Last week the municipality decided to reconsider the 80/20 credit control policy for outstanding debt and possibly change the split to 60/40 instead.
This follows the East London high court’s decision to postpone Niehaus McMahon Attorney’s application to have the policy reviewed on behalf of 50 ratepayers in East London.
Since March, consumers have been experiencing deductions of 80% from their electricity purchases due to outstanding debts with the municipality.
Mayoral committee member for finance services, Noma-Afrika Maxongo said that given the response from the public and mounting legal pressure, the municipality has realised that 80/20 may have been too steep for consumers to pay.
Maxongo said this did not negate the importance of the municipality’s responsibility to collect revenue.
Councillor Geoff Walton said that this outcome must not be viewed as the end of the electricity blocks but rather as a revision of how its implementation can be better managed.
Walton said, from the beginning, council believed the policy would be met with backlash because of its severity and would not recoup the funds it envisioned because consumers would opt to sit in the dark, given that many do not have extra funds to recover electricity units deducted.
Walton said consumers could anticipate the 60/40 deductions to take place before the end of the year.
He said: “Because the changes are substantial in nature, the draft bylaw will again have to be considered by council and consulted with the public. That alone will take at least two months.
“But it is possible to promulgate by year end if the matter is expedited.
“The municipality has learned that there must be improved consultation and communication with the public, before doing anything which affects the public.
“The municipality cannot now simply change the draft bylaw and promulgate it, without going back to the public and asking for their input.
“We trust that will happen. If not, then we have learned nothing. We must consult, not simply impose or inform.”
Attorney for the ratepayers, Brandon Blignaut, said that since the municipality announced its decision to review the 80/20 policy the 50 ratepayers had been receiving their full units of electricity and were happy with the outcome.
He said: “We have been saying from the beginning that 60/40 split, promulgated into a bylaw is a more equitable split.
“The municipality has decided to send it back to council and this confirms they agree that the policy had no enforcement behind it because it was not a bylaw.”
He said, without serious intervention, the municipality would experience more legal action from ratepayers relating to inaccurate smart meter water readings. Maxongo said the municipality was working on means to identify leaks faster, separate water bills from other services statements and review debt-incentive schemes.
Walton agreed with Blignaut and said there remained serious challenges with water billing and that inaccuracies in this regard were at the root of the 80/20 policy disputes.
“We do not believe the municipality has an accurate assessment of how many billing errors there are.
“We are aware that staff are working on the cases they have on record, but assessing accounts for errors is time consuming and we do not see all cases being resolved by year end.
“The idea is to have two separate bills, one for water, which is the main source of queries, and a bill for other services, is a short-term measure proposed to deal with the immediate problem and obtain full payment for the other services.
“But that must not divert attention from the real problem of managing the water billing.
“While many of the smart water meters operate correctly many consider the meters not so smart.
“The municipality needs to assess carefully exactly what the nature and causes of the water billing errors are, and deal with those matters.
“If that is not done, the errors will simply repeat again and again.”