Collecting outstanding town rates remains a stubborn problem for municipalities across Fiji, the Minister for Local Government and Housing, Maciu Nalumisa, has warned, even as current collections remain relatively high in some councils. Speaking during discussions on the Labasa Town Council 2018 Annual Report, Mr Nalumisa said the council’s present rate collection performance “hovers around 80 per cent”, but recovering arrears continues to elude local authorities.
Nalumisa told councillors that Labasa’s experience was not unique, and that unpaid rates were a widespread issue for local governments. To tackle the problem, the minister said the Labasa Town Council had introduced ratepayer profiling in recent years to better understand who is falling behind and the composition of outstanding liabilities. “This is to try and recover arrears from ratepayers, an issue that happens across all municipalities,” he said, describing profiling as a way to develop more practical and targeted recovery methods.
The minister also outlined changes to how interest on overdue rates is applied, a move aimed at easing the financial burden of long-standing debt and encouraging repayment. Under the amended approach, interest on arrears has been shifted from a compound calculation to a simple interest method, and the applicable interest rate has been cut from 11 percent to 5 percent. Nalumisa said the adjustments were designed to make arrears more manageable and to bring more ratepayers “on board in paying the rate arrears that have been there for quite some time.”
Local governments rely heavily on rate revenue for essential services and maintenance; persistent arrears can therefore strain council budgets and service delivery. Nalumisa framed the combined strategy — profiling to identify and segment debtors, paired with lower and simpler interest charges — as a pragmatic attempt to boost compliance without imposing unduly punitive measures on struggling households and businesses.
While the minister did not provide aggregate figures for total outstanding rates in Labasa or nationwide, his comments signal a policy shift toward incentivising repayment rather than solely pursuing aggressive enforcement. He described the measures as a step toward gradually reducing outstanding rates and improving overall compliance across municipalities.
Council members and observers will be watching to see whether these changes translate into higher arrears recovery in coming months. If profiling produces clear debtor categories and the eased interest regime reduces the growth of balances, councils may be better placed to negotiate payment plans and write down long-unrecoverable amounts. For now, Nalumisa’s remarks underscore that, despite relatively strong current collections, debt recovery remains the central challenge for local government finance in Labasa and beyond.