Cape Town battles with state debts

[semiautomatix]

The City of Cape Town is owed R366-million by national and provincial authorities, but is not being paid because the two spheres of government cannot agree on who is responsible for the debt.

This has prompted city finance managers to approach the auditor-general for assistance. Several high-level meetings over the past nine months have not yielded a resolution.

Executive director of finance Mike Richardson told the Cape Argus the dispute had been going on for 18 months, and the amount owed increased every month.

The total outstanding for rates and services owed to the city at the end of December was R4,5-billion, of which R3,3bn was for arrears.

http://www.iol.co.za/index.php?set_id=1&click_id=13&art_id=vn20100202124236905C419138

My word! That's a lot of money the ANC decided not to pay for using Cape Town's buildings. And you wonder why it's taking the DA so long to sift through the mess left over by the ANC in the Western Cape.

I'm guessing when the ANC realised that the province was going to be lost they promptly pushed all national debt to the provincial government. Sneaky b*****ds.

Wow, they're doing everything in their power to make it difficult for the DA. They definitely don't give a damn about the citizens of this country, I can tell you that much.

 

[Morgoth]

no surprise here... the ANC are the masters of corruption and spending

 

[Pilgrim]

@timgaul, I am not sure if they really are trying to make life difficult for the DA. The DA is simply trying to pick up the pieces after the ANC left.

They really don't have to go out of their way to create problems...

 

[Sherbang]

:erm:

"That's where the problem arose. Province did not have money at the time, and the longer it was left, the more complicated it got."

Richardson said the national government had paid everything it owed, but that money went to arrears service charges owed by the province.

The western cape province is DA not ANC.

 

[semiautomatix]

:erm:

The western cape province is DA not ANC.

It's debt from 18 months ago, buddy. Read it again, I highlighted the important bits.

 

[davemc]

Dear DA, please sell the government property to recover some of the costs outstanding.
Please try to force the people who buy the buildings to use a percentage of the building for creating more parking.

In the meantime, establish a direct-tax company where citizens are encouraged to pay rates and taxes and income taxes.
Use the money deposited into this company destined for government [-]waste[/-] coffers to slowly repay the debt.

Thank you.

 

[semiautomatix]

@timgaul, I am not sure if they really are trying to make life difficult for the DA. The DA is simply trying to pick up the pieces after the ANC left.

They really don't have to go out of their way to create problems...

I do think when it was realised they were going to lose they try to push as much debt and paperwork to the next regime. I do honestly believe most of it was incompetence but a large chunk was out of spite.

 

[JungleBoy]

Dear DA, please sell the government property to recover some of the costs outstanding.
Please try to force the people who buy the buildings to use a percentage of the building for creating more parking.

In the meantime, establish a direct-tax company where citizens are encouraged to pay rates and taxes and income taxes.
Use the money deposited into this company destined for government [-]waste[/-] coffers to slowly repay the debt.

Thank you.

Can't do that...now, the WC gvt occupies some of those buildings.

 

[Sherbang]

It's debt from 18 months ago, buddy. Read it again, I highlighted the important bits.

I read it. R3,3bn is for arrears. The dispute has been going on for 18 months and for at least half that time it'd been the DA refusing to pay (which means the amount is continuing to increase every month as it's still not being paid).
Payment of service charges was devolved to provinces for the entire country, not just the WC, so I don't think it's an attempt to make the DA's life complicated. All the other provinces had to take over service charge payments as well.

 

[semiautomatix]

I read it. R3,3bn is for arrears. The dispute has been going on for 18 months and for at least half that time it'd been the DA refusing to pay (which means the amount is continuing to increase every month as it's still not being paid).
Payment of service charges was devolved to provinces for the entire country, not just the WC, so I don't think it's an attempt to make the DA's life complicated. All the other provinces had to take over service charge payments as well.

Now the province believes it owes less than is being claimed, while the national government thinks its account is paid up

The city was not prepared to change the details of parties responsible for accounts until all arrears had been paid off.

The total outstanding for rates and services owed to the city at the end of December was R4,5-billion, of which R3,3bn was for arrears.

Premier Helen Zille got involved as long ago as last May, when she chaired a meeting in an attempt to resolve the issue.

So what has happened is that the DA is refusing to foot the bill for the huge amount of debt left to them by the ANC. Indeed, they believe the ANC is still responsible for a large portion. The figures indicate that the DA is clearly paying the amount it has owed over the last 9 months; the dispute, however, is regarding money inherited by the DA-led province. This was in May 2009 when Helen Zille attempted to resolve the situation, upon the DA taking power.

