EDITORIAL | Operation Vulindlela has a huge task ahead to tackle local government chaos

Few can disagree that since its inception in 2020, Operation Vulindlela has made a positive mark on the South African landscape.

It has overseen the auction of digital spectrum, championed regulatory changes to enable private electricity generation, introduced reforms to the rail and ports and implemented e-visas and visa waivers.

Some of these projects are further along than others, but there can be no doubt there has been a notable level of improvement.

The enterprise, a joint initiative of the Presidency and the National Treasury aimed at driving structural reforms and economic recovery, is now turning its focus to local government.

It has its work cut out.

Many municipalities are in crisis, crippled by severe cash constraints and unable to deliver basic services. They owe Eskom a combined R82bn, and the various water boards a hefty R21bn, placing huge financial strain on these utilities. Municipal bailouts may be unavoidable.

Last November, auditor-general Tsakani Maluleke told parliament that material irregularities by municipalities had led to financial losses of about R5.2bn since her office's new powers came into effect in April 2019. These powers authorise the AG to take remedial action against government entities flagged for material irregularities. The R5.2bn was related to noncompliance with the law or suspected fraud, Maluleke said.

Her Municipal Finance Management Act report for 2021-22 found that of South Africa's 257 municipalities, only 38 received a clean audit, down from 41. Nearly three in four didn’t have proper financial controls in place and irregular spending had ballooned to R136bn.

Most municipalities are operating at deficits due to gross financial mismanagement and poor governance. A recent survey by Ratings Afrika found that 112 municipalities had a combined operating deficit of R27bn in 2023.

It's a grim picture. Local government is at the core of service delivery, and its failure in this regard has become a significant obstacle to investment. If municipalities fail, our country fails.

So it is heartening that Operation Vulindlela is set to maintain its pace under the new administration of a government of national unity. In his opening of parliament speech in July, President Cyril Ramaphosa listed the fixing of struggling municipalities among his key priorities. He said simplifying and speeding up planning and regulatory processes could make it easier for businesses to invest, which would in turn increase jobs.

This week, after the ANC's lekgotla, the party's head of the local government subcommittee, Parks Tau, reiterated their full support for Operation Vulindlela, saying the country needed an “overarching solution to the debt crisis in our local government system and how that affects service delivery”. He said there needed to be a greater appetite to partner with the private sector to mobilise resources.

There is no magic wand that will instantly transform municipal frogs into princes. But with buy-in from the private sector and a cohesive, co-ordinated plan, our local government landscape can be overhauled into a functioning cog that provides consistent basic services and a conducive environment for job creation. Given the current state of local government, it is hard to believe we can ever get there. But if our leaders prioritise service delivery over politics, our economy will boom.