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Looming financial crisis for Nelson Mandela Bay as Covid-19 bites: DA

May 18, 2020
Looming financial crisis for Nelson Mandela Bay as Covid-19 bites: DA

Port Elizabeth - The Democratic Alliance (DA) in the Nelson Mandela Bay on Monday said that the Metro is facing a looming financial crisis that could cripple service delivery and bring the City’s administration to a grinding halt if urgent interventions are not put in place by the current administration.

"Financial reports indicate that the Metro, materially under-recovered R170 million in rates and taxes during April, as residents and businesses feel the impact of the lockdown to prevent the spread of the Coronavirus," said DA Eastern Cape leader, Nqaba Bhanga.

"The Democratic Alliance has also reliably learned that there has been a significant drop in the sale of electricity especially due to the slowdown of business operations, which will further reduce the Metro’s revenues.

"Coupled with this is the fact that we are likely to experience further collection rate drops during the months of May and June. This should be a cause for significant concern, and we need to be proactive in managing this unfolding financial crisis.

"What is extremely concerning, however, is the lack of engagement from the administration over what steps are being put in place, if any, to deal with this crisis."

Bhanga said that the City’s administration speaks of Covid-19 relief measures, but council has received no concrete advice from the municipality’s budget and treasury directorate on the financial impact to date of the Covid-19 lockdown on the Metro.

He said that he has since written to the Acting Executive Mayor, Cllr Tshonono Buyeye, requesting that he schedules an urgent briefing session with the Chief Financial Officer and all party political leaders to discuss, amongst others:

• The current state of the fiscus as well as revenue projections for the remainder of the financial year;
• Covid-19 relief measures for residents that could be costed and implemented immediately;
• Grant funding and total capital budget spending in the administration to date;
• The amended process plan with regards to the tabling and adoption of the 2020/21 IDP AND MTREF;
• Details as to public participation processes to be followed in respect of the 2020/21 IDP and MTREF.

"We can no longer stand idly by and watch Nelson Mandela Bay hurtle toward financial ruin," Bhanga said.

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