Deputy President Paul Mashatile has addressed concerns over municipalities’ debt to Eskom and water boards during the question and answer session in parliament on Thursday.
Mashatile started off by emphasizing the importance of providing essential services such as water, electricity, and sanitation. He said different government spheres are working together to ensure that municipalities are able to deliver these sustainably.
“In our view, the sustainable provision of essential services such as water, electricity, sanitation must be the hallmark of developmental local government,” he said.
“The task delegated to myself, working with [the] Department of Cooperative Governance and Traditional Affairs, the National Treasury and other departments, is to ensure that municipalities deliver critical services.
“In the immediate, we have been helping municipalities to pay debts owed to Eskom and water boards.”
It was reported in 2022 that municipalities owe about R56.3-billion to Eskom, however, the debt continues to rise.
Mashatile said the government has concomitantly introduced a debt-relief package for “Eskom to improve the utility’s balance sheet, which involves writing off some of the municipal debts under strict conditions with guidance from the National Treasury”.
This plan requires participating municipalities to make regular payments for their current bills for 12 consecutive months, set tariffs that reflect costs, and install smart prepaid meters.
Mashatile said the culture of non-payment is concerning. Thus, Eskom is working on a smart metering solution to change consumer behavior by reinforcing a culture of payment for services rendered.
He said the municipal debt relief is also conditional and application-based, aiming to correct underlying behavior in operational practices at defaulting municipalities.
“The culture of non-payment, not only by municipalities but also by all organs of state and individual household customers, is concerning.
“As the government, we cannot over-emphasize the need to enforce the culture of payment for services rendered.”
Regarding water debts, municipalities owe more than R60-billion to water boards.
“Municipalities and water boards are responsible for 65% of the debt to the water trading entity. As of December 2022, water boards were owed R60.1-billion by municipalities. This includes R10.9-billion that is overdue for more than three months.
“The escalating debt in the water sector is attributed to the absence of economic regulatory regime for infrastructure, cost in pricing and culture of non-payment of services, water losses and unauthorised connections.”
He added that measures put in place to manage this issue include the adoption of credit control and installation of bulk prepaid meters, and are dependent on coordination across all spheres of government.
“This is why the government will work with all sectors of society to increase and build sustainable economic activities in all municipalities to create viable tax-based services to develop revenue and social economic development,” he said.
Mashatile also addressed concerns over cadre deployment affecting the performance of the municipalities, stating that the distress in municipalities is not purely related to personnel.
He affirmed that it is the right people that lead these municipalities, adding that they were duly checked and interviewed before being sworn in.
“We have the right people leading these municipalities, because of the processes we introduced. You will see a lot of improvement going forward.”
The grey list
The Phala Phala game farm scandal involving President Cyril Ramaphosa was brought up again in the National Council of Provinces on Thursday.
The MPs questioned when the president, as well as Russian President Vladimir Putin and former deputy president David Mabuza would account for their alleged crimes.
The MPs also wanted to know if Mashatile, in his capacity as the chairperson of the cabinet committee on justice, crime-prevention and security, would prioritize the speedy prosecution of high-profile cases to remove the country from the Financial Action Task Force grey list.
The MPs further enquired if former president Jacob Zuma would be re-arrested to continue his prison term, and if former correctional services commissioner Arthur Fraser would be charged for allowing his early release.
In response, Mashatile stated that no one is above the law, reiterating that the president had submitted himself to law-enforcement agencies and that the Reserve Bank and the public protector had both issued reports on the Phala Phala matter and urged MPs to refrain from interfering.
“Through the cabinet committee on justice, crime-prevention and security, we will continue to enforce the implementation of the high-level goals, ensuring that all relevant agencies and departments are addressing deficiencies identified by the Financial Action Task Force.
“Let us not interfere,” said Mashatile.
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