Conceptual analysis of factors influencing revenue collection in South African local governments

Abstract

The study examines the factors that influence revenue collection within South African local government. The primary objective is to analyze the factors affecting revenue collection in municipalities. The research adopted a qualitative methodology, relying heavily on secondary data within a conceptual framework. Local government is mandated to deliver sustainable services that depend on various key dimensions, including financial management and revenue collection. Critical issues impacting poor revenue management in municipalities include non-payment, indigent management, free basic services, budgeting, tariff determination, revenue planning, limited growth in the rates base, customer data accuracy, meter reading and billing accuracy, debt management, credit control, non-technical losses due to meter tampering and illegal connections, call center and customer relationship management, cash flow planning, and the high level of outstanding consumer accounts. Research gaps in South African municipal revenue collection processes include a lack of empirical studies on how ineffective governance and capacity development influence revenue flows. The paper aims to contribute to the empirical literature in public administration and expand existing knowledge. It will also assist policymakers in developing revenue collection policies and support municipalities in implementing revenue collection models. The study concludes with an exposition of strategies to improve municipal income collection within the South African local government environment.