Ramaphosa opens the door to scrapping municipalities that cannot deliver

President Cyril Ramaphosa used the launch of the Cabinet-approved Revised White Paper on Local Government 2026 to put the viability of South Africa’s 257 municipalities on the table, backing a question his minister had raised minutes earlier about whether every one of them should continue to exist.

Speaking at the launch, carried by The Presidency of South Africa (YouTube), Ramaphosa said the country was undertaking “a bold reset of the local government system 30 years later”, nearly three decades after the original 1998 white paper established democratic local government. He described the reform as one of the most important of the democratic era, and said it would be remembered as the moment local governance was repositioned.

The question of viability was raised first by the Minister of Cooperative Governance and Traditional Affairs, Tabisa, who told the gathering that the next five years would require hard answers about municipalities that cannot deliver services, fail to pay staff, or fail to contribute to medical aid and pension funds. She asked why municipalities that are not fit for purpose should be carried forward to 2031. Ramaphosa took it up directly in his address, saying the country needed to step back and ask whether what the minister had raised was something that needed to be given weight, acknowledging that communities feel a sense of proprietorship over their municipalities.

The white paper sets out a differentiated model in which powers and functions would be linked to a municipality’s size, capability and performance, rather than the one-size-fits-all approach of 1998. Where a municipality cannot carry out a responsibility, the paper proposes that it be assigned elsewhere, in many cases at regional scale or through partnerships. Ramaphosa said this would require constitutional and legislative amendments to be considered where necessary, and that interim arrangements should be tested while that process runs.

On water and electricity, the paper separates the role of service authority from service provider and introduces a compulsory licensing requirement for all providers. Ramaphosa said the role of local government as a provider of these services had not been sufficiently regulated.

The financial measures are the part he called the most important, describing them as stripped of politics and focused on how public money is used. Revenues from the sale of electricity and water are to be ring-fenced and used to maintain infrastructure before anything else. Ramaphosa anticipated resistance to that, saying municipalities would argue the money is theirs to use as they wish, and answered that it cannot and should not work that way. He put the scale of the problem plainly: municipalities owe Eskom more than R120 billion, and many are in arrears to water boards.

He also said the Minister of Finance had announced an increase in the equitable share for local government, and that support to indigent households now runs to R110 billion, a figure he said he had initially understood to be around R4 billion before being corrected.

On staffing, Ramaphosa called for administrations populated by people appointed for competence rather than patronage, and said there must be consequences when public resources are wasted, procurement is manipulated or public duties are neglected. He drew a comparison with a football coach selecting a squad, saying that appointing people known to be incompetent and expecting a different outcome makes no sense. He praised municipal managers who refuse to carry out instructions that are not lawful.

The paper also places local government’s link to economic growth at its centre. Ramaphosa said investors put their money at municipal level rather than at the Union Buildings or in Cape Town, and that slow permitting and licensing decisions drive them away. He recalled a company that left, with thousands of jobs lost, after concluding it was not getting the services it needed. He said he would like to see economic growth targets set for councils, mayors and municipal managers.

Implementation is to be phased, supported by a time-bound local government transition management entity coordinated from the Department of Cooperative Governance and Traditional Affairs, the Presidency and National Treasury, alongside the Department of Public Works and Infrastructure. Ramaphosa said the body would not take over the lawful duties of municipalities, departments or councils, but would ensure reform does not fall between institutions. A single transition plan is to set out what changes, who is responsible, what happens first and how progress will be measured.

He tied the reform to the local government elections on 4 November, saying parties may compete vigorously and disagree on policy, but that once elected they share an obligation greater than party advantage to make the municipality work. A disagreement in council, he said, must never become an excuse for an unapproved budget, an abandoned project or the collapse of an essential service.

Ramaphosa acknowledged both progress and failure. He said more than 90% of households have access to electricity, more than 87% have access to piped water, and two-thirds have flush toilets, while informal settlements still lack basic amenities and some taps run dry. He traced the system’s weaknesses to the 1998 design, which he said joined historically unequal municipalities and assigned them powers that in some cases outstripped their capability and funding, and to politicised appointments that opened the door to patronage and corruption.

The original white paper was launched in 1998 under then-president Nelson Mandela, a point made from the floor as the gathering noted that the policy had reached the end of its roughly 30-year horizon.

Ramaphosa closed by saying the work must outlast any election cycle, municipal term or administration. “We must now show the courage, the determination and the discipline to put it into practice,” he said.