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Municipal Revenue Enhancement through More Effective Data Analysis


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The information age has given individuals the ability to transfer information freely and to have access to knowledge, of any kind, at the touch of a button. Data, from National Income levels to Football statistics, is readily available on the web to any individual with a computer and internet access. However, data in itself is useless. Data’s true value lies in its analysis where key insights can be revealed to improve decision-making and achieve more desirable outcomes.

The public sector is one of the many decision makers in a position to use advanced information systems to gain a greater understanding of the portfolios they manage. This understanding results in better decision-making and additional income being generated through previously un- and under-billed clientele being charged for the services they are enjoying. Thus additional income can be achieved without the need for raising existing tariffs and assessment rates.

Revenue enhancement objectives are driving Smart Metro's and municipalities to find systematic ways to uncover irregularities in their billing databases that will result in increasing revenue from their existing customer base. Government entities can benefit significantly from revenue enhancement tools that organise their extensive and readily available data that until now has been left unattended. Municipal billable asset and consumer information is available from various sources and becomes useful through experience and skilled collation, cross-checking and analysis.

The creation of a single database that is complete, current and accurate is essential for proper analysis and effective decision-making. Once this is achieved, municipal management are empowered to take decisions and actions that are guaranteed to improve their billing and substantially increase their revenue.

Municipalities around South Africa are feeling the pressure of not correctly managing their revenue streams which has resulted in service delivery protests and audits from the Auditor General receiving particular interest in the press. The AG recently revealed the shocking statistic that 90 of the 283 municipal budgets for 2010/11 were insufficiently funded[1]. Furthermore numerous government departments have been given a “disclaimer” opinion by the AG in their annual report[2].

The disclaimer opinion is not necessarily a death sentence for municipalities if the correct action is taken in timeous fashion. However, as the City of Johannesburg experienced, correcting a billing system can result in escalating costs. For the past 13 years the City has tried to resolve the crisis of their billing database. The City’s head of Finance, Geoff Makhube, announced in September that Operation Phakama – the new IT billing system - would be fully operational within the next year. The IT system has cost around R500 million and should be able to handle the 1.2 million accounts processed by the council.

Data analysis does not necessarily need a massive capital outlay as in the case of Johannesburg but can be achieved through a methodical data management system that accurately identifies, tracks and rationalises billing abnormalities.

Information systems are making it easy to capture and store data but experience is fundamental in ensuring that it is properly organised and that remedial action can take place. Smart Metro's utility management system combined with sister company Munsys's globally proven billable asset tracking system (in use by Surveyor-General) seamlessly organises and transforms data into sustainably increased revenue streams.

The Smart Metro group of companies has a 25 year proven track record of accurate billable asset tracking and revenue enhancement with numerous public entities. Smart Metro, in a joint venture with Ducharme Consulting (currently working on audit compliance with more than 60 municipalities) are moving municipalities beyond compliance to performance and financial sustainability. The end result for municipalities means clean data, easy audits, increased revenue, and improved service delivery.

Date Posted: 2011-11-02
Posted By: SmartMetro
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