South African municipalities in crisis – one in three councillors don’t have a matric
South Africa’s Constitution mandates local government to provide democratic, accountable governance, deliver sustainable essential services, promote development and a healthy environment, and involve communities in local matters.
However, “local government is inadequately equipped to fulfil its developmental agenda.”
The South African Local Government Association (Salga) presented this view in its recent presentation to Parliament’s Portfolio Committee on Cooperative Governance and Traditional Affairs (COGTA).
Salga further expressed concerns about the declining level of service delivery, instability, weakening capacity of municipalities, and the debt owed to municipalities that impinge on their performance.
According to Salga, there are four root causes for the “digression and decline” of the trajectory of the developmental impact of many local governments, being:
- Poor political leadership capacity and weak administrative management;
- Inefficient and non-integrated LG delivery mechanisms, systems and processes to enable service delivery;
- Ineffective utilisation of financial resources (poor financial administration) & inability to collect revenue, and insufficient fiscus allocation;
- Degenerating infrastructure and non-existent or poor services provided to local communities.
Salga Chief Operations Officer Lance Joel shared some alarming statistics on councillors’ education levels and leadership capacity in municipalities.
Joel said that after the local government elections in 2021, over two-thirds of the councillors were new to the sector. “Out of every three councillors, two were new.”
Their assessment of education levels of councillors, he said, shows that “out of every three councillors, one does not have matric, the second one only has a matric, and the third one has a post-matric qualification.”
“We are concerned about this picture,” said Joel, adding that the change of leadership in the 2021 elections resulted in a loss of institutional memory.
The Electoral Commission of South Africa reports over 3,800 councillors managing a combined budget of R572.68 billion across 257 municipalities.
Joel emphasised that 50% of the country’s population lives in 17 of the largest metros and municipalities, and 34.5% of the population lives in nine of the biggest coalition-governed municipalities – many with substantial multi-billion-rand budgets and crippling instability.
He noted significant gaps remain despite initial capacity-building efforts for councillors.
Looking at the Auditor General Report on Local Government (2022-23)
- Clean Audits: 34 out of 257 municipalities (13%) received clean audits, down from 41 in 2020-21.
- Unqualified Audits with Findings: 110 municipalities had unqualified audits with findings, up from 100 in 2020-21, indicating questionable spending.
- Material Irregularities: 85 municipalities had material irregularities and questionable spending.
- Deep Distress: 28 municipalities are in deep distress; 10 of these did not provide sufficient information for an audit, compared to 2 the previous year.
It is important to note that there was a notable 45% reduction in the number of municipalities with disclaimed audit opinions.
“This is commendable and needs to be replicated to improve financial governance in all those municipalities still in the red zone,” said Salga.
The AG reported minimal improvement in financial reporting quality among municipalities, with persistent issues in revenue collection and spending. Key problems identified include:
- Loss of revenue due to infrastructure neglect and poor billing practices;
- Financial losses from weak procurement and project management;
- Unfunded budgets and high unauthorized expenditures highlight poor financial planning;
- Poorly managed finances affect service delivery and lead to delays in payments to creditors.
Director of Research and Programme at Good Governance Africa, Dr Ross Harvey, wrote that the other key thing to examine in a report of this nature is the extent of fruitless and wasteful expenditure.
In the previous year (2021-22) this figure was an eye-watering R4.89 billion.
In 2022/23, this rose to R7.41 billion (out of a total budget of R572.68 billion).
Gauteng is the worst offender (R2.34 billion), followed by Mpumalanga (R1.64 billion) and the Free State (R1.41 billion).
The report noted that “this amount could be even higher, as 15 municipalities (including 50% of municipalities with disclaimed audit opinions) did not report all the fruitless and wasteful expenditure they should have reported in their financial statements.”
To address these issues facing municipalities, the AG has called for the following:
- Professionalising and capacitating local government;
- Capable institutions with intergovernmental support;
- A culture of ethics and accountability.
Harvey said that it is crucial to implement substantive and sustainable interventions.
While he said it is commendable that businesses and residents are stepping in and challenging government failures, a more effective approach is to empower municipal management teams to create a governance register aligned with the King IV Code of Good Governance.
This code aims to enhance governance beyond mere compliance and improve performance.
“Building competence takes time, but it will surely stand as an antidote to the current malaise,” said Harvey.
Government response
The committee expressed concerns about the high turnover rate of municipal councillors after local elections, which results in the loss of institutional memory and eroded capacity in municipalities.
Additionally, they expressed concern over the educational level of elected councillors because the municipalities preside over multi-million-rand budgets that can go up to several billions of rands.
Chairperson of the Committee, Dr Zweli Mkhize, stressed that the constitutional rights of the voters to exercise their democratic rights in freely electing their local representatives remains important but needs to be carefully balanced with the need to create a capable body of leaders.
Mkhize said that since elected representatives have oversight responsibility over multi-billion-rand budgets in municipalities, they must properly understand financial and other complex municipal operations to decide on priorities of services to be delivered, control the budget and hold bureaucrats to account.
The Portfolio Committee said that it “does not appreciate” the “feeling of helplessness” displayed through the over-emphasis that ‘’Salga has no executive authority over the municipalities’’.
“Salga wields a considerable influence over municipalities and should use this influence to champion a turnaround in the performance of municipalities, deepening accountability and improving audit outcomes,” said Mkhize.
“We want to urge Salga to be more assertive in dealing with municipalities. You are not helpless,” Mkhize added.
The committee called for Salga to use its influence to support non-compliant municipalities and backed its recommendations for adopting the executive committee system in hung municipalities to enhance stability and inclusivity.
Read: The best-run municipalities in South Africa – with more than half in one province
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