Levy will solve council woes
JUST over a week ago municipal managers, officials and mayors from across the country attended a conference organised by the South African Local Government Association (Salga) to focus on why so many municipalities are not functioning.
KwaZulu-Natal has the largest number of municipalities of any of the provinces. We have one metropolitan, 10 district and 50 local municipalities.
Delegates at the conference were told that 15 of our 61 municipalities are completely unsustainable. When an organisation such as Salga makes such a statement, we must view that as a big wakeup call.
When municipalities get into such situations, it is the communities that suffer from a breakdown in basic service delivery.
Municipalities obtain their income from four basic sources:
Rates levied according to the Municipal Properties Rates Act;
Charges on utilities such as electricity and water;
Tarrifs raised on refuse removal, use of council facilities, parking meters;
Municipal investment grants (MIG).
The unsustainable municipalities invariably rely totally on MIG funding to survive. Unfortunately, grant funding in these instances covers little other than management and councillor salaries.
The obvious result is that there is little or no service delivery, employees leave for better paid positions and the municipality becomes dysfunctional.
That is the problem occupying the minds of the government and the Independent Electoral Commission.
It is no coincidence that we are weeks behind with the demarcation of wards for the 2011 elections. The reasons are obvious. There is intensive behind-the-scenes juggling – al la the National Party government – to reallocate these dysfunctional municipalities into the boundaries of existing functional municipalities.
If this does take place, an extra burden will be placed on the already overburdened ratepayer.
There is, however, a more viable and sustainable solution – to restore the revenue that accrued to the Regional Service Councils and use this to finance these and other dysfunctional councils.
This money was raised by applying a tax (1 percent) to the revenue of every company and farm, as well as a small portion of their labour costs. This revenue was used solely in rural areas, which is where most of the unsustainable municipalities are.
These Regional Service Council levies were done away with in June 2006.
There is no need to go back to the Regional Service Councils, but merely reintroduce the levy. I call on all political parties to promote this solution as opposed to the integration of non-viable municipalities into existing, viable ones.
Unless the government chooses to reintroduce this levy, I believe we are in for serious ratepayer backlash, as they cannot afford another hike in rates to finance the integration of non-viable municipalities.
A boycott by ratepayers might not be just a possibility, but a harsh reality.