget to $123 million and last year the council's chairperson of the Finance and Development Committee, Councillor James Sithole unveiled a budget of $113 million for 2014.
The report further stipulates that just for the month of December, the local authority parted with $2 375 202 in salaries, with $4 186 718 being channelled to other salary related costs, which include employees' medical aid, Local Authorities Pension Fund and the National Social Security Authority at $6 561 920.
In total, for the month of December, the local authority parted with $7 816 750, the other costs incurred were $157 401 for Value Added Tax and informal traders, $404 049 for trade creditors, $78 369 for financial institutions, $123 160 for fuel, $107 050 for engineering services contracts, $108 250 for cleansing contracts and $35 000 for the Manpower Development Fund. This reveals that during the month of December only $338 460 was channelled towards service delivery. The Government stipulated ratio for use of council funds is 70 percent service delivery and 30 percent salaries, therefore for the month of December just 4,3 percent was used for service delivery.
When Sunday News contacted the city's acting town clerk, Mrs Sikhangele Zhou and the city's financial director Mr Kimpton Ndimande, they both were unwilling to comment. Mrs Zhou said the best person to comment was Mr Ndimande as he was the one responsible for defending the council budget.
"That involves a lot of figures, I would not be in a position to comment on that matter. Try to talk to Mr Ndimande, the finance director, he would know as he is the one who defends the council budget," said Mrs Zhou.
However, Mr Ndimande also refused to divulge any details. The city's mayor, Clr Martin Moyo confirmed that the local authority was facing difficulty in adhering to the Government stipulated ratio but noted that the major problem was the high number of defaulters in the city.
"I think the major problem when we come up with a budget is that we are making projections but in most cases we fail to meet what we aim to collect at the end of the day while the budget that we submit to Government adheres to the 70:30 percent ratio. We are critically failing to meet that ratio because we are collecting far less than what we aim to collect.
"This whole matter is relative and unfortunate but there is nothing much we can do, if we collected more we could stick to the government stipulated ratio," said Clr Moyo.
Minister of Local Government, Public Works and National housing Dr Ignatius Chombo said it was unfortunate that councils were failing to adhere to the government stipulated ratio but said this was a matter that had to be rectified during the budget making process.
He said councils had to realise that salaries remained fixed, therefore if they failed in their prescribed duties during the budget making process they would end up with a situation where the bulk of the budget goes towards salaries, neglecting service delivery in the process.
"One thing that we should never forget is that salaries will always remain fixed, therefore, at the end of the day the buck stops with the councillors who now need to talk to their residents to understand the gist of the budget, if they sell a budget of $150 million to the residents, they should be able to stick to that and the residents should be in a position to pay their rates and rents.
"What we are saying is that councils should adhere to the clear principles of service provision rather than fattening their pockets, if they want the huge salaries they should ensure that they collect more that will see them move towards the 70:30 percent ratio," said Dr Chombo.
He said the whole issue of council salaries was a local issue that had to be resolved locally and the only platform was the budget making process.
Bulawayo United Residents Association (BURA) chairperson Mr Winos Dube blasted the local authority saying the council's wage bill did not tally with the service delivery.
"We cannot have a situation whereby a huge chunk of what is collected monthly goes towards salaries, this has to be rectified as a matter of urgency. However, residents should also play their part by ensuring that they pay what they owe so that we boost revenue collection," said Mr Dube.
According to the BCC's salary schedule, city managers earn an average of $9 000 per month. The town clerk, Mr Middleton Nyoni, is the highest earner at City Hall with a salary of $9 439, 19.
Breaking it down, Nyoni's basic pay is $5 182, transport/fuel $946,43, housing allowance $518,20 and telephone allowance of $29. He also gets about $2 763,56 through other cash allowances.
BCC directors and the chamber secretary's basic pay are pegged at $4 627, transport and fuel $821,22, housing allowance $462,70 and telephone allowance of $26. A cash allowance of $2 467,58 brings their total monthly package to $8 404, 50.
Each director is also entitled to $100 monthly medical aid contribution, $800 school fees per term, $73 cellphone allowance per month and $3 461 in insurance. Deputy directors earn a total package of $7 462,18 while assistant directors are paid $6 613,42.
This comes against a backdrop of reports that council senior staff were awarding themselves unjustified hefty salaries and allowances, a move that has been condemned by both councillors and residents.
According to council documents, the local authority has for the past three years been collecting about $62 million in rates and rent per year but has continually submitted a budget that is almost double their collection average.
It has also been revealed that the council coughs out over $5 million a month on salaries, this meaning in a year, minus the thirteenth cheque; the local authority channels a minimum of $60 million towards salaries, leaving just a meagre $2 million for service delivery.
