3 days ago
Forum says ring-fencing property revenue will empower Eersterust
The Eersterust Community Development Forum (ECDF) has made a notable intervention in the national discussion on local governance reform by submitting a proposal to Cogta Minister Velenkosini Hlabisa during the ongoing White Paper Review consultation process.
This move, according to Arnold Adams, the co-ordinator of the forum, has been driven by the urgent need to address the inequities caused by the 2025–2029 municipal property revaluation process.
This process resulted in significantly increased rates for residents in Eersterust without a corresponding increase in services.
At the core of the forum's submission is a desire to reform the system so that the revenues generated by a community, specifically from property valuation, are reinvested back into that very community.
'This new provision would allow municipalities to allocate up to 25% of the increased revenue from property revaluations directly back into the local area where it was generated,' said Adams.
This measure is designed to ensure that the funds are not only used equitably but also transparently, with the proposal outlining mechanisms for community oversight, transparent financial systems, and a close alignment with municipal planning instruments.
A key feature of the forum's proposal is the idea of ring-fencing a portion of the increased revenue for reinvestment into local services.
This mechanism guarantees that the funds are used directly for the improvement of the community, addressing pressing issues like infrastructure decay, street lighting, and community programmes.
'For communities such as Eersterust, ring-fencing could provide tangible benefits like improved public spaces, cleaner environments, and better youth services. This would all be funded by the increased property values, without the need for additional taxes,' confirmed Adams.
The proposal has already garnered significant attention from policymakers, government officials, and academics.
The forum is actively working towards a joint meeting with stakeholders to present and refine the proposal further.
According to Adams, the national White Paper Review offers a rare opportunity to advocate for legislative change that will ensure historically marginalised communities can benefit from the wealth they help generate.
The central thrust of the forum's proposal lies in the draft legislative amendment to the Municipal Systems Act.
According to Adams, the funds would be directed towards infrastructure, service delivery, urban management, and social upliftment programmes, particularly in under-resourced communities like Eersterust.
This step would allow communities to directly benefit from the increased revenue, addressing historical service gaps and inequities.
The proposal is positioned as a direct response to the systemic challenges highlighted in the March 2025 Discussion Document on the White Paper Review.
Adams pointed out that one of the primary goals of the proposal is to link the increased revenue from rising property values directly to local service reinvestment, rather than imposing additional burdens on communities already struggling with high rates.
'The proposal also responds to the concerns about inefficiency in municipal revenue distribution. By empowering communities to manage a portion of the funds they generate, the proposal fosters a sense of ownership and accountability, aligning with the key reforms proposed in the White Paper,' said Adams.
Under the proposed amendment, municipalities would be allowed to delegate the management of reinvested funds to community-led non-profit companies (NPCs), ensuring that residents play a crucial role in decision-making.
'The NPCs would include representatives from the community and follow transparent financial practices, ensuring funds are used in alignment with the city's Integrated Development Plan. For Eersterust, this could mean more localised, efficient responses to pressing community needs, from infrastructure repair to youth programmes,' proposed Adams.
The forum's proposal aligns with the broader objectives outlined in the White Paper on Local Government 2026. Specifically, it responds to the need for municipal fiscal reform and rebuilding community trust.
By redistributing a portion of the increased revenue back into the community without the need for new taxes, the proposal introduces a more equitable funding model that addresses long-standing service delivery challenges.
By empowering communities to manage these funds, municipalities also reduce administrative pressure while benefiting from the local knowledge and engagement of community-based organisations.
To ensure that the funds are used effectively, the proposal recommends that they be managed by community-led NPCs, with oversight by a community-represented board. All expenditures would be aligned with the city's IDP and be subject to public participation processes, independent audits, and annual performance reviews.
Moreover, municipalities would retain oversight, ensuring funds are used properly and are subject to forensic audits if necessary. These measures will ensure the management of these funds remains transparent and accountable to the community.
The forum is setting up consultations on the plan at present with the University of Pretoria (UP) and Cogta (Cooperative Governance and Traditional Affairs).
'These consultations are designed to ensure the voices of local residents are heard and considered in the refinement of national policies. In addition, the ECDF has launched a public survey to capture the views of Tshwane residents on the proposed amendments, further ensuring that community input plays a vital role in shaping the final legislative framework,' explained Adams.
Prof Nara Monkam, head of the Public Policy Hub and Chair in Municipal Finance at UP's African Tax Institute, said this initiative offers a natural pilot model that, if successful, can be replicated across struggling communities in the country.
'Importantly, all interventions proposed will be done without encroaching on the functions assigned to the municipality. The intervention of the NPC comes to complement, not crowd out, the functions of the municipality,' said Monkam.
She says it has sparked conversation about equity-based fiscal models, community-centred service delivery, and the need to review current frameworks to better suit residential areas.
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