FINANCIAL FITNESS BY JESSIE TAYLOR
Capable public servants
ensure a capable state T
he successful formula for strengthening local government delivery can be seen in the management of several municipalities. At the heart of this delivery focus lies the commitment of public sector management and staff – something that new regulatory frameworks will look to build on. The highs and lows Ratings Afrika released its annual Municipal Financial Sustainability Index report for the year to June 2020 in April. The report found that the aggregate cash fall facing the sector is around R50.7-billion. This number has been exacerbated by the challenges of the Covid-19 pandemic. The Index rates municipalities out of a score of 100, looking at their operating performance; liquidity management; debt governance; budget practices; affordability; and infrastructure development. It considers financial sustainability as the ability of a municipality to deliver services, as well as develop and maintain
44 | Public Sector Leaders | May 2021
infrastructure, without unplanned increases in rates or decrease in its level of services.
The public service is diverse, with a huge range of skills, qualifications and capabilities The report found that South Africa’s big metros had felt the brunt of the economic consequences of Covid-19. In the top eight metros, which are home to around 40% of the country’s population, and are responsible for around 60% of the GDP, for the first time, the average financial sustainability score dropped below the minimum threshold for viability, as a result of the pandemic. However, some municipalities are performing well. The report identified the top municipalities as Mossel Bay, Saldanha Bay, Swartland (Malmesbury) and Overstrand (Hermanus) – along with Midvaal in Gauteng.
Anton Bredell, the Minister of Local Government, Environmental Affairs and Development Planning in Western Cape says independent reports are critical weather vanes in indicating the ability of a municipality to provide services and a better life to the people in its communities. “It doesn’t mean there aren’t challenges in those municipalities and these must be acknowledged. There are many challenges and the triple impact of poverty, unemployment and inequality remains a massive issue. In the Western Cape, we continue to see massive population growth, driven in a large part by ongoing inward migration into the province. We also see continued urbanisation that is placing strain on larger councils. However, reports like these show councils continue to perform despite the challenges. It also shows the public that their money is being well managed and not stolen or wasted.”
