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Makana Revenue and Debt Collection meeting

Report on meeting hosted by GRA on 1 November 2016, Grahamstown Bowling Club

Philip Machanick, GRA chair (left) with Sheldon Godall (Revco)

Philip Machanick, GRA chair (left) with Sheldon Godall, Revco

The amount of outstanding uncollected debt in Makana is not as discouraging as many of us might believe. And the prospects for increased revenues are improving, according to the company responsible for collecting on unpaid bills.

Revenue Consulting (Revco) CEO, Sheldon Goodall, revealed the good news to a meeting of about 35 people organised by the Grahamstown Residents Association (GRA) on Tuesday evening.

Most participants came to the meeting to get a better understanding of their Makana utility bills and how best to correct mistakes in their bills. Almost all residents had a horror story about being grossly overcharged or having wildly fluctuating charges. However, GRA chair, Philip Machanick made it clear that Goodall had not come to resolve individual queries, but rather to explain how his company intended improving debt collection in the municipality.

Sensing that the atmosphere might become a little hostile, Machanick appealed to residents to keep questions civil.

Goodall explained that Revco only collected outstanding debts that were handed over to the company by Makana municipality. In other words, Revco would not arbitrarily demand payment from anyone without good reason. He stressed that his company complied strictly with all relevant laws and regulations, but that if anyone was unhappy with the way it conducted business, he was always open to discussions.

The Revco CEO said that there are many reasons why people don’t or can’t pay their bills. However, whatever the reason, it is important to engage with the debt collector to resolve any disputes or problems. He encouraged people to take heed if they receive a warning letter or SMS. Instead of ignoring the warning they should rather open a formal complaint so that disputes could be resolved.

Goodall made it clear that legal action was only an option of last resort because it was expensive and not very helpful. He said he preferred to consult with customers so that they could work out a payment plan with the municipality and that in 99 percent of such cases they are able to reach a workable solution.

One of the biggest problems facing Makana residents is the unpredictability of charges for electricity and water. Municipal bills tend to rise and fall considerably making it difficult for households to budget from one month to the next and keep up with payments.

Some variation is to be expected as households tend to use more electricity for heating in the winter and more water for watering gardens in the summer.

Goodall addressed concerns about huge outstanding debts that the municipality has not been able to collect in recent years. It has not written off bad debt even though it is normal practice is to cancel irrecoverable debt after a certain period. This decision created a false impression that the money would come in and placed an unrealistic strain on the municipal budgeting process. Retaining bad debt on its books implied that the outstanding debt would be recovered, whereas in fact a significant proportion will never be collected.

The number of households belonging to deceased estates was another headache for the municipality. There are more than 3 600 such households that in many cases receive municipal services that they do not pay for. It is difficult for the municipality to recover outstanding amounts because it has no contractual agreement with the current residents of the house.

Everyone at the meeting agreed that one of the hardest working people at the municipality is Diane May, the acting revenue manager who spends many hours every day resolving account queries brought into her office. Some residents believe May needs more people to help in her office.

Goodall said that residents are welcome to contact him or his company about any queries regarding debt collection. His contact details are:

Revco has provided a copy of the slides of their presentation, which you can download here (PDF).

– report by Steven Lang

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