Skip to main content

THE FRAGILITY OF LOCAL GOVERNMENT IS A MANUFACTURED POLICY REALITY: LETS TALK

When EDI Holdings was established as a company to begin the transformation of the electricity industry, the ideational construct was to 'unbundle' the industry into generation, transmission and distribution. EDI Holdings would be modelled as a company holding majority shareholding in six regional electricity distribution companies (REDS), demarcated to be anchored by the then six metropolitan municipalities. The plan was for municipalities and ESKOM to enrol into the process by amongst others collapsing their electricity distribution assets in exchange of shareholding into the REDS.


As part of its stakeholder engagement process, EDIH had to engage with key players along the restructuring journey. National Treasury was one of the first to be engaged. Then Director-General, and now Reserve Bank Governor, Lesetja Kganyago, asked a question in one of the engagements; "if you take electricity distribution away from municipalities, which makes up for a substantial part of the local government fiscal resources, how do you plan to close the resultant revenue gap", he went on to submit that 'any change in the current configuration of the electricity industry, particularly its distribution, cannot be construed outside a national fiscal reform program, and our democracy is (was seemingly) not ready to have that engagement'. Twelve years after that discussion EDIH folded and ceased to exist as a structure, but its intents mutated into later policy decisions on and about ESKOM. 


Fast track to the six administration's proposals on 'economic reform' as published by a Tito Mboweni led National Treasury. Relevant to this rendition is the transformation thrust of the 'economic policy reforms' to 'unbundle' what the document calls 'network industries'. The document purports that such unbundling will 'open' or 'liberalise' aspects of the 'network' and create new value chains as well as allow for the 'market' to mitigate the 'risks' of 'monopolistic' 'public service' provision of electricity, water and logistics. The essence of this approach meant the 'electricity distribution role' and 'water authority status' of municipalities as agents of the local state was decisively recalibrated without any recourse to the constitutional implications thereto. A constitutional amendment without changing the constitution.


The 'unbundling', and it would seem, was more about the opening up of the 'transmission' and 'distribution' infrastructure for new 'independent power producers' and 'independent water producers' to plug in so as to have access to an otherwise 'public service' construed business system. The 'unbundling' approach, notwithstanding its foregrounded 'green energy' and 'climate change' intents which are plausible, does not deal with the 'fiscal implications' of the  pending real loss of revenue by municipal governments. 


The impact on household affordability of the reconfigured water and electricity provision costs, when current establishment subsidies are later factored out by market economy exigencies, and given the shrinking rates and taxes base occasioned by low to no growth economy, has not been adequately addressed. Without problematising the 'unbundling' policy trajectory, the implications of this new and emerging policy on the costs of providing democratic and accountable government to communities as a constitutional guarantee will be an unfunded mandate for municipalities.


The 'unbundling' induced policy space has seen aggressive moves by 'gated communities' and 'high paying water and electricity' users to remove the influence of municipalities on how they access these services. A 'services' based gentrification process is 'underway' and it ultimate impact will be the fragility of local government as the primary experience space of government by local communities. The inability of certain of municipalities to provide adequate local infrastructure and services to communities is very much a function of an absent fiscus as it is the 'no rates and taxes' base inherited from the R293 towns and the unsustainable erstwhile Black Local Authorities construct of local government.


Our national policy makers, unless otherwise proven, are hard at work manufacturing various fragilities into our local government system. This requires a new thinking movement to open up the discussion in the interest of those whose end will be at the periphery of the 'local state'. The feudal is becoming the new.


🤷🏽‍♂️A ndzo ti vulavulela

🤷🏽‍♂️Be ngi vesa nje

🤷🏽‍♂️Ek wys maar net

Comments

Popular posts from this blog

The DD Mabuza I know, dies a lesson to leadership succession mavericks.

When we completed our Secondary Teachers Diploma, together with two cohorts that followed us, at the Transvaal College of Education, and we later realised many other colleges, in 1986, we vowed to become force multipliers of the liberation struggle through the power of the chalk and chalkboard.   We left the college with a battle song ‘sesi bona nge sigci somoya, sesi bona nga madol’nkomo, Siyaya siyaya’. We left the college with a battle song' sesi bona nge sigci somoya, sesi bona nga madol'nkomo, Siyaya siyaya'. This song, a call to war with anyone, system, or force that sought to stop us from becoming a critical exponent and multiplier to the struggle for liberation, was a powerful symbol of our commitment. We understood the influence we were going to have on society. I was fortunate to find a teaching post in Mamelodi. Mamelodi was the bedrock of the ANC underground. At one point, it had a significantly larger number of MK operatives than several other townships. Sa...

Farewell, Comrade Bra Squire, a larger-than-life figure in our memories: LITERALLY OR OTHERWISE

It’s not the reality of Cde Squire's passing that makes us feel this way. It is the lens we are going to use to get to grips with life without him that we should contend with. A literally larger-than-life individual who had one of the most stable and rarest internal loci of control has left us. The thief that death is has struck again.  Reading the notice with his picture on it made me feel like I could ask him, "O ya kae grootman, re sa go nyaka hierso." In that moment, I also heard him say, "My Bla, mfanakithi, comrade lucky, ere ko khutsa, mmele ga o sa kgona." The dialogue with him without him, and the solace of the private conversations we had, made me agree with his unfair expectation for me to say, vaya ncah my grootman.    The news of his passing brought to bear the truism that death shows us what is buried in us, the living. In his absence, his life will be known by those who never had the privilege of simply hearing him say 'heita bla' as...

Celebrating a life..thank you Lord for the past six decades.

Standing on the threshold of my seventh decade, I am grateful for the divine guidance that has shaped my life. I am humbled by the Lord’s work through me, and I cherish the opportunity He has given me to make even the smallest impact on this world.  Celebrating His glory through my life and the lives He has allowed me to touch is the greatest lesson I have learnt. I cherish the opportunity He has given me to influence people while He led me to the following institutions and places: The Tsako-Thabo friends and classmates, the TCE friends and comrades, the MATU-SADTU friends and comrades, the Mamelodi ANCYL comrades, the ANC Mamelodi Branch Comrades, the Japhta Mahlangu colleagues and students, the Vista University students and colleagues, the Gauteng Dept of Local Government colleagues, the SAFPUM colleagues, the  SAAPAM community, the University of Pretoria colleagues, the Harvard Business School’s SEP 2000 cohort network, the Fribourg University IGR classmates, the Georg...