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Govt cuts Chambeshi smelter’s property rates amid suspicion
By Mwila Chansa in Kalulushi
Tue 05 Oct. 2010, 14:20 CAT [11 Reads, 0 Comment(s)]
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THE government has directed Kalulushi Municipal Council to give Chambishi Copper Smelter (CCS) a rebate on property rates payment from K9.4 billion per annum to K1.5 billion per annum.
Well-placed sources told The Post in Kitwe that during a meeting held among officials from CCS, Kalulushi Municipal Council and then local government minister Dr Eustackio Kazonga, the Kalulushi council officials were informed that CCS would be paying K1.5 billion to the council for rates and K500 million for service provision for Chambishi residents.
The source said most workers were puzzled at the decision to reduce rates to as low as K1.5 billion because the initial figure of K9.4 billon per annum was arrived at after the valuation report of 2007 conducted by the rating tribunal that was appointed by the government to value properties in Kalulushi.
“And according to the valuation report, the valuators thought that according to the property that CCS has, they were supposed to be paying K9.4 billion,” the source added.
“In fact, before the valuation roll came out, all property owners in Kalulushi were called by the tribunal to complain if at all they thought that what they were supposed to pay was too much and CCS complained to the tribunal but their complaint was turned down because according to them, that was the correct value and if anything, they had even undervalued them.”
The source explained that CCS then wrote a letter to the council asking for a 30 per cent remission and that when they saw that things did not work out, they allegedly complained to commerce minister Felix Mutati who then is alleged to have issued a verbal instruction to Kalulushi town clerk Maxwell Kabanda not to go ahead and charge CCS K9.4 billion for rates but wait for ‘further instructions’.
The source said that after workers were informed about the developments, they staged a protest because they were wondering what was so special about CCS when other mining companies in the district paid their property rates without any problems.
The source said Kabanda and the then mayor Evaristo Mwalilino assured the workers that the council would do everything possible to recover the money from CCS.
“But from that time, the minister Dr Kazonga told the town clerk not to issue any press statements concerning the CCS issue because government was dealing with the matter. The town clerk also called the union and told them to stop issuing any statements over the same issue because they are government workers who cannot ‘xxxx the finger’ that feeds them,” said the source.
The source said most workers were happy that Dr Kazonga, whom they described as ‘very intimidating’, had been transferred to another ministry.
And according to a letter dated 15th September 2010 and addressed to Kabanda and copied to the permanent secretary Ministry of Commerce, Trade and Industry and CCS executive officer, CCS should be paying Kalulushi Municipal Council K2 billion per annum as property rates plus a contribution of K500 million per annum for the provision of services for Chambishi residents.
Asked to clarify the two figures (K1.5 billion and K2 billion) the source said in a meeting in Lusaka, K1.5 billion for rates and K500 million for services was agreed upon.
Meanwhile, local government permanent secretary Timothy Hakuyu instructed Kalulushi Council to implement what was decided at the meeting at his ministry headquarters held between the council, CCS representatives and Kazonga.
“The meeting agreed that CCS would pay Kalulushi Municipal Council K2 billion per annum as property rates plus a contribution towards the local community of Chambishi township of K500 million for the provision of services as contained in the letter dated 7th June 2010 from CCS Ltd addressed to the honourable minister of commerce, trade and industry and copied to this ministry among others,” the letter read in part.
Hakuyu urged Kalulushi Council to inform his ministry on the modalities they were going to adopt in managing the K500 million per annum for the provision of services to the community.
But the sources said council operations would be adversely affected by the reduction of rates for CCS because from this year’s budget alone, most of the council’s revenue was supposed to come from CCS which had the highest value.
The sources further disclosed that CCS had since signed a memorandum of understanding with Kalulushi Council to collect rates for four years in advance because the current valuation roll would expire within four years.
The source added that most workers felt the government was favouring CCS because the Chinese firm allegedly funds campaign activities for the ruling party. Early this year, there were differences between CCS and Kalulushi council over the debt that the former owed the latter in unpaid rates.