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Hlabisa wants new White Paper to address municipal funding model problem


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Hlabisa wants new White Paper to address municipal funding model problem

Cooperative Governance and Traditional Affairs Minister Velenkosini Hlabisa
Cooperative Governance and Traditional Affairs Minister Velenkosini Hlabisa

23rd June 2025

By: Terence Creamer
Creamer Media Editor

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Cooperative Governance and Traditional Affairs Minister Velenkosini Hlabisa reports that government is aiming to publish an updated White Paper on Local Government by March next year, arguing that the prevailing 1998 policy does not adequately address issues facing municipalities.

Speaking during a political dialogue on the White Paper in Johannesburg, Hlabisa said that while the 1998 document was foundational to the introduction of developmental local governance, prevailing challenges facing municipalities were indicative that it could not “stand the test of time”.

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“Issues such as the funding model for municipalities, the deployment of political leadership into the executive committees of councils, and the exclusion of traditional leaders from key decision-making processes have all contributed to the challenges we face today.”

He argued that the funding model for municipalities represented a particular challenge, as it relied heavily on transfers from the national government and failed to provide sufficient resources for municipalities to deliver services.

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“This has led to many municipalities struggling to provide even the most basic services, such as water, sanitation, and electricity.”

A discussion document seeking comment on reforms to the White Paper was Gazetted on April 10, with a closing date of June 30, and Hlabisa said that further engagements would be undertaken before an updated White Paper was published.

“The aim is to publish an updated White Paper on Local Government by March 2026.”

Moves to draft a new policy are in line with the Medium-Term Development Plan 2024-2029, which proposes a review of local government's institutional and legislative frameworks to strengthen them and support differentiation.

“The goal is to establish mechanisms for effective interventions when municipalities cannot meet minimum norms and standards for service delivery,” Hlabisa said.

It also comes after the national government added the issue of tackling service-delivery problems within the country’s metropolitan councils to the reforms being pursued under Operation Vulindlela.

Besides supporting moves to update the White Paper into a “modern and fit-for-purpose local government system”, Operation Vulindlela would also be seeking to shepherd in a shift to a utility model for water and electricity services.

Under the plan, all metros would be required to establish or appoint ring-fenced, professionally managed and independently licensed utilities.

There would also be moves to ensure that all municipal managers and CFOs met the minimum standards for qualifications, experience and integrity, and to review how local government revenue matched its responsibilities.

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