Gauteng MEC of co-operative governance Lebogang Maile has painted a bad picture of municipalities highlighting an R8.6bn loss in revenue and damage to infrastructure in the past four months.
Maile told journalists in Sandton on Wednesday that the Covid-19 pandemic had worsen existing problems as municipalities experienced reduction in property rates, water, sanitation and electricity.
Maile warned that the decline in revenue collection in all the municipalities would have a negative impact on service delivery.
"Water and electricity will be the services that will be severely affected amongst others. As you know these are important basic services," he said.
Collectively, municipalities under collected by R2.6bn in April, R2.4bn in May, R2.2bn in June and R2bn in July.
“These revenue reductions have had a negative effect on the cash flow of our municipalities and affected their ability to meet their obligations to creditors such as Eskom, Rand Water and other critical suppliers within the service delivery value chain,” he said.
Finances in municipalities have also been pressured by spending on overtime, protective clothing and demand for services as part of Covid-19 response.
Gauteng has been the epicentre of Covid-19 for some time during the national lockdown, which demanded a better response from the provincial government.
Premier David Makhura even requested the national government to be returned to level 5 lockdown to restrain the rising numbers of infections. Municipalities provided support to provincial and national governments strategies in dealing with the pandemic. The government shutdown the economy, more people lost their jobs and ratepayers were left with less money to pay for municipal services.
Maile said his department has already started supporting municipalities.
“We are also providing a multidisciplinary team of revenue experts to strengthen revenue enhancement and debtor’s management with a focus on having a positive effect on the liquidity of the municipalities,” Maile said.
Municipalities continue to struggle with high levels of water and electricity losses due to bypassing, non-metering of customers, inaccurate billing, vandalism and illegal connections.
“Some of these problems are caused by lawlessness, which requires law enforcement to step up to the party to stop cable theft and vandalism of infrastructure. But there is also a need for communities to work in partnership with us to deal with this phenomenon as well as bring an end to the crippling problem of illegal connections…,” he said.
Maile conceded that old problems such as unauthorised, irregular and wasteful expenditure (UIFW) have persisted in the municipalities.
In the City of Johannesburg alone, UIFW increased from R4.3bn in 2014/2015 to R12bn in 2018/2019 financial year.
Furthermore, some of the municipalities are still struggling with filling vacancies. As of August, Johannesburg had a 42% vacancy rate for senior posts, Tshwane at 10% and Ekurhuleni at 0%. Vacancy rates in Lesedi local municipality is at 50%, Emfuleni at 25% and West Rand district municipal is at 33%.
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