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How structural flaws contribute to the crisis in SA’s municipalities

Minister Zweli Mkhize says that 31% of the country’s municipalities are ‘dysfunctional’ and another 31% ‘almost dysfunctional’.
South Africa could consider reducing governance options available to municipalities to ensure more uniformity and easier oversight. Picture: Shutterstock

The dire state of municipal governance in South Africa has been in the news for much of this year. Recent events in Emfuleni Local Municipality, an urban municipality with more than 700 000 residents in Gauteng, the country’s economic hub, show the extent of the problem.

The municipality, located to the south of Johannesburg, has been unable to settle water and electricity debts owing to the utilities Rand Water and Eskom. This has led to services to residents being reduced or cut. Lack of infrastructure maintenance has further bedevilled the delivery of water and electricity, as well as rubbish removal.

Sewage spills have plagued suburbs and severely polluted the Vaal River – the main source of drinking water in the province that is also crucial to its tourism and agriculture. The municipality’s entire basic vehicle fleet was recently repossessed by creditors.

In June, the Gauteng Provincial government placed the municipality under financial administration.

Emfuleni is not alone. The national minister responsible for municipalities recently said 31% of the country’s municipalities are “dysfunctional”, and another 31% “almost dysfunctional”. He went on to say that many South African municipalities are battling with financial management as well as good governance and administration.

Given its extensive infrastructure and a large tax base, Emfuleni is the kind of municipality that has little excuse not to function well. If it is failing, how could less developed municipalities thrive?

Who is to blame?

It’s tempting to blame the government for the municipality’s troubles.

According to the National Treasury’s municipal finance data website, Emfuleni had a healthy cash balance in 2015. But it then fell by over a third in 2016, before collapsing in 2017. While the municipality did have problems with wasteful expenditure and budget overspending before, things got much worse after the local government elections in August 2016.

The municipality has also been experiencing political turmoil. The previous mayor resigned in 2017 amid a sex scandal and rumours of financial mismanagementOpposition parties and civil society organisations blame the council and mayor, who are from the governing African National Congress, for the municipality’s problems.

But it’s also necessary to look beyond people and politics, and consider whether structural factors have contributed to the crisis. Emfuleni’s problems perhaps point to flaws in the way in which local government in South Africa is structured and financed.

Raising revenue 

Emfuleni’s cash shortage has partly been blamed on poor collection of revenue from service charges. This highlights the extent to which South African towns depend on income from service delivery. Municipal finance data show that Emfuleni generated about 85% of its own income in the 2016/2017 financial year. (The rest came from its equitable share of national tax revenue and grants from national government). Most of its self-raised revenue came from service charges.

A budget that depends on recovering service debt means that the ability to run the municipality depends on how much residents can consume and pay for. This is neither stable nor sustainable.

A number of factors affect these revenue streams. The first is that a culture of non-payment is pervasive among residents. Secondly, service revenue is also often affected by supply side constraints, such as water scarcity or power cuts. And lastly, a revenue stream based on consumption also assumes that most residents can afford services. This isn’t always the case.

Emfuleni has gone through tough economic times in recent years. Unemployment has risen sharply and some better off residents have moved away. This does not bode well for service demand, or the ability to pay for what has been consumed.

The problem won’t go away unless municipalities find less volatile ways of balancing the books. A greater allocation from national government would be one route. So would raising money through loans and imposing taxes or development levies on businesses.

But the problem goes beyond money.

Unclear lines of accountability 

At least some of the crisis in Emfuleni has been down to mismanagement. This calls into question how municipalities are run.

According to the Constitution, local governments have both legislative and executive functions. This means that there isn’t a clear separation of powers between municipal executive leaders (mayors) and the councils to which they report.

On top of this, municipal powers are closely tied to administrative functions, meaning that there is an overlap between political and bureaucratic structures in municipalities.

The close connection between different functions makes sense. But it makes lines of accountability unclear. This isn’t helped by the fact that municipalities can choose from different governance models. This means that accountability works differently in almost every municipality.

This may well have added to Emfuleni’s woes. The municipality has an elected municipal council and an executive mayor system. It is further part of the Sedibeng District Municipality, with which it shares responsibility for many of its functions.

There are concerns that executive mayor systems give too much power to mayors and not enough to councils. There is also insufficient accountability, and flows of information, between local and regional municipalities.

South African municipal governance is also bedevilled by the influence of political parties over councils, mayors and the administration. In Emfuleni, for instance, the mayor initially resigned when the council was put under administration, but then withdrew his resignation after the ANC intervened.

What needs to happen?

South Africa may have to consider reducing the governance options available to municipalities, to ensure more uniformity and easier oversight. It also needs to devise uniform, simple and clear, internal accountability structures for local government. And it should seriously consider legally regulating the line between political parties and the civil service.

Finally, provincial intervention in local government affairs is not ideal, and should only happen in extreme cases – as has been the case in Emfuleni. But it would be better if this was triggered by an event – such as a municipality falling into arrears with the water or electricity supplier – rather than waiting for political discretion to be exercised.

Marius Pieterse is a professor of Law at the University of the Witwatersrand.

This article was published with the permission of The Conversation. The original publication can be accessed here

COMMENTS   18

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” a culture of non-payment is pervasive among residents ” – This says it all !!!!

Corruption, incompetence and laziness are the issue dear Prof. It’s not structural. If people cannot and do not do their jobs and are not fired that’s when you have a real problem.

Municipalities have been looted for 25 years by ANC cadres enriching themselves and simply not doing their jobs.

There is also ”a culture of accountability being pervasive among local government management” and also ” a culture of responsibility being pervasive among provincial leadership” and not to mention ” a culture of ultimate ownership, accountability and responsibility being pervasive among national leadership ”

Maybe it’s just down to pure incompetence, greed and political gansterism.

