Mbalula breaks e-Toll promise again, Makhura must lodge intergovernmental dispute

The Democratic Alliance (DA) in Gauteng is not surprised that Minister of Transport, Fikile Mbalula has yet again failed to announce a resolution on e-Tolls in the province.

Last month, Mbalula announced that a final decision on e-Tolls would be made at the end of the current financial year which ends today, with not a single word from “Mr Fix It”.

The DA will be writing to Gauteng Premier, David Makhura, urging him to lodge an intergovernmental dispute with the National Department of Transport for the urgent scrapping of e-Tolls. For the past 18 months, Mbalula has been continuously kicking this can down the road. It is clear that it is just another political ploy to further delay the matter.

Given the recent announcements that all toll fees would soon increase, despite the desperate state of the economy and the subsequent damage to livelihoods during the strict Covid-19 lockdown, it is even more important to get rid of e-Tolls as soon as possible.

For too long the residents of this province have been bankrolling something they were not consulted on and cannot afford. The people of Gauteng must no longer be burdened by this unworkable system.

Upgraded Golden Harvest Park facility ready for hand over to the community

Golden Harvest Park is an important green space in Northwold, and is regarded one of Johannesburg City Parks and Zoo’s (JCPZ)as the flagship parks. Yesterday I visitd the park to check on the recent upgrades ahead of the handover later this week.

I am pleased to report that the project has hit all of its targets, including a brand-new outside gym, an upgraded children’s play area, a soccer field, ablution facilities, paving at the JCPZ depot, the rehabilitation of the bridge, and the removal of the old dilapidated Mayoral Lapa.

The park has seen many improvements from a major reduction in crime incidents, to the launch of a Park Run that has seen over 1000 participants joining in.

These achievements have been made possible through the contribution of the community and many stakeholders such as the residents associations, the Friends of Golden Harvest Park, JMPD, SAPS, and local private security companies.

We hope to see many local residents enjoying the use of the new facilities available at the park and taking care of them through shared ownership. The DA will continue to work towards ensuring that the residents of Ward 101 are afforded a safe and welcoming environment to live, work, and play in.

Mystery of eight missing Life Esidimeni patients

The mystery about eight Life Esidimeni patients who are missing continues to be of concern as the Gauteng Health Department still cannot trace them.

According to a written reply by Gauteng Health MEC Nomathemba Mokgethi to my questions in the Gauteng Legislature, there are no files for four of the eight missing patients.

The Department has made extensive efforts to find the patients, including checks with Home Affairs and SASSA to see if they had applied for IDs or received a disability grant. In some cases there are no ID numbers or dates of birth.

Missing person cases have been opened with the South African Police Service, and the Department is continuously checking for the patients in all facilities in case new information emerges.

Mokgethi says that search efforts are continuing but “it is difficult and time consuming to trace patients if information of the patients is not provided or available.” Furthermore, the telephone numbers of family members and home addresses provided are incorrect.

It is nearly five years since the transfers of patients from Life Esidimeni to illegal NGOs in June 2016, so it is unlikely that any of the missing patients are still alive.

The terrible possibility is that some of the missing patients died at the NGOs, but we will never know as their bodies may have been secretly disposed of.

There have been 144 confirmed deaths, but the true Esidimeni death toll should probably include the eight patients whose fate is currently unknown.

March Council meeting highlights

Council sat over a marathon two-day session last week to consider 112 reports. The majority of these were related to increases on rates and tariffs, which were detailed in our statement on 25 March. Other noteworthy reports are detailed below.

The DA opposed a report which claimed to accept a R90 million donation from Nike SA for an extension of their lease on two City-owned properties in Klipspruit, Soweto. This was originally granted as a lease to Nike SA for the development of a sports facility, known as Shapa Soweto. While we welcome the continued development of this facility, its acclaimed sports training programmes, and the planned integration with the new Klipspruit Sports Centre, this process goes entirely against the Municipal Finance Management Act which clearly stipulates how these land transactions are supposed to happen. The rule of law cannot be sacrificed for laziness
on the part of City officials, and Council must be made aware of all the terms and conditions of this lease.
– Cllr Belinda Kayser-Echeozonjoku, SMMC for Community Development.

The report for the completion of the Alexandra Automotive Hub and revitalisation of the Marlboro-Alexandra industrial precinct was approved with substantial input from the DA. We will now finally see the establishment of a steering committee to address the numerous challenges facing this precinct, such as abandoned factories, lack of law enforcement, illegal land occupation, and other factors which deter investment. The completion of
the Hub will pave the way for third parties to take over management of the facility and implement proper training programmes to enable growth in this important sector for emerging SMMEs.
– Cllr Dave Dewes, Section 79 Economic Development Member.

Seven years after the landmark Constitutional Court ruling the City’s new Informal Trading Policy was finally brought to Council. The DA opposed this policy as it differs substantially from the version which was widely accepted by all stakeholders in October 2019, and had it sent back to the Section 79 Committee. There was no accountability from the ANC as to why it had taken more than a year to come to Council. The draft policy lacks the collaborative management model put forward by trader associations, the ability of groups like City
Improvement Districts to manage informal trading in their areas, a more humane consequence system in place so that traders don’t have their goods confiscated for a first infraction, and for management of both street and market trading to be housed in one unit to ensure consistency. Informal traders are desperate for proper management and guidelines which work for all parties involved, but this should not come at the expense of conditions which have already been agreed upon.
– Cllr Bonile Fandesi, Section 79 Economic Development Member.

The much-awaited Traffic Pointsman report came to Council, but as usual did not follow due process and was lacking real details, so the DA voted to make sure that it went back to the  Section 79 Committee so that all faults can be fixed. We support this programme as it brings much needed stability to traffic during rush hour and when traffic lights are out. However, any potential service provider has to show proof of securing R100 million in sponsorship over five years, and the City must be able to account for this to residents as the City and
therefore residents will be responsible for the cost of training the pointsmen. Residents deserve to have this programme in place and the pointsmen deserve fair and safe working conditions with appropriate compensation. – Cllr Michael Sun, SMMC for Public Safety

The DA opposed the approval of the Greater Lanseria Masterplan which was not properly presented nor did it have any of the details which are required for the approval of such a significant development. The DA supports this development but like the Gautrain promises to be a vanity project which connected individuals benefit from instead of residents who have to foot the bill. We do not know how much the City will have to pay towards the project, which threatens to take vital funds away from much-needed upgrades to the City’s existing, aging power and water networks. It will also require the City to lift the urban edge which is in place as
part of the City’s Spatial Development Framework, and for us to undermine the SDF requires real evidence. There is no indication of the feasibility for this project, public consultation, the readiness of the other three municipalities (one in another province) and their contribution to the project. Projects which boost economic development and create jobs are desperately needed, but public money is very limited and we cannot afford to waste it on vanity projects. – Cllr Reuben Masango, SMMC for Development Planning

A report to resurrect the Joburg Bakery Project was pushed through by the ANC despite objections from the DA. This failed project was originally started by the Tau administration under the umbrella of the so-called Blue Economy, and aimed to provide 50 co-operatives with containers of installed bakery equipment and supplies to run the operations. There was no project feasibility done and ridiculous items like imported mango flour were never going to be sustainable. It was clearly designed to secure votes in the 2016 election by providing a neverended financial lifeline to the politically-connected co-operatives. The DA Administration terminated the project and initiated a forensic investigation into the co-operatives. Now the ANC are about to spend R14.3 million on a project where only six of the 18 beneficiaries were revealed to be operational. – Cllr Mpho Phalatse, Section 79 Health and Social Development Member

Council was requested to approve the acting arrangement of the Executive Director of Community Development. This despite the fact that the acting arrangement had already expired. The real story behind the scenes was that Council had approved the appointment of Philisiwe Tau (the wife of Parks Tau) for the position, despite her benefitting from financial deals with Regiments Capital which in turn secured lucrative contracts with the City through Parks Tau and the current mayor, Geoff Makhubo. The DA naturally opposed her
appointment. Philisiwe Tau however did not start on 1 December and is still not in the position. It is alleged that the previous City Manager refused to accede to her demands for an inflated salary – a conflict which contributed to City Manager’s early exit through a ‘negotiated settlement’. The acting Executive Director was only fourth on the list of candidates, despite his excellent performance in the position. – Cllr Nonhlanhla Sifumba, Section 79 Community Development Member

Gauteng hospital CEOs rebuked for safety failures during Covid-19 pandemic

Eight Chief Executive Officers (CEOs) of Gauteng health facilities have been given final warnings for not complying with Occupational Health and Safety (OHS) legislation during the Covid-19 pandemic.

