The decline and fall – one in five municipalities in a state of collapse

Decline Source: Google Images

by Jordan Griffiths, First published by The Daily Maverick on 06 October 2020.

THE collapse of a local municipality is easy to spot. The first warning signs always come from the finance departments. It begins with decreasing revenue collections. Then streets begin crumbling as they are not maintained, waste collection is disrupted, parks are not maintained, illegal dumping increases and the water supply becomes compromised.

There is a gradual crisis taking place in South Africa and it relates to the impending collapse of local government under the African National Congress. Media reporting on local municipalities often does not make the mainstream headlines as generally there is more interest in national news unless it pertains to one of the large metropoles. As a result, there has not been much analysis on the state of local government across the country. While readers may follow the news about the area in which they live, they may not have a holistic picture of the state of local government nationally.

For example, on 5 October 2020, Eyewitness News reported that the provincial government in North West intends to place 12 municipalities under administration. These include Bojanala, Lekwa Teemane, Mahikeng and Madibeng. This is done through a Section 139 intervention as provided by the Constitution. In order to invoke this legislative provision, the provincial government must have identified clear governance failures, what the Constitution terms “executive obligations” that are no longer being delivered on. In the case of most municipalities that are placed under administration, there are usually multiple obligations that are no longer functioning. There are two options available to the provincial government when they embark on invoking section 139 of the Constitution.

The first instance is known as a 139(1)b intervention whereby the ANC-led provincial government appoints an administrator who will then make all the executive decisions in the municipality. The municipal council will not be dissolved and elected councillors will stay in their roles. In this approach, the provincial government exercises control over the functioning of the municipality through their appointed administrator. The law states that the provincial government should take responsibility only for relevant obligations that are not being delivered upon. However, generally, they take full control and centralise all power through the administrator.

In the second instance, known as a 139(1)c intervention, the provincial government will appoint a head administrator and dissolve the entire municipal council. This will remove all the councillors from their elected positions. It also triggers a by-election in the municipality which must be held within 90 days of the head administrator being appointed. This is what was used in the City of Tshwane by the provincial government where the Democratic Alliance was in government. It is a decision that the Gauteng North High Court has ruled was illegal and one which is expected to be affirmed by the Constitutional Court as it deliberates on the appeal by the Gauteng provincial government.

The ANC generally avoids dissolving municipal councils when it invokes Section 139 because in 99% of all cases it is placing municipalities under administration that it itself governs; ANC provincial governments are placing ANC-run municipalities under administration.

It avoids dissolving municipal councils for two reasons. The first is because removing their own ANC councillors from office would leave them unemployed, which causes its own internal political problems. Second, it would result in a municipal-wide by-election which costs money to contest and requires internal political organisation. It would also probably lead to the election of the very same people who had led the municipality to collapse in the first place. In choosing not to dissolve the municipal council, the provincial government can leave the administrator in place for months on end. This has happened in municipalities around the country where in some cases administrators have been in place for well over a year.

In July, in a briefing to Parliament, Deputy Cooperative Governance and Traditional Affairs Minister Parks Tau indicated that there were 46 municipalities countrywide where provincial governments had been required to intervene in terms of section 139. Out of these 46, 22 are in the North West and 10 are in KwaZulu-Natal.

There are about 278 municipalities in South Africa, thus about 16% are in a state of collapse. If we add the additional 12, based on the EWN report, this would mean that 21% of municipalities in the country are under administration or facing potential section 139 interventions. That is one in five. Of those 278 municipalities, about eight are metropolitans and 44 are district municipalities, leaving 226 local municipalities. The majority of interventions focus on local municipalities. When you focus on this subgroup the state of decline becomes particularly startling.

As the money dries up, the municipalities stop paying Eskom. Despite billing residents for electricity and collecting these funds, they do not pass them on to Eskom, incurring millions in debt. Pravin Gordhan recently indicated that municipalities owe Eskom R43.9-billion as of June 2020. Eskom, in turn, begins load shedding these municipalities or instituting debt recovery which results in municipal assets being seized, as happened in Emfuleni.

The inability to manage billing and safeguard revenue is indicative of a failed chief financial officer (CFO) and incompetent city manager. The next area to fall is the supply chain as processes regarding procurement are either subverted or ignored to facilitate the flow of funds out of the municipality to unscrupulous service providers.

This collapse becomes physically visible to residents. Streets start crumbling as they are not maintained, waste collection is disrupted, parks are not maintained, illegal dumping increases and the water supply often becomes compromised. Generally, all proactive maintenance budgeting is eroded which means that these failed municipalities operate in a permanent crisis mode in merely responding to outages and infrastructure failures as they occur.

This situation creates immense fragility in the functioning of these local municipalities such that minor failings can cause catastrophic disruptions. For example, when electrical faults go unattended resulting in substations which collapse, or cracks and leaks in water pipes go unattended causing massive pipe bursts. Once a total systemic collapse has set in that cannot be ignored, then the ANC provincial government steps in.

The challenge is that it is happening more and more frequently across the country. Never before have so many municipalities been placed under administration. While this article has focused only on rural municipalities formally placed under administration, many others are on the brink of collapse with ANC provincial governments merely watching from the sidelines as they fall into ruin.