Business and government departments are to blame for more than a third of the R25-billion in municipal debt, according to a study by the Department of Provincial and Local Government.
The findings were tabled at a government-sponsored indaba in December, called to discuss the crisis of municipal finances.
The trend was confirmed by MPs during a recent visit to 41 of the 284 councils across South Africa.
”There are people who can afford to pay but are not paying,” said Yunus Carrim, chairman of Parliament’s local government committee.
”In several councils [we found] government departments are not paying, businesses are not paying, civil servants are not paying.”
The lack of coordination between provincial and national departments and municipalities also emerged as a concern.
Local government watchers said this week that the higher levels of government were ignoring and overriding the views of municipalities.
The Local Government Department said 30% of the multibillion-rand municipal debt stems from non-payment by business and 6% by government departments. Households account for 60% of the debt.
The analysis shows that the largest slice of the debt, or R15,6-billion, was accumulated in the nine metros around the country. The 16 largest councils account for R18,6-billion of the debt.
Municipalities in Gauteng are responsible for 51% of the debt, followed by municipalities in KwaZulu-Natal and the Western Cape, where 72% of the R2,3-billion municipal debt is owed to the Cape Town unicity.
Nationally, 26% of the debt is for water and 24% for rates and taxes. Unpaid electricity bills account for 16%.
A small but encouraging improvement has occurred in the payment of municipal accounts by pensioners since the introduction of policies such as pensioner discounts, said Minister of Provincial and Local Government Sydney Mufamadi.
He said it was crucial to implement other credit control tools to encourage payment, such as policies for indigents to separate defaulters who can pay from those who cannot.
This week Mufamadi acknowledged that there had been a lack of coordination between the different spheres of the government and that national policies were not filtering to the municipal level.
He said it was simplistic to single out one reason for municipal debt. Causes range from serious backlogs in developing infrastructure, inadequate revenue bases and non-payment because of inaccurate billing to inaccessible pay-points and inadequate services.
The department has moved to redress some of the problems since December’s indaba.