The Select Committee on Cooperative Governance and Public Administration, focusing on Traditional Affairs, Human Settlements, and Water and Sanitation, has expressed concern that the Mafube Local Municipality’s poor rates and taxes collection hampers its ability to achieve the goals of the Section 139 (5) (a) and (c) intervention mandated by the provincial executive.
“We are deeply concerned that the municipality only collects 20% of service charges, leaving 80% uncollected,” said committee chairperson Mxolisi Kaunda.
“Financial recovery plans that are not anchored on a strong revenue collection base are futile, as financial resources from services charges are the bedrock of municipal cash flow. It is on this basis that we are extremely worried that the municipality only collects up to 20% of services charges which means that 80% of services are not charged.”
Following their initial visit to Free State municipalities to evaluate provincial interventions, the committee noted President Cyril Ramaphosa’s pledge to review the municipal funding model.
Despite this, it urged Mafube Municipality to enhance billing and revenue collection within the current financial framework.
The committee raised alarm over the municipality’s outstanding debt exceeding R1.5 billion from government departments and local ratepayers.
It also called upon national and provincial authorities to settle these debts promptly to support struggling municipalities like Mafube.
“It is unacceptable that government departments contribute to cash-flow challenges in these municipalities by not paying for services rendered to them,” Kaunda said.
The committee welcomed the municipality’s intention to work on its indigent register to increase its knowledge of clients who are able to pay for services provided.
Meanwhile, the committee was shocked to discover that the municipality owes the South African Local Authorities Pension Fund and Municipal Workers Retirement Fund about R200 million.
The committee said this will deny municipal workers their retirement benefits on their retirement and render them unable to access the government’s two-pot retirement scheme.
The committee also said this is unacceptable and called on the municipality to address it as a matter of urgency to secure workers’ retirement benefits.
In addition, while the committee noted the High Court judgment of January 2025, which found the mayor, exco representative, the municipal manager and the chief financial officer liable for R14.7 million for historical debt owed to the pension fund and the province’s and the municipality’s intention to lodge an appeal, it urged the parties to continue to engage to find workable solutions to the current impasse.
The committee also noted with appreciation that the municipality has filled critical vacancies. The committee is confident that the new staff members will drive the financial recovery plan to resuscitate the municipality and ensure its ability to deliver quality services to the people.
Regarding the visit to the Frankfort Waste Water Treatment Plant, the committee was concerned about the amount of water losses at the plant and urged the municipality to prioritise maintenance of the plant and the entire system to secure its future.
Furthermore, the committee was alarmed to hear about disagreements between the municipality and service providers contracted to develop some of the infrastructure projects that aim to resolve water shortage challenges within the municipality.
After listening to all the stakeholder submissions, the committee will table a report in the National Council of Provinces on its assessment of the impact of the intervention.
Meanwhile, the committee visited the Matjhabeng Local Municipality on Wednesday following the Free State provincial government’s invocation of Section 139 (5) (a) and (c) on 24 November 2024, citing severe financial and service delivery failures as the primary reason for its decision.
The municipality owes R6.8 billion to Eskom, and R7.3 billion to the Vaal Central Water Board.
The provincial executive was of the view that the municipality is in breach of Section 152 of the Constitution as it was failing to implement the objects of a municipality.
“The committee’s visit to the municipality is intended to interact with the internal and external stakeholders and solicit their opinions on the constitutional, procedural and substantive matters related to the intervention,” Kaunda said.
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