Every Municipality Must Work
Honourable Chairperson, Honourable Members of the National Council of Provinces,
Minister Velenkosini Hlabisa
Deputy Minister Prince Zolile Burns-Ncamashe,
Ministers and Deputy Ministers,
Chairperson of the House of Traditional and Khoi-San Leaders,
President of the South African Local Government Association (SALGA),
Directors-General of DCoG and DTA,
CEO of MISA,
Leadership of IMATU and SAMWU, Fellow South Africans,
Ladies and gentlemen.
Good day.
1.INTRODUCTION:
Hon Members.
It is an honour to rise in this House as we consider Budget Vote 3 for the Department of Cooperative Governance under the theme: “Every Municipality Must Work.”
In debating Vote 3, we are considering the State’s capacity to support municipalities and stabilise local governance, strengthen service delivery to communities and provide leadership across the country.
In doing so, we are guided by the Municipal Performance and Turnaround Strategy based on pillars of local government that’s remain our focus areas.
A lot of work has been done and continues to be done, around the pillars of Local Government transformation, in relations to : Governance, Basic services, Finance, Institutional Capacity Building and Framework for professionalisation, Community Participation and Local Economic Development,
2. WHITE PAPER REVIEW
Honorable Members.
Our ongoing efforts to ensure an effective and efficient functioning local government, as envisaged by the National Development Plan, are advanced within the context of the reforms envisaged.
This reform is being realised through the review of the 1998 White Paper on Local Government (WPLG).
Despite the assumptions made earlier at the start of the democratic local government, the system, while developmental in nature, has had challenges which otherwise have impacted its constitutional intent.
Therefore, the Macro Local Government Policy Review which is underway, is meant to adjust the system and position local government for improved performance and provision of quality services to the people.
These reforms are therefore unfolding through five decisive pillars to ensure the following:
These pillars remain foundational mainstay of the policy ,to provide stable and predictable frameworks that build trust ,strengthen accountability eco-system and facilitate achievement of local government objectives as enshrined in the Constitution.
3. DISTRICT DEVELOPMENT MODEL
Honorable Members.
The District Development Model (DDM) remains an integral part of South Africa’s development strategy, acting as the primary operational framework to bridge the gap between planning and service delivery across all forty-four (44) districts and eight (8) metropolitan areas, within cooperative governance.
The quality of One Plan System for DDM Spaces will improve national and local planning and facilitate implementation of catalytic projects as anchors of growth and development.
4. SECTION 154 INTERVENTIONS
Honourable Members.
Over the past years, the work undertaken across provinces has demonstrated the importance of cooperative governance in practice.
As part of our ongoing commitment to ensuring that every municipality in South Africa functions effectively and delivers quality services to the citizens, we continue to extend Section 154 of the Constitution of the Republic of South Africa, to have dedicated support in municipalities.
As such we have dedicated support teams that are hard work in the following municipalities:
Notably the work that is done by the Presidency together with us, to ensure stabilization of the Metropolitan municipalities is underway and substantial progress is recorded.
5. TARGETED OVERSIGHT AND SUPPORT ENGAGEMENTS
Hon Members.
Through targeted oversight and support engagements, we have visited almost all the provinces and have interacted with 81 Municipalities, working directly with provincial governments, municipalities, SALGA, and sector departments to address systemic challenges in local government.
These engagements were and are, constructive and practical working interventions, aimed at diagnosing service delivery failures, strengthening intergovernmental coordination, and agreeing on practical Programmes of Action to stabilise municipalities and accelerate service delivery.
6. PROGRESS ON KEY MUNICIPAL INTERVENTIONS
Hon Members.
In addition to ongoing interventions, progress is being made in addressing several structural challenges in local government.
Municipal Debt to Eskom: The Department of Electricity and Energy – together with Eskom and supported by National Treasury – has concluded debt arrangement agreements with defaulting municipalities. While these agreements provide a repayment framework, compliance remains uneven. A review of the arrangements has been completed, and options such as Distribution Agency Agreements are being considered. A detailed update will be presented to the IMC.
