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City achieves a remarkable 100% Collection Ratio over past 12 months

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City achieves a remarkable 100% Collection Ratio over past 12 months

by City of Cape Town
14 May 2007
City of Cape Town
City of Cape Town

The City of Cape Town is clearly making advances in the collection of rates and service charges. The 12-month collection ratio at the end of April 2007 stands at 100%. This means that, on average, ratepayers and service users have paid the City equal to the total bills issued in the past 12 months.

This is a historic achievement and is the first time this has been achieved since the formation of the new City of Cape Town in 2000.

The one month collection ratio in April 2007 was 130%. In April 2006, the 12-month moving average collection ratio was 94%.

Following the launch of an intensive Debt Collection Campaign by Mayor Helen Zille in September 2006, some 330 000 final demands (or "pink letters", as they are popularly known) were sent out to non-payers between October and December last year. No fewer than 132 000 residents have come to the Council's offices to settle their outstanding accounts or make arrangements to pay them off.

Cllr Ian Neilson, Mayoral Committee Member for Finance, said: "Congratulations to everyone for this wonderful achievement. This is a truly remarkable milestone. It has been dedicated and sustained work over a long time that has led to this result, and I want to thank every member of the public who paid and to the Revenue staff and all the other departments who have contributed to this result. This is what makes the City financially sustainable and enables us to deliver services at the level required for a city that aims to be world class".

Derek Harris, Director of Revenue, said: "These collection ratios show that our City is leading the way in local government in terms of sustainable debt collection. I thank those residents who have come forward and stuck to their repayment agreements".

"The City has no option, under existing legislation, but to take serious steps against defaulters, restricting water supply in the case of residential properties, and cutting off water supply and electricity in the case of businesses. These restrictions and disconnections are being made at the rate of 500 a day" he added.

Following the disconnections, the City would hand defaulters over to its attorneys for collection of the outstanding money. Defaulters would be liable for legal costs, interest and disconnection and reconnection fees. No further reminders would be issued. To avoid these additional costs, residents are urged to visit our offices in order to make suitable arrangements to settle their arrears.

In many cases, people who were not in arrears last year, were now, and 125 000 final demands have been sent out during March and April 2007 and the same action would be taken against them if they did not come forward to pay their bills or make arrangements to pay them off.

The City said its total arrears bill stood at R3.327 billion as at the end of March 2007, compared to R3.533 billion at the end of September 2006. The biggest portion of this - R2.5 billion - was owed by residential property owners.

On another note, the City said approximately 4 000 people had come forward to register on its indigent register, which grants rates and service charge relief to those that are really unable to pay. However, it believed this figure was too low and said people should not be "afraid or ashamed" to register for indigent relief where necessary. The City would assist such people, "no matter how large their debts might be".


NO. 144/2007
11 MAY 2007

TEL: 021 400-2201
FAX: 021 957-0023

CELL: 083 306 6730

TEL: 021 400-2270
CELL: 084 630 7386

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