November 21, 2017

Two years later, Rustenburg still feeling effects of strike

Two years since the end of what has been recorded as the longest strike in the history of mining in South Africa, the mining town of Rustenburg is yet to recover.

The town’s executive mayor, Mpho Khonou, observed, as he was tabling the 2016/17 budget: “Prior to the protracted strike, Rustenburg had the third fastest growing economy out of eight metropolitans in South Africa and in 2012 contributed 4.9% of the South African GDP [Gross domestic product].”

Khonou revealed that during the 2012 and 2014 strikes in the platinum sector, the municipality reported a deficit of R423-million when most of the businesses were struggling financially. “The payment ration has been under tremendous pressure from about 2012 when the mines started with retrenchments. The increase in provision for bad debts in 2013/14 due to the prolonged strike reduced the net debtors from R687-million in 2012/13 to R316-million. The non-payment of services for the five months starting at the end of 2013 meant that bad debt provision had to be increased.”

The accounting deficit and cash operating deficit reflected consumers inability to pay for services in 2014, lamented Khonou. “The municipality had to pay for bulk electricity from Eskom and bulk water with minimal payment from residents for at least five months. This impact was felt further in 2015 and beyond as consumers had to make arrangements to start servicing their debt. The revenue for electricity sales had declined by R164-million during the strike.”

Related posts

Leave a Reply

Your email address will not be published. Required fields are marked *

Time limit is exhausted. Please reload the CAPTCHA.