This was revealed by Gauteng Health MEC Nomathemba Mokgethi in a written reply to my questions in the Gauteng Provincial Legislature.

According to Mokgethi, the CEOs failed inter alia to:

• Hold a daily meeting on Personal Protective Equipment (PPE)

• Conduct environmental risk assessments

• Hold weekly OHS meetings

The CEOs of the following health facilities were reprimanded in this matter:

• Chris Hani Baragwanath Hospital

• Helen Joseph Hospital

• Rahima Moosa Hospital

• Tshwane District Hospital

• Wits Oral & Dental Hospital

• Medunsa Oral & Dental Hospital

• Medical Supplies Depot

•Forensic Pathology Services

I am concerned that CEOs of major hospitals neglected occupational health and safety during the Covid-19 epidemic. This increased the risk of staff contracting the virus.

Since January last year there were also three disciplinary cases against other hospital CEOs.

The CEO of the Far East Rand Hospital was dismissed because he claimed commuted overtime and was grossly insubordinate in suspending staff.

Meanwhile, the disciplinary case against Ms Ruth Mabyana has still not been concluded after she was suspended as CEO of the Bheki Mlangeni Hospital in August last year for alleged misconduct concerning an incident where a psychiatric patient was sexually assaulted by another patient.

The last case is that of the Tembisa Hospital CEO who was suspended in January this year after the report of the Health Ombudsman on the death of Shonisani Lethole.

It is disappointing that so many CEOs have not measured up to what is expected of them when running a hospital.

Charter Schools: An Option for Gauteng?

South Africa has one of the most unequal education systems in the world. Even in the public-school system, the gap in the quality of education between those at fee-paying schools and those at no-fee schools is vast with the latter largely serving the lowest 25% of income earners. 

Stellenbosch University researcher, Nic Spaull estimates that in maths and science the average grade nine pupil at a fee-paying public school has two to three more years’ worth of knowledge and learning than a grade nine pupil at a no-fee public school[1]. Subsequently, a key challenge facing the state is to ensure that lower-income communities have access to the same quality of teaching and learning as those from the more affluent communities. 

While South Africa has pockets of outstanding public schools, they typically receive four times the number of applicants than they can accommodate which means most applicants are unable to get into these schools. The lack of quality public schools means competition for a place in a good public school is often more intense than it is for most private schools.

In response, the market has responded to this situation in South Africa by creating a range of private school options catering for families who cannot get their children into good public schools, but who can afford to pay fees. The question is whether using Public-Private Partnerships (PPPs), by way of charter schools is the correct way to address this challenge. 

The paper therefore seeks to address the following research questions:

  • What are: charter, academies, collaboration and donor schools? 
  • How does the Western Cape model work?
  • The advantages and disadvantages of charter schools.
  • Lessons from the United Kingdom (UK) and the United States of America (USA); and
  • Whether this model could potentially work in Gauteng?


School reforms featuring the introduction of new types of schools have occurred in the education systems of several countries, most notably: charter schools in the United States, free schools in Sweden and academy schools in England. At the heart of these reforms are attempts to improve learner performance by delivering a superior quality of education particularly where educational inequalities and the issues of problem schools, often in disadvantaged areas, have featured prominently. 

Conceptualisation of terms

What are charter schools?

The ‘charter’ in charter schools is a contract, agreed upon between those who run the school and the entity that authorises the school’s existence which ranges from school districts to boards of education in collaboration with private donors and non-profit education providers. Charter schools come in the form of public schools that are tuition-free are and open to all on a first-come, first-serve basis, or by way of a  lottery. The charter grants autonomy to those running the school to develop their own curricula, employ personnel and draw up budgets free of the regulations that district schools are subject. 

One example of how charter schools operate differently from district schools is that many charters have longer school days and school years than their peers. In exchange for this flexibility, charters are held accountable by their authorisers such as state education agencies or organisations like colleges, special boards and school districts. These authorisers can revoke a school’s charters if it does not meet set standards. 

What are collaboration schools?

Collaboration schools (which are also referred to as donor schools) are defined by Unwin (2017) as schools that draw most of their funding from public or state allocations. They are managed and operated by a private entity with autonomy, which is not absolute, from government regulations and policies. Collaboration schools are also not classified as private or independent schools according to national or provincial policy.

The focus of our research will be on the Western Cape Collaboration Schools pilot programme which envisions addressing the challenge of ensuring that lower income communities have access to the same quality of teaching and learning as those from more affluent backgrounds. The Western Cape Education Department (WCED) draws on lessons from the Academy School model in the UK and Charter Schools in the USA. 

What are school academies?

Academies were introduced in the English schooling system a decade after charter schools in the United States were first introduced. These academies were the result of acknowledging that schools in England were not producing a high enough standard of education, particularly schools serving children in disadvantage urban areas. As with charter schools, academies are independent, non-selective, state funded schools that fall outside the control of local authorities. Nonetheless, it should be noted that while charter schools are largely brand new or start up schools, academies are almost exclusively existing schools which have adopted a collaboration school model which is referred to as a takeover.

Furthermore, a distinction is made between two main groups of academies. That is sponsored academies and converter academies. Sponsored academies have sponsors such as businesses, faith communities, universities, other schools or voluntary groups who have majority control of the academy trust. Most of these used to be under-performing schools that became academies to improve their performance. Converter academies on the other hand are schools which are deemed successful enough to convert to academies in order to benefit from increased autonomy. They were introduced in July 2010 as part of the Academies Act. Today, the programme has broadened to include primary and secondary schools, special schools, free schools, university technical colleges (UTCs) and studio schools[2].

United States of America Case study

Charter Schools in the USA, the first of which were created in Minnesota in 1993, are illustrative of a charter track record that can at best be described as uneven. Literature is peppered with both successes and failures depending on a variety of factors that ultimately result in differing outcomes in very similar schools. 

Initially established as non-profit independent schools serving pupils from low-income families, the model has morphed into a system with thousands of schools, of which 15% are operated on a for-profit model. In addition, around 7,000 charter schools now serve more than 5% of students in the United States while steadily growing over the past 10 years, adding about 300 or 400 schools each year[3].

The broadest assessment of charter school effects comes from the Centre for Research on Educational Outcomes (CREDO) at Stanford University. An initial report in 2009 examined charter schools in 16 states. The initial findings indicated that charter schools overall had essentially no impact on student learning in mathematics and reading. Overall findings masked some variability: 46% of charters performed no differently than traditional public schools, 17% outperformed traditional schools, and 37% underperformed.

Sarah Cohodes (2018) in her article titled “Charter Schools and the Achievement Gap” states that the best estimates find that attending a charter school has no impact compared to attending a traditional public school. However, much of the same research also finds that a subset of charter schools has significant positive impacts on student outcomes. These are typically urban charter schools serving minority and low-income students that use a no excuses curriculum. When estimates for these highly effective schools are not separated from the broader group of charter schools, mostly those in suburbs and rural areas, differences between charter and traditional public schools average out to zero.

Who benefits from charter schools?

