REVEALED | A further 43 municipalities on the brink of collapse, shows new News24 index

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While South Africans are heading to the ballot box on 1 November, News24's Out of Order index, calculated from a set of data painstakingly collated over the last two months, suggests that the crisis on the frontline of service delivery is likely to deepen. (Getty Images)
While South Africans are heading to the ballot box on 1 November, News24's Out of Order index, calculated from a set of data painstakingly collated over the last two months, suggests that the crisis on the frontline of service delivery is likely to deepen. (Getty Images)
  • News24's Out of Order index suggests that the crisis on the frontline of service delivery is likely to deepen.
  • The index is calculated from a set of data painstakingly collated over the last two months.
  • The index suggests 43 municipalities over and above those already red-flagged by government are in the danger zone of collapse.

No water. Intermittent electricity supply. Potholes. Sewerage in the streets.

This is the grim reality in many of South Africa's municipalities, and is the direct result of municipal mismanagement. And the prospects for many local governments look bleak.

While South Africans are heading to the ballot box for municipal elections on 1 November, News24's Out of Order index, calculated from a set of data painstakingly collated over the last two months by a News24 team, suggests that the crisis in the frontline of service delivery is likely to deepen.

The index, the first data journalism project of its sort in South Africa, suggests 43 municipalities, over and above the 87 already red-flagged by government, are in the danger zone of collapse.

The 43 are municipalities that have not already been named in other officially published lists from the Department of Cooperative Governance and Traditional Affairs (Cogta) or the Auditor-General as being delinquent or under administration.

They include municipalities across five provinces. They are dominated by KwaZulu-Natal (22), followed by the Eastern Cape (9), Limpopo (7), Northern Cape (3) and two in North West.

Among the municipalities on this list are Mbashe, Great Kei and Intsika Yethu in the Eastern Cape; Impendle, Umvoti and Nongomo in KwaZulu-Natal; Elias Motsoaledi (Greater Groblersdal) in Limpopo; Kagisano-Molopo in North West, and Dikgatlong in Northern Cape.

Significantly, a report submitted by Cogta to the parliamentary local government portfolio committee in August 2021 indicated that a further 111 local municipalities were classified as being at medium risk for deteriorating further. Only 16 were rated as stable. The Out of Order index suggests many of those medium risk municipalities may be further down the road than already imagined. 

How the index works

The index allocates each of the more than 200 local municipalities and eight metros a score on a scale from 0-100, where 0 is a failure and 100 is perfectly performing.

Our data draws on the most authoritative sources available, such as National Treasury's budget data used to calculate budget allocations to municipalities, the Auditor-General's reports, and Statistics South Africa.

Unlike other approaches, we have included not only pure financial metrics but also measures of unemployment, poverty and basic service delivery to households.

READ | Why residents of two North West towns are back in court, in a bid to resolve water woes

Some factors are within the direct control of the municipality, and others are not, but all affect their trajectory as sustainable entities. Out of Order is intended to provide an assessment of municipalities and, where it was practical, includes data for several years to underpin some contributors to the index. There are over 20 different dimensions used to calculate a score.

It is important to note that this index, while based on authoritative data, still represents only an informed view of the state of municipalities. It is not a formal economic or scenario modelling application and is not intended to be viewed as such.

Even with the data sources being among the most robust available in South Africa, we have identified many problems in the accuracy, reliability and consistency in the quality of data - often in that which is supplied by the municipalities to national government and Statistics SA.

The Out of Order project is an endeavour of data-driven journalism intended to arm citizens with useful knowledge when making an informed decision on how to vote.

News24 editor-in-chief Adriaan Basson said: 

This project comes just in time as South Africans prepare to vote in this year's municipal elections. It is an extremely valuable tool to help voters decide if their municipalities are worth trusting with their ballots or not. It is the first data journalism project of its nature, and I am very proud of our colleagues for bringing tons of data, research, statistics and analysis together in such an accessible and visually appealing way.

