The ANC says the local government system needs urgent restructuring that could translate into fewer municipalities in SA.
The “urgent need to rationalise the local government system” is outlined in the party’s national executive committee’s (NEC’s) lekgotla bulletin.
This report spells out the outcomes of the recent biannual meeting attended by the party’s alliance partners and structures, traditional leaders and guests from business and civil society.
The dire state of local government, and whether the best structures are in place, has been raised by the party less than a year before local government elections are due.
This sphere of government has been mired in financial mismanagement, resulting in deteriorating municipal coffers. The Covid-19 pandemic has made the situation even worse.
NEC member and chair of the ANC’s legislature and governance subcommittee Phumulo Masualle explained in an interview on Wednesday that the overwhelming view was in favour of reviewing local government structures, especially given the evolving district development model.
This model aims to break down the silos between the three spheres of government and to co-ordinate and integrate development plans and budgets. It has already been piloted in some areas.
“Do we really need all of them [municipalities] as they are? The answer is certainly not,” Masualle said.
For example, he said that instead of having six or seven different municipalities, these could be merged into two, which could then pool revenue and resources.
Masualle said the call to rationalise local government has been coming for a while but that new evidence has come to light that has forced the ANC to deal with it.
It also comes as the party has increasingly focused on the state of local governance, which has in turn resulted in the creation of the district development model.
“The continuing problems with the allocation of powers and functions, fiscal split across the three spheres of government, the lack of financial viability of many, particularly smaller, category B municipalities, all suggested the urgent need for the ANC to develop and adopt a framework to rationalise municipalities,” the report said.
It was central to such a framework to ensure the fiscal split of financial resources empowers municipalities to deliver, and that ideally funds should be directly transferred to municipalities where they were properly managed.
Municipalities are revenue-generating entities, but some smaller municipalities are heavily reliant on grants from national and provincial government for their sustainability as they do not have the revenue base large metropolitan municipalities have. As a result of the intertwined finances, it would mean the party would also have to look at the role of national and provincial government in this respect.
The report said the rationalisation framework should build on President Cyril Ramaphosa’s call for the district development model to not only be a means of co-ordinating a one-government approach, but that it also takes on a new institutional form.
Masualle said some of the smaller category B municipalities did not have a chance to be sustainable, even if they had the best systems and managers in place, because of their poor revenue base.
He said the ANC was working on preparing for its national general council later in 2021, as some of the ideas would need to get a final stamp of approval.
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