Good municipalities are about more than good financial management

Every year without fail, the release of the Auditor-General results on municipalities and municipal entities is the only time that local government is consistently in the news. We are bombarded with news about the ‘best’ and ‘worst’ performing municipalities, but this is done in a manner that separates municipal financial management from the core business of local government- service delivery.

Local government is the sphere of governance that is closest to the people and is tasked with identifying land for housing purposes, with accredited metros fulfilling housing functions themselves. It is also tasked with delivering services such as primary healthcare, sanitation, water and electricity among other functions and responsibilities. As such, this sphere of governance is the key role-player in ensuring the realisation of socio-economic rights, not in policy but the actualisation thereof.

There is no doubt that local government requires financial resources and that these finances have a huge impact on its’ [local government] ability to go about its core business. So it is fair to say that poor financial management has an impact on service delivery, but it cannot be assumed that the opposite is true. Good financial management does not mean that the services are being rendered nor that they are done in an adequate manner.

To really understand this, one would need to breakdown municipal budgets to understand what its priorities are, which is reflected by how money is allocated. This can further be broken down by looking at spending per ward, assessing how it is allocated and weighing this up against the respective community needs. Understanding municipal spending per capita in the different wards, allows one to pick up if those with more needs are adequately prioritised.

 ‘Accountability’ is the current buzzword of choice but from a municipal perspective, the ability to adequately account for finances whilst communities remain underserviced- if even serviced at all- cannot be used as a full measurement of efficiency and effectiveness of a municipality.

And this is not to say that good financial management or that measurement does not have its place. It is a question of saying that what is deduced from good financial management should be done within the framework of the core functions of local government.

- This article was orginally published on NGO Pulse.