Update

GEORGE NEWS - The Good Party has questioned a proposal to write off almost R10.8 million in municipal costs linked to the Neo Victoria building collapse, saying George ratepayers should not have to carry the financial burden.

George Herald previously reported that a decision by the George Municipal Council on whether to write off the money spent on clearing and rehabilitating the site had been postponed. 

A recommendation for writing off the debt by the Finance Committee had been tabled to Council at a special meeting on Tuesday 23 June, however the item had been withdrawn.

In a subsequent media statement, Good’s Councillor Chantelle Kyd said residents deserved answers before any decision was taken and they have the right to ask why they should pay for a tragedy they did not cause.

Kyd argued that ordinary residents could not simply write off their municipal accounts without consequences. 

“If they fail to pay, the municipality acts swiftly to recover the money. Ratepayers are entitled to expect the same determination when millions of rands of public funds are at stake.”

She asked whether every legal avenue to recover the money had been exhausted, whether council had received all the legal advice needed to justify such a decision, whether the municipality had done everything within its powers to protect ratepayers and why residents should be expected to foot the bill.

In response to questions from the George Herald, the municipality confirmed that a report on the matter had been prepared for council but was later withdrawn from the agenda.

“To date, no decision has been taken by Council. Accordingly, the matter remains under consideration, and any future recommendations or decisions will follow the municipality’s normal governance and Council processes.”

The municipality explained that the expenditure resulted from its statutory disaster response after the Neo Victoria building collapse. It said the operation was aimed at protecting lives, securing the site and supporting the rescue and recovery effort.

It said 34 people were rescued alive from the collapsed building, while recovery operations continued until all 62 people who had been on site had been accounted for.

On the question of recovering the money, the municipality said it had sought legal advice after Neo Victoria Developments (Pty) Ltd was placed in liquidation. “Based on that advice, it was determined that the municipality would rank as a concurrent creditor, while the bonded financial institution is the preferred creditor and its claim exceeds the value of the property.”

The municipality said pursuing further legal action against a company already in liquidation would have “no reasonable prospect of recovery” and could amount to fruitless and wasteful expenditure. Because council had not yet considered the matter, it could not comment further on possible recovery processes, legal matters or future recommendations.

The municipality said it remained committed to “sound governance, transparency and accountability” and that any future decision would be made in accordance with the Municipal Finance Management Act, Generally Recognised Accounting Practice and other applicable legislation.

It also said it would continue to participate in any relevant legal or liquidation-related processes where necessary, but would “not engage in political debate through the media”.

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