Since coming to office in 1994, the South African government claims to have provided seven million additional people with access to clean, running water and 3,5-million people with access to electricity.
While impressive, these figures have been challenged on a number of fronts. One criticism is that much of the infrastructure is of low quality or no longer operational. Another criticism is that millions still remain without services.
Even more fundamental is the argument that service delivery is being undermined by policies of cost recovery. That is, by charging people the full cost of the services they receive. A recent survey by the Municipal Services Project and the Human Sciences Research Council found that up to 10-million people have had their water and/or electricity cut off since 1994. In most cases, those cut off were simply unable to pay the rising costs of water and electricity.
The extent and harshness of these cut-offs is unprecedented in South Africa. While service delivery was woefully inadequate under apartheid, very few cut-offs for non-payment occurred.
In the brave new world of neo-liberalism, by contrast, cost recovery is the guiding ethos of service delivery. For the African National Congress — and every other major political party — cost recovery is about balancing budgets, fiscal restraint and running the country like a business.
Some even argue that policies of cost recovery are ”pro-poor”, ensuring financial ”sustainability” and providing the capital to extend services to those who do not yet have access.
Equally important are the moral arguments used to support cost recovery. Poor people are often accused of being locked into a ”culture of non-payment”, abusing their ”right” to water and other basic services while refusing to accept their ”responsibility” to pay.
In classic liberal terms, cost recovery is a form of market discipline, keeping in check our self-maximising desires by forcing us to pay the full costs of a good or service. Only in this way can we learn the ”true value” of a scarce good such as water.
But cost recovery is linked to another agenda: the privatisation and commercialisation of municipal services. Full (or near full) cost recovery is a prerequisite for potential private investors. No firm wants to buy into a business that only collects 40% of its revenue base.
It would be a mistake, however, to conflate cost recovery and privatisation. Most publicly owned service providers in South Africa are also pursuing cost recovery models, hoping to become more ”efficient” and more ”accountable” in their own right. In fact, public sector managers are often the most aggressive proponents of cost recovery, keen to mimic private sector counterparts.
The failures of this model run deep. The cholera epidemic in KwaZulu-Natal, for example, created in part by the imposition of cost recovery on water, has cost the state tens of millions of rand more in crisis management than it used to spend to provide water for free. Cost recovery has also had severe social consequences, leading to the loss of personal dignity, environmental degradation and increased domestic violence.
Our conclusion is that both the economic and moral arguments for cost recovery ring hollow. Cost recovery is not pro-poor. It penalises those most in need of service support while those who benefited most from service subsidies under apartheid (big business and white suburbanites) escape the financial responsibility of reversing apartheid’s legacies.
So what is to be done? ”Free services” may help alleviate these concerns. But even with free lifelines, thousands continue to have their services cut off because of arrears. Data, for example, shows that 256 325 households across the country had their electricity cut off and 133 456 households had their water disconnected in the last three months of last year — six months after the free services programme was introduced.
Block tariffs (charging more as consumption increases in order to subsidise the poor) can also make a difference. But most tariff structures in South Africa are only marginally progressive. In some cases industry and suburban households pay less for water and electricity than low-income households.
The bottom line is that the citizens of South Africa have a constitutional and human right to basic services. Harsh cost recovery measures are undermining these rights.
The government is faced with a clear choice: either abandon the dogma of cost recovery or face the wrath of thousands, even millions, of citizens victimised and criminalised because they cannot afford to pay the price of the essential requirements of life.
David McDonald and John Pape are the editors of Cost Recovery and the Crisis of Service Delivery in South Africa, released this week by Human Sciences Research Council Publishers and Zed Press