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Chris Hani District Municipality (CHDM) council approved writing off over R2 million in interest owed by two government sector departments during a virtual ordinary council meeting on April 24.
This follows negotiations since 2021 after the National Department of Public Works and Infrastructure in the Mthatha region and the Department of Justice and Correctional Services at Middleburg Prison started paying their debt to CHDM.
Presenting the item, acting executive mayor, Thembisile Bobo, said during the take-over of the water services from local municipalities in July 2014 there were some billing challenges.
Not sending invoices regularly to government departments led to some of the departments defaulting on payments.
“The municipality started charging interest in July 2017 as a result, the Department of National Public Works (Umtata Region) and the Department of Correctional Services were charged interest. These government departments are paying institutions and have requested the interest be waived off their debts,” he said.
The financial report is for the quarter which ended on March 31.
Bobo said the total debt for public works was R2.6 million while the amount to be written off is R427 965.37.
For correctional services, the debt in total is R2.7 million with the relief in interest standing at R1.9 million.
There were no engagements on the item except for councillors Nosipho Papiyana and Mhlangabezi Mangcotywa who persuaded the council to approve the write-off.
