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Councils, utilities face the music

IN the run up to the July 31 elections, President Robert Mugabe went for broke and even employed populist policies to win polls.


He ordered the scrapping of rates bills in a bid to pull voters but his tactics could have devastating consequences for local authorities and utilities.

Already reeling from unsustainable wage bills and debt burdens, councils and Zesa, for example, could further sink into trouble in the long run due to Zanu PF’s demagoguery, often based on populist nationalism and a dubious redistributive socialist agenda.

The term populist is generally used to describe politicians who use rhetoric to aggressively defend “the people’s interests” against the privileged elite even though they usually do this to win votes. Some analysts, however, say this is a one-dimensional definition.

As Jan-Werner Mueller, who teaches politics at Princeton University in the United States and writes for the UK Guardian, says the word is ubiquitous in contemporary political analysis, although most observers would be hard pressed to define “where exactly legitimate democratic politics stops and pernicious populism begins”.

“Consequently, the charge ‘populism’ is routinely dismissed by populists themselves as the last resort of discredited elites who don’t like the outcome of a referendum or an election,” Mueller says.

Mueller says just as technocrats assume that there is only one right solution to every policy challenge –– hence political debate is not necessary –– so, for populists, the people have one, and only one, uncorrupted will. Liberal democracy assumes just the opposite: space for different perspectives ––and for political alternatives.

So, perhaps as crude populists, Mugabe and Zanu PF leaders have strictly been acting more like demagogues –– rabble-rousers who appeal to the emotions, prejudices, and even ignorance of the less-educated citizens to win elections and maintain power.

For they usually oppose deliberation and advocate immediate, sometimes violent action to address problems. In the process, they accuse moderate and thoughtful opponents of being apologetic and weak.

However, typical of populist parties as generally understood the world over, Zanu PF claimed by proposing to scrap outstanding bills, it was merely identifying with and feeling for the people who were at the mercy of corrupt and incompetent MDC-run local authorities and utilities.

While the ordinary people are happy about debt revocations, the question remains how sustainable would this be?

During election campaigns when Mugabe directed the 92 councils to write-off bills amounting to US$2 billion, he was mum over how the cash-strapped government would bail out the struggling local authorities and utilities after the polls.

After implementing Local Government minister Ignatius Chombo’s directive, Harare among other local authorities lost over US$166 million, followed by Bulawayo US$46 million, Masvingo US$6,7 million and Masvingo Rural District Council US$4,8 million.

The impact of the debt eliminations is beginning to show as it emerged this week Gwanda was yet to pay August salaries, while Mutare also faces a workers’ revolt due to late payment of salaries.
Councillors say Harare is likely to struggle even to raise US$3 million to purchase water chemicals monthly, among other requirements.

While local authorities are battling to pay workers, ratepayers may begin to suffer more and complain about worsening poor service delivery due to councils’ financial problems.

Besides councils, Zesa has also started scrapping the bills, resulting in the loss of US$170 million, and sudden prolonged power cuts which suggest the ripple effects of Mugabe’s populist policies might be serious.

Although Zesa warned power outages were meant to pave way for maintenance works at Kariba and Hwange power stations between September 2 and February 2014, the debt cancellation could worsen the situation even if the utility claims this would not change anything.

Commentator Godwill Phiri said debt cancellations were part of
Mugabe’s desperate tactics to win elections but there would be a price to pay afterwards.

“The Zanu PF directive to scrap bills is a reckless populist move which doesn’t make economic sense,” said Phiri. “In the short-term, it benefitted Zanu PF because they got votes and also people who had their bills cancelled but in the long-term, councils will struggle even more to meet service delivery demands.”

Phiri questioned how Chombo would ensure service delivery after cash-strapped councils lost US$2 billion through unilateral debt cancellations.

However, journalist-turned-academic Joseph Khanyile Mlotshwa said Zesa would survive as it relies on money that has been locked up in consumers since 2009.

“The issue of the implications of cancelling debts is a tricky one,” said Mlotshwa. “We consider the debts to be the money that ratepayers owed and have not been paying for long. In a sense, it is money that the service providers never had except on paper. Zanu PF’s logic is that cancelling or maintaining it is all the same and it is easy to follow that logic.

“It is also easy to follow the logic of those who say the cancellation will affect payments of salaries and service delivery in the long-term. But the question is: how have they been paying these salary bills, huge at times, if ratepayers have not been forthcoming?”

Mlotshwa said some councils got bank loans to pay huge workers’ salaries and award top management loans to buy top-of-the-range vehicles, something unsustainable.

Another analyst Chamu Mutasa said councils and utilities such as Zesa and Zinwa rely on rates and other charges, and the scrapping of debt will negatively impact on sewerage reticulation as well as water and electricity supplies.

Mugabe has defended his populist policies, saying the harsh economic environment had hit ratepayers who badly struggled between February 2009 and June 2013 to settle their bills.

But Zesa says the impact of debt cancellation would be minimised as the utility plans to install prepaid metres in every household countrywide by December to speed up the debt-recovery process.

About 300 000 households in the country, which represents 57% of domestic consumers, are already using prepaid metres while Zesa has already started installing prepaid metres at farms.

While populism is generally associated, especially of late, with a resurgence of demagogues in many developing countries, particularly in Latin America, there is a surge of populist politics around the world.

The late Hugo Chavez in Venezuela, the Kirchners in Argentina, Evo Morales in Bolivia, Alan Garcia in Peru, and Rafael Correa in Ecuador are some of the examples but there are rising populist parties and leaders in Europe and Nordic countries as well.

In fact, they are everywhere, and Mugabe is no exception despite that his populist policies, including on land reform and indigenisation, have had a damaging impact on the economy even though the people supported them and it won him elections.

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