Walvis clarifies debt erasure criteria

Earlier this year, the municipal council granted approval for the cancellation of outstanding interest amounts for improved residential properties and water debts for all pensioners who are registered in the municipal database for such purposes, for all outstanding debts up to the end of February 2022.

According to Richard Hoaeb, the council management committee chairperson, in April it was decided that an estimated N$54 million, representing the outstanding interest on improved residential properties, and around N$6.7 million, representing the outstanding pensioner debts as of 28 February, be written off.

"The total amount of debt to be written off represents 17% of the total outstanding debt. In terms of the debt written off on improved residential properties thus far is N$49 million. Additional pensioners’ debt added since the resolution stood at N$10.2 million, with the total written off at N$16.2 million."

Adjustments

Hoaeb explained that the remaining balances of N$5 million and N$700 000 of interest on improved residential properties and pensioners respectively, won't be cancelled.

"Quite a number of transactions took place since the date of the resolution and the date of the physical write-off and, as a result of that, a number of accounts which were active and included in the initial figures as per the resolution of 6 April 2022 became inactive due to sales, settlements, water leak credits given, levy adjustments etc," he explained.

He added that "process to write off debt as per the resolution was concluded by system experts/owners in South Africa and they made use of codes per service type to execute the exercise. They will then forward the list of written off debt for our verification."

The councillor added that "human errors, like double write-offs, were also detected and the same were equally alerted and corrected."

Clarifications

Among the challenges encountered were those related to rates and taxes that do not qualify for cancellation.

Referring to the local authority act, Hoaeb said it stipulates "one will be exempted from paying rates and taxes only once you fall into those categories mentioned under this act and once you have applied for such exemption. Writing off rates and taxes will then have the equivalent impact on the final balance as exemptions if written off, hence no action on it in terms of write-offs."

He added that "due to the fact that the home loan accounts in place are subsidised, no action in terms of write-offs was executed."

He added that the council forwarded a letter to the line ministry in relation to rates and taxes and home loan instalments, but, "seeing that there are no clear directives from the line ministry, writing-off on them was put on hold."

Discontented

Another challenge relates to unimproved residential properties, "which are not in arrears and did not benefit from this incentive. The reply from the administration on this was always referring to the resolution."

In addition, there were grumblings about the wording of the April resolution.

"Two customers, one of whom went up to the level of contacting her lawyer, felt that all her properties, including the vacant plot, should be written off. The very customer was explained the same and her lawyer was replied to as to the council's intention, which is one developed and registered property per pensioner, where the monthly discount is applicable on services provided."

Unclear rules

Hoaeb said the vagueness of the resolution has been acknowledged.

"The intention of the council was that one improved residential property per customer, which is registered for a monthly discount on service accounts. Rates and taxes, as well as home loan instalments and loan accounts, are not to be written off until clarity is obtained. No writing off is applicable on unimproved residential properties."

"The intention of the council was that one improved residential property per customer, which is registered for a monthly discount on service accounts. Rates and taxes, as well as home loan instalments and loan accounts, are not to be written off until clarity is obtained. No writing off is applicable on unimproved residential properties."