Funding model of municipalities under the spotlight

Funding has been highlighted as a key factor in turning the performance of struggling municipalities around.

This has emerged at the three-day local government summit in Bloemfontein.

With assets attached in some struggling municipalities, mayors are calling for national government to prioritise local government budget allocations.

Tlhoare Motsoeneng is the Mafube Municipality Mayor, “We are running very small municipalities that are very indigent in nature so you find that if I make one example, it has a population of about 62 000 people and 80 to 90 percent of the population is indigent. And when you look at the distribution of equitable share that national and the province, they are taking a lot of money. Just a small chunk is going to local government and the local municipalities are the ones that are supplying services to the communities. So, I think the issue of revisiting the funding model is going to assist us a lot.”

Free State holds Local Government Summit

 Meanwhile, answering oral questions in the National Council of Provinces, Deputy President Paul Mashatile says National Treasury will implement measures, including cutting budgets, to force national government departments who owe municipalities, to pay their debt.

Mashatile says one such measure is to cut some of the department’s budget to use that money to pay municipal debt. Intergovernmental debt has a crippling effect on the services that municipalities are able to deliver. Mashatile says accounting officers must also ensure that debt is paid within 30 days.

“We will continue to implement these and other measures to eliminate intergovernmental debt and improve delivery to all communities. top slicing is critical because it can’t be allowed that government debt should default, whether to each other, but particularly to municipalities.”

Deputy President Paul Mashatile’s NCOP Oral Question Session