Gweru City Council undertakes debtors cleansing exercise

The Gweru City Council is conducting a debtors cleansing exercise to verify the status of its debtors, including companies that have ceased operations but are still listed as owing money. This effort aims to ensure accurate and up-to-date financial records.

Assistant director of finance, Mr. Owen Masimba, reported that as of the end of May, the council is owed ZWG143 million, with government departments accounting for ZWG17 million. The council also owes ZWG26 million to entities including the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), Zimbabwe Revenue Authority (Zimra), and the Local Authorities Pension Fund.

The exercise involves checking whether the council can realistically collect these debts. Under the Urban Councils Act, debts from insolvent companies or estates can be written off if deemed irrecoverable. Mr. Masimba explained that companies that have closed or gone insolvent continue to accumulate fixed charges, which bloat the debtors' book without the likelihood of recovery.

The council may remove such debts from its system in accordance with the law. Despite financial challenges, the council is up to date with workers' salaries, although payments sometimes spill into the first week of the following month.

In a recent full council meeting, Mayor Martin Chivhoko revealed that Zimra garnished the council's bank accounts over ZWG3 million in unpaid taxes, hindering their ability to transact. Over ZWG2 million has been transferred to Zimra in compliance with the garnishment order. Mayor Chivhoko expressed concern over accumulating creditors and urged debtors to pay their bills to help the council manage its financial obligations.