By Prof. Busisiwe Mavuso
- The BLSA Reform Tracker shows reform momentum has picked up, led by progress on electricity, freight logistics, water and digital reforms.
- Operation Vulindlela’s latest progress report confirms that the hardest decisions have been taken: an independent transmission system operator separate from Eskom and an independent    National Ports Authority separate from Transnet.
- The rail infrastructure manager, the Transport  Economic Regulator and electricity distribution reform are lagging, and these gaps must close before private train operators enter the network next year.
- The white paper on local government ends the one-size-fits-all approach to municipalities, and this week’s elections are a chance for voters to demand delivery.
The BLSA Reform Tracker released its quarterly review last week. It reveals a positive step up in momentum, with its reform index up after a dip last quarter, led by progress on economic reforms. The full review is a good read, interrogating government’s progress on implementing reforms; you can read it here.
Many reforms moved forward, including water, with the establishment of the National Water Crisis Committee structure and the publication of the National Water Action Plan; freight logistics including the publication of the fourth version of the Network Statement and Rail Access Agreement; progress on the title deeds backlog, which has now been properly measured; electricity with progress on Bid Window 8 of the renewable energy procurement programme; and much else. There was good movement on digital policy and visa reform. On the governance front there were advances on public service reform with the appointment of a director-general as head of public administration in the Presidency and the Public Service Commission Act extending oversight of local government. The review also points to some reforms that are stuck, but on balance the momentum shifted notably in the right direction.
The improvement was broad and, in many cases, represents the culmination of processes that have been underway for a long time. But the local government elections this week are an obvious milestone that has catalysed significant political effort. Since the Tracker’s quarter closed we’ve also seen the white paper on local government released, replacing a policy framework for local government that dates from 1998. There is a lot to like in it, overhauling how local government is financed, managed and held accountable. As readers know, I have often pointed to the serious risk that municipal service delivery failure poses for business, and the white paper rightly abandons a one-size-fits-all approach to how municipalities are run and interact with the rest of government. That is appropriate – municipalities that are run well should be given more powers. But those that are manifestly failing should face the opposite.
The white paper is the fruit of Operation Vulindlela’s work on local government reform. OV, the joint initiative of the Presidency and National Treasury, released its quarterly progress report last week, and it confirms that the hardest structural decisions have been taken. In August the President approved plans to establish a transmission system operator fully independent of Eskom, and Cabinet approved an independent National Ports Authority separate from Transnet. These decisions create a level playing field for private investment in generation, rail and ports, and the OV team deserves real credit for driving them.
The report is also candid about where reform is stuck. Of its 30 reform actions, nearly half are on track and four are complete, but three face significant challenges requiring intervention: electricity distribution reform, the Transport Economic Regulator and the title deeds backlog. Corporatisation of Transnet’s rail infrastructure manager is behind schedule. That candour is welcome. Private train operators begin running on the network next year, and they will need an independent regulator and an infrastructure manager at arm’s length from Transnet’s own operations. OV’s March 2027 deadline for the regulator must hold.
Reform is about laying the platform for growth. We are building an economy that is more resilient, not only to economic shocks, but also to institutional and political failure. And perhaps most importantly, these are not cyclical changes or temporary interventions designed to get us through the current economic difficulties. Once we establish competitive electricity, rail and port markets, supported by independent regulation and meaningful private-sector participation, we create an economic system that is more competitive and less vulnerable to the failures we have experienced in the past. That is why BLSA invests significantly in the reform effort.
The progress we have made is being noted by investors as well as credit rating agencies. After the Medium-Term Budget Policy Statement, Moody’s described South Africa as having reached an economic inflection point, reflecting the stabilisation of government debt and progress with pro-growth economic reforms. The reward for this progress will in part be credit rating upgrades that will reduce the cost of debt, leaving more money for government to spend on delivery.
Of course, the ultimate check on government delivery is the ballot box, and this week’s local government elections provide that opportunity. Citizens can demand delivery, and I hope they do so in large numbers because this is an important moment to reflect on what must change. Whatever the outcome of these elections, we need municipal administrations that are capable of delivering basic services, maintaining infrastructure, managing public finances responsibly and creating an environment in which businesses can operate and invest. We need professional, technically competent municipal administrations, stronger financial management, proper maintenance of infrastructure and meaningful accountability for performance.
Because ultimately, municipalities are not simply providers of services to residents. They are a critical part of South Africa’s economic infrastructure. And their performance has a direct bearing on investment, industrial competitiveness, employment and economic growth. Our democracy and the effectiveness of government depend on it.