A study by Stanford University’s Centre for Research on Education Outcomes (CREDO) titled 2019 City Study: Indianapolis, evaluates school performance in public schools located within the boundaries of Innovation Network Schools over four years, analysing annual growth between the 2013-2014 school year and the 2016-2017 school year.

On average, Indianapolis charter schools and Indianapolis Public Schools’(IPS) Innovation Network Schoolsare providing students with significant learning gains relative to traditional public schools within IPS.

Some of CREDO’s most notable findings for 2016-2017 include:

  • Indianapolis charter school students achieved growth equivalent to 77 days of additional learning in English Language Arts (ELA) and 100 days of additional learning in math relative to students in IPS traditional public school (TPS).
  • Students in IPS Innovation Network Schools achieved growth equivalent to 53 days of additional learning in ELA and 89 days of additional learning in math relative to students in IPS TPS.
  • Students in charter schools and Innovation Network Schools achieved similar gains in both ELA and math relative to the state average, while students in IPS TPS achieved significantly less growth relative to the state.

The study also found that in 2016-2017, charter schools provided superior learning gains for black students and low-income students and especially strong learning gains for Hispanic students and English language learners.

  • Black students in Indianapolis charter schools achieved growth equivalent to 65 days of additional learning in ELA and 83 days of additional learning in math relative to Black students in IPS TPS.
  • Low-income students in Indianapolis charter schools achieved growth equivalent to 71 days of additional learning in ELA and 94 days of additional learning in math relative to low-income students in IPS TPS.
  • Hispanic students in Indianapolis charter schools achieved growth equivalent to 100 days of additional learning in ELA and 94 days of additional learning in math IPS TPS.
  • English language learners in Indianapolis charter schools achieved growth equivalent to 130 days of additional learning in ELA and 106 days of additional learning in math relative to English language learners in IPS TPS.

While this report is the first academic study on the performance of Innovation Network Schools, CREDO has previously released four studies on charter school performance in Indianapolis. Each study has found positive impacts for students who attend Indianapolis’ charter schools relative to their traditional public-school peers.

It is worth noting that these results are repeated in other studies. Using randomised study results from charter school lotteries in Massachusetts, Angrist, Pathak and Walter’s similarly found that non-urban charters do not outperform public schools and may even do worse, but urban charter schools benefit black students and poor students[4].

Best practice: High expectations, high support charter schools

Boston Charter schools in Boston are some of the most studied. Research has consistently found that attending a charter school in Boston has large positive effects on math and reading test scores. The most recent estimates, which include about 95% of the city’s charter school enrolment, found test score gains of about one-third of a standard deviation per year of attendance in maths and 20% of a standard deviation for reading at the middle school level. Estimates for Boston charter high schools are even larger. A report that includes the entire state of Massachusetts mirrors national studies; charters in urban areas have the most beneficial impacts, and charters in suburban or rural areas have no or in some cases negative impacts on test scores.

While many charter schools fail to live up to their promises, one type has repeatedly shown impressive results. These charter schools are referred to as “high expectations, high support” schools. These schools devote more of their resources to classroom teaching (even keeping students in class for more hours) and less to almost everything else. It is reported that these schools set high standards for students and try to instil confidence in them while focusing on giving teachers feedback about their craft and helping them get better.

The latest research on this approach was conducted by Professors Michigan and Berkeley at the Massachusetts Institute of Technology (MIT). These scholars tracked thousands of charter school applicants all through high school and after high school, in Boston, where most charters fit the “high expectations, high support” model. Their study[5] found that learners who go to Boston’s charter schools learn reading and math better and faster than students elsewhere. They are more likely to take Advanced Placement tests and to do well on them. Furthermore, their Scholastic Aptitude Test (SAT) scores are higher than for similar students elsewhere (an average of 51 points higher on the Math SAT). Many more students attend a four-year college, suggesting that the benefits do not simply disappear over time.

The successes are large enough that some of Boston’s charters, despite enrolling mostly lower-income students, have test scores that resemble those of upper-middle-class public schools. The seventh graders at the Brooke Charter schools in East Boston and Roslindale did as well on a state maths test as students at the prestigious Boston Latin school which is the country’s oldest public school and a school with an admissions exam.

One of the criticisms highlighted above that charter schools skim off the best students is not the case in Boston. Many groups that struggle academically such as boys, African Americans, Latinos, special-education students are among the biggest beneficiaries. Boston’s charters eliminate between one-third and one-half of the white-black test-score gap in a single year.

Advantages and disadvantages of charter schools


In terms of charter schools, there are three main arguments in support of the model being deployed in fee-free schools.

In the first instance, advocates of these schools posit that schools are given more flexibility to govern and administrate according to pupils’ specific needs. Secondly, it is stated that this model offers greater accountability by schools to government and parents, based primarily on something they term “Outcomes Based Assessment”. And finally, proponents of these schools argue that schools which may not legally charge fees and struggle to raise alternative funds, benefit from much needed extra resources supplied by the collaboration or philanthropic partner.

Based on these arguments, charter schools are therefore alleged to offer improved teaching and learning more efficiently than is the case currently. According to evidence from the reviewed literature, some studies have shown that demand is growing for places at these schools where many of them are former under-performers. To illustrate, a 2015 census of private schools showed that enrolment for UK pupils is down to pre-2008 levels. This is attributed to the fact that there is much more quality education available in the state school system than there used to be with many parents and their children now preferring places at these improving state schools. 

According to a report from the Centre of Development and Enterprise (2012), advocates typically see the promise of charter schools as promoting: 

  • Experimentation and innovation 
  • Diverse public-school options for at-risk students 
  • Competitive pressure on the broader public school system 
  • Focused, mission-driven organisations  
  • Enhanced accountability


Critics of charter schools, on the other hand are not convinced that charter schools are able to drive competition and improve outcomes. Amongst the issues raised is the following: 

  • Creaming the most privileged students 
  • Segregation by race or affinity 
  • Undermining the power of teachers’ unions
  • Lack of accountability

A large-scale study[6] compared state district, non-profit charter and for-profit charter schools across multiple states in the US and essentially contradicted claims made by proponents of charter schools. The study showed that learning outcomes vary broadly, with no conclusive evidence of charters performing better than their public counterparts. In addition, trends identified in the same study showed that collaboration arrangements in school management resulted on average in firstly, more money per pupil being paid for administrative and management costs and secondly, less money per pupil being paid on instructional costs, in other words, teaching and learning material. 

It was further found that as a general trend, both for- and non-profit charters kept teacher salaries low by relying on younger, less experienced staff. They also experienced high staff turnover which correlates negatively and significantly with lower learning outcomes. According to Muller[7], a Researcher in Teacher Development and Sociology of Education at the University of Cape Town, such findings directly contradict the premise of efficiency that is often used to justify public-private partnerships in education as being superior to purely public schools since if instructional costs go down and management costs concomitantly go up, this could have the negative effect of private managers infiltrating struggling public schools and inadvertently redirecting teaching salary funds towards themselves. 

This was the case with the Wakefield City Academies Trust were in 2015 its interim chief executive Mike Ramsay, had paid himself £82,000 over a three-month period. Subsequently, the trust was in a vulnerable position as a result of inadequate governance, leadership and overall financial management. Later that year, it was reported that the trust had paid almost £440,000 to IT and admin companies owned by Ramsay and his daughter. Due to its failures, the trusts were forced to give up all their schools.

As evidenced from above, PPP schooling arrangements are controversial and give rise to significant concerns. Chief amongst these concerns is the perceived undermining of the power of teacher unions. Teachers and their union representatives typically hold a deep belief that the rise of charter schooling will be the end of teacher unions, decent pay and workplace protections. In most states in the USA, and at the local school district level, teacher unions are some of the most powerful lobbyists in government, fighting for (and often winning) pay increases, rights to tenure, strong benefits packages, and small class sizes. Teacher unions are typically allowed to collect mandatory fees from all public-school teachers to pay for their operations and lobbying efforts.  

