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The culture of non-payment in a dysfunctional state

South Africa

ANALYSIS

The culture of non-payment in a dysfunctional state

Illustrative image | Sources: Adobe Stock | Kingpng | Flickr

The issue of non-payment for services reveals important aspects of our politics, the weakness of our state and how the councils’ weaknesses are likely to cascade into a massive problem for Eskom.

Councils around South Africa have battled to ensure that they are paid what they are owed for providing services. Now, two major DA-controlled cities, Joburg and Tshwane, say they will cut off people who do not pay for services or rates. This may appear the obvious reaction, as it is what councils around the world do in these situations. Our society, however, has certain… features, which could make this much more complicated than it first appears. 

The issue reveals important aspects of our politics, the weakness of our state and how the councils’ weaknesses are likely to cascade into a massive problem for Eskom. 

Last week, the mayor of Tshwane, the DA’s Randall Williams, announced that Tshwane would cut off those who were not paying. This involved the headquarters of several national government departments and a number of businesses, including the Sheraton Hotel, which is part of a giant international group.

services non-payment tshwane joburg
Services are cut off for non-payment in the City of Tshwane Metropolitan Municipality on 8 February 2022. (Photo: Helenus Kruger / City of Tshwane)

The ANC’s Gauteng Cooperative Governance MEC, Lebogang Maile, tweeted his support for Williams. He said: “It can’t be right that some pay and some don’t. In fact, municipalities across the province should follow suit. This should not be misconstrued for political scoring. It is not. They are fulfilling their mandate.” 

On Monday, the DA’s Joburg mayor, Mpho Phalatse, confirmed that her metro was following the same procedure and identifying buildings that had not paid their bills.

Some of the details are astounding. As the Sunday Times reported, the Charlotte Maxeke hospital alone owes more than R200-million. Of course, as Phalatse confirmed, the city is not planning to switch off the hospital.

But it does show how the Gauteng health department has been so badly run that it has not paid the bills for this and other hospitals. As another example of this, the Gauteng health department suspended several officials over the weekend, after it emerged that the department’s bill for the AngloGold Ashanti Hospital’s refurbishment had rocketed from about R50-million to R558-million.

Gauteng officials suspended over R588m refurbishment of AngloGold Ashanti Covid hospital

For many, all of this is too obvious. The councils are only doing what they should do, simply following their policies as spelt out in billing arrangements, and switching people off. In fact, they should have done this years ago.

However, this could turn into a major test for these councils and others who try to follow their example.

First, any business that finds its ability to trade being threatened is likely to test this in court. For the councils to prevail, they will have to prove that all their figures are correct — that their billing system has captured all of the data accurately.

Joburg’s billing system has been known for about 15 years to be unreliable and often just wrong. Several attempts have been made to fix it, but residents still complain of major problems.

It is likely that unless the city has all of its ducks tidily in the most perfect of rows, some kind of legal embarrassment could result.

This has happened before.

Ten years ago the city found itself in a fight with ratepayers. They went to court. First, they demanded that the city no longer just switch people off. This part of the application they won. The second part of the application was never heard. This may mean that the precedent from the first part of the application stands.

It is possible that some businesses in Joburg and in Tshwane will quote this precedent or win similar actions.

That said, the actions of these councils may also mark an important turning point.

services non-payment tshwane joburg
Services are cut off for non-payment in the City of Tshwane Metropolitan Municipality on 8 February 2022. (Photo: Helenus Kruger / City of Tshwane)

It is well known that there is what some ANC figures, including Deputy President David Mabuza, have called “a culture of non-payment” in our society. Organisations like the Soweto Electricity Crisis Committee believe that people should pay a monthly fee of about R300 a month for electricity (they base this on what they say was an ANC election promise in 1994).

Eskom says that in some places there is a payment rate of lower than 5%. It also says that illegal connections have reached the stage where it has to impose what it calls “load reduction”, a process whereby supplies are cut to certain areas at certain times. This is because the transformers were not designed for the load which they are bearing now, which is the result of illegal connections (and Eskom is not being paid for this electricity).

Many councils around the country are simply not able to collect the revenue that is owed to them and have defaulted on their Eskom bills as well.

Some of Eskom’s financial problems stem from this.

