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DE RUEHSA #0347/01 0300739
ZNR UUUUU ZZH
R 300739Z JAN 06
FM AMEMBASSY PRETORIA
TO RUEHC/SECSTATE WASHDC 1195
INFO RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY
RUEHBU/AMEMBASSY BUENOS AIRES 0173
RUEAIIA/CIA WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDC/DEPT OF COMMERCE WASHDC
RHEHNSC/NSC WASHDC

UNCLAS SECTION 01 OF 03 PRETORIA 000347 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE PLEASE PASS TO DEPT OF HUD 
 
E.O. 12958: N/A 
TAGS: PGOV ECON EFIN EINV EAID SF
SUBJECT: SOUTH AFRICA: HOUSING AND SERVICE DELIVERY WOES 
PERSIST IN FACE OF LOCAL ELECTIONS 
 
REF: A. 05 PRETORIA 4585 (NOTAL) 
     ¶B. 05 PRETORIA 4966 (NOTAL) 
     ¶C. 05 PRETORIA 5010 (NOTAL) 
     ¶D. 05 PRETORIA 5032 (NOTAL) 
     ¶E. 06 PRETORIA 23 (NOTAL) 
     ¶F. 06 DURBAN 5 (NOTAL) 
     ¶G. 05 PRETORIA 2621 (NOTAL) 
     ¶H. 05 DURBAN 136 (NOTAL) 
 
(U) This cable is Sensitive But Unclassified.  Not for 
Internet Distribution. 
 
¶1. (SBU) Summary. Since mid-2004, South Africa has seen 
several protests in disadvantaged communities, ostensibly 
against poor public service delivery, lack of adequate 
housing, and corruption.  These protests have intensified in 
the run up to the March 1 local elections, suggesting that 
there are distinct political overtones behind the unrest. 
While the government has made progress on housing and 
delivering public services to poor South Africans since 1994, 
millions of residents still live without access to basic 
shelter, clean water, sanitation services, or electricity. 
The focus of their frustration has increasingly been on the 
inability of local government to serve them.  Most municipal 
governments are under skilled and under staffed, and many are 
poorly directed.  President Mbeki is focused on rooting out 
ineffective municipal leaders and building local capacity. 
The Departments of Housing and of Provincial and Local 
Government are working with municipal governments to remedy 
the situation, but the task is daunting.  The immediate 
question is whether South Africans will recognize the 
government's effort and turnout at the polls on March 1.  End 
Summary. 
 
¶2. (SBU) This cable is part of a series of cables reporting 
on the lack of public service delivery and the mood of the 
electorate in advance of local elections on March 1.  Team 
members, including Embassy, Consulate, and USAID personnel, 
will visit a diverse, but representative sample of 
municipalities in all nine provinces to better understand the 
extent of the problem.  Ref A served as a background piece on 
local elections.  Refs B through F detailed visits to the 
Eastern Cape, North West, and KwaZulu-Natal Provinces. 
Municipalities in the other provinces will be covered in 
subsequent cables.  This cable provides an overview of local 
government service and housing delivery issues. 
 
Local Unrest Unabated 
--------------------- 
 
¶3. (SBU) Disgruntled residents continue to protest against 
local governments throughout the country, as they see little 
improvement in their daily lives.  These protests have 
recently intensified in part due to local politics heating up 
in the face of the March 1 local elections.  Since July 2004, 
protests have sprung up in pockets across South Africa as 
residents, fed up with corrupt municipal government, 
inadequate housing, as well as a lack of access to clean 
water and sanitation take their frustrations to the streets 
(Ref G).  During the past six months, protests, mostly 
involving burning tires and blocking roads, have occurred in 
Soshanguve (Pretoria/Gauteng), Mabopane (Pretoria North/North 
West), Frankfort (Free State), Walmer (Port Elizabeth/Eastern 
Cape), and Worcester (Western Cape) as well as in other 
areas. 
 
How Bad Is It? 
-------------- 
 
¶4. (U) Eleven years after the transition to democracy, the 
government can claim limited success in rolling out housing 
and public services to the ANC's core constituency, i.e., 
those that apartheid sought to ignore.  Nevertheless, housing 
and the provisions of basic public services to this sector of 
the population remain quite low.  Although the SAG has built 
1.8 million low-income homes since 1994, the backlog of homes 
remains roughly the same, i.e., 2.4 million units.  According 
to the South African Government (SAG), 63% of households in 
2004 had access to adequate sanitation, 70% of households had 
access to electricity, and 90% had access to clean water. 
However, the quality of access varied greatly.  Access could 
include everything from indoor plumbing to a shared community 
tap.  The statistics do not distinguish between the quality 
 
PRETORIA 00000347  002 OF 003 
 
 
of access. 
 