Most charter school laws provide a blanket exemption from state and local collective bargaining provisions, directly threatening unions’ power bases and leaving charter school teachers without representation. For these reasons, teacher unions and district-level leaders frequently oppose charter schools. They are often joined in this opposition by other state and local unions as an act of solidarity, creating a very powerful alignment of interests. 

When the National Education Association (NEA), the largest labour union and professional interest group in the United States representing public school teachers and other support personnel, updated its policy on charter schools in 2017, the organisation was aggressively against the growth of charter schools stating that “…the new NEA Policy Statement on Charter Schools will boost NEA’s forceful support of state and local efforts to limit charter growth and increase charter accountability, and slow the diversion of resources from neighbourhood public schools to charters.”[8].

The Western Cape collaboration schools pilot programme


The Western Cape collaboration schools pilot programme is an attempt by the Western Cape government to try new ways of improving the education system, and particularly to address the inequalities that still persist as a legacy of apartheid. The belief was that this model could make a positive difference in providing quality education in poor communities and improving performance in underperforming schools. 

The Western Cape Government has the ambition of Collaboration Schools eventually making up 10-15% of the public education system. Subsequently, the Collaboration Schools pilot programme therefore seeks to, amongst others:

  • Improve the quality of education at public schools;
  • Demonstrate effective models of partnerships in education;
  • Strengthen public school governance and accountability;
  • Develop educators; and
  • Implement interventions aimed at the improvement of the quality of public education for learners from low income communities.

Through the Collaboration Schools pilot, the WCED aims to test a new model of schooling that will bring additional education management skills and innovation into the public school system, through non-profit partnerships that improve the quality of teaching and learning in no-fee public schools. 

Implementation of the WCED collaboration schools pilot programme

The Collaboration Schools Pilot began in five schools in January 2016. Three of the schools were existing public schools that were deemed to be failing by the education department while the other two were newly opened as part of the pilot project (start-up schools). The schools were all no fee schools that receive appropriate provincial funding allocations in low-income communities. The schools are operated and managed by an independent, non-profit organisation referred to as the School Operating Partner (SOP) which is accountable to both the funder group and the Western cape Department of Education.

The model is based on a partnership between the education department, schools, donor organisations and non-profits specialising in the practice of quality education. The support organisations, called operating partners will ensure intensive school-level support to teachers and principals through training, additional resources, monitoring and regular feedback while the WCED continues to play its critical role in overseeing school performance and holding the schools and operating partners to account as part of the public education system. Support from the WCED will be integrated with that provided by the operating partner, with collaboration schools continuing to receive funding, infrastructure and services such as transport and nutrition from the WCED according to prevailing policy. Former Western Cape Premier, Helen Zille stated that the approach centred on choosing the correct people for each post and introducing accountability measures for outcomes, particularly the learning outcomes of students. Philanthropic donors provide additional funding over and above the Western Cape Department of Education’s investment in these schools.

Some of the collaboration school features are: 

  • Operating partners, in the form of specialist non-profits, provide expert support and resources at school level. 
  • Operating partners are also allowed a significant number of representatives on the School Governing Body (SGB).
  • Principals retain pivotal responsibility to run the school, and 
  • The department retains its responsibility to oversee and support each school.
Pilot performance

Initial schools included in the pilot project were Oranjekloof Primary School and Silikamva High School (both serving learners from Imizamo Yethu in Hout Bay), and Langa High School while newly established schools were Forest Leadership Academy (a primary school in Eersterivier) and Happy Valley Primary in Blue Downs. To draw the most useful evidence from the pilot, the department selected a mix of primary and secondary, new and long-established schools. 

By June 2017, the Western Cape had seven public schools operating as collaboration schools, four primary and three high schools, across four of the Western Cape’s districts. From the pilot’s inception to 2017, funders had committed over R75 million to the project. Of this amount, R31.8m went to the schools directly while an additional R37.8 million was provided to the non-profit partners who brought additional capacity to the schools in the form of governance, training, support and social capital. In addition, the operating partners have been working with schools to develop specific school improvement plans and implemented these plans.

During the Western Cape Government Education Budget Vote for the 2019/2020 financial year, it was reported that the department continued to make progress in the Collaboration Schools project.  According to the department, indications are that it is bringing improved education to poor communities, so much so that there are now 11 schools in the project. 

The report further noted that the results of the systemic tests as well as the NSC results at these schools have increased significantly since the inception of the new model. For example, for the last few years, matric results for Langa High School have been unacceptably low; in 2015 it had a 41.9% pass rate and in 2016, it dropped further to 34.3%. The department decided to approach the school about becoming one of the new collaboration schools in 2017.  In the 2017 NSC, Langa High School achieved 49.7% and in 2018 they achieved a 78% pass rate making it a school of choice in the community. 

Through the pilot project, the Western Cape government is already seeing results in that where all partners are committed, positive outcomes occur; from increased teaching performance, to growing community support, manifesting in high demand for 2017 enrolments. These schools are becoming the standard bearers for an approach with enormous transformative potential for under-performing schools, of which there are a great deal fewer than there were in 2009. 

To unlock this potential, however, all partners in a school community need to be fully committed to doing what is in the best interest of the learners. To yield positive results, these schools require sound management and administrative systems that ensure accountability and a solid partnership between all role players in striving for a decent education. 

Western Cape Provincial School Education Amendment Bill

The Western Cape Provincial School Education Amendment Bill resulted in a number of adaptations to the original Bill, particularly in terms of collaboration schools. 

Section 12(1) of the Western Cape Provincial School Education Amendment Bill provided for the establishment of both collaboration and donor funded schools as additional types of public schools. The section further provides for the declaration of existing schools as either collaboration or donor schools by the Provincial Minister. Provision is made for matters pertaining to governance of these schools and for the appointment of staff by the governing body and the donor where relevant.

The Bill additionally provides for an operating partner, meaning a non-profit organisation that has the authority to empower the governing body, management team and educators of a collaboration school with capacity, skills and resources thereby enabling the development of structures, systems, cultures and capacities necessary to deliver quality education. It is worth noting that an operating partner only falls in the category of collaboration schools, not donor-funded schools.

During the hearing process for the proposed amendments to the Bill, various concerns were raised by major stakeholders such as South African Democratic Teachers Union (SADTU) and Equal Education (EE). Equal Education argued that the Bill was essentially a duplication of already existing functions. There was displeasure about the supposed plan of the WCED to give undue authority to private organisations in the educational system of the province bearing in mind that some of the private operators may lack the requisite knowledge to run the educational system. There were also no provisions to protect schools and poor communities against abuses by the private organisations. There were no guarantees in the proposed amendments that collaboration schools and donor-funded schools would not be targeted for profit over the long term. While government needed the support of donors and international philanthropists due to the rocketing national debt and other economic challenges, the government needed to put measures in place that protected national, parental and learner interests against potential abuse by donors.

While EE welcomed testing innovative education models, the organisation opined that experimentation in education is a very sensitive undertaking as it involves the lives and futures of pupils. In its submission on the Bill, Equal Education argued that many of the proposed amendments were “unlawful, redundant, contrary to the spirit of democracy and redress in education, unlikely to improve educational outcomes and potentially directly harmful”. Furthermore, EE was concerned that in donor-funded schools, representatives of a donor, merely by virtue of their funding contribution may be entitled to half or even the majority of the voting seats on a school governing body.

The South African Communist Party (SACP) and SADTU argued that “the schools collaboration project finds its expression in the context of privatising what belongs to the public and will ultimately commodify what the public is supposed to get free”. They posed that the sourcing of donors for the improvement of public schools should not be done to restructure the democratic structure of governance currently outlined in the South African Schools Act which they believe the Bill does. 