This is a demonstration of how problems at one level of government have an impact on another section of government. In the case of Eskom, the buck stops with it, because it has to pay for coal to generate power. Businesses and councils have won court orders preventing Eskom from switching them off.

This means that Eskom ends up having to provide power to entities that do not pay.

services non-payment tshwane joburg
Services are cut off for non-payment in the City of Tshwane Metropolitan Municipality on 8 February 2022. (Photo: Helenus Kruger / City of Tshwane)

In the context of the “culture of non-payment”, the ANC may well be quietly hoping the DA-led councils achieve some success. If Joburg and Tshwane are able to force their people to pay up, then perhaps other ANC councils nationwide will be able to follow suit and the entire “culture” could be rolled back.

However, both Joburg and Tshwane have not, as yet, switched off individual households in the same public way they have businesses and government departments.

Switching off individual households is much harder from a PR point of view than doing the same to businesses. You can imagine the image of children in the middle of winter with no electricity, or of a child studying by candlelight.

It would lead to claims that councils are heartless and more intent on getting money than providing services.

And yet without doing that, there is no chance of changing this “culture of non-payment”.

Also, with the 2024 election being so important, it is unlikely in the extreme that the ANC will attempt to do this on a large scale.

This suggests that despite what appears to be broad economic support (both the ANC and the DA agree), there are unlikely to be major changes. Simply put, the problem is too deep-seated. It will require long-term sustainable interventions.

Still, without a major change, without people paying for the services they consume, it will be impossible for councils, and for Eskom, to continue operating.

In the end, the buck has to stop. Somewhere. DM

Gallery

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All Comments 8

  • Long-term sustainable interventions – like what? I don’t see any in KZN. My gardener boasts he has enjoyed electricity since the dawn of democracy at absolutely no cost. He turns on his electric oven and opens the door to heat his house 24/7 in winter. His water geyser is never turned off. This is not a rare case in Msunduzi/ uMngeni. Meanwhile, in the world of extortion, we pay.

  • I can assure you – if I should be more than about 3 days late with my payment, the services to my property in Jo’burg will be disconnected. The fact that I have been paying diligently for the past 30 odd years makes no difference. Maybe I should join the anc and/or change my surname?

  • Your information is incorrect – Eskom does switch off electricity for non-payment in the suburbs. Its in the townships that they don’t switch off for individual default. All animals are equal, but some are more equal than others…

  • There is another element not discussed. In some towns (probably Western Cape) the debt collection rate is close to 100%. It looks fantastic. What is not realised, is that this means “100% of bills sent out” are paid. It could still be that only a low proportion of “registered rate payers” are actually billed. I guess that this can be in the order of 30% of bills being sent out. This is onbviously even worse where 100% of payments are not made.
    Where small municipalities, who are not really feasible, have up to 70 to 90% of inhabitants registered as “indigent”, there will be very little income, even if payment levels reach 100%.
    The counter argument is of course that such municipalities claim the “equitable share” contribution from National, which in turn should then pay for such individuals’ services. But we all know what happens when big grants are paid into a general “expense pool” in municipalities. A perfect target to “utilise” those funds as is seen fit, and the income never reaches the department incurring the costs, hence the service collapses.
    So there should be a two-pronged approach; everyone should pay AND the municipality should allocate the equitable share income correctly.
    Has the AG audited this anywhere?

  • This culture of nonpayment or late payment starts at the very top of government and then filters all the way down, to provincial and municipal levels. Who can forget ANC staff picketing outside Luthuli House for nonpayment of their salaries over several months? Many small SME’s depend on government payments and these are often late. Maybe the culture would improve if there was a delay in paying cabinet ministers on time , if at all!If the ANC government is serious about correcting late payment, it should set the example .

  • 26 June 1952 marked the start of the Defiance Campaign. While this campaign and its many iterations thereafter were key in the downfall of Apartheid its legacy has unfortunately morphed and entrenched itself into todays culture of non-payment and disregard for any inconvenient laws.

    Perhaps this year’s 70th anniversary can be used by society to formally declare an end of the Defiance Campaign?

  • Is there any evidence that an attempt has been made to pay? The principle in tax law is that you have to pay first and argue afterwards. Either way, some gesture of goodwill – especially from Gauteng and national government – would suggest that non-payment should not be an option

  • Please help me, where do you apply for membership of the ANC. I understand it costs only R 10/month, for this you get EVERYTHING else free!!

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