 

[I am Penguin]

no surprise here... the ANC are the masters of corruption and spending

No also the masters of procreating and polygamy it seems.

 

[Sherbang]

So what has happened is that the DA is refusing to foot the bill for the huge amount of debt left to them by the ANC. Indeed, they believe the ANC is still responsible for a large portion. The figures indicate that the DA is clearly paying the amount it has owed over the last 9 months; the dispute, however, is regarding money inherited by the DA-led province. This was in May 2009 when Helen Zille attempted to resolve the situation, upon the DA taking power.

Yes you are right!
The amount has still grown substantially though, while the dispute goes on and it's the province that owes the money not the ANC.
So now the DA has token over the province they've also taken over the debt left by the ANC, for better or worse, no-one else is going to pay it...
Meanwhile month by month it just grows bigger and bigger. It wasn't R3,3bn when the DA took over, that is what it has grown to now!

 

[semiautomatix]

Yes you are right!
The amount has still grown substantially though, while the dispute goes on and it's the province that owes the money not the ANC.
So now the DA has token over the province they've also taken over the debt left by the ANC, for better or worse, no-one else is going to pay it...
Meanwhile month by month it just grows bigger and bigger. It wasn't R3,3bn when the DA took over, that is what it has grown to now!

That I can agree with, unfortunately it's not something the DA should have to deal with. But for better or worse they have inherited this situation, and the debt may not be entirely theirs, the national government may be partially to blame. That is what is taking so long - the ANC caused this situation and now they are refusing to shoulder some of the burden of creating it.

So the problem is that the debt is not entirely the province's. So there is someone else who has to pay, and that is the national government. Remember this is for MPs houses, and so forth.

 

[greggpb]

Wow this is gonna be a tough one to solve...

 

[JungleBoy]

So what has happened is that the DA is refusing to foot the bill for the huge amount of debt left to them by the ANC. Indeed, they believe the ANC is still responsible for a large portion. The figures indicate that the DA is clearly paying the amount it has owed over the last 9 months; the dispute, however, is regarding money inherited by the DA-led province. This was in May 2009 when Helen Zille attempted to resolve the situation, upon the DA taking power.

When you inherit a gvt you also inherit it's debt...it's tough sh#t like that. It happened to the ANC in 1994.

 

[semiautomatix]

When you inherit a gvt you also inherit it's debt...it's tough sh#t like that. It happened to the ANC in 1994.

That's not what this is about at all.

JungleBoy, it's all been explained in the thread above. Try reading before you comment, next time, ok? That's a good boy.

 

[Sherbang]

That's not what this is about at all.

JungleBoy, it's all been explained in the thread above. Try reading before you comment, next time, ok? That's a good boy.

Well he has a point though. When the ANC took over the country in 1994 they also took over the countries huge debt, just like when the DA took over the province in 2009 they took over the provinces debt. The ANC didn't refuse to accept the debt because it was the national party who was responsible for creating it - even though it was debt built up in order to enforce apartheid, they took it on and accepted they were now responsible for it, it's part of the package. Now the DA has taken over the province, the debt is part of the package and the province must take responsibility for it, even though they didn't create it....

 

[sox63]

The city was not prepared to change the details of parties responsible for accounts until all arrears had been paid off.

"That's where the problem arose. Province did not have money at the time, and the longer it was left, the more complicated it got."

Why was the city not able to accomodate the change in structures? I have not seen any mention of this scenario elsewhere in the country, so I have theory regarding this.

The DA being in control of the city at the time, thought they had a good chance of winning the WC and thus refused to make the simple change that all other municipalities made. So IMO, this is a political hot potato created by the DA themselves. Just my opinion...

We will see what the AG says. But if all other Municipalities complied with the change and only CT did not, it seems it was a political play by the DA which backfired.

 

[bekdik]

And where does the province get it's money from?

 

[semiautomatix]

Well he has a point though. When the ANC took over the country in 1994 they also took over the countries huge debt, just like when the DA took over the province in 2009 they took over the provinces debt. The ANC didn't refuse to accept the debt because it was the national party who was responsible for creating it - even though it was debt built up in order to enforce apartheid, they took it on and accepted they were now responsible for it, it's part of the package. Now the DA has taken over the province, the debt is part of the package and the province must take responsibility for it, even though they didn't create it....

It's not bloody about that! It's about whether the National government owes money to the City of Cape Town, as well. The DA aren't saying they need to pay part of the debt, they just don't believe they should pay all of the debt. Jislaaik people, stop arguing the same wrong point.