The project was therefore seen as a ploy by the provincial education department to implement ‘neoliberal policy’ that would ignore and censor the say of the community, parents, teachers and workers’ in the governance of the school. This uproar played itself out in the media and resulted in the temporary withdrawal of Mellon Educate, an international volunteer-based charity which agreed to partner with the schools on the project. Spokeswoman for the Western Cape Education Department Jessica Shelver confirmed that “there has been some instability within the community regarding the schools’ participation in the collaboration schools pilot project”

In the US, despite charter schools enjoying national bipartisan support, state-level politics have often been acrimonious and sometimes highly partisan. In most states, teacher unions came out strongly against charter laws, viewing the largely non-unionised charters as a threat to membership and union power. The unions were often joined by local school governing boards that felt threatened that charter schools could be authorised by state or university sponsors. 

Potential for application in Gauteng  

There are several lessons to take from both the US and the UK. To begin with, charters lose 24% of their teachers each year which is double the rate of traditional public schools. This is attributed to longer hours and less pay. The average Success Academy (a charter school operator in New York City) teacher, for example, leaves after four years. The high turnover tends to negatively affect student achievement.

Furthermore, researchers add that after 25 years and thousands of schools later, charter schools still on average produce results which are roughly equal to those of the public schools to which they set out to be better alternatives. This is a significant point in that research on similar school models in other parts of the world illustrate that the effect of such models is, at best, mixed in that some charter schools do appear to do very well, but on average charters do no better and no worse than public schools

Critics of this expansion of charter schools have raised serious questions about its consequences, both direct and indirect. For instance, local school boards complain that charters unfairly drain needed resources from traditional public schools and that the uncertainties surrounding them make strategic planning difficult, especially since charters are not held to the same transparency and accountability standards as traditional public schools. Of further importance is that some accuse charters of maintaining selective admissions and retention practices, promoting racial and socio-economic segregation and creating what amounts to a dual education system contrary to the traditional values and intent of universal free public education.

The push to have large numbers of charters operating side by side with traditional public schools raises not only issues about a dual education system but also significant policy issues:

  • How do you manage a system in which two sets of schools operate under different rules? 
  • How do you assure accountability for academic results and the expenditure of public funds when there is no overarching entity in charge of both sets? 
  • How do you promote democratic values and assure that local community voices will be heard when the authority of democratically elected school boards is weakened?  
  • How do you assure places for hard-to-educate students and otherwise protect the broad public interests that justify free compulsory schooling in the first place? 

These are some of the pertinent questions that in forging ahead, policy makers should deeply consider. Should Gauteng embark on a charter school initiative, several takeaways are evident, especially with regards to the need to:  

  • Focus intensively from the start on clear academic and other outcomes for students;  
  • Provide equitable funding and access to facilities;  
  • Ensure that government agencies are capable of and accountable for responsible oversight; and 
  • Invest in ways to incubate and support school capacity and replication.  

There exists various example of PPPs in education which have been illustrated by the examples referred to above which have all displayed varying degrees of success in improving educational outcomes. 

It is worth considering that introducing of new school models in Gauteng, whether these are charter schools or collaboration schools, it will ultimately require amendments to legislation. As experience from the Western Cape, and other countries has shown, stakeholders such as SADTU will pose a major challenge to a move towards charter schools. Certain measures such as early consultation should be taken from the onset in dealing with stakeholders who may hold a negative view to the introduction of new school models in Gauteng. 

While there is a growing consensus that South Africa’s poorest performing schools are still under-funded and it seems pragmatic to source extra resources from donors in the form of NGOs, philanthropists and private operators, caution should be exercised while the challenges highlighted above, together with their intended or unintended consequences are carefully considered. 


From the above, it is evident that charter schools cannot be generalised. How these schools are run, funded, and overseen varies dramatically from country to country, region to region and school to school based on a variety of factors. A successful collaboration school in the Western Cape will not automatically equate to an equally successful school in Gauteng or Limpopo based on the mere fact that they are all charter schools. The respective departments of education, teachers, parents, learners, donors and all other stakeholders will determine the success or failure of such a school. Be that as it may, the successes of these schools are worth studying to find the solution for the challenges  that public schools face.

Gauteng should carefully heed the lessons learnt from charter arrangements in other countries because while the project’s individual proponents may be well-intentioned, there exists a real risk of such models laying the country’s public education coffers vulnerable to capture by private interests. Whether for profit or not, collaboration schools are likely to introduce other well-known aspects of privatisation and perceived undermining of democratic school governance while introducing market principles into education. One of the core aspects of the model is how it restructures SGBs. 

Lastly, to improve our schools, we need to improve our teacher workforce. That would mean better screening to select the best candidates, higher salaries, better support and mentoring systems and better working conditions. Charter schools require innovation, creativity and a commitment to improved learner outcomes. Without this, this model is bound to fail. This is clearly evidenced in the case of Uganda where courts ordered the shutdown of Bridge schools because of poor infrastructure and under-qualified teachers.

The establishment of charter schools can be an important tool for serving previously underserved students and injecting new talent and ideas into the school system. At their best, charter schools can be a research and development opportunity for public education systems by offering proof points on what is possible when government agencies responsibly unleash innovative ideas, entrepreneurial leadership and mission-driven staff to create better outcomes for students. They offer a mechanism to start new schools quickly and an organisational structure that is designed to solve learning problems rapidly and creatively.  

It needs to be stressed that these policies cannot run on autopilot. Agencies hoping to build high-quality public-school choices need to design the programs to target the students with the greatest need while building accountability systems that allow for diverse schooling options. 

[1] N, Spaull. 2019. Priorities for Education Reform (Background Note for Minister of Finance 19/01/2019).

[2] A studio school is a type of secondary school in England that is designed to give students practical skills in workplace environments as well as traditional academic and vocational courses of study.

[3] Unwin, S. 2016. The Collaboration School Model: A viable solution to the public schooling crisis in South Africa. Graduate School of Business; University of Cape Town.

[4] Angrist, Joshua D., Parag A. Pathak, and Christopher R. Walters. 2013. “Explaining Charter School Effectiveness.” American Economic Journal: Applied Economics, 5 (4): 1-27

[5] Leonhardt, D. 2016. Schools That Work.

[6] Center for Research on Education Outcomes (CREDO). 2013. National charter school study. Palo Alto, CA: CREDO, Stanford University: Stanford. 

[7] Muller, S. 2017. SA’s public-private school plans require healthy scepticism. Mail and Guardian.  17 May 2017

[8] Crockett, K. 2019. Teachers’ Unions Oppose Charters Schools; Use the Power to Strike to Stop Competition from Charter Schools. Centre of the American Experiment.

The Township Economy – Challenges and Opportunities

According to Currin (2020), South African townships remain as they were initially conceived, that is, spatially disconnected and alienated from mainstream economic activity. Asad Alam, the World Bank Group country director for South Africa, states that addressing the spatial inequalities reflected in townships is essential to improving the lives of its people. Subsequently, the township economy is currently attracting a great deal of policy interest in South Africa, primarily as a result of the persistence of concentrated poverty, unemployment and the lack of economic transformation since democracy, which is intrinsically linked to the historical of these areas.

According to the Gauteng Township Economy Revitalisation Strategy 2014-2019, the township economy”refers to enterprises and markets based in the townships. Township entrepreneurs operate these enterprises to meet the needs within and beyond the township and therefore can be understood as township enterprisesdistinguished from those operated by entrepreneurs outside the township. Scheba and Turok (2019) further add that the township economy is a spatial concept, and is not like the ‘informal economy’, which refers to unregulated economic activities irrespective of their location.

This paper seeks to analyse the state of township economies bearing in mind both challenges and opportunities available to this sector. This is crucial because as provided by Nqapela (2017), we must realise that the township economy will not mirror the established mainstream economy due to infrastructural, spatial and network separation. It will need to develop on its own specific and particular terms.  Subsequently, there is a need to develop its own specific and particular terms. 

The report will therefore examine diverse policy initiatives that have been presented to develop the township economy which is characterised by a high rate of informality while providing a range of goods and services to meet the needs of communities in the township and beyond.  

