Between a rock and a dark place: Municipalities battle to keep the lights on in the face of escalating debt

In the space of one week in September, the country’s load shedding status sent any sniff of foreign investors scurrying for cover, and the City of Tshwane narrowly averted being plunged into complete darkness after settling its outstanding debt to Eskom of over R1,6bn. It joined the City of Johannesburg, Ekurhuleni, and a long list of smaller municipalities which continually roll over debt, and default on payment settlement plans until the threat of Doomsday. Pay up, or we throw the big switch.

Court invalidates an unlawful contract and holds officials personally liable for unauthorised and irregular expenditure

The case of Imvusa Trading 1581 BK v Oudtshoorn Municipality is about a monetary claim arising from a contract between the Oudtshoorn Local Municipality and Imvusa Trading 1581 (Imvusa). The Municipality contracted Imvusa to repair potholes on its behalf without following the requirements set out in the Constitution and the Municipal Finance Management Act of 2003 (MFMA). The Court held that concluding procurement contracts by deviating from legislated procurement requirements renders such contracts unlawful and therefore invalid.

Court prohibits traditional authorities from developing land without the approval of the municipality

Since the pre-colonial era, traditional leaders have allocated land to residents in terms of indigenous law. In the democratic era, traditional leaders continue to allocate land to residents and issue permissions to occupy (PTO). These PTOs are sometimes issued by traditional leaders to a resident that is willing to pay to occupy land that is owned by the municipality. This can give rise to illegal occupation of municipal land and municipalities having to incur enormous expenditure in trying to service these developments.

Determining the size of local councils in Ethiopia: The larger, the more democratic?

It has been close to ten years since the local government elections were held in Ethiopia. The elections have been indefinitely postponed since 2018 because the political and security situation in the country did not permit conducting the elections.

Exploring the digital skills needs of small and medium-sized enterprises and co-operatives

Small businesses play a pivotal role in contributing to the nation’s gross domestic product (GDP) and employment creation. According to the International Finance Corporation, small businesses contribute about 34 percent of the GDP in South Africa and employ between 50 and 60 percent of the country’s workforce.

Exploring the smart city concept and its implications on the local government sector

Migration and population expansion have accelerated the rise of urban population in cities across the world, including Southern Africa. Africa has experienced substantial urbanisation over the past few decades, and this trend is anticipated to continue.

Land-grabbing: Municipalities must uphold the Constitution when dealing with unlawful occupiers

Land-grabbing is a term that captures the story of land dispossession in South Africa. The term has its roots in our apartheid history in which the authoritarian government initially deprived the Black majority (broadly defined) of their property. In democratic South Africa, land grabbing is often used to describe the process in which South Africans (black and white, men, women and children) are dispossessing the state and private businesses of land.

Rogue leadership and lawlessness in Kannaland Municipality

More than half of Kannaland Local Municipality’s population lives in poverty. Improved access to water and sanitation, well-maintained roads, adequate parks and recreation facilities, etc. can go a long way to ensure a dignified living in all its communities. However, Kannaland has struggled to deliver services since December 2018, when it was placed under provincial administration, a situation that still persists. Political instability, maladministration and poor oversight are among the root causes of poor service delivery. As political parties continue their political scheming to gain access to political office, service delivery in the Municipality continues to decline.

Traditional leaders, municipalities and land use management: Who does what?

On the 20th of October 2022, the Dullah Omar Institute (DOI) in partnership with the Hanns Seidel Foundation South Africa held a webinar under the theme “traditional leaders, municipalities and land use management”.

Building capacity at the municipal level to develop the local economic development potential of marine resources

Coastal and marine management is a potential area of focus for municipalities in their local economic development initiatives. However, the local government sphere currently has limited capacity to carry out this mandate. In addition, the lack of general capacity in government, from the national to the local sphere, is a major threat to sustainable coastal management.

City of Cape Town wants to run the metro railway service

A simple google search of South Africa’s railway leads one to pictures and videos of dilapidated railway networks, in sharp contrast of what one would imagine when told ‘South Africa has the best railway system on the continent [of Africa]’. The dilapidated Goerge Goch station has even become a popular meme on [South African] twitter, often used to express shock at anything but the horrifying state of one of many railway stations in South Africa. Behind the ‘thixo wase Goerge Goch’ phrase, lies the sad reality that the once mighty railway lines of South Africa are quickly becoming no more.

