Impact of local government funding in Zululand district, South Africa

Abstract

This study reviews the impact of Local Government (LG) funding in Zululand municipal jurisdiction, with the purpose to identify and measure the motivational factors that influence LG funding in South African municipalities. The study was motivated by challenges confronted by municipalities outside the metropolitan areas, where service delivery and infrastructure are lagging. The importance of linking social development with the respective funding mechanisms was further explored, with the view to determining the level of funding and financial intervention for community social and economic well being. The thrust of the study concerned the balancing of insatiable community demands from various municipalities, versus the limited national government resource base to meet those demands. These demands form the basis of the factors that contribute to cost overruns in municipalities, inadequate planning, poor cost estimates, and scope changes, as well as project delays, corruption and material price escalation. In order to achieve the main purpose of this study, a mixed research method allowed both quantitative and qualitative data to be gathered from a sample of 30 participants, drawn from four municipalities in Zululand, through a self administered questionnaire. Data were analysed using SPSS version 25.0, with results presented in frequency tables, figures, correlation tables, and cross-tabulations. The findings reveal that, to a larger extent, internal factors contribute to the under-performance of municipalities; wherein an understanding of statutory instruments is lacking by the respective municipal staff responsible for finance. These internal factors develop from other associated factors, such as recruitment policies and regulations, human capital development, budget constraints, and more. The results further indicate that political interference, unemployment, poverty, and lack of adequate funding from National Treasury (NT) inhibit infrastructure and social development contribute to poor municipal performance. There is little emphasis or very limited work published on strategies that impact sustainable social service delivery and infrastructure investment in municipalities in particular and local government in general. It is envisaged a study of this nature will provide insights to management, key personnel and leadership into critical issues, and provide solutions to the major causes of social service inefficiencies, social inequality and social injustice from a local government funding point of view.