The big picture

Nationally, the average index score is only 45 out of 100 for all municipalities, which underlines the crisis that has been unfolding in local government over several years.

The average index score for the 87 municipalities that have previously been identified as problematic was 43. Some 47 of those previously identified as a problem still score below their cohort's average of 43, suggesting little significant change in status over the last three years since they were listed as dysfunctional.

out of order metros graph
Some of the 43 municipalities on the brink of collapse. Visit the Out of Order site to see the full list.

The non-metro municipalities that performed best in our index feature a mix across provinces, although they are dominated by the Western Cape, contributing 14 to the top 20. The Eastern Cape contributed two while Northern Cape, Gauteng, KwaZulu-Natal and Mpumalanga all had one.

READ | In Centane, residents had to walk up to five hours for water. Now a court order brings hope

Cape Agulhas, which administers the Bredasdorp area, and nearby Overstrand (both governed by the DA) performed the best in our index with a score of 65 each while the Eastern Cape, which otherwise dominates the worst performers, contributed two – Kouga (DA majority) and Kou-Kamma (ANC majority).

Among the main metros, there's little to divide the top three.

eThekwini comes in first with 62, followed by Cape Town and City of Tshwane (Pretoria) on 61, while the tail is made up of Mangaung on 46 and Nelson Mandela Bay at 52.

Out of Order Key Metros

Visit the Out of Order site to see why the metros received these scores.

eThekwini scored slightly higher than Cape Town due to its underspending against its budgeted operating expenditure in 2018/19.

Maintaining infrastructure

A key indicator for citizens is how the municipality maintains local infrastructure. This is normally measured as a percentage of the capital budget which is spent on repairs and maintenance. Ideally, R8 in every R100 spent on a capital project, or 8%, should go to maintaining what has been built.

Tellingly, in the Out of Order data, only four municipalities are spending at that level in the 2018/19 financial year data that is available. They are Cape Town (8%), Ulundi (10.6%), Makhuduthamaga in Limpopo at 17%, and Sol Plaatje in the Northern Cape at 8.2%.

Some 88 municipalities spent between 1% and 8% on repairs and maintenance, while 112 spent nothing or did not provide data.

Staff salaries timebomb

The amount municipalities are spending on salaries for staff can be a warning that things are going awry.

The normal range for this should be between 25% and 40% of total operating expenditure, according to Municipal Money which tracks this ratio, among many others.

This is also a factor in the Out of Order Index. Some 26 municipalities are spending more than 40% of their total operating expenditure on salaries.

READ | 'Nobody really knows' what happened to R5.5bn at SA's worst-run municipalities - AG

According to this data, the worst offender is the worst-ranked municipality in SA in our index – the ANC-run Impendle in KwaZulu-Natal – with an impossible sounding 143%.

Other notables are !Kheis in the Northern Cape and Intsika Yethu in the Eastern Cape, both on 51%.

Altogether, some 46 municipalities are paying more than 40% of the total operating expenses to staff salaries.

Service delivery data conundrums

Service delivery metrics are among the attributes used in our index, but we have approached these with caution and suggest readers do the same.

Based on data they have submitted to Statistics South Africa, some municipalities would appear to have over 100% service delivery to households, which is highly improbable.

READ | This municipality is bankrupt, but councillor and staff salaries have spiked by 161%

There are several possible reasons for these data oddities.

One scenario is that the baseline number of households comes from the last Census, which is now ten years old and that due to massive urbanisation, the number of households in a municipality has exploded leading to the out-of-kilter percentages.

Another reason is that municipality data reported to Statistics South Africa is deliberately or mistakenly inflated.

- The Out of Order index was designed, researched and built for News24 by Andrew Trench, Kirsten Pearson, Alastair Otter, Laura Grant and Rudi Louw. The project is supported by the Truth First trust.

Visit News24's elections hub for all the latest news, analysis and opinions on the upcoming municipal elections.

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