JOHANNESBURG – South African local governments are facing the unpleasant reality of a rapidly increasing number of households requiring state support.
At the same time, local governments' fiscal capacity to meet their needs is becoming increasingly constrained.
Mansoft CEO Nicholas Maweni issued a strong warning this week that the country's poverty management system is undermining the very people it is meant to protect.
“South Africa is facing a difficult reality: the number of households requiring municipal support is increasing, while the financial capacity of municipalities to shoulder this burden is under severe strain,” he says.
Maweni argues that this is not just an economic challenge, but a constitutional and governance imperative.
“Local governments are constitutionally mandated to serve their communities in a sustainable manner,” Maweni said.
“That responsibility includes protecting the poor, but it also includes protecting people's wallets. That balance is now more urgent than ever.”
Safety net weakened by poor management
Poor registration aims to ensure that the poorest households do not lose access to basic services such as water, sanitation, electricity and garbage removal.
Through free basic services, eligible households receive critical support to protect their dignity and prevent deeper poverty.
But Maweni warns that the integrity of the system is increasingly under threat.
“The purpose of the Poor Register is noble and necessary, but if it is not managed properly it is susceptible to abuse,” he says.
Local governments across the country face a variety of risks, including false income declarations, duplicate registrations, falsified documents, failure to report improvement in financial status, and applications from disqualified households.
In more serious cases, falsification of poverty registers by officials and insiders has been observed.
“This is creating a quiet but serious leakage into local government revenues, and that leakage is not without its victims,” Maweni explains.
“Every rand misallocated to ineligible households is rand taken away from elderly people, child-headed households, unemployed parents or vulnerable families who genuinely need municipal protection.”
He emphasizes that compassion must be accompanied by discipline.
“Local authorities have to be considerate, but compassion without control makes them fiscally reckless,” Maweni says.
Verification is the foundation of reliability
Local government equity (LGES) remains an important 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 poverty registers, councils risk funding “ghost beneficiaries, expired beneficiaries, duplicate applicants and disqualified households”.
“A well-managed poverty management program must answer five fundamental questions: Who is eligible?” Maweni asks.
“Are they still alive and residing in the municipality? Are they receiving income or property that would affect their eligibility?
“Are they consuming within acceptable limits? And is their status reviewed in line with policy?”
He points out that approval should not be treated as the end of the process.
“Even after a household is identified as poor, consumption still needs to be tracked,” Maweni says.
“If this is not done, local governments may end up funding unsustainable uses and later writing off debts that should never have been increased.”
The consequences are serious. Weakening protections for the truly poor, deepening local government revenue losses and increasing audit risk.
Technology as an integrity layer
Maweni believes the solution lies in modernizing the system of managing the poor. “The days of passive, paper-heavy government for the poor should be over,” Maweni says.
“Local governments need a system that allows them to verify, track, monitor and report on poor households with discipline and transparency.”
He emphasizes that technology needs to support both urban and rural consumer bases, metered and unmetered services, and support for alternative energies such as gels and paraffin.
Importantly, the system will help municipalities identify excessive consumption and compare actual usage with permissible limits.
“The most important principle is simple: Trust must be backed by verification,” said Maweni.
Verification should include checking against information from the Home Office, labor and employment data, SASSA, property ownership records, address data and credit bureaus.
“Where there is a public good, there needs to be governance. This is not about punishing the poor. It's about protecting the poor,” Maweni says.
From passive management to active governance
Maweni calls for a decisive shift in local government practice.
“Local governments must now move from passive pro-poor governance to active pro-poor governance,” he says.
This includes digital registration, policy-aligned verification, periodic reviews, and immediate removal of deceased persons, employment applicants, property owners, duplicate records, and ineligible beneficiaries.
However, he stresses that the system needs to work faster and more effectively for those who are truly eligible, as the poorest households deserve support that is provided legally, accurately and sustainably.
“The constitutional promise of local government is not just to provide services, but to provide them sustainably,” Maweni said.
“Local governments that cannot protect their revenues will ultimately struggle to protect their residents.”
Maweni warns that South Africa cannot afford a porous social safety net.
“Rather than denying the poor, it is time to close the loopholes by protecting the integrity of programs that serve them,” Maweni said.
