Reliance on ser­vice charges be­dev­ils mu­nic­i­pal­i­ties

Mis­man­age­ment and lack of jobs worsen sit­u­a­tion

Sunday World - - Viewpoint - OPIN­ION Mar­ius Pi­eterse Pi­eterse is pro­fes­sor of law at the Uni­ver­sity of the Wit­wa­ter­srand

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 show the ex­tent of the prob­lem.

The mu­nic­i­pal­ity, lo­cated in the south of Joburg, has been un­able to set­tle wa­ter and elec­tric­ity debts owed 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.

The mu­nic­i­pal­ity’s en­tire ba­sic ve­hi­cle fleet was re­cently re­pos­sessed by cred­i­tors. In June, the Gaut­eng 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 mu­nic­i­pal­i­ties are bat­tling with fi­nan­cial man­age­ment as well as good gov­er­nance and ad­min­is­tra­tion.

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. In 2017, mayor Si­mon Mo­fo­keng re­signedamid a sex scan­dal and ru­mours of fi­nan­cial mis­man­age­ment.

Op­po­si­tion par­ties and civil so­ci­ety or­gan­i­sa­tions blame the coun­cil and mayor, who are from the gov­ern­ing ANC, 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 SAis struc­tured and fi­nanced.

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.

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.

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.

But the prob­lem goes be­yond money. At least some of the cri­sis in Em­fu­leni has been down to mis­man­age­ment.

/ Ve l i N h l a p o

Let the peo­ple choose how they want to travel, but taxi men do not be­lieve in this free­dom of choice which is spelled out in the won­der­ful con­sti­tu­tion of SA, says the writer.

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