The uptake of specialised financial services by municipalities involved in waste management can improve revenue collection and the efficiency of landfill sites, says multidisciplinary engineering firm BVi Consulting Engineers.
The company notes that by employing financial administration contractors, the public’s willingness to pay for waste disposal will significantly increase once it realises that there is an effective, equally enforced and, hence, fair financial system in place.
BVi can do this by controlling vehicle access to landfill sites; ensuring that landfill users are charged correctly, accurately and timeously; controlling the collection process; and by managing in and outbound tele- phonic call centres.
“A financial administrator plays an integral role in the landfill management process and integrates different role-players such as the owner, users, site contractors, weighbridge operators, weighbridge suppliers and software suppliers,” explains BVi Ekurhuleni metropolitan municipality landfill site financial administration project financial director and leader Stefan de Meillon.
The appointment of an external financial administrator significantly reduces the financial risk, especially in terms of fraud, which is an ever-increasing challenge at landfill sites.
“Despite efforts to close loopholes, fraud remains a risk owing to a number of factors, including the nature of the weighbridge process, which requires a human component; the weighbridge typically being situated in a physically remote location; and the transport industry being highly price competitive,” notes De Meillon.
Further, disaggregating the roles and responsibilities of the three role-players – the owner, the landfill operator and the financial administrator – results in a balance of power, which provides checks and balances for all aspects of the process.
Through its financial administration service, BVi can also provide a client with a range of reports containing financial and statistical data, on which projections and other management decisions can be based, explains De Meillon.
BVi was awarded its first financial administrator contract in 2005 by the Ekurhuleni metropolitan municipality.
The contract requires the company to manage all the functions relating to the financial administration of all five of the municipality’s landfill sites and one privately owned site, which is also being used by the municipality.
The municipal sites comprise the Rooikraal landfill site, in Boksburg; the Simmer and Jack landfill site, in Germiston; the Weltevreden landfill site, in Brakpan; the Rietfontein landfill site, in Springs; and the Platkop landfill site, in Vosloorus.
The contract also requires BVi to collect raw data from the weighbridges, invoice the users and ensure that the charges are paid timeously.
The large number of transactions, vehicles and users of Ekurhuleni’s landfills pose a challenge in trying to invoice users on time. Therefore, to achieve the efficient running of operations, the company has invested in internally-developed software systems, which enable statements to be issued to users before the fifth day after the end of the month.
“We have also developed a range of reports that were not previously available. These reports link tonnages and waste-type reports to financial information, which enables strategic decision-making with regard to tariffs setting each month,” says De Meillon.
In addition, BVi is responsible for operating a call centre, based in Pretoria, for Ekurhuleni, which resolves statement and other queries, he adds.
A crucial development of the project is the uploading of data from each of the landfill sites to a central dataset, owing to the implementation of a central database system. The weighbridge software developer Opto Africa, links the five landfill sites and the privately owned site to the system and provides the benefit of centralised control over all six sites.
Meanwhile, the 2012 implementation of a camera system, also by Opto Africa, further increased control and reduced the risk of corruption at all of the five landfill sites.
Since being awarded the contract, BVi has taken on several additional tasks for the Ekurhuleni municipality, such as vetting new users and, subsequently, has more control over landfill processes. This increased central control is necessary to deliver a better service to the users of the landfill sites, adds De Meillon.
He says, since all the other municipalities in South Africa are large enough to justify the appointment of external financial administrators for landfill sites, BVi forsees a bright future for its financial administration service, which can, for instance, be combined with facility-management opportunities.