The out-of-court settlement between Nersa and Eskom imposing R54bn in additional electricity tariffs over three years will make it even more difficult to manage Eskom’s debt because consumers will not be able to pay, says Bheke Stofile, president of the South African Local Government Association (Salga).
“This booby trap is very difficult for municipalities to accept because our citizens are already owing them over R400bn, which they’re unable to pay,” he says. “Add this to the R107bn municipalities owe to Eskom and all they’ll do is drive the municipal system into a deeper crisis. What we’re going to get are pushbacks and riots.”
By increasing the already ballooning debt chasms — between households and municipalities, between the government and municipalities, and businesses and municipalities — the tariffs will lead to even more illegal connections, Stofile says.
In many areas throughout the country, we are seeing this bubbling pressure, and the possibility is that ultimately there will be riots
— Bheke Stofile, South African Local Government Association president
“Communities are reaching a stage where they cannot absorb any more tariff increases. They’re hitting their net incomes hard. The take-home salaries they rely on to feed their families are being consumed by tariff increases. We are reaching that stage, and that is going to be a crisis stage.”
The government needs to look at this holistically in terms of its impact on end users, he says.
“This is a crisis that we have been seeing bubbling in the system. We have been trying to warn those responsible for taking these decisions that there will be resistance and pushback from communities. In many areas throughout the country, we are seeing this bubbling pressure, and the possibility is that ultimately there will be riots.
“Government — local, provincial and national — needs to go back and rethink the modalities through which it must rescue communities from these pressures. We as government are elected to serve the interests of the public, and the public is saying to us: you are abusing the power we have given to you. This is not a local government problem, it’s a whole of government problem.”
The extra Eskom tariffs agreed to by Nersa will have a devastating impact not just on municipalities but at a national level. Stofile says the government needs to pay attention to the violent protests rocking Kenya “because communities are not prepared to take their burdens any more as business as usual. We need to have a relook at our systems and processes, such as these tariffs, and the burden they’re putting on communities.”
He concedes that a fundamental challenge is to fix municipalities. But he says the failure to pay for basic services such as water and electricity has historical roots.
“South Africa has a history that when those who are in government today were fighting for freedom, we said: ‘Don’t pay government for services.’ So those in the struggle didn’t pay for services. But when freedom was achieved the government never engaged in a process that ‘now it is time to pay government for services, because not to pay government is to collapse government’.
“That is the issue we’re sitting with today. And that is why we are seeing ballooning debt. Because communities and government themselves don’t pay,” Stofile says.
“I can share many horrible stories of disputes about what is owed by national government to local government. You read into that government refusing to pay. And government is supposed to pay for those services. How much more then communities.”
The government has not tried hard enough to end the culture of nonpayment, he says.
“In the areas where there was a culture of payment you’ll see municipalities are collecting in these areas. In the areas that developed a culture of nonpayment there is no way that communities are paying.
This culture of non-payment is the elephant in the room that all of us as government have failed to confront
— Stofile
“This culture of nonpayment is the elephant in the room that all of us as government have failed to confront. We sit and tell lies to communities about the problem as if it is a municipal failure, whereas it is a government failure to lead and respond to the challenges we are facing.”
He says the failure of municipalities to professionalise and hire the right technical and financial skills, which has aided their collapse, says more about national government than local government.
“These are policy issues for which national government has been responsible and which are now bearing fruit that was never meant to be.”
The corruption evident in the failure of municipalities to pay Eskom and the water boards is also a national government issue, as the recent assertions by KwaZulu-Natal police chief Lt-Gen Nhlanhla Mkhwanazi made clear.
“He raised a very important matter that most of us in government did not want to listen to: that the issue of corruption is because of the approach we take as government as a whole on matters that affect mostly the performance of government,” Stofile says.
“What is seen to be an illegal act in different levels of government is informed by the manner by which you are identified to be a councillor or a manager who will serve the interests of a particular value chain.
“I’ve said to parliament: as much as you talk about supporting local government, if you want to support local government remove the elephant in the room. Cut the invisible hand, the existence of which was confirmed by Gen Mkhwanazi later...
"You must deal with the politics of these issues. Ward councillors should be a community choice, but it’s a political choice. They should be chosen by the community, but they’re chosen by the political party.
“The result is there is no political will to ensure that the councillors chosen are those who will be the watchdogs of tender and other processes.”
In terms of the constitution communities ought to play a much bigger role in holding councillors, municipal officials, ministers and the political parties accountable.
“When this happens then what you are going to see in government at all levels is going to be completely different to what we’re seeing today,” says Stofile.
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