SPEECH BY JAAP KELDER – 11 JULY 2011
Why should we have ratepayer's associations at all? We have got councillors elected from political parties, but they are powerless as they have certain functions in municipal council meetings. They are not allowed to interfere in the daily workings of the municipality, they cannot issue instructions to municipal workers. All they can do is raise concerns in council meetings where they can be out voted. The residents have the real power as they control their monies.
The legality of Declaring a Dispute.
If you go to the Constitution, which is the supreme document running the affairs of this country, Section 152 (1)(e) provides for the active participation of residents in municipal affairs. Go and read your Constitution – that's what it says. The Municipal Systems Act regulates the affairs of the municipality and Section 16 – 22 provides for the active participation of community based organisations in municipal affairs. Section 16 states that with the drawing up of the budget, the views of the ratepayers associations must be taken into account. The Municipal Finance and Management Act provides for the participation of the residents and ratepayers association in the drawing up of the Integrated Development Plan as well as the Budget. The Municipal Finance and Management Act, Section 23 says very clearly that the inputs of the residents into the Budget must be discussed at a full council meeting and these inputs must be taken note of and must be incorporated into the Budget. The Electricity Act, Section 6 provides for the participation of electricity end user forums. So all these laws written by the current government provide for community participation. But the sad thing is this government ignores all these regulations. They don't want interference from residents. And to put the cherry on top of the cake, they are not performing as they should be performing. They are raising rates and taxes on an annual basis Mike Schussler of Econometrix has raised the point that over the last three years, municipal rates have increased by 72%. We all know that electricity prices are being increased at 30% per annum on average - and who is paying for it? Sorry ladies and gentleman – you are paying for it and you are not getting the service for it. In your metro last year R2Billion – that's two thousand million rand has disappeared which cannot be accounted for. It is not the municipality's money – it is your money. You have paid that money into council and they can't account for it.
The Auditor-General's report has given a disclaimer - now that is just about the worst opinion that the AG can express on any institution – it means there are no financial controls in the council – and again, it is the ratepayer's monies that is being used - misused and abused - which they can't even account for.
What is the solution? These are the problems, but once you've got a problem, you have to identify the problem and you've got to take action against it and that is what we have been doing. As far back as 1995 Dr Pitt Fennel took the Municipality to court on the non-collection of monies. Section 96 of the Municipal Systems Act says very clearly it is the duty of the Municipal Manager to collect all outstanding monies but, for this financial year, they are budgeting for R165 million rand in bad debts. Now ask yourself the question - are you the people whose monies are to be written off or are you paying? And if you are paying, who are these people who are not paying - whose debts are being written off? Is your Municipal Manager complying with Section 96 of the Municipal Systems Act? No - and who is bearing the cost of it? I'm sorry to say it's you sitting here who are the sufferers. Your money is being used to subsidise other people.
The argument is that we have poor people. But those poor people in the squatter camps don't pay rates and taxes, they don't pay for water because they get 6Kl a month free, they get 50kW of electricity free - that is over and above what they are stealing - so they are not paying for any services and, on top of that, you are still writing off R165 million rand per annum, which is increasing to R175million and R185million in the next few years – and they are budgeting for these figures to be written off every year. The total outstanding debt is running into millions. The total outstanding debt owed to municipalities countrywide is R62Billion rand – that is 62 thousand million rand and they are not even going to recover 10% of that. The rest will be gone forever because, as those of you in business know, once you let the debtor get too far into arrears, you know you will never ever recover it because there is no security – these people don't have houses and no proper jobs so the money is gone forever.
In 1995, Dr Fennell in East London and myself in Kempton Park made court cases against our councils to get them, with court orders, to get these monies collected because we could see (we were both councillors) the deterioration, we saw what was coming and we tried to prevent it. In my case I took the council to court and I lost in the High Court because I asked for "mandamus" – this means a court order forcing the council to collect monies. I lost the case in April 1996 with costs – went on appeal to the full bench - 3 judges in High Court - won the case with costs, council took the case to the Appeal Court in Bloemfontein and there we lost with costs. The result is that we are sitting with R62Billion which will never be recovered.
What is the result of that? All the metros in the country except Cape Town are technically bankrupt. Joburg, a world-renowned city, is technically bankrupt. If you read the latest Auditor's report, most councils' liabilities exceed their assets. In Free State there are 20 towns where Eskom is on the point of disconnecting the whole town because of outstanding debts. The councils get a grant every four months from government and those grants are supposed to be uplifting communities. The councils are now using those grants to pay Eskom. So what happens? No services to the poorer communities. The monies are being mis-appropriated. Imagine the devastation when the whole town is cut off.
Parys was cut off last year and with a high court order the council was forced to reconnect power. We went to see Eskom and they said "we are a business and we are allowed, morally and legally, to cut off a whole town". But that will cause chaos and Eskom are in a catch-22 situation. If they don't collect monies, they can't fund new power stations and if we don't get new power stations, we don't have enough electricity. If they apply credit control we get riots in the towns – we've had it in Joburg and in Durban in the past week. So it is a catch-22 situation.