The State of the Township Economy

While there is a firm belief by the government that the township economy, estimated to generate R200 billion per year[1], has a vital role to play in helping to create a vibrant socially inclusive, labour-absorbing and growing economy, government efforts are yet to yield the required returns. Several studies, including one by the World Bank (2014) on the economics of South African townships show that the townships have a low rate of entrepreneurial activities in South Africa compared with other countries in Latin America, Asia and the rest of Africa. 

It is reported that only 80% of all new businesses in South Africa survive past the first two years, a low rate when compared with other countries. There are numerous reasons for this phenomenon which do not bode well for township enterprises. Most businesses are brought into existence for survival with little or no understanding of costs, responsibilities, markets, funding needs and other requirements of the business such as a lack of proper financial records and systems and technology. In addition, these businesses lack the systems necessary to handle growth or deal with associated risks (EVA Financial Solutions, 2019). 

The most comprehensive data on township economies has been collected by the Sustainable Livelihoods Foundation (SLF), who have surveyed almost 11,000 township enterprises across nine sites in four provinces (2016). They have found that grocery, food and liquor services comprise 54% of all township businesses, followed by local services (34%), including hair salons shops, traditional healers, mechanical/electrical repairs, recycling, churches and early childhood education (edu-care) centres. 

The study further found that the minibus taxi industry additionally played a vital role, reflecting the poor location of many townships and the lack of formal public transport. In contrast, manufacturing makes up only 2% of all enterprises, and they are rarely linked to wider value chains and external markets (SLF 2016). It is worth noting that there are illegal activities such as drug dealing, counterfeit goods, contraband cigarettes and sex work that are not reflected in these statistics. 

Informal retail trade is the dominant activity in townships and encompasses street traders, spaza shops and shebeens (SLF 2016). The scale of informal trade is a result of low barriers to entry and low start-up costs, as well as strong demand for convenience (daily top-up shopping). The study further provided that products that are sold are almost exclusively produced by firms based elsewhere such as maize meal, bread, milk, coffee, and peanut butter, which are all made by well-established conglomerates (CSP 2018). Subsequently, Scheba and Turok (2019) surmise that township enterprises perform more of a complementary role in enabling formal retailers and wholesalers to access a growing segment of low-income consumers who have large collective spending power. 

The majority of country’s unemployed (about 60% of the total) come from townships and informal settlements. Townships, as seen above, have always been a hive for entrepreneurial activity, but the main challenge has been unlocking the potential in order to generate broader economic benefits. According to research by the World Bank Group, only 25% of money generated in the townships is spent there. This is further illustrated by showing that the township of Diepsloot has an estimated economy R2 billion, most of which is spent in the surrounding suburbs of Sandton and Fourways.

The goods and services that township enterprises provide have a vital economic and social role for the communities they serve – for example: 

  • Minibus taxis – in the absence of the adequate public transport system, have played and continue to play an essential role in the daily commuting of millions working class people to and from work and to and from shopping routines at affordable rates while employing more than 70,000 people in Gauteng; 
  • Spaza shops – This is a R7 billion sector that has historically played the role of a micro convenient grocery store providing necessities to township residents within walking distance; 
  • Burial Societies – In response to the need for a decent and dignified funeral, thousands of burial societies were born to provide an informal funeral insurance cover at an affordable rate – to an estimated 12.5 million members and their dependents. This economic activity is valued at R25 billion; 
  • Stokvels – These are traditional rotating schemes that have played a role in funding education of children and providing credit to township entrepreneurs

Challenges Inhibiting the Potential of Township Economies

Literature reverberates with the notion that most township SMMEs do not grow in size and develop like those in the formal sector. While some informal businesses in inner cities grow, those in townships mainly just survive, only make enough money to meet their ‘ ‘family’s daily needs. Challenges faced by township SMMEs, be they internal or external, have a massive impact on the survival and the sustainability of the business. Since township SMMEs operate in environments that differ from the SMMEs in the cities, challenges they experience are unique to them. The social, infrastructural and economic costs of ineffective urban planning are often under-estimated. Yet what are commonly referred to as ‘townships’ in South Africa can have highly divergent features. For example, in relation to the following: 

  • The quality of socio-economic infrastructure, 
  • Their distance from industrial and commercial areas, 
  • The level of income differentiation, 
  • The nature of the available skills set, 
  • Size and history, 
  • The extent and character of existing economic activity, and
  • The nature of tenure arrangements and the scale of informal housing.

The Gauteng Township Economy Revitalisation Strategy highlights specific barriers that are more pronounced in township enterprises. These specific barriers are as follows: 

  • Lack of entrepreneurial and productive activity,
  • Poor understanding of the abilities and value of township enterprises, 
  • Little hard evidence to demonstrate the impact and value-add of township enterprises,;
  • Limited account is taken of the particular characteristics and needs of township enterprises within enabling and supportive environment; and 
  • Complexity and lack of coherence within township economy sectors combined with widely varying skills and knowledge bases.

Furthermore, the following additional barriers were identified in the strategy. These barriers include, but are not limited to: 

  • Access to capital – including grants and loans and financial exclusion, 
  • Access to markets – including the preferential procurement, 
  • Skills development, 
  • Enterprise development support – cluster support, business skills and co-op development skills, and
  • The domination of economic sectors, throughout the value chains by few monopoly players. 

The World Bank Group study on the Economics of South African townships found that failure to modernise the township economy would make this an era of lost opportunities, not only for the townships but also for the nation. The study further notes that with unemployment concentrated in the townships and informal settlements, the battle to reduce South Africa’s staggeringly high unemployment rate will likely be won (or lost) in these places. 

A barrier that has been neglected and needs urgent attention is the framework of rules and procedures that conditions the environment within which township enterprises operate. This oversight needs to be corrected in the light of growing evidence that the regulatory framework disables rather than enables township enterprises. Inappropriate standards and onerous approval procedures currently inhibit the formalisation and expansion of many township enterprises. 

It is very difficult for firms with growth aspirations and potential to do so because of bureaucratic obstacles and regulatory hurdles. While some township activities are inherently survivalist in character and benefit from being informal and below the radar screen; others are disadvantaged by a regime that discourages them from saving and reinvesting to develop and grow their operations. Many of them want to be considered legitimate and would be willing to pay taxes in return for greater security and better support services. The current situation oscillates between laissez-faire and enforcement of punitive regulations, which creates uncertainty and opportunities for abuse. 

According to Scheba and Turok, townships are challenging spaces for economic development and quite different to rural areas, despite the tendency to link them together in recent policy statements. President Ramaphosa mentioned townships six times in his ANC election manifesto speech in January 2019, each time alongside rural areas. This suggests a lack of appreciation of the distinctive obstacles and opportunities facing township economies. 

Many of these obstacles reinforce each other and compound the significance of any particular constraint. The result can be a vicious circle, which increases risk and discourages township enterprises from reinvesting to expand and to strengthen their capabilities over time. To illustrate, crime and xenophobia deter many spaza shops and township service providers from stocking a wider range of products or trading longer hours. Subsequently, better road layouts, street lighting, better security and the clustering of outlets and related infrastructure could alleviate some of these constraints. 

Township enterprises also fail to increase their incomes by investing in developing distinctive, higher-value products and services. Instead, they are caught up in a constant struggle to survive. The lack of adaptation and innovation also limits the product variety and choice available to local consumers. As a result, townships continue to exist on the margins of neighbouring urban core economies unable to attract formal private investment into their respective townships. 

Another neglected but integral aspect of the systemic barriers facing township economies is the governance regime that includes the framework of rules and procedures that influence how enterprises operate. The current regulatory framework and administrative processes are in many ways, unsupportive and inappropriate, which results in enforced informality (Charman et al. 2013). That is, people who are already vulnerable are pushed into operating in the unregulated economy without formal protections and safeguards. It also results in uneven enforcement practices by the government, creating an environment of uncertainty, ambiguity, and extra-legal social regulations, which pose higher risks and is not conducive to long-term investment to develop township enterprises. 

