We are mindful that municipalities face growing pressures from both the rising cost of bulk services and rapidly growing numbers of households.

Municipal capital spending exceeded R53 billion in 2014/15.

Yet we continue to see underspending of infrastructure grants in many local authorities. A review of these grants has led to several proposals for improvement:

This year brings our fourth fully democratic local government elections. In recognition of this, the National Treasury will launch a data portal to provide all stakeholders with comparable, verified information on municipal financial and non-financial performance. I hope this will further stimulate citizen involvement in local governance.

The elections will also see a significant change in municipal demarcations. The number of municipalities will be reduced from 278 to 257, with the objective of improving their viability and sustainability. Local government allocations will be revised to take account of these boundary changes and over R400 million is allocated over the next two years to assist with the transition.

The “Back to Basics” programme launched in 2014, aimed at improving service delivery performance of municipalities, is entering its second phase of implementation. It involves active monitoring of performance in governance and service delivery, support to struggling municipality and stronger accountability measures.