So what do we do as residents of this country? The system we have devised is to withhold your monies – not boycott – and the moment the council provides the services which you have stipulated that you require to be rendered, eg. Potholes fixed, stormwater drains cleaned – whatever you can find that is wrong with your town – then you will pay over your money. And what has happened in a couple of towns? In 2007, Warrenton who don't have a water born system so it's all by honeysucker - the truck had broken down and sewerage was running down the streets – I was there, I saw it – and they declared a dispute – their rates were increased by 400% and the residents said we are declaring a dispute, paid the money into a trust account and within three months the increase in rates was decreased to 10% which is reasonable and the honeysucker was fixed and the ratepayers paid over the money. So if your council complies with their duties - which is not expecting anything spectacular – and they just do the job for which they are being paid - and they are handsomely rewarded, it is not as if they are working for a pittance – they are getting big salaries, so I think for big salaries, we can expect big services. So we advise that you withhold your money, pay it into the trust account so that the day the money does become payable - because one day you will have to pay – it will be available because without money no council can deliver services. So the day they deliver those services they will be entitled to the money and the money will be available to be paid to them.
The next question people ask is - Can they take my house away from me? Firstly, they can't because Section 102 (2) of Municipality Systems Act says very clearly where a person has declared a dispute with a municipality, the dispute must first be resolved before credit control can be applied. What does credit control mean? Credit control means either you can be sued or your services can be disconnected. Now, what does that section of the Act say – it says no credit control until the dispute has been resolved. In other words, if they sue you and summons you to court, under the protection of the ratepayers association so you won't be liable for any legal costs, you put a defence into court. But funnily enough, the first withholdings started in July 2005 in the town of Swartruggens and we are now six years down the line and not a single municipality countrywide has had the guts to go to court and say to a ratepayer "we want our money" - they are dead scared of going to court because once you get to court, there's no holds barred and then you can put each and every issue on the table and they know they are in the wrong and they dare not go to court, so they can't sue and can't just take your house. If they want to take legal action against you, they have to issue a summons, if they issue a summons you go to court. But you will be protected by your ratepayers association who are in turn protected legal-wise and money-wise by the National Taxpayers Union because everybody pays a subscription fee on an annual basis and that is where the NTU get the money to defend the costs. Just as a matter of interest, over the past four or five years we have spent over R600,000 in legal fees - in spite of winning all the court cases we still have those expenses to pay. But not a single individual has ever been held liable for a cent in legal costs so you are totally covered. It is like an insurance policy. R20 per household per annum – that's your insurance premium which you will be paying.
The second thing people are worried about is that the municipality will cut their electricity. Again, the law says no credit control until the dispute has been resolved, but the municipal officials have ornaments for ears – they can't really hear and they don't understand, so they do cut people off. When this happens you go to court and, on the basis of spoliation which means you are in possession of a power supply and the municipality is illegally disrupting the power supply, you can get a court order within hours to force the council to put the power on again. Now, some of these councils are very clever – they do it on a Friday afternoon at 4pm knowing that you will be sitting without power for the whole weekend. We've got a solution to that. Beforehand, you make sure there is a magistrate who is available after hours, you make sure the Sheriff is available after hours and we've had it in the case of Williston in the Northern Cape where people were cut off at 4pm in a the afternoon, the case was heard by the magistrate that evening who issued the order at 10 pm which was served on the Municipal Manager at 11pm and at 12pm the technician was ordered to switch on the power. You could be without power for a day possibly, that is a pain you must accept, but, with a court order you will be reconnected as a temporary measure and then on the return date which is normally two or three weeks later, the council have then got the right to come to court and say why they cut you off. Each and every case, except for the case in Bethlehem, we have won the cases. What happened in Bethlehem they withheld the rates to the tune of about R1million, council cut the power on the Monday morning, they went to court, but the magistrate said I am not going to give an order today, I'm postponing this till Friday. So the residents would have been sitting without power for a whole week. After a day it is a pain, after two days it becomes a severe pain and after a week it is not a joke anymore so the residents said okay we will pay the money because they can't afford to sit without power for a whole week. That was the only case in the whole country where they couldn't get an immediate order. So we've got to prepare ourselves for that as well.
To summarise, they cannot attach your property or cut services until the dispute has been resolved. I want to make it very clear, we are not trying to take over the government, we are not trying to boycott the government, we are not trying to undermine the government, but on the other hand, we are normal residents who have the right to services. We've got the right to demand these services. The law provides for this, but if you don't stand up for your rights, you are going to lose these rights. It is a matter of "use it or lose it".
We are now getting to the stage, after seventeen years of mismanagement, that residents countrywide have had enough. There is no chance of improvement. All we get is promises, promises, promises. We are now getting to the stage where we say No More.
