How can we afford rubbish removal and better street lights?

THE CONVENTIONAL approach to the problem of non-payment of rents, rates and service charges is to ask "how do we reverse the culture of non-payment bred by resistance to the apartheid regime now that the democratic new South Africa has arrived?" This is a partial and misleading approach, for even if apartheid and the resistance to it had never existed, there would doubtless have been a crisis over non-payment. As it is, the tradition of successful and long-lasting rates and rent boycotts merely lends an extra and troublesome dimension to the problem, for it created a political and moral rationale for non-payment that continues to be invoked in a radically changed situation.

The non-payment phenomenon in South Africa’s cities and towns should be viewed as part of a wider social crisis. The dimensions of this crisis are customarily wrapped up in phrases about "transition" or "transformation", but it is best to be blunt about some of the key processes through which the country is passing at a great rate.

Had apartheid not existed urbanisation would doubtless have been a gradual and continuous process but for years this process was artificially restrained. The abolition of the pass laws in 1985 continues to have a huge impact, much like that of a piece of elastic snapping back rapidly, having been stretched in the opposite direction. In the mid-1980s the rule of thumb was that roughly one third of Africans lived in the "homelands", another third in the cities and towns and the remaining third in the rural areas outside the homelands. This has changed at enormous speed in recent years not only because the legal barriers to urbanisation were removed but because of the large shake-out of farm labour and the ending of the homeland system - with its large subsidies to homeland development.

The result, almost everywhere, has been the run-down of the old homeland "capitals" such as Thohoyandou or Phuthadithaba and a dramatic decline in employment opportunities there. In addition, trade union insistence on standardised national pay rates saw the old border industries shut up shop and move to the cities once the subsidy incentives to stay there were removed. All of these factors hastened the flow to the cities. By 1999 it was estimated that 50 per cent of the African population lived in the towns but that this figure was increasing steadily and would reach 55 per cent by 2005. There is no reason to believe that this influx will not continue for a long period after that.

This accelerated process of urbanisation is changing the entire face of South Africa. In the first place, the physical structure of townships built in the 1950s and 1960s is creaking under the tremendous strain of this increased population. Such townships are being pressed by informal settlements on all sides — and often within their own streets as well. Whereas in the apartheid era urban Africans by definition all had jobs (if not they were shunted out of town), unemployment is increasingly becoming the norm among these large African communities.

Attempts to provide housing and other services for this mushrooming population have inevitably fallen far behind demand so that increasingly urban settlements are informal, uncontrolled and unregulated. The more the authorities do manage to supply housing and services, the more these urban settlements attract other rural dwellers (for whom no one provides houses) and immigrants from the surrounding countries who are unlikely to make the payment of rents, rates or service charges a high priority. The net result of these pressures is that an enormously greater demand is placed on the urban infrastructure and services at the same time as the ability to pay is diminishing.

South Africa is also going through the same process of de-industrialisation witnessed in many other countries, with a run down in manufacturing, mining and agriculture and growth limited to the service sector. This has had an extremely depressive effect on the formal sector job market, for the unemployed masses being disgorged onto it usually lack the skills required in the growth areas of the service sector — information technology, software, financial services etc. There is a general fall in per capita incomes and an increasing number of people at the bottom of the system who are suffering rapid immiseration not just in relative but in absolute terms. But relative inequality within groups has also grown. The number of poor whites is increasing, too, and it must be expected that more and more of them will react as have the whites of Carletonville by becoming non-payers themselves on a very significant scale. The phenomenon of non-payment, predominantly an African one to date, is likely to spread into other racial groups.

The black population is still growing quite rapidly, though the depredations of Aids mean that the rate of growth of will be slower than expected. Aids is bound to affect the problem of the non-payment of rates, rents, service charges and taxes for multiple reasons. One is simply that many of the economically active, who are most able to make such payments, will become sick or die. Another serious question is how far those who know they are HIV positive are likely to bother to pay rates or service charges. The temptation to spend whatever they have on themselves is understandable and likely to be overwhelming in such a situation.

The fact that neighbours and family members are becoming sick and dying all around is bound to produce a tremendous malaise, indeed the demoralisation of many communities. In such an atmosphere it is difficult to see how community spirit can be built up and how such relatively prosaic questions as the payment of rates can achieve either the salience or priority that local councils might wish.

This social and economic context provides a framework for thinking about the phenomenon of non-payment which is realistic but undoubtedly gloomy. On present trends it is extremely difficult, if not impossible, to imagine that the problem can be fully solved in the immediate future, if by solved we mean the attainment of a close to 100 per cent payment rate in the large majority of townships and informal settlements.

In effect, by refusing to pay rates and service charges non-payers are pushing the buck back to the government. It therefore faces a situation in which all the major public utilities are likely to incur large and possibly unsustainable losses due to non-payment. Either it will be forced to support these utilities by subsidies or, at best, it will have to accept lower returns from them than would otherwise have been the case and delay their possible privatisation. Equally the government will inevitably be reluctant to surrender management control over these utilities to anyone else, for there can be little doubt that if they were run on lines of economic efficiency alone they would be forced to retreat from certain areas of provision, effectively "red lining" significant parts of the community. Such a solution is not acceptable to the government or to voters.

Non-payers are also, in effect, voting to weaken local government and to force the tax burden upwards onto central government alone so that local authorities are supported only by central government subsidy, which in turn depends on centrally levied taxes. The government will no doubt wish to resist having this burden laid upon it and will wish to see payment levels improved to the maximum degree possible. Our study suggests several ways forward.

