DURBAN - AS THE eThekwini Municipality counts the costs of last week’s unrest with billions of rand in lost revenue, looted goods and damaged property, authorities are seeking to declare the city a disaster area.
In a move aimed at unlocking urgent financial bailouts and enabling budget adjustments, the city’s multi-party executive committee (exco) resolved to apply to the national government for the municipality to be declared a disaster area in terms of sections 23, 41 and 55 of the Disaster Management Act 57 of 2002.
A preliminary report presented to the committee yesterday shows that in the first four days since the outbreak of violence, the city lost at least R1 billion in respect of looted stock and there was damaged property and equipment estimated at R15bn.
While about 55 000 informal traders have been out of business, more than half of the 40 000 affected formal businesses are in a state of permanent closure, with at least 150 000 jobs at risk.
The total impact on the loss of the Growth Domestic Product to the municipal region will be over R20bn, including lost production, according to the report.
Acting city manager Musa Mbhele warned that the figures, estimated on the first four days after the unrest erupted, were expected “to triple” at the final analysis. As the city failed to generate or calculate due revenue, the cost in lost revenue is sitting at R50 million.
As part of a recovery plan, which has been developed so that it benefits the city and its customers, a rates rebate programme has been put in place, giving an option to property owners to either apply for revaluation of properties or seek a special rates rebate.
“This relates to businesses that can no longer operate due to the damage to their property. There are two options, namely, to use section 78 of the Municipal Property Rates Act to allow business property owners to apply for a supplementary valuation of the property. The second option is the use of section 14 of the (city’s) Rates Policy to implement a special rates rebate based on this being a disaster,” the report states.
“In terms of section 78, the property will be revalued by the Real Estate (service department) while in terms of section 14 of the policy, the owner will be entitled to a property rates rebate of 75% for six months. However, if the repairs of the building are not yet completed, the rebates can be extended for a further six months,” said Mbhele, adding that only one option per owner would be considered.
“Based on the figures from the Economic Development cluster that about R15bn worth of land and buildings were damaged, the estimated income loss will be around R300m. As regards businesses where the buildings are damaged, but where the business is still operating, further analysis is being done to determine how assistance could be provided.”
Once the city is declared a disaster zone, a special budget adjustment and staging of the budget (freezing on certain programmes to provide for emergency costs) would be applied.
The disaster declaration would also allow for additional grant funding from other spheres of government, including the departments of National Treasury, Trade, Industry and Competition and Small Business Development.
THE MERCURY