High Court rejects unwarranted deviation from strict procurement rules in Nelson Mandela Bay Metro

In Nelson Mandela Bay Metropolitan Municipality v Erastyle (Pty) Ltd, the Court had to decide whether Erastyle (Pty) Ltd (Erastyle, the first defendant of eight defendants) was lawfully appointed to provide a service to Nelson Mandela Bay Metropolitan Municipality (the Metro). Secondly, whether the payments received by Erastyle from the Metro amount to irregular expenditure in terms of section 32 of the Local Government: Municipal Finance Management Act (MFMA).

Municipalities may not charge fees to protestors for security and traffic control services

The right to protest is essential to South Africa’s constitutional order. Protests played an important role in South Africa’s transition from apartheid to the current democratic dispensation. Protests continue to play a vital role in enabling citizens to hold the government accountable. It then goes without saying that the right to protest, as provided for in section 17 of the Constitution, should not be limited unjustifiably. In Right2Know Campaign v City Manager of Johannesburg Metropolitan Municipality, the Court confirmed the importance of the right to protest in South Africa.

The prosecution of corruption in local government

The National Prosecuting Authority (NPA) must prosecute corruption at all levels of government. While much of the focus has been on the capture of national government and national state-owned enterprises (SOEs), there has also been widespread corruption in municipalities.

SCA invalidates by-laws restricting the transfer of immovable property

In Govan Mbeki Local Municipality and Another v Glencore Operations South Africa (Pty) Ltd and Others, the Supreme Court of Appeal (SCA) had to determine the constitutionality of section 76 of the Govan Mbeki Spatial Planning and Land Use Management By-law of 2016, and section 86 of the Emalahleni Municipal By-law on Spatial Planning and Land Use Management of 2016 (SPLUMA) which imposed restrictions on the transfer of property in these municipalities. The constitutionality of these provisions was challenged in Court on the basis that they exceeded local government powers in terms of section 156 of the Constitution read with Schedule 4B. The SCA agreed with the High Court's decision that the provisions were unconstitutional and therefore invalid.

The impact of disaster or crisis on business continuity in the local government sector

A reflection of the impact of disasters in the local government sector provides a good platform for a discussion on the need to implement business continuity plans for municipalities. A business continuity plan refers to the processes and procedures a municipality must implement to ensure that mission-critical functions can continue during and after a disaster or crisis.

Court clarifies the interpretation and application of a Municipal Spatial Development Framework

In Choisy-Le-Roi Owners v The Municipality of Stellenbosch the Court addressed the question of how a Municipality’s Spatial Development Framework (‘MSDF’) should be interpreted. The judgment confirms that a municipality may not rely on a draft MSDF in making spatial planning decisions and if it does, it runs the risk of having its decision struck down by a court of law. Thus, only the approved MSDF may be utilised when making spatial planning-related decisions.

Court stops Eskom from withdrawing funds from Renosterberg Local Municipality’s bank account

The issue of municipal debt to Eskom is an ongoing concern as noted earlier in the Bulletin. The MEC: Northern Cape Provincial Government: Department of Cooperative Governance and Traditional Affairs v The Renosterberg Local Municipality forms part of a series of cases that attempts to navigate the issue. While Eskom is permitted to collect its dues from municipalities, it may not do so in a way that significantly impairs a municipality’s ability to operate and deliver services to its citizens.

Mines, malls and cellphone masts: how the Constitutional Court confirms the need for municipal approval and government doesn’t seem to want to listen?

In June 2020, the Constitutonal Court handed down an important judgment for local government. In Telkom SA SOC Limited v City of Cape Town and Another, the question was whether Telkom, as a holder of rights under the Electronic Communications Act (ECA), must comply with municipal planning and building regulation bylaws before exercising those rights.

Municipal Systems Amendment of 2022: Will it depoliticise municipal administration?

In May 2022, Parliament passed the Municipal Systems Amendment Bill which regulates many aspects of municipal administration. The Bill is not new. It was initially passed in 2011, but the Constitutional Court struck down the relevant Amendment Act in 2017.

