The best-run South African municipality revealed
This municipality has achieved a consistent track record for 14 consecutive years.
The Ratings Afrika Municipal Financial Sustainability Index (MFSI) evaluates municipalities based on six key criteria.
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These include:
- operational performance
- liquidity
- debt management
- budgeting practices
- affordability
- infrastructure development
The MSFI uses audited financial statements to measure the financial stability of South Africa’s largest local municipalities and metros.
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The MSFI defines financial sustainability as a municipality’s ability to deliver services and maintain infrastructure without incurring sudden tax or tariff increases, while also being able to absorb financial shocks.
Examples include natural disasters or economic downturns that can occur without requiring external financial aid.
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It has been publishing its findings annually since 2011, with the same municipality having the most consistent track record.
According to BusinessTech, the MFSI has used this to determine South Africa’s best-run municipality, which is the West Coast District Municipality.
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Two of its local municipalities, Saldanha Bay and Swartland, also tied for first place as SA’s top-performing local municipalities.
The West Coast District Municipality’s performance has consistently stood out amongst the 107 SA municipalities.
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The municipality stretches from the northern edge of the Cape Town Metropole to the border of the Northern Cape, covers 31,000 square km and is home to nearly 500,000 residents.
It has been recognised for achieving 14 consecutive clean audits and maintaining a 100% capital project expenditure record, indicating consistent financial discipline and effective governance.
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It's not surprising that the Western Cape has once again dominated the rankings, highlighting its strong record of accountability and service delivery.
The success of the province was also reflected in the metro category, with the City of Cape Town (70) once again emerging as the ONLY metropolitan municipality considered financially sustainable.
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Ratings Afrika has found that no other metro in the country comes close to matching Cape Town’s financial performance.
The region's good governance, efficiency and municipal management have reporedly contributed to its growing appeal.
The small towns of the West Coast have become increasingly popular since the Covid-19 pandemic. Where they were mostly seen as holiday villages, an increasing number of people are now moving there permanently and investing in second or holiday homes.
Germishuys added that the West Coast has experienced a significant property boom, and Langebaan is the top performer.
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While there seem to be high performers, Ratings Afrika paints a grim picture of the overall state of SA local government.
The national average score for the 107 municipalities measured is 36 out of 100, the same result as the previous two years.
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The Western Cape municipalities largely contributed to the increase in the score, with a collective average of 55 out of 100.
Ratings Afrika noted that one Gauteng municipality, Midvaal, stood out among the rest, alongside the majority of municipalities in the Western Cape.
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