Abstract:
Section 152 (1) of South Africa’s Constitution states that one of the aims of local
government is to ensure sustainable service provision to communities. Section 152
(2) states that municipalities must strive, within their financial and administrative
capacity, to achieve the objects in subsection (1). In reality, municipalities struggle
to provide services because of substantial infrastructure backlogs, high levels of
indigence and a limited revenue base. Section 214 requires revenue to be equitably
divided among the national, provincial and local spheres of government, as
determined annually by a Division of Revenue Act that depends on consultation with
the Finance and Fiscal Commission, organised local government and the provincial
governments. This article investigates whether South African local government has
the capacity to fulfil its constitutional mandate and how current fiscal arrangements
among the different spheres of government affect its ability to perform its duties. The
capacity of the South African government is contrasted with the model adopted by
the Rwandan government, where central government transfers funding directly to
local government. Consequently local government is directly accountable to central
government for performing its mandate. In particular, the capacity challenges at the
local government level are analysed and discussed.
