The DA will submit questions probing the deal between the Sol Plaatje Municipality and the Northern Cape Department of Roads & Public Works. This deal will result in a loss of more than R533 million for this cash-strapped municipality.
As this so-called settlement agreement secures a once-off payment of R95 million on departmental debt of R628 million, the municipality loses R5 for every R1 received. We will therefore also call for an urgent review of the municipal credit control and debt write-off policy. While it is undeniable that there needs to be an alternative payment mechanism for the millions owed by organs of state to the municipality, this kind of loss-making venture is not sustainable and revenue from municipal accounts should rather be ringfenced for infrastructure that can boost the local economy.
The deal, signed by the municipal manager, was not presented to council for discussion. It benefits the department while pushing Sol Plaatje deeper into ‘technical bankruptcy’ and sets a dangerous precedent for other organs of state who may feel entitled to the same deal. Ratepayers and local businesses will also question why they must pay their bills when departments are effectively rewarded for not paying theirs.
The DA raised concerns about decreased funding for municipal roads and stormwater systems during the drafting of the 2025/26 budget. To justify the reduction, the administration claimed in May that there would be an apparently “unprecedented” deal to secure R150 million in services from the department to improve municipal infrastructure. This was echoed by the provincial member of the executive council for finance in her June budget speech when she promised a deal worth R250 million for Sol Plaatje. But the contract signed by the municipal manager only provides for the once-off payment of R95 million. According to subsequent press releases from the municipality, this money will go towards paying Eskom. The value of the agreement has vanished, taking with it the faint hope of serious investment in infrastructure.
The condition of Sol Plaatje’s roads, with the majority of tarred roads beyond their actual lifespan, is one of the top three concerns captured in the IDP and budget participation processes. Poor roads dampens investment, deters tourism, and poses dangers to road users.
While officials may praise this deal, council remains in the dark and the residents of Sol Plaatje lose out on much needed funds while continuing to suffer on roads that are falling apart.