Remedial action boosts collection rate

TAKING NOTE: Lack of service delivery impacts negatively on collection rates says BCM Picture: FILE
TAKING NOTE: Lack of service delivery impacts negatively on collection rates says BCM Picture: FILE
Buffalo City Metro’s revenue collection is showing an improvement thanks to strict remedial action implemented by the city and quarterly reports submitted to the council for monitoring purposes.

The plan, which was implemented from December 2016 has seen an increase in the revenue collection rate which at the end of July 2017 stood at 78.3%.

City manager Andile Sihlahla highlighted that this was a remarkable improvement when compared to end of July 2016 where the collection rate was “only 61.17%”.

“The collection rate was 89% as at end June 2017, which was an increase of 1.5% as compared to May 2017.

“The collection rate decreases every year in July due to the annual charges (rates and sewerage) that are raised in July but only become payable by September 30,” said Sihlahla.

“The following remedial action plan has been implemented in order to increase the collection ratio:

lContinued enforcement of the collection action as prescribed in the credit control policy at a regional level;

lAudit of business customers’ meters and complete billing profile;

lImplementation of the reviewed credit control policy to enhance affordability of payment arrangements;

lContinued implementation of the on-line vending purchases via latest technology;

lContinuous implementation of the SMS functionality to inform customers of their current and outstanding debt and;

lThe review of the current debt book, specifically related to the protection of accounts due to various reasons including indigent debtors with expiry dates.”

Sihlahla said from April to March 2018 the audit of business customers’ meters and complete billing would continue.

“The service provider is currently underway with a pilot phase Berea in East London specifically. The main goals for this pilot phase is the testing of the data collection methodology and tools and the identification and resolution of practical challenges out in the field,” Sihlahla said.

“The indigent debtors with expiry dates have been identified and letters are in the process of being issued, informing qualifying indigent customers to reapply for their indigent subsidies.

“This exercise, related to the protection of accounts, is continuing and is anticipated to be finalised by December 31,” he added.

The metro is targeting a 92.5% revenue collection rate in the current financial year which ends in June next year.

However to improve the rate, Sihlahla said BCM “must ensure that all vacant funded positions within the revenue management department are filled”.

The accounting officer admitted that BCM’s lack of constant service delivery such as refuse collection and grass cutting had a negative impact on the collection of rates.

Other challenges listed by Sihlahla included illegal electricity connections which reportedly create ineffective credit control actions. Network interruptions within the revenue management offices in Mdantsane and East London and interruption of revenue management operations specifically related to industrial action in BCM were also listed as challenges. —

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