Thursday, January 07, 2010
Thu, 07 Jan 2010 10:13:00 +0000
REDCLIFF Municipality has collapsed as a result of alleged gross mismanagement of funds and non-payment of rates by residents and companies operating in the once vibrant industrial town.
The town has a population of around 70 000 people. Council is owed US$4 million in rates with companies such as Ziscosteel having last settled their bills in February 2008.
Other companies operating in the Midlands town such as Zimchem and Bimco have also stopped paying rates citing viability problems. Only Steelmakers is paying rates to the Redcliff Municipality. However, council reduced Steelmakers’ monthly bill from US$74 000 to US$7 000 under unclear circumstances.
This has seen the MDC-T-run council failing to pay workers their salaries for the past four months.
Many small towns die a natural death upon the closure of the mines that surround them. Kamativi Tin Mine, Mhangura Copper Mine and BHP Harley Platinum Mine saw the demise of the centres that surrounded them.
Investigations by our Harare Bureau have shown that council owes its employees salaries backdating to September last year, while contract workers have not been paid since March 2009.
This has seen the unpaid wage bill ballooning to US$420 000.
Council is also failing to settle its bills with service providers such as Zesa, TelOne and Ziscosteel.
Ziscosteel supplies Redcliff with water, which in turn it draws from the City of Kwekwe. Council owes Ziscosteel nearly US$100 000 in water bills according to reports. Ziscosteel in turn owes the City of Kwekwe US$1,3 million in water bills.
Redcliff Municipality has been running without water and electricity for almost a month now.
TelOne has disconnected telephones and council business is run on individual mobile phones. Council turned to diesel generators after Zesa switched off electricity supplies nearly three weeks ago.
The municipality owes Zesa US$50 000 in electricity bills.
At Redcliff Civic Centre (Town House), the nonavailability of water for three weeks has seen council introducing "the bucket system" in its toilets.
Redcliff Municipality has been surviving on businessman Mr Philip Chiyangwa's US$680 000 land development deal brokered by the municipality's marketing manager Mr Paul Shongera.
Mr Chiyangwa, through his company Pinnacle Holdings, has been religiously settling his dues and has already paid US$400 000, but there are indications that the funds could have been misused.
Police in the town have since launched investigations into how these and other council funds could have been misused.
When our Harare Bureau visited Redcliff on Tuesday, council was holding a crisis meeting to solve these and other issues.
Mayor Joseph Matewa confirmed in an interview after the special council meeting that council was in dire straits and he would require six months to turnaround its fortunes.
“We have serious cash problems. We have not paid our employees salaries since September last year and the unpaid wage bill is now US$420 000,” said Mayor Matewa.
“We have been surviving on Mr Chiyangwa’s funds after council sold him land. He has paid about US$400 000 now and is left with about US$300 000. We relied on this deal to sustain our activities,” he added.
Mayor Matewa claimed there was mismanagement of funds paid by Mr Chiyangwa by some senior council officials and the municipality had launched investigations.
Council had reported the alleged embezzlement of funds to the police. Police have since visited Redcliff town offices to establish the facts. The mayor confirmed that all the companies operating in Redcliff apart from Steelmakers have not been paying their bills. Redcliff town was established around Ziscosteel Company, yet the giant steel company stopped operations over two years ago.
On Steelmakers, Mayor Matewa said: “Steelmakers used to pay US$74 000 in rates every month, but the bill was reduced to US$7 000 under unclear circumstances and without council’s consent by a senior council official.”
In another development, Redcliff councillors earn more than council employees in a development that has caused disharmony among the workers.
“They (councillors) get US$180. Their allowances have been paid and are being updated as we speak,” he said.
The majority of workers earn well below US$100 although last year they agreed with council that the least paid employee should earn US$120.
At the moment council is in a quandary as to how to extricate itself from the mess.
It had resolved to lay off some of its employees, but does not have money to give them retrenchment packages running into thousands of dollars.