Time for Northern Cape debt to be resolved

17 October 2019

The Democratic Alliance (DA) in Northern Cape remains deeply concerned by revelations that the Northern Cape is the second biggest offender in respect of outstanding debt owed to municipalities.

This comes after a reply to a parliamentary question by DA MP Patricia Kopane revealed that the Northern Cape owes R575 million to municipalities. This is second to only the Free State, that has a debt of R629 million.

Last year the Northern Cape was classified as the third highest, clearly demonstrating that the province is losing the fight and moving up in the ranks of outstanding debt owed to local government.

For a number of years already, the DA has been calling on the Northern Cape Department of Roads and Public Works to resolve the outstanding debt, to no avail.

Municipal debt directly affects local government’s ability to render services. A municipality’s ability to function depends on the money it collects from other spheres of government and ratepayers. Without a revenue stream, it cannot deliver services or invest in infrastructure.

Outstanding debt also exacerbates municipalities’ inability to pay their creditors, such as Eskom and the respective water boards, with dire consequences for the provision of electricity and water to residents.

The DA is tired of hearing from the provincial department that this matter is being discussed on a “national level”. This has been the run of the mill response for years - it’s time for action.

In this regard, the promised intervention by the National Department of Public Works to ensure that all government debt owed to municipalities is settled, is welcomed, albeit long overdue.

The DA will be monitoring the promised intervention closely - R575 million can surely make a huge difference in the cash flow of embattled Northern Cape municipalities and improve their ability to deliver services.

Issued by Harold McGluwa, DA Northern Cape Provincial Spokesperson of Roads and Public Works, 17 October 2019