Makana Mayor Zamuxolo Peter has rubbished recent claims by the Daily Dispatch suggesting that Rhodes University bailed out the municipality so it could pay employees.
Makana Mayor Zamuxolo Peter has rubbished recent claims by the Daily Dispatch suggesting that Rhodes University bailed out the municipality so it could pay employees.
This came as the city's biggest worker union announced that it had joined forces with officials to investigate the current cash-flow crisis.
Speaking to Grocott's Mail this afternoon Tuesday 29 October, the mayor explained that like several other Grahamstown institutions, the University owed the municipality rates.
There had been no coming-to-the rescue, he said.
"Rhodes like other people who owe us, was paying their outstanding debt. It was just fortunate that they paid that day," said Peter.
He said Rhodes had owed Makana Municipality R8 million in rates. He said the University had signed an agreement with Makana's finance department to settle their debt.
"We engage with everyone who owes us – even businesses in Grahamstown," Peter said.
"Rhodes is not a bank or a loan shark to say that they gave us an advance. It's what they owe us anyway as the municipality.
"We are grateful to them for paying [but]that is what we expect from all our creditors," the Mayor said.
He expressed regret about the late payment of workers' salaries.
Leader of the South African Municipal Workers Union in Makana, Luyolo Nogxabela, told Grocott's Mail the union had met with city management and had been briefed about the financial crisis.
"We formed a committee consisting of the leadership of Makana and both unions to investigate what is happening with the finances. We will get a detailed report from that committee on 15 November," he said.
Rhodes University spokesperson Zamuxolo Matiwane, confirmed the Mayor's version of the University's role. This afternoon he told Grocott's Mail, "It was not a bail-out. It was just an advance payment." He referred Grocott's Mail to a statement made by the university, which you can download below.
You can download the University's statement about their payment, issued yesterday (Monday 28 October) by Executive Director: Infrastructure, Operations & Finance Dr Iain L’Ange by clicking the link below.
UPDATE: While both the Mayor and Matiwane denied that the University's payment to the municipality constituted a 'bail-out', Grocott's Mail did not intend to imply that Matiwane agreed with the Mayor's assertion that the University's payment on Friday was the settling of an outstanding debt. He was simply stressing the fact that it was an advance payment for anticipated municipal services.
