CASH-STRAPPED Mutare City Council last week resolved to settle its more than $1 million debt to Premier Services Medical Aid Society (PSMAS) through a land swap deal as revenue collections in the eastern border town continue to shrink.
The local authority owes its workers salaries for seven months.
Last week, police were called in after some contract workers stormed Civic Centre demanding their dues.
In a full council meeting on Tuesday last week, the council resolved to offset its $1 180 698 debt to PSMAS through a swap of land measuring 18 500 square metres.
Town clerk Obert Muzawazi told the council meeting that at the rate at which they were collecting revenue, the local authority would not be able to settle the debt hence the proposal for a land swap.
He said PSMAS was agreeable to the land swap deal.
The local authority said the move was the only solution to the difficult financial situation.
“In line with the litigation that council has with PSMAS for an outstanding fee for services rendered to its employees, the parties came up with an out-of-court settlement wherein the council offered land namely sub-division A of stand 7212 of Mutare Township, subdivision B of stand 7212 Mutare Township, subdivision C of stand 7212 Mutare Township,” the council minutes read in part.
“The piece of land measures in total 18 500 square metres.
“This is in full and final settlement of the debt of $1 180 698 owed by council to PSMAS.” Manica Post