Who Runs Our Municipalities?

Njaliwe Banda, the Associate Partner of Ntiyiso Consulting Group

The 2020/21 AG report highlighted that Municipalities had a collective revenue of R431.03 billion, of which R304.56 billion is revenue generated by the municipalities themselves. Unfortunately, the report also states that only 69% of the current revenue debt is recoverable.

A growing challenge that the municipalities are facing in the collection of revenue is the uncertainty of who is running the Municipality. As part of the municipality’s mandate, they are required to provide electricity and water services to their citizens. One of the services is the implementation of meter reading services to allow the municipality to accurately determine the revenue owed to them for billing purposes. In addition, the municipality, based on policy and legislation is allowed to implement credit control actions on accounts not paid as per section 96 (a) of the Municipal Systems Act which states, “A municipality must collect all money due and payable to it, subject to this Act and any other applicable legislation;”

In addition, the policies implemented by the municipality should cater for credit control and debt collection policy procedures and mechanisms. These policies may be supported and enforced utilising the Municipality’s By-laws.  Although this is law and non-adherence to this can result in the prosecution of contraveners of this law. A growing pattern has emerged where there are growing cases of intimidation and access restriction of certain areas by inhabitants of the municipalities. The people of the areas do not allow municipal staff or resources to access the areas siting violence if the area is breached.

One such scenario is a local municipality in the Northwest where the Municipality Is finding difficulty in accessing a specific area. This area is a great contributor to the overall collection of the Municipality’s revenue. The total number of meters in the area equates to 21% of the overall number of meters in the Municipality, 99% of these are water meters. Numerous attempts to access the area have remained fruitless as the consumers have cited multiple challenges that are the main contributor to this. The main challenge is the ineffective service delivery in the area. Consumers often go for long periods of time without water and sewerage infrastructure, which is dilapidated, causing sewage spillage into open roads. Furthermore, the area is inundated with skwatta camps that have resorted to illegal electricity connections. The owners of the electricity, therefore, feel it is unfair they have to bear the costs of these illegal connections, therefore denying the municipality access.

The effect of non-access to this area means that customer consumption is estimated for billing purposes. This unfortunately further exasperates the situation as consumers who do not agree to their estimated bills, do not want to pay for services. Therefore when there is an attempt to disconnect/restrict services, this is also denied.

Municipal resources have been kidnapped, abused and violated in their attempts to access these areas. Municipal infrastructure and resources have been damaged in the same vein due to structural infrastructure and fires set. So what is the conclusion? Unfortunately, the Municipality is faced with a Catch-22. In the sense that the inability to accurately gather consumption data is forcing estimations, which clients are then disputing. In addition, the inability to collect this revenue will affect the availability of funds to rectify the service delivery challenges in the area.

How do we flip the script and return the control to the Municipalities? This is when customer education and awareness projects are key for all Municipalities. The consumers do not have adequate information on the necessity of allowing access to these areas as it has a ripple effect on the entire value chain. Customer centricity is key in all organisations including municipalities. If there is a focus on understanding the underlying challenges that the consumers and communities face and developing tailor-made solutions to address them, this will ensure that consumers then feel appreciated and start to develop an understanding of Why. Why do they need to come, What does it mean for me?

 The effectiveness of these programmes requires buy-in from all key stakeholders such as Municipal Managers, Councillors and community leaders. In most instances these community leaders have a great influence on the people, therefore working together will ensure we achieve success. In addition, recruiting people within the community will create empowerment within and the peers recruited will be better placed to be granted access to these areas.

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