South Africa does not lack laws, institutions or mechanisms to rescue failing municipalities. What it lacks is the political will to use them consistently. Replacing basic, yet critical, service provision with private companies may sound like decisive action, but without confronting corruption, political appointments and impunity, it risks becoming another way to line the pockets of private capital while disadvantaging the less fortunate.
By Themba Khumalo
Across South Africa, the tap has become a daily gamble, and the light switch a prayer.
In municipalities big and small, sewage runs down main roads, clean water vanishes for weeks, and streetlights stand dark.
When local councils fail, a familiar argument takes centre stage.
The Democratic Alliance (DA) has made it a centrepiece of its local government campaign, proposing that private companies take the lead in supplying electricity, managing bulk water, and collecting waste. Proponents call this a practical, business-minded solution to an escalating national crisis.
Yet this proposal sidesteps a basic truth: South Africa’s municipal collapse is not caused by a lack of private companies or market options. It is caused by unchecked theft, political interference, and a refusal to punish those who plunder public resources.
Offloading state duties to the market treats the symptoms while ignoring the disease, creating a model that threatens to deepen inequality across our towns and cities.
The Market Fallacy and the DA Proposal
The DA’s plan calls for “competitive tendering” and buying power directly from Independent Power Producers to bypass failing public entities like Eskom or Joburg’s City Power.
On paper, bringing in skilled, profit-driven contractors sounds like an easy fix. Private companies are often viewed as efficient, disciplined, and free from local political squabbles.
However, relying on private firms to deliver core public utilities introduces a dangerous structural flaw. Private businesses exist to make a profit, whereas public services exist to ensure universal access for every citizen, rich or poor.
The DA’s push for privatisation is not a groundbreaking administrative innovation; it is an ideological shortcut that replaces genuine state accountability with corporate management.
This market approach breaks down along three distinct lines:
The Destruction of Cross-Subsidisation: South African municipal finances rely on redistribution. High-income households, shopping centres, and industrial parks pay higher tariffs for electricity and water. The municipality uses that surplus to fund free basic services, road maintenance, and sewer repairs in poor townships.
If the DA’s model allows commercial districts to buy power directly from private producers, the municipality loses its biggest revenue base. What remains is a bankrupt public utility responsible only for non-paying, low-income areas, while private companies profit off wealthy zones.
Price Exclusion and Cherry-Picking: To ensure a return on investment, private operators need to cover costs and make a profit, which frequently drives up tariffs. Private firms naturally prefer rich suburbs where ratepayers pay on time, leaving sprawling townships and rural settlements with minimal investment because they are commercially unprofitable.
The Oversight Illusion: The DA claims that private contractors will bring discipline, but offloading operational duties does not eliminate bad governance. A municipality that lacks the technical skill to fix a leaking pipe or maintain an electrical substation is equally incapable of monitoring and regulating complex, multi-billion-rand contracts with private corporations.
Instead of eliminating tender corruption, it simply transfers public tax revenue into private hands while insulating companies from public accountability.
The Accountability Failure Behind Municipal Collapse
South Africa’s municipalities are not failing because the law is weak or because public ownership is inherently broken. They are failing because the rules are ignored without consequence.
Year after year, the Auditor-General publishes detailed reports exposing billions of rands lost to irregular spending, fake tenders, and blatant fraud.
The names of the officials, the dodgy contracts, and the exact amounts stolen are clearly documented.
The collapse of municipal services is driven by three recurring failures:
Hiring the Wrong People for the Job: In many municipalities, key technical positions—such as senior engineers and finance heads—are handed out as political rewards rather than given to qualified professionals. When a water treatment plant breaks down, there is no one in the building who knows how to repair it.
The Resignation Trick: When a municipal manager or chief financial officer gets caught stealing, they often resign immediately. Instead of opening a criminal case, the municipal council simply closes the file. The disgraced official then moves to another municipality in a different province and starts the cycle again.
No Fear of the Law: Corruption flourishes when it is safe and profitable. As long as corrupt officials and dishonest contractors keep their luxury homes and sports cars, stealing from the public purse remains a low-risk career choice.
The Power Already Exists
Fixing municipalities does not require brand-new legislation or radical privatisation. The state already possesses a formidable legal toolkit designed to protect public funds and maintain order:
Anti-Corruption Laws: The Prevention and Combating of Corrupt Activities Act makes it a serious criminal offence for any government official to ignore or cover up fraud.
Specialised Police Units: The Hawks, the Special Investigating Unit (SIU), and the Asset Forfeiture Unit have the legal power to investigate tender fraud, freeze bank accounts, and seize property bought with stolen public money.
Direct Intervention Rules: Under Section 139 of the Constitution, national and provincial government can step in, remove a dysfunctional municipal council, and send in experienced administrators to take over the administration.
The infrastructure to clean up local government is already built. The breakdown occurs when political leaders hesitate to enforce the law against their own colleagues and political allies.
The Path to Real Recovery
If local government is to be restored, the solution must focus on accountability and administrative discipline, not administrative surrender:
Put Criminals in Prison: The state must use its existing investigative and prosecutorial power to put corrupt officials and fraudulent contractors in court. When stealing public money leads straight to a prison sentence, the plunder will stop.
Take Back Stolen Assets: The Asset Forfeiture Unit must aggressively seize cars, houses, and bank accounts linked to municipal tender fraud to pay back the public.
Strict Merit-Based Hiring: Political appointments in technical municipal jobs must end. Engineering departments must be run by qualified engineers, and finance departments must be run by trained accountants.
Blacklist Dishonest Suppliers: Any company involved in municipal tender fraud must be permanently banned from doing business with any part of the government.
The Power of the People
Governments rarely reform themselves without external pressure. Dismissing municipal failure as unfixable and handing core services to the private sector surrenders the very idea of a capable state.
The DA’s proposal asks South Africans to accept that government cannot be cleaned up, offering market management as a white flag.
The ultimate power to force change rests with everyday citizens, ratepayers, and civic groups. By demanding transparency, using the courts to hold failing municipalities accountable, and using the power of the ballot box to vote out underperforming leaders, citizens can force the state to do its job.
Handing basic utilities over to private companies because the state is “too corrupt to fix” is an abdication of duty. The state has the power, the resources, and the legal duty to enforce the law.
Rebuilding South Africa’s municipalities starts by putting handcuffs on those who broke them.