The Port Vila Municipal Council in Vanuatu says it is gradually paying off its debts.
The council has accumulated debt worth over 12 million US dollars and the Mayor Willie Pakoa has removed portfolios from three of the 14 councillors over allegations of misuse of funds and council revenue.
The Town Clerk Toco Mara says the financial situation is stabilising and the council is making improvements.
"I believe that we need to have a very strong policy and we need to make sure that staff and the council itself that they do understand these policies themselves and that they know what their roles and responsibilities are."
Toca Mara says he expects it will be a few years until the debt is paid off.