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BCC implements 372% rates hike

by Staff reporter
03 Oct 2020 at 08:23hrs | Views
BULAWAYO residents are expected to pay 372 percent more in rates next month as council implements a $551 million supplementary budget with tariffs expected to increase by a further 421 percent two months later.

The council also proposed a more than $16 billion 2021 budget in which rates would go up by 421 percent from the 2020 budget. Council proposed that the budget be reviewed after every three months in view of the changes in the macro-economic environment.

Presenting the 2020 supplementary budget and the 2021 proposed budget virtually in the council chambers yesterday, Bulawayo City Council (BCC) Finance and Development Committee chairperson Councillor Mlandu Ncube said rising costs and Covid-19 affected budgeting hence the need for the supplementary budget.

He said Covid-19 caused council to incur an unbudgeted cost as the municipality had to equip itself to fight the global pandemic.

A resident in the western suburbs who is paying an average of $200 for rentals per month will be required to pay just above $700 next month.

In January, those who are paying about $200 will be paying almost $900 per month. Cllr Ncube said in coming up with the 2020 supplementary budget and the 2021 budget, the local authority tried to balance between the need to provide quality service and easing the plight faced by residents.

He said council proposed the budgets as the rates that were charged by the municipality had become uneconomic yet it is required to deliver efficient services.

"Before I recommend the tariff adjustments, I propose that going forward, this budget be reviewed quarterly to determine the relevance of the tariffs to finance the budget. The proposal is meant to ensure that economic tariffs are charged so that services continue to be enjoyed by the residents. It is therefore recommended that: tariffs be increased by 372 percent from November 2020 in order to finance the proposed 2020 supplementary budget," said Cllr Ncube.

"For the 2021 budget an increase of 421 percent be levied on all tariffs based on the approved 2020 tariffs. This increase will be effected on 1 January 2021. The budget would be subject to review on a quarterly basis in line with changes in the economy. It is my hope that the economy would stabilise at affordable levels."

He said in coming up with the supplementary budget, council considered that service providers demanded payment for goods and services in foreign currency and changes in the foreign currency auction system or parallel market.

"On the other hand, council had not reviewed its tariffs and this led to a mismatch between income and expenditure where the latter was influenced by the exchange rate. "This left council struggling to offer any meaningful service to its valued stakeholders.

"In order to complete the year with basic services, council needs some injection to the tune of $550,8 million," he said.

Cllr Ncube said if council does not get the money it will not be able to continue providing services until the end of the year. He said at the top of the Bulawayo's budget priority list is water provision followed by health, sewerage, housing, roads, education, public lighting, social service with fire and ambulances coming at the bottom. Cllr Ncube said the more than $16 billion budget takes into cognisance that the city needs to strategise in view of declining services caused by water shortage and the Covid-19 pandemic.

"The challenges experienced in 2020 are likely to be carried into the next budget cycle; however, council will be better prepared to attend to such issues as adequate budget provisions have been made. "The 2021 proposed budget seeks to improve service delivery in roads infrastructure, sewerage and water infrastructure.

"The year 2021 will see a number of long-term projects coming to a conclusion specifically of water and sewerage infrastructure," said Cllr Ncube.

He said the 2021 outlook is likely to improve mainly on the basis of expected improved rainfall than can guarantee better provision of water and stability in the foreign currency auction system which presents price stability.

Source - chronicle

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