CREDIT CONTROL PHILILE MADONSELA

Transcription

1 PHILILE MADONSELA CREDIT CONTROL CREDIT CONTROL PRESENTATION MILE SEMINAR

2 LEGISLATION (MSA) Debt collection responsibility of municipalities Section 96. A municipality (a) must collect all money that is due and payable to it, subject to this Act and any other applicable legislation; and (b) for this purpose, must adopt, maintain and implement a credit control and debt collection policy which is consistent with its rates and tariff policies and complies with the provisions of this Act.

3 LEGISLATION (CONTD) Sec 118. (1) A registrar of deeds or other registration officer of immovable property may not register the transfer of property except on production to that registration officer of a prescribed certificate (a) issued by the municipality in which that property is situated; and (b) which certifies that all amounts due in connection with that property for municipal service fees, surcharges on fees, property rates and other municipal taxes, levies and duties during the two years preceding the date of application for the certificate have been fully paid.

4 WORKFLOW Sale Customer Register First Bill Sent 30 Days Judgement Issue Summons Revenue Workflow Second Bill with disconnection notice 10 Days 30/60 Days Disconnection Of Services Hand Over to S.I.E. 20 Days Letter of Intention to Redline Final Demand Redline

5 PROCESS OF DEBT COLLECTION The first consolidated bill is sent. If no payment made the following steps follow: Second bill with a disconnection notice is sent. Disconnection of services A notice to redline is sent. A customer is redlined with Credit Bureau. A final demand is sent. Sale in Execution process starts afterwards.

6 CATEGORIES OF PROPERTIES CATEGORY OF PROPERTY % DEBT O/S RESIDENTIAL 40.60% AGRICULTURAL 0.38% VACANT LAND 24.01% INDUSTRIAL 14.24% BUSINESS & COMMERCIAL 18.43% PUBLIC SERVICE INFRASTRUCTURE 1.48% OTHER 0.85%

7 COLLECTION RATES COLLECTION RATES 2013/14 YTD MAY 2013 Normal Electricity 5,209,871, ,752,232, % Bulk Electricity 3,829,569, ,032,719, % TOTAL ELECTRICITY 9,039,441, ,784,951, % Rates 4,566,503, ,504,601, % Water 3,173,306, ,390,410, % Refuse 362,813, ,835, % GRAND TOTAL 17,142,064, ,068,799, %

8 CHALLENGES GOVERNMENT DEPARTMENTS * Delays in payment * Request for reversal of interest * Schools not paying for services

9 CHALLENGES contd Inadequate (Electricity and Water) staff for disconnection of services for non-payment and for Credit Control follow up. Customers tampering with meters resulting in loss of income. Data cleansing Deceased Estates and Liquidated Estates

10 CHALLENGES contd OTHER Our computer system is outdated hence management information not readily available accounts are printed per month hence everything must be done electronically. Cumbersome Sale in Execution process. Each case must be pursued individually. Courts cannot cope with the volumes. If matter is opposed delays can be up to 4 5 years.

11 INITIATIVES ARREST A DEBT This is an automated process of sending redline letters, redlining customers and final demands for all accounts that fall into arrears. This is to get the customers to pay whilst the debt is still affordable. CONSOLIDATION OF ACCOUNTS This process is ongoing where separate accounts belonging to one property are consolidated for effective credit control.

12 INITIATIVES contd MAJOR DEBTORS TEAM Major debtors are generally customers with 50 or more accounts eg. Transnet. These are companies that are willing and able to pay for services and rates but outstanding as a result of unresolved queries. There is a team dedicated to these customers.

13 INITIATIVES contd TOP DEBTS TEAM This team is totally dedicated to high value, generally single debtors. Started at debt above R1m and working down from these. GOVERNMENT TEAM There is also a team working with Government departments to resolve outstanding issues and ensure payment of those accounts.

14 INITIATIVES contd SALE IN EXECUTION There is a sale in execution dept that deal with matters handed over to outside attorneys. They take matters to sale stage.

15 INITIATIVES contd DECEASED AND LIQUIDATED MATTERS Deceased matters were handed over to an external legal company that specialises in deceased matters. SECTION 105 PROCEDURE This procedure will allow the Municipality to take all outstanding matters to Court simultaneously. The Municipality used to heavily rely on Durban Extended Powers which was repealed by MPRA.

16 INITIATIVES contd RMS SYSTEM DATA CLEANSING CONSENT TO JUDGEMENT OWNERS ONLY REGISTRATION SMS PROJECT

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19 THANK YOU