Through examining the informal liquor retail (“shebeen”) sector, Charman et al. (2013) demonstrated that enforcement actually produces informality in this sector. Illustrated with examples from one of their sites in Delft South in Cape Town, the article describes key aspects of shebeen business practice, including the responses to greater law enforcement. The vast majority of shebeens operate without a license and almost always in violation of various municipal zoning regulations and by-laws; they are both informal and illegal enterprises. Notably, instead of closing shop or facing the hurdles of compliance, the great majority of shebeens continue to evade the law by downscaling their activities. In essence, therefore, these shebeens mean owners struggle to access credit and are vulnerable to unfair or illegal lending practices which charge excessive rates of repayment. 

Some shortcomings of the current governance framework include but are not limited to: 

  • The stringent and inappropriate norms and standards in South Africa’s business legislation. These are based on high-income enterprises and environments and are not adapted to the distinctive needs and circumstances of township economies. Unrealistic and prohibitively costly regulatory hurdles hamper business registration and formalisation. They favour larger businesses with the economic power to negotiate exclusive access to specially zoned land and business parks in and around some of the townships. 
  • As a result of their limited financial capabilities, township entrepreneurs tend to rely on low-cost building materials and makeshift premises, including corrugated iron and zinc sheets, old shipping containers and rudimentary stalls. None of these complies with official building and zoning regulations, which excludes them from regularisation and access to scarce space within shopping malls and other business sites. 
  • Township edu-care providers are often excluded from receiving government subsidies and support for infrastructure and teaching materials because they do not comply with official building and planning regulations. An incremental approach would allow enterprises to progress towards meeting the required standard over time, rather than setting the bar so high at the outset that few can ever attain it. 
  • Cumbersome and costly approval procedures for compliance with many business laws and regulations imposes unrealistic costs on entrepreneurs and thus hinders formalisation and growth. Small township enterprises are disproportionally burdened by onerous administrative procedures because they do not have the dedicated capacity of larger firms to deal with the red tape. Township entrepreneurs often lack the requisite information and wherewithal to understand and deal with complex regulatory requirements. In addition, many lack the technical systems to submit documents effectively and timeously. 

The World Bank study showed that almost 30% of informal enterprise owners listed permit requirements and business regulation as business constraints in Diepsloot. Charman et al. (2013) argue that hurdles related to registration and licencing are particularly important constraints on informal enterprises in the liquor sector. Yet despite the need to support such entrepreneurship, informality can also function as a poverty trap and a barrier to business survival and growth. Informal enterprises are vulnerable to crime and to police harassment. Informality limits access to credit and to insurance, and insecure land tenure limits access to capital required for growth. Without licenses, shebeens cannot become taverns and are forced to operate in the shadows; without formal registration, informal crèches cannot access the government subsidies available to Early Childhood Development Centres (Sustainable Livelihoods Foundation (SLF) 2016).

Several studies have highlighted the major challenges facing the growth and development of small, micro and informal enterprises in townships. These include a lack of available land to conduct business, inadequate services and infrastructure (water, electricity, sanitation, waste and internet), lack of connectivity and thus high transport costs, limited access to finance, inappropriate regulations, limited government support and skills development programmes, weak integration into formal value chains, lack of access to more profitable markets, negative social attitudes and strong competition from more established businesses.

Yet while pathways to formalisation are an important part of township economic growth strategies, certain current features of townships mitigate against this, with land-use management arrangements posing a particular obstacle. As a result of these land-use challenges, many enterprises are doomed to what SLF calls ‘enforced informalisation’, forever unable to access the benefits, protections and contract security that arise from formality, limiting their ability to expand into markets beyond the township or to participate in higher value chains (Cities Support Programme: National Treasury). 

Although townships contain enormous buying power and offer numerous opportunities for entrepreneurship, their economies are predominantly consumer-driven and have limited production activities. Investing in townships should be seen as worthwhile, given the volume of end users within these markets, but needs to be coordinated. Aspects that need to be coordinated include recreational facilities, commercial/retails outlets, industrial developments, as well as road and rail networks. 

The informal economy provides opportunities for employment and entrepreneurship. Work in township micro-enterprises offers the unemployed, particularly the youth, a point of entry into the labour market. In addition, the township economy provides opportunities to acquire skills, gain on-the-job experience and build social networks. In essence, therefore, it is clear that there are good business opportunities for those youth able to apply their knowledge and skills and to mobilise capital.

If township enterprises are to be strengthened and increase their contribution to an inclusive, labour-absorbing, and growing economy, three key outcomes from this strategy are necessary. The government needs to: 

  • Create the appropriate enabling environment based on strategic focus areas to revitalise the township economy, 
  • Establish the economic and social value of the township economy, and 
  • Ensure that the township economy becomes the key player in the provincial economy. 

Key action points in the strategy are those that the government believes, with its limited available resources and leverage from the private sector, can most effectively impact on these outcomes. 

The government’s role is to create an enabling environment in which township enterprises can flourish. Such an enabling and supportive environment will be based on the seven strategic focus areas identified in theGauteng Township Economy Revitalisation Strategy (2014-2019). These strategic focus areas are identified as follows: 

  • Ensuring an appropriate legal and regulatory framework, 
  • Promoting manufacturing and productive activities,
  • Economic infrastructure support and clustered enterprise development, 
  • Financing and investing in the township economy, 
  • Ensuring access to markets, 
  • Entrepreneurship development, and 
  • Promotion of innovation and indigenous knowledge systems (Gauteng Township Economy Revitalisation Strategy, 2014-19: 19-27). 

The government can achieve these in a number of ways, in particular, the government can: 

  • Help to ensure that township enterprises are able to increase their entrepreneurial and productive activities, 
  • Help to ensure township enterprises compete effectively with mainstream economy businesses by levelling the playing ‘field’ while consolidating their practices of co-operation and solidarity, 
  • Make sure that the specific and justified needs of township enterprises which are either formal or informal are recognised and taken into account in policymaking and programme delivery, 
  • Help change the ‘culture’ and show through the  government’s own actions, and the promotion of others, there are ways of doing business which are socially inclusive and sustainable, 
  • Ensure private sector and all public sector bodies, particularly at provincial and local government spheres actively targets township enterprise goods and services when making procurement decisions,
  • Make sure that township enterprises have access to appropriate finance and investments, including the creation of own financing systems, and 
  • Make sure that timely and appropriate enterprise development advice and support measures are widely available to township enterprises as it is to non-township business. 

The government can do the above by effectively coordinating, in an integrated way, the existing support initiatives to ensure they are also directed towards the township economy. In particular, the government will prioritise its limited resources, and mobilise other partners on a clustered enterprise development approach, focusing on the sector and spatially directed support, rather than on individual and isolated initiatives. In addition, understanding the cultures, motives, networks and practices of this informal, unlicensed and unregulated economy is vital to the development, formalisation and integration of it into the formal economy, or even for the provision of basic commercial, finance and business support services to them.

In providing stimuli for township economies, policymakers have to navigate seemingly irresolvable contradictions. These contradictions stem from the fact that it would make it easier for the government to provide services if the business operators and vendors were to be clustered together creating economies of scale for the government. But the business operators might be reluctant to be grouped and clustered together given that if in the same sector and offering the same range of goods, products and services, are likely to be competitors, who would find it a disincentive to have to share spaces, support services, business intelligence, market share and the like, with their competitors.  

It is equally obvious that the bulk of the businesses have already established a market of suppliers and clients and will be reluctant to lose out on them or provide a competitor with access to them. They will wish to remain within easy accessibility to an already cultivated market and to further capitalise on being located where people are concentrated and where traffic volumes are high. While the clustering and grouping approach might promote the development of business hubs and economies of scale for service provision, it ignores the most basic aspects of business practice.

