Sparked by financial crisis in 1997, the Greater Johannesburg Metropolitan Council (GJMC) embarked on the Igoli 2002 initiative to undo the causes of the financial crisis, address infrastructure backlogs and essential maintenance needs, and eliminate duplication, inadequate coordination, lack of skills and the absence of a performance management system.

A primary challenge in an elaborate process (detailed in Box 4.4) of restructuring is whether the needs of all stakeholders can be met, and how to consider the right interests for the right reasons and the right services. This has been difficult, and the municipal management has been criticised at times for not sufficiently engaging with all relevant stakeholders. The leadership maintains, in turn, that it has to make certain trade-offs because it is not able to satisfy all the interests all the time. It has also decided to provide a broad strategic plan on the basis of its management assessment of key issues, and has pledged to deal with the specific stakeholders around specific issues as implementation of the plan unfolds.

Balancing these interests has indeed been an arduous task, not the least because of the diversity of interests. To provide structure to the process, the Office of the City Manager focused on principles, general problems and challenges, and the specific aspects of the Igoli 2002 plan. The consultation involved the various political and administrative parts of the metropolitan council, political parties, labour organisations, civic organisations and other community groups, business, national and provincial government departments, and other local governments.

Because of its concerns about employment conditions, the South African Municipal Workers Union (SAMWU) has throughout been considered as a major stakeholder. For this purpose, negotiations built on a national agreement between trade unions, government and local government . But it has also been necessary to discuss specific issues, and in particular to give labour, and individual staff, as much assurance as possible. A promise was made that no retrenchments would take place - a controversial aspect as many observers believed this would nullify the productivity effects of the plan. Relations with SAMWU remain tense, and there have been a number of militant protests. The unions, supported by their national leadership, continue to fight the plan, first because they in principle disapprove of private sector involvement, and second, because they fear that restructuring will threaten their interests and conditions of employment.

Consumers have been an important interest group and ongoing efforts are made to inform them of changes and to obtain their views. The foremost dilemma is that consumers vary so much - from the wealthy residents in the northern suburbs that fear excessive property tax and user-fee hikes in their areas as a means to cross-subsidise services in poorer areas, to poor people who have inadequate access to services and are unable to afford those services. In attempting to motivate consumers to pay for services, attention is focused on improved metering, more stringent credit control and continuous interaction to explain to consumers the benefits of paying for services. Politicians form an important interest; hence alliances were forged with the top leadership in the council while briefings of different parties were held. There has been some concern that the process was essentially driven by officials, but even top political leaders have argued that this was necessitated by the urgency of the reforms required and that the process would be more political as details unfold.

Financiers have been a major target audience. The city management wanted to reassure international and South African financiers that it is worth investing in, and that the municipality would be a creditworthy borrower. Interactions with financiers therefore informed many aspects of the strategy, and led to some major tenets, such as ringfenced revenue streams, assurances that political change will not compromise debt repayments, and a focus on effective management of assets.

Finally, national and provincial government have been major stakeholders. They were regularly briefed, asked for advice and support, and views were exchanged to ensure that the Johannesburg experience is captured in the development of policies at these other levels. In 2000, Johannesburg became the first recipient of a major national grant to assist in the transformation of big cities. The challenge has been to maintain the integrity of local decision-making, and as the city's finances improved and it greater independence was confirmed, this progressed.

The range of institutional options adopted shows that the council is seeking the most appropriate alternatives, instead of being driven by an ideological belief in private sector participation. This has enabled it to interact with the consumers on the basis of service concerns, rather than ideological positions. Such pragmatism is crucial when a council deals with such diverse interests and views, as it has to reconcile widely divergent perspectives while facilitating service delivery that meets specific needs.