Johannesburg – South Africa’s municipalities are confronting the growing and uncomfortable reality that the number of households requiring state support is rising sharply.
At the same time, the financial capacity of local government to meet that need is increasingly constrained.
Munsoft CEO Nicholas Maweni this week issued a strong warning that the country’s indigent management systems were failing the very people they are meant to protect.
“South Africa is facing a difficult truth. The number of households needing municipal support is growing, while the financial capacity of municipalities to carry that burden is under severe strain,” he says.
Maweni argues that this is not simply an economic challenge but a constitutional and governance imperative.
“Municipalities are required by the Constitution to provide services to communities in a sustainable manner,” Maweni says.
“That responsibility includes protecting the poor, but it also includes protecting the public purse. That balance is now more urgent than ever.”
A safety net weakened by poor controls
The indigent register is intended to ensure that the poorest households do not lose access to basic services such as water, sanitation, electricity, and refuse removal.
Through Free Basic Services, qualifying households receive essential support that safeguards dignity and prevents deepening poverty.
However, Maweni cautions that the integrity of this system is increasingly under threat.
“The purpose of an indigent register is noble and necessary. But when it is not properly managed, it becomes vulnerable to abuse,” he says.
Municipalities across the country face a range of risks, such as false income declarations, duplicate registrations, fraudulent documents, non‑reporting of improved financial circumstances and applications from households that no longer qualify.
In more serious cases, manipulation of indigent registers by officials or insiders has been observed.
“This creates a silent but serious leakage in municipal revenue. And that leakage is not victimless,” Maweni explains.
“Every rand wrongly allocated to an ineligible household is a rand taken away from the elderly person, the child‑headed household, the unemployed parent or the vulnerable family that genuinely needs municipal protection.”
He stresses that compassion must be paired with discipline.
“Municipalities must be compassionate. But compassion without controls becomes financially reckless.” Maweni says.
Verification is the backbone of credibility
The Local Government Equitable Share (LGES) remains a key mechanism for funding Free Basic Services.
In 2024/25, the affordability threshold used in the LGES formula was R4 418 per month.
But Maweni warns that without accurate and regularly updated indigent registers, municipalities risk funding “ghost beneficiaries, outdated beneficiaries, duplicate applicants and households that no longer qualify”.
“A properly governed indigent management programme must answer five basic questions. Who qualifies?” Maweni asks.
“Are they still alive and resident in the municipality? Do they receive income or own property that affects eligibility?
“Are they consuming within allowable limits? And has their status been reviewed in line with policy?”
Approval, he notes, must never be treated as the end of the process.
“Once a household is approved as indigent, consumption must still be tracked,” says Maweni.
“If this is not done, municipalities may find themselves funding unsustainable usage and later writing off debt that should never have escalated.”
The consequences are severe: weakened protection for the genuinely poor, deepening municipal revenue losses, and increased audit risk.
Technology as the integrity layer
Maweni believes the solution lies in modernising indigent management systems. “The days of passive, paper‑heavy indigent administration should be behind us,” Maweni says.
“Municipalities require systems that can verify, track, monitor and report on indigent households with discipline and transparency.”
He emphasises that technology must support both urban and rural consumer bases, metered and unmetered services, and alternative energy support such as gel and paraffin.
Crucially, systems must help municipalities identify excessive consumption and compare actual usage against allowable limits.
“The most important principle is simple. Trust must be supported by verification,” Maweni states.
Verification should include checks against Home Affairs, labour and employment data, SASSA, property ownership records, address data and credit bureau information.
“Where there is a public benefit, there must be governance. This is not about punishing the poor. It is about protecting them,” Maweni says.
From passive administration to active governance
Maweni calls for a decisive shift in municipal practice.
“Municipalities must now move from passive indigent administration to active indigent governance,” he says.
This includes digital registers, policy‑aligned verification, regular reviews and immediate removal of deceased persons, employed applicants, property owners, duplicate records and ineligible beneficiaries.
But he stresses that the system must also work faster and more effectively for those who genuinely qualify, because the poorest households deserve support delivered lawfully, accurately and sustainably.
“The constitutional promise of local government is not simply to provide services. It is to provide services sustainably,” Maweni says.
“A municipality that cannot protect its revenue will eventually struggle to protect its residents.”
Maweni warns that South Africa cannot afford a social safety net with holes in it.
“The time has come to close the loopholes – not by denying the poor, but by protecting the integrity of the programme meant to serve them,” Maweni says.
