Secretary for Local Government, Public Works and National Housing, Engineer George Mlilo has announced that his ministry has made a u-turn on its decision to suspend borrowing powers for local authorities, saying it will only add further restrictions to the current system.
The current system requires councils to apply for borrowing powers from the Ministry of Local Government ,before taking loans with the ministry having the power to approve or deny such requests. However, Mlilo recently said the ministry was banning borrowing with immediate effect to save them from the humiliation of having their properties attached when they fail to repay such as was the case with Chitungwiza.
He said almost all local authorities are in the red and struggling to service their debts hence the decision to suspend borrowing powers. Eng Mlilo however is now on record as saying the ministry is not banning borrowing powers for councils. He added that there will be further restrictions to make sure people do not just borrow for the sake of borrowing without an ability to pay back.
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