Under the constitution, the national government has always been able to intervene directly in the management of a dysfunctional municipality, but it has been extremely reluctant to exercise its oversight powers. Where it has intervened, any improvements have generally been limited.
First, it starts from the right premise, recognising that the crux of the problem in SA’s municipalities is that there is a leadership culture of not enforcing debt collection, and a consumer culture of refusing to pay for services, coupled with a persistent crisis of financial mismanagement. Whether the plan succeeds will depend on how badly municipalities want their Eskom arrears written off, how highly they value their financial sustainability, and how much of a consumer backlash they are prepared to endure to achieve this.
It will also fail if municipalities consider the political costs of compliance too high. The Treasury has not factored in the problem of affordability other than to say it will give municipalities three to five years to phase in some of the more onerous requirements.