BY NGUMBAO KITHI
The Mombasa Municipal Council is sinking in debts. While unveiling the council’s budget statement for the 2012/2013 financial year at the Town Hall, the Chairman of the Finance Committee, Mr Mohamed Hatimy revealed Thursday that the council has an outstanding debt of Sh2 billion.
He said the council plans to spend Sh1.37 billion to pay 2,550 employees and 44 councillors, an increment of Sh6 million. The estimates show that Sh580 million will be for maintaining assets, and Sh667 million for daily operations despite a projected deficit of Sh441 million.
To make matters worse, Mombasa’s revenue collection is projected to be Sh3.2 billion but its expenditure will be Sh3.6 billion meaning the local authority will spend more than it can afford, but has no plans to reduce the stupendous wage bill.
Because of failure to meet its revenue collection targets, officials say they will raise land and property rates to fill the deficit. It is also placing hopes in winning court awards to redeem outstanding debts and also waiting to receive proceeds from major creditors like Kenya Power.
“The city intends to finance the deficit after the implementation of both the reviewed valuation roll and the fees and charges, which is expected to be finalised within the next financial year,” said Hatimy.
He said the council was expected to charge the Kenya Power on the electricity poles erected in Mombasa to distribute electricity.