Scheba and Turok (2019) further point out that an Act such as the Spatial Planning and Land-Use Management Act (SPLUMA) (No. 16 of 2013) which replaces all the previous land-use planning legislation could be effectively used to redress spatial injustice and to promote social and economic inclusion. This offers opportunities for new ideas and approaches to be introduced through municipal by-laws. To illustrate, new zoning schemes could allocate special rights to particular locations, which could regularise existing informal practices in townships. Municipalities could also use new zoning schemes to support the integration of informal enterprises in new shopping malls, public transport nodes and public spaces in more affluent areas. Yet SPLUMA has also been criticised for reinforcing a codified land-use management system and perpetuating restrictive zoning controls in townships. 

Conclusion and Recommendations

Current government initiatives to support township economies are important considering their history of marginalisation. The first step on the road to improvement is to undertake a more detailed and systematic analysis of the constraints facing township enterprises. This should go beyond simply identifying laws, regulations and administrative processes that stifle growth but examine the specific aspects that are most problematic and seek to prioritise their relative importance. It is clear from the literature reviewed that government has implemented regulatory paradigms that do not recognise the peculiarities of township businesses. Furthermore, while by-laws are still overly-anchored in formalised suburban and CBD enterprises this fails to consider the current state of the township economy. Subsequently, there is a need to actively look into shifting the basis of how townships are regulated, to create a specific set of conditions which allow for a revitalised township economy.

Currently, the country finds itself stuck in a low-level, high-unemployment equilibrium that has a modestly performing formal urban sector with heavily concentrated ownership structures. 

The World Bank states that breaking out of this low equilibrium mould will require a coordinated policy push along multiple dimensions to: 

  • strengthen the economic and institutional linkages between the township economy and urban formal/economy, 
  • elevate the human capital and infrastructure base of the township economy, and 
  • improve investment climate conditions, including access to credit in townships.

There is an additional concern that even the traditional informal economy, comprising mostly survivalist activity in the form of micro-retail trading in townships, may also be at risk, faced with growing competition from large formal retailers operating on a larger scale as well as foreign traders operating on smaller margins with stronger business networks (Financial Mail 2011). 

Given the importance of townships in the country, this is a hugely neglected area that requires much more concerted policy attention. The challenges as shown above are multi-faceted, so piecemeal actions and initiatives will not suffice. Townships are also extremely diverse, so a tailored approach in each area is essential. Revitalising township economies requires a strong, capacitated state to support, in partnership with key role-players, the creation of an enabling environment in which township enterprises can grow and transform to become more productive and sustainable. 

Furthermore, an incremental approach would allow enterprises to progress towards meeting the required standard over time, rather than setting the bar so high at the outset that few can ever attain it. Operating without a consistent formal governance framework creates an environment of uncertainty and informal regulation that deters investment and growth. The characteristics of townships must be understood from a number of different perspectives. This includes the demographic and socio-economic profiles of different communities within townships, as well as the type of housing that people live in. 

Lastly, the ongoing COVID-19 pandemic is likely to leave an indelible impact on the country’ small and medium-sized enterprises. These businesses typically have limited cash reserves, smaller client bases, and less capacity to manage commercial pressures than do larger companies. Be that as it may, these businesses play critical role in job creation and growth, therefore protecting and enabling SMMEs during this period of economic turbulence is important not least because their survival and recovery is likely to be a useful gauge of what is yet to come for the economy as a whole.

[1] Breakfast with Bongani Bingwa, 2020. Will the Gauteng Township Economic Development Bill Fuel xenophobia?

DA calls on MEC Lesufi to open the 2022 academic year online admission in April this year

The Democratic Alliance (DA) in Gauteng is calling on the Gauteng Department of Education MEC, Panyaza Lesufi to open the online admission for the 2022 academic year in April this year. The finalisation of all placements should be concluded in October this year.

By moving the online admission earlier, this will provide parents with parental choice to select the schools they want for their children, and ensure they have enough time in doing so. It will also afford the department enough time to plan and ensure that all learners are allocated schools before the start of the 2022 academic year.

The online admission must be used to assist the department with planning and budget allocation.

Currently, there are more than 600 learners who have not yet been allocated schools. These learners are dangerously falling behind in the curriculum and have been denied their right to access to basic education.

The department has failed to use the online application system to plan for placement for the 2021 academic year, as the process was done very late.

Further to this, the department failed to spend more than R1.3 billion in the 2019/20 financial year.

This money could have been used to build more new schools in high demand areas where there are new housing developments, and help ease classroom overcrowding in existing schools.

The department has no excuse to return any portion of their budget to Treasury, as there are many areas of concern that require urgent funding.

The department must provide the necessary resources to schools before the start of the 2022 academic year, so that learning and teaching will not be disrupted like it has in years before.

DA calls for urgent investigation into alleged awarding of bursary to daughter of senior official

The Democratic Alliance (DA) in Gauteng is calling on the Gauteng MEC for Cooperative Governance and Traditional Affairs (COGTA), Lebogang Maile to urgently investigate whether Sedibeng District Municipality is awarding the Local Government Sector Education and Training Authority (LGSETA) bursaries in line with the policy regulations.

The DA has been reliably informed that the daughter of Sedibeng Director for Human Resources, Mr W.M. Ramotsedisi, is allegedly among three people who have received the bursaries.

We are also in possession of a letter from the Director for Human Resources addressed to the Municipal Manager (MM), requesting the MM to approve a payment of R66 445,47 for re-imbursement of bursary holders on behalf of the LGSETA.

The letter states the names of the bursary beneficiaries which allegedly includes the daughter of the Director for Human Resources. It further states that the bursaries are for unemployed members of the community.

Such bursaries are meant to be allocated to the poor and unemployed, who come from underprivileged families and cannot afford tertiary education fees.

The Director for Human Resources earns a competitive and market related salary from the municipality and can certainly afford his daughter’s tertiary education costs.

The DA has also tabled questions to MEC Maile at the Gauteng Provincial Legislature to ascertain the policy regulations of the bursaries, whether the daughter of the Director qualifies for the bursary and to determine whether the process of awarding bursaries was transparent and fair.

Should it be found that the bursary applications were not advertised, and the process was not transparent and fair, Ramotsedisi and his daughter must pay back the bursary money.

There are too many unemployed youths in Sedibeng who are denied such opportunities to apply for bursaries because of corruption in the system. This system of patronage and nepotism must end now.

MMC Moekena finally punished for fraud and nepotism

The City of Johannesburg Council has confirmed the guilty verdict handed down against Councillor Mally Moekena, the MMC for Public Safety, for violating the Code of Conduct through fraud and nepotism. She has been suspended for one month without pay. The Ethics Committee originally recommended dismissal from Council, but Gauteng MEC for Co-operative Governance, Lebogang Maile, decided that his comrade should get off with a lighter sentence.

The fact that the decisions of a municipal council can be overruled by another sphere of government points to a fundamental weakness in the laws that regulate local government.

Councillor Moekena was referred to the Ethics Committee in 2018 for employing her niece into a key position for which she was not qualified.

As a MMC, Councillor Moekena’s performance has been dismal. She has displayed a complete lack of interest in her portfolio, with JMPD and EMS failing to meet key targets such as by-law enforcement and clamping down on drunken and reckless driving. Probably her greatest failing has been the inability to buy new fire engines when there are currently only about four working fire engines to serve the residents of Johannesburg. Even with R200 million allocated for new vehicles, she wasn’t even able to start the procurement process.

We still believe that fraud and nepotism should be punished with full dismissal, and that Moekena should not be allowed to return to the position of MMC for Public Safety given her poor performance and lack of integrity. The Mayor needs to fire her and appoint a new MMC who will put the residents of Johannesburg first, and bring much needed stability to a vital portfolio.