South Africans need to start asking tough questions about the state of our municipalities because sound financial management practices are not only essential to the long-term sustainability of municipalities, but also to the process of democratic accountability.
Last year, Cooperative Governance and Traditional Affairs Minister Zweli Mkhize announced that only 7% of municipalities in South Africa were fully functional.
Of the remaining 93%, only 31% are “reasonably functional”, with 31% “almost dysfunctional” and another 31% “completely dysfunctional”.
In a country riddled with corruption, tax abuse and poor governance, these shocking statistics went unnoticed.
Except, of course, by those who experience the living conditions of dysfunctional municipalities.
The time has come for us as citizens to say it as it is – there can no longer be any excuse for the collapse and dysfunctionality of municipalities as several laws set out frameworks and key requirements that should prevent their failure.
However, while we agree that the buck finally stops with municipalities, their collapse can be attributed to the lack of oversight and responsibility taken by provincial governments countrywide.
Legislation provides for several mechanisms for strengthening accountability.
This involves separating and clarifying the roles and responsibilities of mayors, executive councillors, nonexecutive councillors and officials.
This separation of political and management roles is critical for good governance, yet it is exactly where many of the problems start.
While mayors and executive committees are expected to provide political leadership through proposing policies, guiding the development of budgets and performance targets, and overseeing their implementation by monitoring performance, they may not use their position, privileges or confidential information for private gain or to improperly benefit another person.
Sadly, the reality in South Africa is often far removed from what the law envisions.
The municipal manager is the accounting officer of a municipality – they have a legal duty to act with fidelity, honesty and integrity, and in the best interests of the municipality at all times.
To further strengthen municipal financial accountability, the Municipal Systems Act provides for the establishing of the Municipal Public Accounts Committee, which should review the effectiveness of financial management, as well as the legal and authorised spending of funds.
The Municipal Systems Act clearly guides municipal responsibility and prescribes cooperation, assistance and mutual support between district municipalities and the municipalities within their areas.
This includes financial, technical and administrative support services when requested.
Read: Municipal incompetence compromises the people, especially the poor
Provincial Treasury and the cooperative governance department legally have to oversee municipalities.
According to the Municipal Finance Management Act (MFMA), monthly budget statements must be submitted to Provincial Treasury within 10 working days of month end.
Should problems be detected, the MFMA clearly outlines the responsibilities of the local government and finance MECs, even listing the types of provincial interventions the MEC for local government may undertake in such a case.
All of this means that provinces can assert their powers to ensure effective performance by municipalities. What were they doing when municipalities started failing?
National government also has a legal duty to ensure the proper financial management of municipalities.
The cooperative governance department and National Treasury must ensure that municipalities act in the best interests of their communities by delivering quality municipal services, promoting good governance, transparency and accountability, and ensuring sound financial management and accounting.
Under law, Treasury has the most responsibilities when it comes to overseeing municipal finance.
Where was national government’s intervention to ensure accountability and municipal performance?
The municipal decay we witness today should have and could have been prevented years ago.
It is time for politicians to learn that municipalities do not exist in a vacuum, and that they are interdependent on other interested parties and spheres of government.
The effective management and functioning of municipalities should be the top priority if we want to take South Africa forward.
Gulston is the chief financial officer at Outa