The Covid-19 pandemic poses a massive threat to both lives and the economy. Governments will need to innovate and adapt to be able to respond and keep their citizens alive. Local governments are at the coalface of the challenge and need to respond quickly and ably.
Research conducted by the eThekwini Municipality’s Policy, Strategy, Information and Research (PSIR) Department confirms that Durban’s economy is in for a very difficult year. The projected economic growth rate for the municipality has been revised to between -2% and -4% for 2020. The last StatsSA data showed that eThekwini had the highest indigent population of any South African metropolitan municipality.
In simple language, this means that many Durbanites were desperately poor before the pandemic hit.
Our municipality’s own research shows that household expenditure will decrease, tourist trips and events will be cancelled, exports and foreign direct investment will decline and many Durbanites will lose their jobs or sources of income.
The reality is that bad political decisions and reckless spending — particularly over the past few years — have decimated eThekwini’s cash reserves. The city has just under 60 days cash on hand, and about 20 days’ worth of that is from national government grants.
The harsh reality as people become unable to pay their utility bills — which city management is already reporting — and the city’s income dwindles, some tough decisions will become necessary. These tough decisions and decisive leadership will be required to keep the municipality afloat and able to give people the help they so desperately need.
It simply cannot be business as usual. Anything other than an extraordinary approach will fail and leave people in a terrible position.
To this end, the Democratic Alliance in eThekwini has proposed a detailed list of suggestions that we believe can free up much-needed money, focus on what matters and protect and support citizens through this time.
The thread running through all of the proposals is effectively a return to basics. Anything that doesn’t help the municipality deliver quality basic services, maintain and develop its critical infrastructure, sustain the local economy and protect jobs and incomes or protect and support the poor must be scrapped.
In order to properly respond to the crisis, the municipality will need a “war chest” that we don’t currently have, so it’s time to make some tough decisions. Like leaders in business and industry are doing, the DA is proposing a sliding scale of temporary pay cuts for staff on senior managerial grades (above a task grade 16).
The political leadership — specifically full-time councillors like the executive committee, the mayor, his deputy and other senior office bearers — must also be prepared to take a temporary pay cut.
The hefty budgets for councillors’ security, catering and perks must be completely reviewed. It is unconscionable that the municipality continues to spend millions on plush lunches while ordinary people are hungry.
The Municipal Finance Management Act has provisions to incur unauthorised expenditure in times of crisis. This must be urgently used to identify where money currently will either not be spent before the end of the financial year or is not completely necessary expenditure. This money must be re-allocated and freed up to respond to the crisis.
Urgent relief, like making more food parcels available and doubling the capacity of the existing soup kitchens, is critically necessary. Municipal officials are reporting more than twice the number of people who usually come to the soup kitchens are showing up for help.
The payment relief mechanisms we plan to propose are means-tested, and not blanket relief. An application process needs to be devised and those who can show that their incomes have been negatively affected by Covid-19 should be allocated a doubled provision of free basic water and electricity, a rates holiday and not have their water or lights disconnected. Arrears incurred during this time should also not generate interest. We believe that these are reasonable and sustainable suggestions.
The 2020/21 draft budget, which has been approved for public comment, needs to be completely reworked. The next financial year will be a crisis period and the proverbial fat needs to be trimmed. Events, perks, advertising, commemoration days, the Salga and the eThekwini Games, festivals, municipal conferences and international travel are all clear examples of how hundreds of millions could be saved.
The tariff increases were hard to swallow due to the paltry level of service that most departments provide, but are now going to make municipal services completely unaffordable for most people. The city leadership needs to take some hard decisions in favour of its citizens. A clear option is to cut all performance bonuses and increases for all staff and councillors and repurpose the funding towards supporting people and businesses, and limit any water, electricity and rates increases.
The famous phrase “cometh the hour, cometh the man” has never rung truer. There has never been a better time to separate the true leaders from the fat cats at all levels of government and public service.
This pandemic is going to be the most complex government challenge of our time. It requires commitment, innovation and servant-hearted leadership to successfully navigate. Our proposals are on the table and we are committed to working with the eThekwini leadership to protect the lives and livelihoods of our city’s residents.
Let’s see who the real leaders are. DM