The recent court victory by the Institute of Market Agents of South Africa (IMASA) against the City of Matlosana is about much more than a legal dispute. For me, it serves as a sobering reminder of what can happen when public institutions entrusted with managing farmers’ money fail in their responsibilities.
By Lebogang Mashala, Editor at African Farming
As both the editor of African Farming and a smallholder farmer who regularly uses municipal fresh produce markets, particularly the Tshwane Fresh Produce Market, the case hits close to home. Every time I visit the market, I cannot ignore the deteriorating condition of the facilities. The neglect is visible. What is difficult to understand is how infrastructure can be allowed to decline so badly when these markets generate substantial revenue every year.
It is therefore unsurprising that more producers and fresh produce stakeholders are beginning to look elsewhere. Across the country, privately owned fresh produce markets are steadily emerging, offering farmers something municipal markets increasingly struggle to provide: confidence that their produce, their income and the infrastructure supporting both will be properly managed.
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A landmark judgment for farmers
The Matlosana judgment is significant because it reinforces a principle that should never have been questioned in the first place: Money generated from the sale of farmers’ produce belongs to farmers, not municipalities.
Last month, the North West High Court dismissed the City of Matlosana’s application for leave to appeal an earlier ruling that removed its control over funds generated by the Matlosana National Fresh Produce Market in Klerksdorp.
Judge Andrew Reddy upheld an interim order placing control of the market account in the hands of IMASA after the municipality had, according to the court, failed for years to pay market agents and producers the money owed to them. The municipality also failed to comply with a previous court order issued in 2021.
Although the City argued that it was operating under a financial recovery plan in terms of Section 139 of the Constitution, the court made one thing abundantly clear: The municipality’s financial position was irrelevant because the funds in question never belonged to it.
The ruling is likely to have implications far beyond Klerksdorp. It sends a strong message to every municipality operating a fresh produce market: Farmers’ money cannot be used to solve municipal cash-flow problems.
IMASA president Gjalt Hooghiemstra described the judgment as a watershed moment for the industry, noting it establishes important legal precedent for holding municipalities accountable. His organisation has already secured a court order compelling the Tshwane Fresh Produce Market to address critical infrastructure failures, while litigation involving the Johannesburg Fresh Produce Market is still before the courts.
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The cost of poor governance
The consequences of poor governance extend well beyond delayed payments. For years, revenue generated by municipal fresh produce markets has not been ring-fenced and reinvested into maintaining and upgrading market infrastructure. As facilities deteriorate, their ability to efficiently receive, store and market fresh produce declines. Poor logistics inevitably affect product quality, reduce prices and erode farmers’ profitability.
Yet the issue is even bigger than fresh produce markets.
Municipalities are the foundation upon which agricultural production depends. They provide the roads farmers travel, the water they rely on, the electricity that powers packhouses and irrigation systems, and the infrastructure that connects rural economies to markets. When municipalities fail financially and administratively, agriculture feels the impact almost immediately.
Why local government matters
That is why Auditor-General Tsakani Maluleke’s Consolidated General Report on Local Government Audit Outcomes for the 2024/25 financial year should concern every farmer. The report paints a bleak picture of local government, with only 39 of South Africa’s 257 municipalities achieving clean audits while another 39 regressed.
Equally alarming is the fact that National Treasury withheld R13.5 billion from 69 municipalities, including major metros such as Johannesburg, Mangaung and Nelson Mandela Bay, because of persistent financial mismanagement.
The consequences are visible everywhere: failing infrastructure, unreliable water and electricity supply, deteriorating roads and poor service delivery. These are not merely municipal problems; they are agricultural problems. They increase the cost of farming, disrupt supply chains and undermine rural economic development.
With local government elections fast approaching, municipalities will undoubtedly become more visible as political parties compete for votes. Promises will be made, campaigns will intensify and candidates will tell us they have the solutions.
As voters, however, we should look beyond slogans and personalities. Local government elections are not simply about choosing candidates who speak well or make the biggest promises. They are about electing competent leaders who understand that municipalities exist to serve communities, protect public resources and create an environment where businesses, including farms, can thrive.
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A vote for accountability
The Matlosana judgment reminds us accountability is not optional. It is fundamental to good governance.
If municipalities cannot be trusted to safeguard farmers’ money, maintain critical infrastructure and fulfil their basic obligations, they undermine not only the fresh produce market system but the very foundation of South African agriculture.
As farmers and citizens, we cannot afford to treat local government as someone else’s responsibility. Too much depends on getting it right.
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