¶5. (U) A June 2005 study by the University of Cape Town, 
claimed that access to public services and housing had 
slightly improved over time, most notably in the provision of 
electricity.  The study, entitled "Measuring Recent Changes 
in South African Inequality and Poverty using 1996 and 2001 
Census Data," reported on access to public services and 
housing for the poorest 20% of the country as well as for the 
population as a whole.  Access to public services and housing 
for the population as a whole was as follows: 
 
Service                    1996       2001 
------------------------   ----       ---- 
Piped Water                80%        82% 
Electricity for Lighting   58%        70% 
Formal Dwellings           65%        68% 
Refuse Removal             51%        54% 
Sanitation                 50%        53% 
Electricity for Cooking    47%        51% 
 
Access to public services and housing for the poorest 20% of 
the population was as follows: 
 
Service                    1996       2001 
------------------------   ----       ---- 
Piped Water                65%        72% 
Electricity for Lighting   35%        57% 
Formal Dwellings           49%        57% 
Refuse Removal             27%        33% 
Sanitation                 21%        29% 
Electricity for Cooking    19%        27% 
 
¶6. (U) While national statistics revealed little improvement 
in access to public services and housing (except for the 
provision of electricity for lighting), the poor did 
experience a marked increase in nearly all categories.  At 
the same time, a substantial percentage of the poor 
population remained unserved, particularly in the Eastern 
Cape and Limpopo Provinces.  Meanwhile, Western Cape and 
Gauteng Provinces experienced percentage declines in public 
service and housing delivery as a result of rapid migration 
of rural poor South Africans in search of work in growing 
urban areas. 
 
The Source of the Problem 
------------------------- 
 
¶7. (SBU) Municipalities suffer a range of problems, but most 
boil down to a lack of capacity.  After a 2004 assessment of 
the country's 284 municipalities, the Department of 
Provincial and Local Government (DPLG) announced that 136, or 
nearly half, of them were "under-performing" (Ref G).  Eighty 
municipalities did not have technically skilled staff, and 
more than forty employed only one person with technical 
skills.  Only seventy municipalities had a qualified civil 
engineer, despite the fact that they are charged with 
supplying such public services as water and electricity to 
local residents.  Nearly half of all municipalities failed to 
submit financial reports to the Auditor-General in accordance 
with the Municipal Financial Management Act (MFMA).  Those 
that did often took four to six months to file, instead of 
the allotted two months. 
 
¶8. (SBU) Extremely weak financial management at the local 
level has created a number of related problems.  Because 
municipalities do not have trained personnel to monitor and 
collect revenue, local revenues are lower than they should 
be.  Because municipalities do not make proper budgeting 
decisions, resources are misused.  One local financial 
manager was told, for example, to cut expenditures on water 
and sewer pipes because such improvements were invisible to 
local residents and offered no political gain.  Weak 
financial management has fostered corruption, and allowed 
municipal officials to raise their own salaries despite poor 
performance.  Salaries of municipal officials were R4 billion 
($667 million) greater than spending on public services in 
the worst performing 136 municipalities.  One municipal 
manager in Mpumalanga earned more than President Mbeki, 
despite the manager's poor performance.  Because revenue 
collections are poor, some municipalities have raised debt to 
cover their budget shortfalls.  Nationwide, municipal debt 
now totals R40 billion ($6.7 billion), with the 23 largest 
 
PRETORIA 00000347  003 OF 003 
 
 
municipalities accounting for about half. 
 
Government Dedicated to Fix It 
------------------------------ 
 
¶9. (SBU) President Mbeki has tried to get out in front of the 
problem by visibly calling for change in the hope of quelling 
the unrest to boost the ANC's image in the run up to the 
municipal elections.  He has spoken out against corruption 
and incompetency at the municipal level, but at the same time 
pledged greater support.  On December 10, he held a town 
meeting in the Ilembe Municipality in KwaZulu-Natal (Ref H). 
This was part of a series of such meetings in the DPLG's 
Municipal Imbizo program.  On December 14, Mbeki attended the 
ninth and final town meeting in Cape Town, which focused on 
the problems of long standing slums in Khayelitsha and 
Mitchells Plains.  In the meantime, DPLG has been sending out 
its "Project Consolidate" teams as fast as it can to help 
municipalities in dire need of management and technical 
capability (Ref G). 
 
¶10. (SBU) Taking her cue from Mbeki, Housing Minister Lindiwe 
Sisulu is dedicated to speeding up housing delivery.  Her 
goal is to eradicate all informal settlements by 2014. 
Currently, housing is the responsibility of national and 
provincial government; however, in 2006, Sisulu is pushing 
draft legislation that empowers accredited municipal 
governments to deliver housing.  She hopes to speed up 
low-income housing delivery by removing the national and 
provincial bureaucratic burdens that exist.  The accredited 
municipalities would receive technical assistance from 
housing officials during this transition period in line with 
Project Consolidate's capacity building teams.  In addition, 
Sisulu is working to quicken the pace of the housing 
development approval process and advocating for low-income 
developments to be given preference on state-owned land. 
 
¶11. (SBU) The SAG has invested considerable political capital 
in improving housing for and extending public services to the 
poor in South Africa -- the core constituency of the ANC 
government.  In its October budget, the national government 
boosted the budgets of provincial and local governments by 
over R50 billion ($8.3 billion) to fund infrastructure and 
housing projects.  To keep them from choking on this 
increased funding, national government will provide 
assistance in the form of R1.9 billion ($317 million) over 
the next three years to build municipal capacity.  Part of 
the effort to help local government will be to employ 
retirees and foreigners who have the necessary skills. 
 
Comment 
------- 
 
¶12. (SBU) Since 1994, the ANC government has made strides in 
the provision of housing and public services, but still has a 
long way to go to meet the needs of South Africa's poorest 
citizens.  No one knows how long poor South Africans can wait 
for government to translate the benefits of political 
liberation into a higher standard of living for them. 
Despite opposition parties making political hay out of the 
situation, the political urgency for the ANC comes more from 
the unrest that has spread across the country than from the 
prospect of losing political ground at the polls in March. 
For the time being, disenchantment with ANC performance will 
more likely manifest itself into low voter turnout. 
TEITELBAUM