Cry, oh cherished nation. On Wednesday, South Africa’s National Treasury released stunning information before the National Assembly after exposing the awful condition of our towns. Approximately 60% of local authorities nationwide are now “teetering on the edge of collapse.”
In South Africa, municipalities are “collapsing” everywhere.
The agency bragged about some hardly credible numbers and named 43 communities that are “in desperate need of help” after already crumbling. These areas will now be specially targeted for “urgent rescue” by the Treasury.
Only 58 municipalities were able to complete their 2022–2023 budgets. It has been reported that up to 175 municipalities are in “financial crisis.” A staggering 88% of the cohort, or 219 regional administrations, have “raised concerns” about the way they are operated.
Approximately one in five communities “now need rescue”
Senior Treasury representatives spoke before the Standing Committee on Appropriations of Parliament and portrayed a dismal picture. Malijeng Ngqaleni, the deputy director-general for intergovernmental relations, said that local governments are becoming more indebted and have more creditors.
“While 151 municipalities are on the verge of failing, 43 have already failed and need immediate assistance to be saved. Only 58 of the 257 municipalities in the nation submitted underfunded budgets for the fiscal year 2022–2023.
“The 43 municipalities in crisis that are assessed to be beyond the scope of section 154 assistance and need a corrective method of action to save them are the group that will get attention. Together with the provinces, National Treasury is in charge of this procedure. Governmental Treasury
Customers owing huge sums of money.
Customers owe the country’s municipalities R255 billion, according to reports.
Municipalities, in turn, cannot expect to create income if they do not provide dependable services and enhance local government’s ability to earn its own revenue in order to become self-sustaining.
Director of Local Government Budget Analysis for the National Treasury is Sadesh Ramjathan. Tens of billions of rand are owing to utilities, including Eskom, according to what he informed parliament, and these struggling municipalities are unable to generate the money they so badly need.
Eskom and water bodies are among the creditors who are due slightly about R90 billion. You’d agree that these figures don’t give local government a favourable impression.
Failures in revenue management are at the root of the inability to collect what is owed and pay for services rendered. Sadesh Ramjan