The Future of Local Government: From Ratepayers to Customers

It is an open secret that South Africa is experiencing ‘a culture of non-payment for public services’. A large number of municipalities and institutions are owed billions of Rands in revenue from their respective customers. Arguably, majority of these customers rely on government to subsidize basic services as they cannot afford to pay. However, the phenomenon of non-payment is not only limited to poor people, even those that can afford to pay for the services, fail to do so.

Despite major investments in new and old infrastructure, many of our local municipalities experience dire financial, institutional and technical capacity challenges, which impact negatively on sustained delivery of services.

Central government too faces extraordinary fiscal crisis, which over time, will eventually result in budget cuts due to competing public service priorities. The implication is that in the medium to long-term there will be less and less fiscal transfers to local government. If the local revenue base is weakened, then the likelihood is that there won’t be funding for new infrastructure and less budgets for maintenance of the old infrastructure. This situation will deteriorate further and eventually compromise service delivery. As we know it, poor service delivery leads to increased community protests. The manifestation of ‘unhappy communities’ will become a battleground for politicians, wanting to lure communities to vote for them.

It is clear that neither entitlement nor a culture of non-payment for services is desirable and sustainable.

So, what can we learn from the current situation and what are future implications for local government?

Indication is that timely decision-making and the speed of service delivery will drive the future of local government. Politicians will make promises and the pressure will be on officials to satisfy public expectations. Municipalities will have to attract competent staff who are able to think differently and do things differently, away from the traditional, governance and management models.

The global trend shows that the following factors/issues will matter most at local government level: That is:

  • Size of municipalities
  • Technology/innovation
  • Skilled labor force
  • Partnerships (community, public, private partnerships)
  • Community engagements (public trust)
  • Alternative funding models
  • Alternative service delivery mechanisms
  • Use of social media

The world-over, poor people are organizing themselves into localized, community-based structures to take ownership of the operations and maintenance of community water supply and sanitation systems. For example, I visited the community of El Alto in Bolivia (South America) during the year 2000 to learn about how communities there fund the management, operations and maintenance of their infrastructure. Despite Bolivia being one of the poorest countries in Latin American and the world, local communities there, own, manage and sustain water operations by making monthly contributions per household. The ownership and local control is one key lesson I have learnt and the practice has become common in many developing countries. My other recent experiences are based on field trips I undertook to other countries such as: Brazil, Ghana and Tanzania.

The underlying message is that the future customer will cease to become a mere taxpayer. Citizens will have high expectations in terms of what services they require, when, where and how. The delivery of services will become demand, rather than simply supply-driven, as it is currently the case. Local municipalities will be forced to provide a range of alternative, affordable models for service delivery. In other words, if they fail to do so, customers will do to municipalities what they are currently doing to hotels and restaurants in the hospitality and travel industry. That is, naming and shaming non-performing municipalities through online customer reviews and other means.

The institutionalization of public trust, confidence and respect of municipalities will come at a price. Municipal leaders and political parties will cease to make empty promises as they will be monitored, assessed and voted, based on their performance on the ground.

The success of future local governments is therefore highly dependent on their re-thinking of:

  • current old style, supply-driven, one-size-fits-all governance and management models
  • the way they engage their customers, and not simply as ratepayers
  • the way they deliver services, using technology to enhance the speed and reliance of services
  • the way they organize themselves to leverage alternative funding sources from private sector, and so on.

The future looks bright. By sharing this vision about local government, I am simply advocating for sound, localized public services, based on principles of trust, integrity, kindness and compassion. It is our responsibility to create a new political paradigm and discourse for an exceptional customer service. Service delivery is our way of life.