Crisis, What Crisis?

Crisis, What Crisis?

Private Property South Africa
Lea Jacobs

Although authorities have consistently denied that there is a billing crisis, thousands of homeowners across the metropolis would beg to differ. Electricity accounts for tens of thousands of Rands and water bills that are off the chart have become a fact of life for many and that doesn’t appear to be the only bad news, to make matter worse the City of Johannesburg appears to have adopted a ‘cut off first and correct later’ policy.

Under normal circumstances, homeowners pay their accounts and receive basic services. If they receive an obviously inflated bill, they contact the authorities who realise that the amount charged is grossly exaggerated and either charge an estimated fee or send someone out to double check the meter readings. Unfortunately, this does not seem to be happening in Johannesburg. It appears consumers have nowhere to turn and either have to pay up or suffer the consequences, leaving them feeling that no one is listening and even if someone is, they are not doing very much about it.

Although reluctant to admit to the obvious despite a number of damning reports, the City of Johannesburg has conceded that there are some residents who have been incorrectly charged. The bad news is that in January this year, the former mayor of Johannesburg, Amos Masondo stated that ‘in two years’ time, many of the problems we are talking about will be a thing of the past.’ In anyone’s book two years is a very long time to wait and you have to wonder how affected residents are going to cope with what appears to be a growing problem over this extended period.

These problems appear to be a direct result of Project Phakama, an IT system that was designed to improve the city’s billing system. Launched in 2010, the system was initially piloted in the northern suburbs and by the looks of things, started to go horrendously wrong right from the start. Developed as a one stop invoicing system, it supposedly allowed for all accounts to be centralised on one billing database. On the face of it, the system should have worked, and worked well. However, the problem it seems lies not so much with the programme itself, but more with the lack of training provided for those who use it. It has been estimated that somewhere in the region of 41 000 households have had their basic services suspended, often after receiving bills that were so ludicrously high that the owners were unable to make the payments.

One would expect that given the enormity of the problem and the obvious fallout of having a large number of people who, with the best will in the world, cannot meet the demands of the municipality, would have driven someone, somewhere to act. However, by all accounts although the powers that be acknowledge that some homeowners are experiencing problems, the bungling continues.

While it may be a frustrating issue for the homeowners themselves, the situation must be devastating for those who have sold their properties. Throughout South Africa a rates clearance certificate must be supplied to the Deeds Office before transfer can take place.

Given that sellers have to supply a rates clearance certificate before the transfer of a property can take place, begs the question, what happens when the amounts owing, not only don’t offer a true reflection of what is actually owed, the amounts are often so exorbitant that it would be impossible for the average homeowner to settle.

It is not only residents who are regarded as the losers in a situation such as this. The authorities themselves are taking a hammering. In a recent report, factors such as the electricity and water billing crisis are having a negative impact in the way that residents view service delivery. The municipality’s 2011 Customer Satisfaction Survey indicates that the number of Johannesburg residents who are satisfied with service delivery is on the decline and has been since 2009. The latest results show that the number of satisfied consumers has dropped from 65 percent in 2010 to 64 percent this year further dropping from the 68 percent of happy customers in 2009.


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