The most central problem clearly lies in the complex of issues surrounding "the entitlement culture" and even the "culture of non-payment". The latter certainly exists in Gauteng and has some roots elsewhere. The strength of the Masakhane campaign is that it attempts to tackle these cultural phenomena head on and to install a strong sense of community in its place. Undoubtedly a strong, confident community consciousness is the best antidote to these dependent and self-defeating attitudes. Our study also suggests at many points that this is also the key to the achievement of higher payment levels.

Nonetheless, whatever the local successes achieved by the Masakhane campaign, it would be a mistake to see that response as a complete answer to the problem. The government must also consider carefully how far it wishes to risk its credibility in such campaigns, which cannot possibly succeed overall. It may be that Masakhane campaigns should be launched only in those communities where payment levels are already at 40 per cent and can reasonably by expected to rise to, say, 75 per cent. In such cases something real and probably lasting would have been achieved and a consequent strengthening of community solidarity and consciousness would be likely to take place. But to campaign to raise payment levels from, say, 10 per cent to 30 per cent is a waste of time, for non-payment will then remain the norm and the 30 per cent level will not be maintained over time.

Secondly, government is going to have to accept that it will not be able entirely to solve the problem of non-payment in the foreseeable future and that the result will force transfers of resources from central government to the major utilities and to local government. These transfers are going on already and are bound to continue. For government the questions are how far it should openly acknowledge this inevitability, how it should extend subsidies and transfer resources to achieve the maximum impact, and how to promote higher payment levels wherever possible.

Thirdly, our study suggests several ways in which these transfers could be most usefully made. Our survey shows that expenditure on roads (including road cleaning and road lighting) should receive priority, as should a more generalised attack on crime in township and informal settlement areas. A concerted drive against crime in these communities is necessary not merely to restore law and order to these often lawless settlements but in order to give a reasonable chance to the process of community building. This could in turn provide the basis for the stronger community cohesion necessary to the achievement of higher payment levels as a second stage.

In a climate of zero-tolerance of crime there would be a far better chance of persuading residents that the non-payment of rates and service charges was a serious matter — and that making illegal connections to water, telephone and electricity supplies was more serious still. In any case only a crackdown on crime will enable the government to dispose of the criminal syndicates who are often responsible for these illegal reconnections.

In Durban, we were told how Telkom would train young engineers who would then leave six months later because they could make more by selling their skills in townships to make illegal phone connections. In some cases there was only a two-week gap between the original phone installation and illegal reconnection, as syndicates of illegal reconnectors swept in right behind Telkom. Eskom and the water boards can face similar problems as trained staff defect to make more money this way.

A concerted attack on such practices will be all the more effective if it is part of a wider anti-crime campaign. At least residents will then feel that they are gaining a more peaceful community out of the process and not merely losing the opportunity of acquiring cheap and illegal water/electricity supplies.

Fourthly, the government should reward communities that are clearly successful in increasing payment levels so that it strengthens the perception that higher payment levels lead to better delivery and more development. One objection is that this could well produce a pattern of rewarding the better-off communities. However, as our study shows, communities as poor as Keimoes and Kuruman in the Northern Cape and Ivory Park in Gauteng were all among those that might be in the queue for such rewards. Even if better-off communities were in fact rewarded, this could still be worthwhile if it produced permanently higher payment levels in those communities.

Finally, the government will have to consider taking stronger action to guarantee the integrity of existing townships and their infrastructure. It simply cannot allow townships that work to be deluged with squatters and migrants to such a degree that they cease to function as communities. This is a real danger. There clearly also needs to be a far more detailed and determined attempt to plan urban development and not to allow "wild cat" squatting initiatives to determine the pattern of development.

Currently plans are going ahead to merge municipalities around the country into a far smaller number of much bigger units. It may well be that the government will hope thereby to solve some of the problems of non-payment, effectively forcing redistributive transfers from wealthier sections of the community to subsidise non-payers. But the scope for such transfers is by no means unlimited, especially with the haemorrhage of tax-paying skilled and professional labour abroad. The attempt to force such transfers will cause companies and personnel to move away from the affected areas.

In the end there will have to be some scheme of rebates for the very poorest whereby their inability to pay is recognised and they are at least brought within the law. The cost of such rebates should be met out of central government funds, though the same point should be made about the effect on a slender and possibly diminishing tax base. If people feel they are being taxed unfairly heavily, studies the world over show that they find ways of not paying more, even if it means moving away.

The government must also reconsider its policy towards the rural areas, including the former homeland areas. Although the old homelands policy is rightly completely discredited, simply to have scrapped it does not answer the needs of these areas — and threatens to turn the flow of urbanising migrants into an irresistible and destabilising flood. The recent suggestion of the minister for welfare, population and development, Zola Skweyiya, for an unemployment benefit for the poorest of the poor — which in practice would largely mean the rural jobless — would undoubtedly be a start.

But the most effective way to reduce the speed of urbanisation to more manageable levels would be to create more employment opportunities in rural areas and small and medium-sized country towns in the hope that their inhabitants will be less inclined to migrate to the metropolitan centres. In part, this may be dealt with through the development corridor process which the government has launched in a number of areas, but there needs to be a wholesale review of policy, including the possibility of differential wage rates, lower company taxes and other incentives for enterprises to locate themselves outside the major metropolitan areas.