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Business community slams BCC forex conversions

by Staff reporter
13 Jan 2023 at 05:47hrs | Views
THE Zimbabwe National Chamber of Commerce and the Confederation of Zimbabwe Industries have accused the Bulawayo City Council of using a wrong formula to convert the 2022 and this year's tariffs to United States dollars resulting in exorbitant tariffs.

The business community is not happy that despite engagements last year, the local  authority went on to come up with the USD-indexed 2023 budget despite the matter still being contested.

The 2023 council budget, as presented by the chairperson of the Finance and Development committee Councillor Tawanda Ruzive in November last year was US$157,99 million with US$106 million being earmarked for key infrastructural development projects such as the construction of classroom blocks, clinics, servicing of stands and construction of roads.

 In a statement, released by the combined ZNCC and CZI chairperson, Mr Louis Herbst, the two bodies said its members have been raising concern with council management about the charges since June last year.

He said the organisations had also requested information from council management to enable them to determine the legitimacy of the new charges but the requests were ignored.

"Following our unsuccessful requests for information and engagement, the Minister of Provincial Affairs and Devolution Judith Ncube intervened and summoned council management and ourselves to her offices so that issues of concern could be ventilated. Council management appealed to the Minister to give them an opportunity to engage us directly at their offices. It should be noted that the above was done before the 2023 budget consultation process making council officials aware that concerns raised impinge on the 2023 city budget," said Mr Herbst.

He said a meeting chaired by city finance director, Mr Kimpton Ndimande was held in council chambers on November 21, last year.

"Mr Ndimande requested us to set up a committee that would work with the council accounts team to go through the methodology that was used to derive the United States dollar based tariff. The committee has employed consultants who are experts in pricing models to constitute a professional team to meet with council management. We are displeased that council management have not supplied us with information which had a deadline of 30th December 2022," said Mr Herbst.

He said the mandate of the experts will be to isolate the premium in United States dollars arising from the conversion of the 2022 domestic currency tariffs to United States dollars.

They also want council management to provide comparative information on property taxes – rates – and various charges for the period 2015 to 2017 and charges since June 2022.

He said the information will be used by experts to determine the degree of miscalculation in the 2022 and 2023 tariffs.

"The experts, working with council management will design pricing models to be applied by council management when tracking changes in the exchange and inflation rate as they impact on council costs. Council management engaged us in bad faith. They have undermined their own process; this conduct can only be viewed as mala fide. We are in the meantime considering our alternative options and will appraise ratepayers, residents and stakeholders in due course," said Mr Herbst.

Last November, some residents stormed City Hall in protest against what they termed unreasonably high rates that were not supported by any meaningful service delivery.

For a long time now council has been charging residents using estimated figures, blaming a lack of  manpower to undertake physical readings of water meters.

They also accused the local authority of not consulting them during the budget-making process.

Source - The Chronicle