City faces ‘collapse’ over ECB directive
Already owed close to a billion dollars by its residents, the country's biggest municipality says the future looks dark if the courts do not come to its aid.
The City of Windhoek has warned it could collapse if a court does not overturn the national electricity regulator’s decision to ban local authorities from blocking prepaid electricity meters to recover arrears on other outstanding municipal service accounts.In court papers filed in the High Court recently, Windhoek municipality CEO Moses Matyayi said that if the decision is upheld, the country’s administrative hub will collapse because “the blocking of prepaid meters and suspension of the supply of electricity in respect of customers who fail to pay their municipal accounts is one of the City of Windhoek's most effective debt collection methods”.
The municipality’s decision to take the regulator to court was prompted by the Electricity Control Board’s (ECB) directive – issued in June – ordering regional councils and local authorities to cease the practice of blocking prepaid electricity meters to recover arrears on other municipal services, such as rates and taxes, as well as water supply, among others, urging local authorities to explore alternative debt recovery methods that comply with the relevant legislation.
In a media statement issued on Friday, the ECB announced that it will, for now, not investigate complaints regarding the blocking of prepaid electricity meters by local authorities due to arrears on other municipal accounts, pending the outcome of legal proceedings.
Until then, the regulator also indicated that it is restricted from taking any action against licensees who block prepaid electricity meters for unpaid bills on other municipal services.
Millions in arrears
The municipality has accused the regulator of deciding without any consultations whatsoever. It noted that 58 000 of the 69 668 households in the municipality’s jurisdiction use prepaid electricity meters.
The directive, according to the municipality, comes at a time when residents in the capital owe the municipality over N$930 million in unpaid municipal services.
The municipality also lamented that most of its efforts to recover debts have been met with resistance.
As such, without the ability to suspend the supply of electricity, the municipality will not be able to ensure payment of the overall municipal services from households.
According to Matyayi, ECB allegedly received a complaint from a disgruntled resident whose electricity was disconnected, after which the regulator moved to issue the directive without consulting the municipality.
Mediator's role
In the legal documents, Matyayi argued that the ECB is empowered to act as a mediator, at the request of any interested party, for settling disputes between licensees and their customers when it comes to the refusal to supply electricity.
“The power to act as mediator does not entitle the ECB to issue rulings or directives in respect of such complaints. A mediator does not have any decision-making powers. A mediator’s role is to assist parties involved in a dispute to agree on how to settle their dispute,” he noted.
Matyayi added that the ECB lacks adjudicative powers regarding disputes or issuing directives, adding that the regulator is only responsible for making rules or codes.
He noted that, while residents find ways to access water when their supply is suspended, accessing electricity is more challenging. Alternative methods are unsafe because they involve bypassing legal connections.
“This is another reason why suspending the supply of water is not an efficient debt collection method,” he said, adding that all residents consent to the blocking of their prepaid meters as a condition for the supply of electricity and provision of other services when they apply for or take over an account for municipal services.
Matyayi added: “Even though customers with prepaid meters pay for the electricity they purchase, the cost of maintaining the infrastructure to ensure long-term sustainable provision of electricity and further development and expansion is not fully covered by the income the City of Windhoek makes from selling electricity and is thus also covered by rates and taxes and other fees charged by the CoW.”
Although it is yet to respond to the claims of the City, ECB’s legal team gave notice that the regulator will oppose the court applications brought by the municipality.