Independent business community Sakeliga has instituted court proceedings to reverse municipal decline throughout South Africa, proposing a new form of municipal administration, with independent control over electricity and other service charges.
In court papers currently being served on two municipalities in the North West, as well as to Finance Minister Tito Mboweni and others, Sakeliga is asking the court for far-reaching, “novel interventions” that have never been applied at municipal level, it notes in a statement.
Sakeliga’s interventions revolve around the establishment of a so-called “special master”, who takes control of electricity and water fees, in addition to compulsory administration, and compulsory interventions by the National Treasury’s Municipal Finance Recovery Service.
The organisation states that the special master must also compile evidence of corruption and related matters and report to it, the respondents and the court.
Sakeliga CEO Piet le Roux says the new case moves beyond temporary solutions and seeks to prevent access by incompetent or corrupt municipal officials to water and electricity payments in the first place, which is what is required for a long-term solution.
To this end, Sakeliga is requesting the court to appoint a special master, such as independent auditors, to take control of water and electricity payments.
The special master may then make payments directly to Eskom and water suppliers, as well as for maintenance of electricity and water infrastructure, with only a remaining portion to be made available to the municipality and the administration team.
“The purpose of the court case is to save local economies by providing a structural solution,” Le Roux says.
He adds that although Sakeliga and other organisations are regularly successful with interdicts and other short-term interventions, lasting solutions require control over the flow of money.
“After years of failure at all levels of government to intervene as they should have, we are now asking the court to order that the special master take control of the most important financial matters, those regarding water and electricity, until such time as the National Treasury’s financial recovery plan has been properly implemented.”
Le Roux states that failure at local level is a result of a collapse of management and control at all levels of government, right up to Cabinet.
“If we were to simply continue obtaining interdicts banning service interruptions by Eskom and water boards, then Eskom and those water boards would collapse financially, taking the whole fiscus with them.”
However, Le Roux says that if it is allowed for electricity and water to be cut off or interrupted, then it heralds the end of that local economy, following which property values will fall to zero, and whole populations would migrate to the metropolitan areas.
“Services must be rendered and payments for those services must reach the right destinations,” he states.
The litigation strategy forms part of Sakeliga’s larger strategy for local economic recovery, which includes an affiliate programme for chambers of commerce, since chambers can play a key role in local economic recovery.
The affiliate programme promotes cooperation between chambers, reduces litigation costs, and leverages economies of scale for greater efficiency, according to Sakeliga.
The organisation invites chambers that support a market economy and a constitutional order to affiliate with Sakeliga.