Interbank rate throws HCC off rails

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Harare City Council

THE interbank rate has drastically affected Harare City Council (HCC) operations as it hinders financial growth.

Addressing the media Friday morning, Information and Publicity Committee chairperson, Councilor Barnabas Ndira said council revenues continued to decline as prices of goods and services went up.

“Our service providers are pegging their prices based on the interbank exchange rate while our rates, which are our biggest revenue source, remain unchanged because they are subject to ministerial approval,” Ndira said.

HCC’s water treatment bill has hit ZWL 35 million, while monthly-expected collections stand at about ZWL24 million.

Ndira also stated that expenditure had overshot collections in one service delivery mandate-water because the suppliers of treatment chemicals were indexing the prices against the interbank rate.

“Monthly, council requires ZWL 8 million for fuel and ZWL 12 million for salaries, among other costs. The budget we are using was pegged at a time when the bond note was pegged 1:1 with the United States dollar, but now the interbank rate of 1:17 has rendered useless all council efforts,” he said.

HCC is implementing a number of strategies to boost revenue collection and eliminate space barons, especially in the markets sector and computerising revenue collection systems to curb leakages.

Government has availed ZWL 37.4 million to HCC, including a disclosed amount of foreign currency to mitigate water problems in Harare.

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