South Africa cannot survive more of the same failed governance. The R25.6 billion water debt crisis is a wake-up call. It is ordinary residents, ratepayers and the poor alike who suffer the consequences of financial mismanagement: dry taps, disease from lack of water and sanitation, and a future of unsustainable services. We need new governance model for, clean, capable administration wherever it is implemented.
The Minister of Water and Sanitation has laid bare a staggering R25.6 billion in unpaid water bills by municipalities to water boards, in a reply to Parliament. In total 34 municipalities are in default on their bulk water payments. This crisis is not an accident; it is a man-made disaster resulting from chronic mismanagement and disregard for the law in ANC-controlled councils.
The Minister’s reply highlights the depth of the crisis in these 34 municipalities.
Funds from national government are cut off: Over 40% of municipalities (14 of the 34 defaulters) have had their equitable share from national government withheld under Section 216 of the Constitution. Effectively cutting off national transfers to force payment, this sanction underscores how extreme the breakdown has become in these towns.
Provincial interventions do not help: 12 out of the 34 have been or are currently under provincial administration in terms of Section 139 of the Constitution due to governance and service delivery failures. Despite these interventions, their finances and services remain in shambles, proving that ANC cadres parachuted in as administrators fare no better.
Ghost budgets are approved: 30 of the 34 defaulting (over 85%) municipalities approve unfunded budgets, therefore planning to spend money they do not have. This is illegal in terms of Section 18 of the MFMA, which requires all municipal budgets to be backed by real revenue. ANC-run councils ignore the law, plunging their communities into debt and collapse. Such financial recklessness directly leads to broken service delivery, residents get sewage in the streets, dry taps, and crumbling infrastructure.
Furthermore, all 34 defaulting municipalities returned a combined R801 million in unused Municipal Infrastructure Grant (MIG) funds between 2021 and 2024. This means that while water infrastructure was breaking down for lack of maintenance, hundreds of millions allocated for fixes were sent back to Treasury unspent. This travesty is part of a larger pattern under ANC governance, last year alone, over R3.8 billion in infrastructure grants went unspent nationally, depriving communities of desperately needed water, sanitation, and road upgrades.
These figures paint a picture of systematic governance failure. Critical water infrastructure is not being maintained or upgraded because funds are mismanaged or diverted, leaving water boards unpaid and unable to sustain bulk supply. As a result, many communities face continual water outages and even the threat of water boards collapsing under financial strain. The Department of Water and Sanitation confirms that this mountain of debt to water boards “hampers their ability to maintain and upgrade ageing infrastructure”, exacerbating water shortages in our towns and cities.
When governments prioritize sound financial management and service delivery the results are evident. For example, in the Western Cape, 20 municipalities received clean audits in the last financial year. By contrast entire provinces like the Free State and North West did not produce a single clean audit for their municipalities in 9 years.
Throwing more money at municipalities will also not help if corrupt and incompetent officials continue to squander it. We do not need to invent new funding formulas; we need competent leadership and basic accountability. We need to start doing the basic things right. This means:
Enforcing consequence management: There must be real repercussions for the officials and politicians who bankrupt municipalities and neglect infrastructure. To date, not a single official in these failing councils has been held accountable this culture of impunity ends now. Municipal Managers and CFOs of chronic defaulters must be investigated and, where appropriate, dismissed and prosecuted.
Professionalizing appointments: The practice of deploying political cronies with no skills into key municipal jobs has collapsed service delivery. We need to replace cadre deployment with merit-based appointments at local government. Engineers, accountants and qualified town planners must run the show, not comrades.
Budget discipline and ring-fencing of funds: Every municipality must balance its budget and stick to it. No more unfunded budgets and creative accounting but enforces strict financial controls. Ring-fence revenue for services, so that money paid by residents for water and electricity is used only to maintain and improve those services. This will prevent funds from being diverted to bloated salaries or vanity projects while infrastructure decays.
Stable and transparent governance: Many failing councils are plagued by factional infighting and political instability, which directly hurts service delivery. Local government needs electoral and institutional reforms to stabilise coalitions and councils including clear coalition agreements, anti-corruption clauses, and empowering oversight bodies to act against disruptive councillors.
Devolution of powers to well-run local governments: Successful and capable run metros and municipalities should be entrusted with more powers (such as managing passenger rail, electricity generation, or water provision) instead of being held back by failing centralised entities. Then services are delivered by those who are closest to the people and who have a track record of making things work.
Proven solutions are ready to be rolled out nationally, we just need a government willing to adopt them. It’s time to fix what’s broken: install accountable leadership, follow the law, spend public money effectively, and maintain the infrastructure that keeps communities alive. South Africans deserve nothing less than a government that works for them. Let’s bring this change to every town and municipality before it’s too late.