Remember one thing, even if you start this whole thing tomorrow, that services might improve, council might take notice and start improving services – we hope that will be the case and we can resolve the dispute. If it doesn't happen, then there is the possibility that you can start rendering your own services.
You have most probably all heard of or read about Sannieshof in North West Province where residents declared a dispute and started withholding monies in November 2007 and in February 2008 they had no water in the town. Sannieshof has a small river, the Harts river which is dry most of the year so they are dependent on boreholes – they have seven. But in February 2008 there was no water in the town or in the township – nothing – when you opened the tap, air came out. So Carin Visser went to see the Municipal Manager who told her "we've got a bit of a problem, we are facing a challenge, but we are working on it and we are going to lay a pipeline from the Katse Dam to Sannieshof and if the water from this dam is not sufficient, we'll lay a pipeline from the Okavango Delta right down to Sannieshof in the North West Province and this is all going to take time and will cost R12million". Carin thought this was ridiculous and went to look and found pumps broken down, pipelines leaking, etc. Within a week, they fixed the whole problem – for R12,000 - and the whole town had water. Since 2008, Sannieshof residents have been supplying their own services with the withheld money – not 100% because money is not sufficient, but the money that they have withheld up to now is 5% of the municipality's budget and bear in mind the Tswaing Municipality consists of Sannieshof, Ottosdal and De la Reyville – three towns. And let's say that each town would need 5% to run their towns, this gives you 15%. Let's just add 5% to that and make it 20%. Then the question is what happens to the other 80%? What happens to the rest of the money? What has happened to the R2Billion that BCM can't account for? Your taxpayers money. The monies which are outstanding are sufficient to negate the increase so you would have 0% increase if they just collected the outstanding monies. Now, can that be that difficult? Shouldn't be! So the point is, once you've got money in your pocket, you've got financial muscle and you've got financial power.
If you come to water, this country is facing a major, major crisis with water supply. We know that all the coastal towns in the Southern Cape were having a drought – I believe you've had some good rains recently, but water is a major crisis. The Green Drop Report given out by the Department of Water Affairs has brought to light 821 sewerage plants in the country of which 40 are operating 100% - that's less than 5%. 341 are totally, absolutely dysfunctional, with the balance in between. I can state categorically, because we are working on this virtually on a daily basis, there is not a river, not a spruit, not a dam in this country at the moment that is not polluted with e coli and pathogens. That is a sad state of affairs. Countrywide, from Louis Trichardt in the north right down to the Cape. The Berg River in the Cape is absolutely polluted. This water is used to irrigate our crops and e coli doesn't disappear – it only disappears through ultra violet rays and chemical treatment. So these pathogens and e coli are being taken up by the crops, so much so that quite a few consignments of fruit and vegetables sent to Europe have been returned – not acceptable - and are sold locally and we are all eating them. That eventually causes cancer. We've got the medical experts substantiating that, but you will never know it because it takes years and years to build up in your body – and we know how many people are suffering from cancer today – and these are all contributory factors.
So, if your sewerage works are not working properly, you will now have money in your trust account and you can tackle the sewerage plant. You are at the low end of the rivers close to the sea and this ends up in the sea but, at the end of the day, all our beaches are polluted and the South Coast of Natal is now at the stage where holiday makers don't want to go there anymore because it is too dangerous to swim in the sea because it is so polluted.
So these are the challenges that we are facing, but with money in your pocket, you can fix the sewerage works. In January 2009, we went to Sannieshof and saw the methane gas that is being generated by the sewerage plant. Every sewerage plant generates methane gas – that is part of the process – there is nothing you can do about it. Methane gas can be captured and you can get carbon credits for it – you can be paid if you can get rid of the methane gas. We said that we would like to put an electricity generating plant into the sewerage works and we did a study and countrywide from the sewerage plants, as a provisional figure, we can generate 600megawatts of power from sewerage and at the same time get rid of the methane gas. It is a win-win situation. 600megawatt is equal to a power station like Duvha – you all know about Duvha where a whole turbine exploded – R3Billion damage. We could have replaced the whole power station with the methane gas generated from sewerage plants. So you could, by upgrading your sewerage plant, at the same time recover the methane gas, burn it and drive diesel engines with it. I have seen in a pilot plant in Pretoria a standard Mazda 626 engine running on methane gas, drive an alternator and supplying a whole office block with electricity. So we can have a win-win situation, but what do you need? You need an organisation like the ratepayers associations, you need the withholding of the monies and then you can get the whole process started.
Ladies and Gentlemen it is tonight in your hands to decide whether you want to go this route. Let me repeat, it is not illegal – all you are doing is standing up for your rights, and we do all have rights, and this deterioration of services affects everybody. Somebody has got to stand up and that somebody is each and every one of you sitting here tonight. So if you do that, we can have a win-win situation and if we don't I'm afraid we are looking at bad times ahead.
Thank you.