ZWELI MKHIZE | Punish officials, not homes without water

With South Africans due to elect new municipal councils on November 4, the debate over the National Treasury’s temporary withholding of equitable share funding has become about more than a one-off fiscal intervention.

This decision has exposed a deeper question — whether our accountability mechanisms are strong enough to deal with failing municipalities without making communities pay for the failures of those who govern them.

In July the Treasury temporarily withheld equitable share transfers from 69 municipalities because of persistent noncompliance with legal and financial requirements. Initially, 99 noncompliant municipalities received notices of the Treasury’s intention to invoke section 216 of the constitution.

The intervention immediately raised a difficult tension. Municipalities cannot be allowed to disregard legal prescripts indefinitely and without consequences. On the other hand, equitable share funding is critical for providing basic services. So, fiscal enforcement and accountability measures cannot add additional hardship for residents already living with failing municipal services.

One national process

This was why parliament’s oversight committees (the portfolio committee on co-operative governance & traditional affairs and the standing committees on public accounts, finance and appropriations) intervened.

The concerns that triggered the Treasury’s intervention did not arise in a vacuum. Parliament’s joint oversight approach since last year had repeatedly confronted weak financial management, poor revenue collection, ineffective consequence management and governance failures in distressed municipalities across provinces.

The Treasury’s intervention therefore brought into one national process problems parliament had been confronting municipality by municipality.

Meanwhile, the Treasury’s intervention also exposed something parliament itself must fix. Following our joint meeting with the Treasury, the department of co-operative governance & traditional affairs, the South African Local Government Association and the Financial & Fiscal Commission, the portfolio committee requested a legal opinion on whether the Treasury’s action was lawful. That opinion has now concluded that it acted within the law.

That finding does not end the matter but raises important questions. If the Treasury invokes section 216 of the constitution again, what precisely happens in parliament? Which committee considers the matter? At what point does the Treasury motivate its decision? When do affected municipalities respond, and how does parliament reach a decision within the required period?

The committees have consequently asked that joint rules be developed to provide a clear parliamentary process, including provision for an ad hoc committee where necessary. This is not merely a procedural technicality, as clear rules can help prevent future disputes and ensure that fiscal accountability and the interests of communities are considered quickly and transparently.

So, the equitable share episode has become bigger than the 69 municipalities originally affected. It has now put the spotlight on what meaningful municipal accountability must look like and what it requires

There has also been movement since the Treasury’s announcement of withholding equitable share funding to the 69 municipalities. Subsequently, the Treasury announced that the remaining R7.1bn in withheld July transfers would be released to the 69 municipalities, subject to several compliance conditions. These include deadlines for investigations, disciplinary processes, recovery of losses and, where appropriate, criminal proceedings.

We have been clear that the release of funds should not be mistaken for resolution of the underlying problem. The real test is whether consequences follow, and that test becomes even more important as South Africa approaches the local government elections.

Priorities

On November 4 voters will choose the councils that must confront many of these same financial, governance and service delivery failures. As is the norm in election campaigns, political parties will make promises about fixing municipalities. However, the equitable share intervention has demonstrated that local government reform cannot depend on promises and undertakings.

As part of our oversight engagements the committees have repeatedly called on political parties to prioritise competence and integrity when selecting candidates for these elections. This is a critical issue. The quality of political leadership has direct consequences for whether municipal administrations are stable, budgets are credible and public money is properly managed.

Municipal administrations must also be professional and capable. Provincial and national government must intervene, in time, and provide support where required, according to the powers accorded to them by the constitution.

On the national level, the Treasury must exercise its powers lawfully and proportionately. Parliament, in turn, must have clear mechanisms to oversee and interrogate such interventions, monitor undertakings through to implementation, and eventually assess their impact in communities.

Not either or

Importantly, the people responsible for municipal failures must be held to account. It is difficult to justify a system in which an official or office-bearer can be implicated in serious financial misconduct, yet the immediate sanction is felt by a household that ends up without water or electricity.

That is why the principle at the centre of the debate remains important — municipal accountability cannot come at the expense of communities. In short, withholding funds cannot be the first course of action while sparing recalcitrant municipal officials the consequences they deserve.

At the same time, protecting communities cannot mean shielding municipalities, their administration and political leadership from consequences. We should not have to choose between accountability and service delivery, but must build an accountability system capable of delivering both.

So, the equitable share episode has become bigger than the 69 municipalities originally affected. It has now put the spotlight on what meaningful municipal accountability must look like and what it requires. The measure of success will ultimately be whether municipalities govern better and whether communities receive the services to which they are entitled.

This, our oversight has shown, will require political will, competent leadership, functioning municipal structures such as audit committees, consequences for wrongdoing, support where municipalities genuinely lack capacity, and parliamentary oversight that does not end when the meeting adjourns. This is what voters deserve.

• Mkhize chairs parliament’s portfolio committee on co-operative governance & traditional affairs.

Business Day