Further, according to these figures, the local authority has for the past three years been collecting about $5,2 million a month compared to its $5 million monthly salary figure.
A council confidential report, this paper is in possession of, notes that in 2011 council managed to collect $58 168 222, in 2012 $61 498 455 and last year the local authority collected $67 523 416.
However, in 2011 council submitted a budget of $178 million and in 2012, $188 million. For the year 2013 they decreased the budget to $123 million and last year the council's chairperson of the Finance and Development Committee, Councillor James Sithole unveiled a budget of $113 million for 2014.
The report further stipulates that just for the month of December, the local authority parted with $2 375 202 in salaries, with $4 186 718 being channelled to other salary related costs, which include employees' medical aid, Local Authorities Pension Fund and the National Social Security Authority at $6 561 920.
In total, for the month of December, the local authority parted with $7 816 750, the other costs incurred were $157 401 for Value Added Tax and informal traders, $404 049 for trade creditors, $78 369 for financial institutions, $123 160 for fuel, $107 050 for engineering services contracts, $108 250 for cleansing contracts and $35 000 for the Manpower Development Fund. This reveals that during the month of December only $338 460 was channelled towards service delivery. The Government stipulated ratio for use of council funds is 70 percent service delivery and 30 percent salaries, therefore for the month of December just 4,3 percent was used for service delivery.
When Sunday News contacted the city's acting town clerk, Mrs Sikhangele Zhou and the city's financial director Mr Kimpton Ndimande, they both were unwilling to comment. Mrs Zhou said the best person to comment was Mr Ndimande as he was the one responsible for defending the council budget.
"That involves a lot of figures, I would not be in a position to comment on that matter. Try to talk to Mr Ndimande, the finance director, he would know as he is the one who defends the council budget," said Mrs Zhou.
However, Mr Ndimande also refused to divulge any details. The city's mayor, Clr Martin Moyo confirmed that the local authority was facing difficulty in adhering to the Government stipulated ratio but noted that the major problem was the high number of defaulters in the city.
"I think the major problem when we come up with a budget is that we are making projections but in most cases we fail to meet what we aim to collect at the end of the day while the budget that we submit to Government adheres to the 70:30 percent ratio. We are critically failing to meet that ratio because we are collecting far less than what we aim to collect.
"This whole matter is relative and unfortunate but there is nothing much we can do, if we collected more we could stick to the government stipulated ratio," said Clr Moyo.
Minister of Local Government, Public Works and National housing Dr Ignatius Chombo said it was unfortunate that councils were failing to adhere to the government stipulated ratio but said this was a matter that had to be rectified during the budget making process.
He said councils had to realise that salaries remained fixed, therefore if they failed in their prescribed duties during the budget making process they would end up with a situation where the bulk of the budget goes towards salaries, neglecting service delivery in the process.
"One thing that we should never forget is that salaries will always remain fixed, therefore, at the end of the day the buck stops with the councillors who now need to talk to their residents to understand the gist of the budget, if they sell a budget of $150 million to the residents, they should be able to stick to that and the residents should be in a position to pay their rates and rents.
"What we are saying is that councils should adhere to the clear principles of service provision rather than fattening their pockets, if they want the huge salaries they should ensure that they collect more that will see them move towards the 70:30 percent ratio," said Dr Chombo.
He said the whole issue of council salaries was a local issue that had to be resolved locally and the only platform was the budget making process.
Bulawayo United Residents Association (BURA) chairperson Mr Winos Dube blasted the local authority saying the council's wage bill did not tally with the service delivery.
"We cannot have a situation whereby a huge chunk of what is collected monthly goes towards salaries, this has to be rectified as a matter of urgency. However, residents should also play their part by ensuring that they pay what they owe so that we boost revenue collection," said Mr Dube.
According to the BCC's salary schedule, city managers earn an average of $9 000 per month. The town clerk, Mr Middleton Nyoni, is the highest earner at City Hall with a salary of $9 439, 19.
Breaking it down, Nyoni's basic pay is $5 182, transport/fuel $946,43, housing allowance $518,20 and telephone allowance of $29. He also gets about $2 763,56 through other cash allowances.
BCC directors and the chamber secretary's basic pay are pegged at $4 627, transport and fuel $821,22, housing allowance $462,70 and telephone allowance of $26. A cash allowance of $2 467,58 brings their total monthly package to $8 404, 50.
Each director is also entitled to $100 monthly medical aid contribution, $800 school fees per term, $73 cellphone allowance per month and $3 461 in insurance. Deputy directors earn a total package of $7 462,18 while assistant directors are paid $6 613,42.
Source - Sunday News
