The South African municipality that went from the 51st to the 5th best in the country

The Drakenstein Local Municipality has been voted the most improved municipality in South Africa, and is now ranked amongst the five best municipalities in the country.

The recognition was awarded to the municipality at the 2026 Municipal Performance Awards, which recognise municipalities that have demonstrated strong financial governance and resilience.

The awards were presented by Ratings Afrika, in collaboration with the South African Property Owners Association (SAPOA) and the Banking Association of South Africa (BASA).

The award show took place on 1 October at the 60th SAPOA Annual Convention, which was hosted at the Sun City resort.

The Drakenstein Local Municipality is situated within the Cape Winelands District Municipality in the Western Cape, covering an area of 1,538 square kilometres with a population of around 311,000 people.

The municipal seat is located in the town of Paarl, the largest town in the Cape Winelands region, which sits roughly 60 kilometres north-east of Cape Town.

Paarl forms a continuous, de facto urban unit with the town of Wellington, some 10 kilometres to the north, due to the growth of the Mbekweni township that sits between the two towns.

Drakenstein is the largest economy in the Cape Winelands region and the largest in the Western Cape outside of the City of Cape Town, valued at close to R40 billion in 2026.

Agriculture is one of the municipality’s biggest sectors, contributing R2.5 billion or 7% to Drakenstein’s economy in 2024.

The municipality is home to numerous vineyards and wine farms, with estimates that 18% of all wine cultivation in South Africa takes place in Paarl and the surrounding areas.

South Africa’s second-largest producer of brandy, KWV, has its headquarters and main production complex in Paarl, from where it produces 15 million litres of brandy annually.

The municipality is also home to a sizable fruit industry, with the Groot Drakenstein area historically serving as one of the most important fruit-producing regions for the Cape Colony.

The fifth-best municipality in South Africa

In 2017, Drakenstein was ranked the 51st-best municipality in South Africa, achieving a score of 45 out of 100 on the Municipal Financial Sustainability Index (MFSI).

The MFSI evaluates municipalities across six key areas, including operating performance, liquidity management, debt governance, budget practices, affordability, and infrastructure development.

At the time, Ratings Afrika said the municipality was in a financially vulnerable and potentially unsustainable position due to several operational and fiscal challenges.

These ranged from insufficient cash reserves and high consumer debt to macroeconomic pressures stemming from the Western Cape drought of 2015 to 2018.

In 2019, the municipality implemented a financial turnaround strategy, which City Manager Dr Johann Leibbrandt said entailed stricter fiscal discipline and cost containment measures.

“We reviewed structures, optimised vacant posts, reduced unnecessary expenditure and found smarter ways of working,” Leibbrandt said. “Importantly, we did this without external consultants.”

“Throughout the turnaround period, we never defaulted on any of our financial obligations, including payments to Eskom.”

Through this strategy, the municipality began to see its financial situation improve steadily, moving up to 34th place in the 2021 Municipal Performance Awards.

In last year’s ranking, Drakenstein broke into the top 10 and has now been voted the fifth-best municipality in South Africa for its financial management and governance.

Drakenstein was one of just five municipalities which received an MFSI rating of 70 or above in the 2026 ranking, with the remaining four also located within the Western Cape.

In addition, Drakenstein was presented with the award for the Most Improved Municipality in South Africa in recognition of the success of its turnaround.

“From a very weak financial sustainability position in 2019, Drakenstein has progressed to become the fifth highest-scoring municipality on the MFSI in 2026,” Ratings Afrika managing executive Leon Claasen said.

“Drakenstein’s journey demonstrates the impact that sustained focus, effective management, and a commitment to continuous improvement can have on municipal performance.”

This ranking makes Drakenstein the most financially sustainable out of South Africa’s 19 Category B1 municipalities, or secondary cities.

The Auditor-General of South Africa also issued a clean audit opinion on Drakenstein’s financial statements for 2024/25, the municipality’s 11th clean audit.