Page 8 - KZN Business Sense 7.2 - eBook

REVENUE ENHANCEMENT STRATEGY:

THE POST PANDEMIC SOLUTION

Sikelelwa Foslara, Senior Manager: external service providers, but not become dire, in such a way
Revenue Management at Bonakude this is not readily recommended that the municipalities are not
by CIGFARO. It is advisable able to function, municipalities
that the municipalities should should look at an inclusive
he objective of any revenue enhancement strategy
successful revenue deal with their credit control that will assist municipalities with
Tenhancement strategy is and debt collection processes the following:
to retain customer-centricity
to build and improve on current
payment levels and then to recover and only outsource the final 1. Cleaning of the customer
arrear debt. Covid-19 exposed a lot debt collection procedures when database that will ensure that:
debt has to be handed over for
of loopholes in local government ■ Only customers that exist and
revenue management and within legal collection procedures to are receiving municipal services
a few weeks of the pandemic, take place. The main reason for are billed.
one could already start to see the municipalities to manage the ■ All customers within the
potential impact on cashflow and collection of revenue through municipality’s jurisdiction that
how the crisis would impact long- the municipal administration is are receiving municipal services
term sustainability. to encourage municipalities to and own properties are billed
apply legislation to their benefit
Revenue management is an during the collection processes. monthly (completeness) and
integral part of any business The municipal disaster ■ These customers are billed for
that strives to succeed, this also recovery plan should provide actual consumption (accuracy).
includes municipalities. With for channels of payment in This will be done through
the pressures that Covid--19 times of disaster and the related auditing of meters.
has put on the national fiscal, reconciliation of receipts. 2. The Indigent Management
it is even more crucial that System should assist the
municipalities should be self- We note that in the past many municipalities to improve
sufficient as they can no longer be municipalities had received their indigent management
solely dependent on the National negative audit outcomes from through: Sikelelwa Foslara, Senior Manager: Revenue Management at Bonakude.
Treasury for funding. In order, the Auditor-General South ■ Verifying the indigent register
for municipalities to be able to Africa due to challenges that the audit findings from the Auditor In conclusion, the municipalities
deliver on their service delivery municipalities were experiencing ■ Verifying validity of indigency General, but it will assist the
mandate, it is prudent that with their revenue management. status of applicants from Home municipalities with increasing can no longer focus on just
Affairs, Social Development and
collecting revenue from the
municipalities must be able to This was accompanied by Credit Bureau their internally generated revenue
generate their own revenue. service delivery protests where that will in turn make sure that service charges, in this new
communities complained that the ■ Ensuring that municipal normal but they need to rethink
In April 2020, the Chartered municipalities were not being able indigent registers are complete municipalities are able to provide and find ways to increase their
Institute of Goverment Finance to provide basic services. services to their communities as current revenue base, as they can
Audit and Risk Officers The revenue enhancement mandate by the Constitution. no longer depend on government
(CIGFARO) made the following The national lockdown strategy should not only focus grants and subsidies to supplement
comment, “Each municipality exposed the worsened situation on data cleansing to ensure It will not be enough for their own revenue. 
must have its financial system, of the municipalities where complete and accurate billing, municipalities in this new
which is the backbone and many could not: improved credit control and normal to only recover revenues For more information, contact:
driver to manage the raising ■ Charge interest on long debt management and improved as the crisis subsides. We have T:+27 31 201 1241
of revenue and the related outstanding debt, and indigent management but it entered an era where the world E: sikelelwa@bonakude.co.za
collections.” Municipal revenue ■ Apply their credit control should assist with revenue is in need to fundamentally W: www.bonakude.co.za
collections are usually done processes to enforce payments solutions. The revenue solutions rethink their revenue profile, in
internally by the municipality. of their accounts as the entire should assist the municipalities order to position themselves for
In exceptional cases, we have economy was at a standstill to identify new revenue the long term sustainability and
noted that the collection streams. This will not only assist to ensure the municipality is a
of revenue is done through To ensure that the situation does municipalities in reducing the going concern.

SIHLE ZIKALALA DEVELOPMENT TRUST LAUNCHED

waZulu-Natal Premier needed assistance to the indigent ■ Round table discussions
Sihle Zikalala launched the and underprivileged through ■ Community meetings
KSihle Zikalala Development various interventions that ■ Presentations to government
Trust on April 1 at the Coastlands include but are not limited to departments and committees
Hotel in uMhlanga. Through this poverty alleviation, anti-social ■ Scholarships and Bursary
development trust, which is private ills programme, anti-women and programmes
initiative, Zikalala aims to bring children abuse and educational
about long-term social, economic programmes. Infrastructure Development
and environmental benefits within All efforts and work of the Trust For the meaningful fulfilment
the province. is a display of commitment to of these objectives, the Trust has
Premier Zikalala saw the need transformation of society and to support the various projects
and programmes both from a
to initiate the trust to create a just socio-economic development, financial and non-financial point
society underpinned by strong which can be achieved in part but of view through the availability
ethics, social cohesion, democracy not limited through the following: and mobilisation of corporate
and socio-economic development. ■ Sectoral engagements e.g. taxi social investment funding. The
industry
The Trust does not seek to replace ■ Communication programmes Trust intends to partner with
any of the exiting initiatives and ■ Summits strategic organisations in bringing
processes that are underway ■ Dialogues about these human-centred
within the province to achieve ■ Workshops initiatives with an aim to empower
these goals. communities and to ensure the
■ Izimbizo sustainability of the various
Working with strategic partners, ■ Walk-abouts including door to projects and programmes. 
the Sihle Zikalala Development door visits
Trust will bring about much- ■ Public lectures For more information www.szdt.co.za

8