One step forward, two steps back: 2021 local government elections resulted in lower women’s representation than the last few elections

In our previous article on women’s representation in local government, we reported that the numbers of women elected into office for proportional representation (PR) seats was significantly higher than that for ward seats due to a large part because of the policies of political parties such as the African National Congress (ANC) and the Economic Freedom Front (EFF) which facilitate women’s inclusion in party lists through the ANC’s use of a zebra list – one man, one woman and the EFFs gender equality policy. Looking at the 2021 elections, it is unfortunate that we have taken one step forward, and two steps back.

Safeguarding the integrity of councillors and senior managers in local government

On 12 April 2022, the Dullah Omar Insitute (DOI) convened a webinar on 'Safeguarding the integrity of councillors and senior managers in local government'. The webinar, which was supported by the Hanns Seidel Foundation, had a panel consisting of Prof Jaap de Visser (Director: DOI), Dr Phindile Ntliziywana (State Law Advisor: Eastern Cape Provincial Government) and Ms Phatima Rawat (Associate: Ethics Institute).

AARTO Acts: High Court says national government must respect the autonomy of provinces and municipalities

The national government has a shared responsibility with provinces and municipalities to ‘secure the wellbeing of the people’. It may achieve this objective through legislative and policy interventions, among other ways. When pursuing these interventions, it may not do so in a way which infringes the autonomy of provinces except in limited circumstances provided for by the Constitution.

Court tells the City of Cape Town to exhaust intergovernmental dispute resolution mechanisms

In City of Cape Town v the Minister of Energy, the Court had to decide whether the case between the City of Cape Town and the national Minister responsible for energy (the Minister) amounted to an intergovernmental dispute which had to be resolved in terms of dispute settlement procedures provided for in Chapter 3 of the Constitution and Chapter 4 of the Intergovernmental Relations Framework Act 13 of 2005. The Court ruled that the dispute between the City and the Minister was an intergovernmental dispute which the parties should have resolved in terms of the Intergovernmental Relations Framework Act before any of the parties could approach a court of law for resolution.

Local Government in South Africa: Responses to urban-rural challenges

The Dullah Omar Institute (DOI) is one of 18 international partners of the LoGov project titled ‘Local Government and the Changing Urban-Rural Interplay’. The project seeks to establish an international and intersectoral training and research network to identify, and evaluate best-fit practices for local governments in order to address the changing urban-rural interplay and manage its impacts. It is funded by the European Commission as part of the EU-Rise Horizon 2020 Marie Skłodowska-Curie Actions (MSCA).

Municipalities and Eskom must work together to secure the well-being of South Africans

Courts have on several occasions delivered judgments which held that Eskom must first exhaust the alternative remedies available to it to hold municipalities accountable for non-payment for bulk electricity supply before approaching the courts for further relief or restricting bulk electricity supply.

The declaration and publication of financial interests of local councillors in The Netherlands and South Africa

Democracies are built on trust. Citizens must be able to trust that their elected local councillors, members of Parliament and heads of government are honest and transparent. This also applies to their private financial interests, and anything that could affect the way they act in their elected positions. It is important to conduct research, monitoring and advocacy on this.

The declaration and publication of the financial interests of councillors and senior managers: what the law says

In 2021, Julius Malema MP was a director of Mgagao Shamba Pty (Ltd), a farming company. Furthermore, he received two gifts, namely whiskey from Kgantontle Consulting and a pen, diary and USB from the Cape Town Press Club. How do we know this? We know this because it is recorded in the Register of Members Interests which can be downloaded from the website of Parliament. Members of Parliament regularly declare their interests with Parliament’s Registrar of Interests, and aspects of this are published. How does this work in local government? What are the responsibilities of municipalities in this regard? For councillors, it is regulated in the Code of Conduct for Councillors, which appears in Schedule 7 of the Municipal Structures Act 117 of 1998. For senior managers, it is regulated in the Code of Conduct for Staff Members, which appears in Schedule 2 of the Municipal Systems Act 32 of 2000.

The Local Government Ethical Leadership Initiative

The Local Government Ethical Leadership Initiative (LGELI) was launched in December 2020 as a partnership project between the Ethics Institute, the national Department of Cooperative Governance (DCoG), the South African Local Government Association (SALGA) and the Moral Regeneration Movement (MRM).