Municipal Debt to Water Boards: The Department of Water and Sanitation (DWS), supported by National Treasury, has implemented debt-repayment agreements with municipalities owing water boards. Effective from 1 July 2025, these agreements include structured repayment plans and conditional incentives to encourage compliance.
Debt Owed by Departments and Organs of State to Municipalities: National Treasury, in collaboration with provinces, is monitoring and segmenting debt owed by government departments and entities to municipalities to ensure outstanding accounts are settled.
Support to Distressed Municipalities: Through Interministerial Committee we are providing Coordinated support to municipalities.
Following an IMC resolution to expand support beyond the initial 10 worst-performing municipalities, national departments have begun onboarding an additional 28 municipalities and aligning support through updated Municipal Support and Improvement Plans.
Unfunded Municipal Budgets: Unfunded budgets remain a key risk to municipal sustainability. National Treasury and COGTA have issued directives to strengthen compliance and prevent the approval of unfunded budgets, with further measures to be proposed to the IMC.
Review of the Municipal Funding Model: This review forms part of the broader White Paper on Local Government Review. COGTA Ais working with National Treasury to develop aligned, consensus-based policy options. Government remains committed to reviewing the local government fiscal framework. The Budget Forum has approved a comprehensive programme of action to guide this work, including the terms of reference for the review and the initiation of a procurement process to secure expertise for the detailed technical work.
The aim of the review is to critically examine the financial viability of the local government fiscal framework and identify key factors influencing its effectiveness, stability and long-term sustainability. This will be achieved by conducting an in-depth examination of existing policies, practices and mechanisms governing the allocation, management and use of fiscal resources at the local government level.
Professionalisation of Municipalities: The professionalisation of municipal administration and leadership remains a priority. Work under the White Paper Review
process is underway, and a comprehensive report outlining progress and next steps will be submitted to the IMC and Cabinet
The work that is being undertaken in these areas, will further contribute towards the stabilisation of municipalities.
7. MIG 6B INTERVENTION
Honorable Members.
MISA remains an Agency for Engineering and Professional support to municipalities to strengthen infrastructure delivery and in fact implement Infrastructure Delivery Management Systems.
So far 19 Municipalities are receiving the services of MISA, and their infrastructure delivery systems have improved.
We are working with the identified municipalities which are receiving support and the impact is positive.
We remain committed to this course of technical support for better planning, implementation and monitoring of projects and delivery of infrastructure.
8. INTEGRATED URBAN DEVELOPMENT FRAMEWORK
Hon Members.
When Cabinet adopted the Integrated Urban Development Framework (IUDF) in 2016, it did so in recognition of a simple but profound reality that South Africa’s development trajectory is inseparable from its urban trajectory.
The Integrated Urban Development Framework provides a strategic roadmap to guide urban growth towards spatial transformation, inclusivity, resilience and economic productivity, across cities and towns of all sizes.
It’s a government policy response to complex matters brought about by rapid urbanization which impacts cities and towns differently.
In this regard, we are finalising a new implementation plan that will provide guidance for the next five years.
This requires stronger alignment across spheres of government, clearer prioritisation of spatial transformation outcomes, and sustained support to urban municipalities as they navigate the complex development pressures.
For municipalities, this means:
9. SUPPORT TO MUNICIPALITIES IN COLLABORATION WITH PRIVATE SECTOR
Hon Members.
In this regard key focus has been leveraging Social and Labour Plan (SLP) programmes of mining companies to support infrastructure development in mining-affected communities.
This approach aligns mining sector obligations with municipal infrastructure priorities to improve service delivery and support sustainable local development.
The programme has strengthened coordination between the Department of Mineral and Petroleum Resources, municipalities, mining companies and sector departments to ensure Social Labour Plans investments are integrated into municipal planning frameworks.
We appreciate the collaboration between the two departments in changing the infrastructure landscape in the mining communities.
10. CONCLUSION
All these endeavours are at the centre of gradual improvement in municipal performance.
A positive development that we are consolidating and accelerating.
The work being undertaken across provinces shows that government is taking decisive steps to stabilise municipalities, strengthen governance and rebuild the capacity of local government.
We therefore present Budget Vote 3 and 15 for the Department of Cooperative Governance and Department of Traditional Affairs for the 2026/27 financial year for adoption.
I thank you.