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National government has an obligation to intervene on behalf of communities where municipalities, through inefficiency or a lack of commitment to delivery and development goals, fail to provide affordable services.

White Paper on Local Government (1998)


This short report investigates the provision of basic municipal services — electricity, water and sanitation — to low-income households, in an attempt to answer one key
question: is the current model for providing basic services contributing to increased standards of living, reduced household poverty and greater equality?

National socioeconomic development strategy, as articulated in the National Development Plan, includes an important social wage component, as a key tool to raise living standards and reduce poverty and inequality. A social wage comprises both monetary and non-monetary transfers and subsidies for poor households, effectively increasing their disposable income and/or reducing their expenditure requirements. The most visible — and significant in terms of the current budgetary implications — component of the social wage in South Africa is social grants.

Subsidised, including free, services for households — energy, water, sanitation and waste removal — are also intended as an important part of the social wage. The rationale is that (1) access to such services is key to raising living standards and (2) subsidies, including free services, are necessary to compensate for the lack of household income which would otherwise mean that poor households are unable to access these services. In addition, access to quality services facilitates increased opportunities to generate livelihoods,3 and thereby contributes to national employment and income goals.

Universal access to quality services is thus a critical part of South Africa’s long-term goal of reducing poverty and inequality. Effective access comprises both physical access (infrastructure and service delivery that ensures a reliable and quality service) and affordability (services that are unaffordable cannot be accessed).