SOUTH AFRICA: Privatisation creates poverty

Poverty is the new enemy in post-apartheid South Africa, and the government's policy of cost recovery and privatisation of basic services has created new areas of friction with the country's poor and marginalised, according to a Canadian study.
Municipal services such as water, sanitation and electricity, are many people's main contact with government, said the latest issue of Reports, a publication of Canada's International Development Research Centre (IDRC). It quoted David McDonald of the Municipal Services Project (MSP) of Queen's University, Ontario, as suggesting: "The crisis of cost recovery, I would say, is enormous ... In many ways, it has undermined the ANC's [ruling African National Congress] otherwise impressive infrastructure programme."
The aim of cost recovery is for consumers to pay partially or in full for their local services, to generate revenue for future service development. Since apartheid, basic municipal service among poorer families "have been expanded impressively," the Reports article said. More than three million South African households gained clean drinking water, and two and a half million have joined the national power grid. But, in townships where commonly 70 percent of the community are unemployed, people cannot afford to pay for the new services.
One consequence was the cholera outbreak in KwaZulu-Natal in 2000, which claimed more than 250 lives, and caused more than 100,000 cases of illness. The evidence suggests that the trigger was the decision by the provincial government in KwaZulu-Natal - one of South Africa's poorest regions - to charge rural residents for water that used to be "free". Households unable to afford the rates, resorted to using rivers and stagnant ponds. Treating the epidemic cost far more than providing free water.
According to the IDRC, a broad fiscal conservatism permeates government from the federal to municipal levels. "Some municipalities charge utility bills at high consumption rates, without reading actual - and often lower - user meter totals. There's also been a moral campaign to end what some administrators see as a 'culture of non-payment', begun under apartheid when black South Africans refused to pay for services in protest."
However, "it is a culture of poverty, no doubt about it," Olusola Olufemi, a housing expert at the University of Witwatersrand told IRIN. "In the townships there are so many indigents, they have no jobs, they can barely eat. This has created a rebellious attitude. People prefer to tap illegally from those who have." She pointed out that research into HIV/AIDS and housing conducted last year at the Orange Farm settlement on the outskirts of Johannesburg, pointed to the high water needs of people living with AIDS. "Somebody in the last stages of the disease needs constant water because of diarrhoea. If water is not there, if sanitation is not there, it compounds problems," Olufemi said.
Jamil Chand, spokesperson for Johannesburg Water, acknowledges that the "situation is not ideal". But, he told IRIN that the public company - operating under privatised management - was complying with a government directive to provide 6,000 litres of free water to households per month.
But in a press statement last week, South Africa's Municipal Workers Union (SAMWU) alleged that no account was taken of water being wasted by leaking pipes and inadequate infrastructure. "Consequently, the figures published by the company were inaccurate and misleading", SAMWU said. "More worrying still were reports that not only had water cut offs increased but in addition some residents had seen their personal possessions confiscated by agents of the company to offset the company's costs," the statement added. "Close on 100 percent of the population [in Johannesburg] are covered by some kind of water and sanitation services," said Chand. "There are still a lot of challenges, there are still hundreds of thousands of people living below the poverty level. They require attention not just from Johannesburg Water, but from other stakeholders."
Queen's University's MSP suggests that among the "fixes" to make cost recovery more equitable would be flexible payment plans, fewer penalties, more realistic minimum "lifeline" supplies for low-end users and a moratorium on service cut-offs.
There is also a philosophical argument - whether municipal services are a human right or purely an economic good. "We're really just at the starting point of trying to understand the broader social, environmental, and other costs of service delivery," McDonald was quoted as saying. "One needs to consider the broader public good. There's a moral question here, too." (IRIN)