Ramaphosa unveils rescue plan for local government in Sona

President Cyril Ramaphosa used his first state of the nation (Sona) under the government of national unity (GNU) to outline sweeping measures to turn around the embattled local government sector.

The sector is buckling under the weight of pervasive malfeasance and systemic corruption that has resulted in billions being lost to fruitless, wasteful, unauthorised expenditure each year, threatening to roll back gains made in the energy sector and threatening the viability of SA’s water boards.

In his Sona in Cape Town on Thursday night, Ramaphosa admitted that in many cities and towns across our country roads were not maintained and water and electricity supply was often disrupted.

“Refuse is not collected and sewage runs in the streets. In part, this has happened because many municipalities lack the technical skills and resources required to meet our people’s needs,” he said. “Many municipalities have not reinvested the revenue they earn or collect from these services into the upkeep of infrastructure.”

Ramaphosa said part of the problem was down to the existing design of local government, a sign that the GNU is about to embark on systemic reform of municipalities rather than surface-level issues.

“Many of the challenges in municipalities also arise from the design of our local government system. We will therefore undertake extensive consultation to develop an updated white paper on local government to outline a modern and fit-for-purpose local government system,” he said.

The entrenched issues facing local government have already attracted the attention of Operation Vulindlela, a joint initiative of the Treasury and Ramaphosa’s office set up in 2020 to reinvigorate the economy.

The second phase of the initiative would focus on this smallest unit of government, which has drawn sharp criticism from business leaders and citizens for its failure to roll out basic services such as potable water, electricity, clinics and refuse collection.

Starting this year, Ramaphosa said, the government will work with the country’s 257 municipalities to ensure there is adequate investment and maintenance of the water and electricity systems.

Another measure to rejuvenate municipalities — many of which routinely fail to meet financial management standards set by the auditor-general — is that the government would review the funding model for local councils. While they receive grants from the Treasury, the money is far from sufficient to make up for poor levels of municipal revenue collection for services and rates from residents who suffer from poor delivery of basic services.

“We will do so because many of our municipalities truly do not have a viable and sustainable revenue base,” Ramaphosa said, adding that the government will work with traditional leaders in the implementation of local development programmes.

“We will also seek to work with our traditional leaders in ensuring that they continue their own work as we give them recognition as natural and indigenous leaders of our people,” he said.

Ramaphosa also pledged to expand support to struggling municipalities, drawing lessons from the Presidential eThekwini Working Group — a multistakeholder intervention including representatives from government, the private sector, organised labour and civil society to address service delivery, infrastructure and other socioeconomic challenges in eThekwini metro.

“We are seeing great progress in eThekwini as we implement the district development model, which enables all key role players — as in government, business, labour and community-based organisations — to work together,” Ramaphosa said.

The rot in the sector has been put into sharp focus as the country is set to hold the much-anticipated local government elections in 2026, with crucial metros such as Tshwane and Cape Town run by opposition parties.

In a wide-ranging speech, the president said partners in the GNU had set aside their differences and agreed to work together for the good of all South Africans.

Political parties in the GNU, especially the DA, butted heads with Ramaphosa over the signing of the Basic Education Laws Amendment Act and the National Health Insurance Act.

“In the last week we have adopted the medium-term development plan, which sets out a clear and ambitious programme for the next five years,” Ramaphosa said.

“The actions contained in the plan will advance our three key strategic priorities. First, to drive inclusive growth and job creation. Second, to reduce poverty and tackle the high cost of living, and third to build a capable, ethical and developmental state.”

He said the “most urgent task” is to grow the economy so that “we can create jobs, reduce poverty and improve the lives of South Africans”.

“To achieve these objectives we are strengthening the role of the Public Service Commission in the appointment of key people who direct the affairs of our state.

“We will introduce a graduate recruitment scheme to attract the best and the brightest in the public service,” he said.

In a show of unity this week, both the ANC and DA — the biggest members of the GNU — came together to address the misinformation and clarify the intentions of the Expropriation Act after US President Donald Trump waded into SA domestic affairs with a threat to cut off funding based on a misinformed view about the new regulations.

“We are witnessing the rise of nationalism, protectionism, the pursuit of narrow interests, and the decline of common cause. This is the world that we as SA, a developing economy, must now navigate, but we are not daunted,” Ramaphosa said. “We are, as South Africans, a resilient people, and we will not be bullied.”

mkentanel@businesslive.co.za