Show me a poor politician and I’ll show you dancing unicorn.

I’m all for servicing the people which are most vunrable in our society but my trust in government is -50.

This article does not admit to the truth trying to blame the constitution/rules of the country for not making it clear whose does what is just a slap in the face, if the answer is so simple and obvious yet so andemic why has no body taking it up with the courts ?
After 24 years…

Buy Bitcoin and hedge poor goverences. This is the reason why people are looking for an alternative to fiat money because we don’t trust politicians anymore.

How about significantly under-educated people taking on posts they have never worked with before. If you really look at it THIS WAS A HUGE ON THE JOB TRAINING EXERCISE IN GOVERNMENT!!

…..yip….and ignorance to responsibility

But I guess if Zuma & .inc were comfortable doing nothing except finding ways to deceit and deceive the country, what can avg citizen expect from the local municipality

In addition to points mentioned, it would be helpful to remove political affiliations at municipal level. Councillors should be elected and held responsible based on their personal profiles and performance rather than have their national political affiliation affect their election.

To me the entire article can be distilled into the consequences, summed up in this passage:

“Unemployment has risen sharply and some better off residents have moved away. This does not bode well for service demand, or the ability to pay for what has been consumed.”

That is what is happening to South Africa as a whole right now. People with money are moving out and the people that are left cannot (or won’t) pay. The ANC cries for investment on the one hand while on the other it makes it as hard as possible to do business in, or invest in SA.

This is such a nonsense article – as all it seems to put forward is reasons for incompetence at municipal levels. If there wwas a proper employee selection process and a will to serve the community then this situation would not arise, there is a serious attitude problem within government managed service delivery entities and regrettably they all fail dismally. The travesty of this article is that there is no hope of improving the situation but that more and more will sink into a cesspool of inefficiencies and ineffectiveness

I believe that individuals determine their own reality and destiny. This is even more valid for groups of individuals. When a group of people, a society, is given the opportunity to influence their destiny, the shape of that destiny will represent the individuals in that society. People act according to their belief systems, when they employ their logic and intelligence to come to conclusions, and make decisions. The efficiency of this decision-making process is reflected in the reality and living standards of those individuals.

All the different communities in South Africa share the same national government, the same economic and financial constraints, the same socio-economic problems, the same access to skilled workers and talent. Some communities experience excellent service delivery, while for others there are a total implosion of basic services. The only real difference between these municipalities is the quality of the voters. The mindset, believe system and attitude of the voters in a community determine the efficiency of the services they receive from their municipality. One can say that the quality of services delivered by a municipality is a reflection of the quality of individuals in that community. This is the reality that is guaranteed by the right to vote.

There are only 2 options when service delivery is unsatisfactory. Remove the right to vote from people who pull down the average level of sophistication, or move to a municipality where people are more sophisticated. When central government takes control of municipalities, they are basically implementing option one. When people move to DA municipalities they are implementing option two. For those without options the electricity network will crash, sewerage will run down the streets and running water will become unavailable, even while the dams are full. No form of intervention can stop people in a democracy from creating their own destiny.

STRUCTURAL FLAW INDEED….
South Africa is poor to allow the average citizens to pay fully for basic services.

Central government must pay for water, electricity and waste collection. Those entities are by en large owned by the government, inversely the very ordinary citizens.

No township house with less than three bedrooms should be asked to pay for these service. Any householder with more than the basics should be proportionally be billed.

Poor people should not be pressed down at the poverty line but should be afforded the opportunity to rise and be better citizens.

Boombang:

This generation does not seem to understand that the freedom fight was not about
free water
free electricity
free university
free housing
free medical
free school
free transport
free land
free tv
free wifi
free mobile data

All that matters is that Mr X is now driving in a new BMW X5 and his wife is driving in a new Prado. “The rest is irrelevant.”

It is imperative that we pipe the water from the Lesotho Highlands Water Project to Gauteng without delay. We may even use South African Steel and South African Designers and Contractors to do it, if our Construction Industry, on the brink of collapse, can be saved. Our ability to execute mega pipeline projects and large infrastructure projects has been crippled. Due to the urgency of the pipeline project a dedicated water fund can be established for its execution. The Lesotho water is pristine. The water will gravitate to Johannesburg-south, preventing significant pumping and treatment costs. This action will save Gauteng, and South Africa, once upon a time the engine of Africa.

You are dreaming if you think there is a workable solution to this problem. First, try and get rid of the incompetents. Then try and employ competent people on merit.

…. but will there be any people then?

It seems to me that the only thing most municipalities are capable of doing is renaming themselves. Renaming seems much more important than service delivery, of course it is much easier too.

“The municipality, located to the south of Johannesburg, has been unable to settle water and electricity debts owing to the utilities Rand Water and Eskom. This has led to services to residents being reduced or cut.”
Electricity not yet – but when it happens – and it is imminent, it will be the end of heavy industry in SA and the trigger for widespread famine, social implosion and conflict. And sacrifice of the country to Chinese colonisation.

“In June, the Gauteng Provincial government placed the municipality under financial administration.”
As at writing hereof – more than two months later – no administrator has been appointed. What makes you even think that the ANC is serious about solving any of this?

“In Emfuleni, for instance, the mayor initially resigned when the council was put under administration, but then withdrew his resignation after the ANC intervened.”
The mayor is not being fired, reprimanded or even investigated for any alleged role he may have allegedly played in the alleged fiasco (enough disclaimers for you?). He will be leaving the mayoral post due to a PROMOTION – wait for it – he will be the next Provincial Secretary of the ANC in Gauteng. An even higher post that will give him even more power. With the full blessing of the ruling party. Amandla.

Alice in Wonderland stuff, this. The Mad Hatter’s tea party, to be specific.

End of comments.

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