Zille says the Cape Town rich-poor divide is narrowest in SA

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Helen Zille is right to dispute claims by ANC leaders and others that opposition-run Cape Town is ‘more unequal’ than other South African cities. It is one of the most unequal cities in the world but other SA cities are more unequal still, UN figures show.

UPDATE: Africa Check revisited this topic in a 2016 factsheet about how inequality is measured in South African cities, which listed a wider range of data sources. Read the piece here.

At the Democratic Alliance federal congress last weekend, party leader Helen Zille dismissed as a “myth” accusations by ANC officials and others that the gap between rich and poor is greater in DA-run Cape Town than in other South African cities.

While few dispute the claim that South African cities, as a whole, lead the world in inequality, Zille dismissed as misplaced remarks such as ANC Western Cape leader Marius Fransman’s, a few months ago, that Cape Town is “the most unequal city in the world”.

Fransman claims Cape Town most unequal city

In a speech to youth leaders on June 16 2012, at the youth training centre in Michell’s Plain, Fransman asked: “How does Zille claim to be best premier when the Western Cape has the most service delivery protest; Cape Town is the most unequal city in the world.”

Responding to such claims, Zille addressed her party congress: “There is a myth that Cape Town is more unequal than other South African cities. This not true,” she said.

So who is right?

UN says East London, Johannesburg and East Rand

In 2011, the United Nations’s agency for human settlement, UN-Habitat, released its State of the World’s Cities 2010/2011 report. Subtitled ‘Cities for All: Bridging the Urban Divide’ the report examined income inequality in cities around the world and reported that South Africa has the highest levels of 109 countries, with all regions studied.

Presenting its conclusions the report declared: “Three South African cities top the list of the most unequal cities in the world, when measured on income-based data gathered in a UN-HABITAT survey of cities in 109 countries from all regions” and names them as “Buffalo City (East London), Johannesburg and Ekurhuleni (East Rand)”. Cape Town, according to the report, is the least unequal city in the country.

All SA cities show a high level of inequality

The measure the UN-Habitat uses is the Gini coefficient, a measure of the inequality of income. A Gini coefficient of 0 means total income equality – where everyone has the same income. A Gini coefficient of 1 means maximum inequality. One person has it all. A rating of 0.4 is considered the international alert line for high inequality.

In South Africa, Johannesburg and East London have an 0.75 rating, the East Rand and Bloemfontein 0.74, Pietermaritzburg 0.73, Pretoria, Port Elizabeth and Durban carry a 0.72 rating, while Cape Town has a rating of 0.67.

This clearly shows high levels of inequality in Cape Town, but still makes it lower than other cities.

More recent study looks at other factors  

A more recent UN-Habitat report, released in September this year, examines the state of different world cities, assessing a wider range of factors than simply income.

Here again, the story is the same. The State of the World’s Cities 2012/2013 – Prosperity of Cities report does look at income inequality, and using the Gini coefficient measure it finds that Johannesburg is still more unequal than Cape Town, with little change from the 2011 figures.

It also lists Cape Town as a more broadly prosperous city than Johannesburg, the only other South African city examined. It does this by developing a new gauge it calls the City Prosperity Index which measures five factors: productivity, quality of life, infrastructure, environment and equity.

Equity takes in the Gini coefficient as well as looking at inequality of access to services.

Infrastructure and quality of life includes aspects such as adequate water, sanitation, power supply, transportation, road network, communications technology, as well as the provision of social services, recreation facilities, health, education and safety and security.

Like the Gini coefficient, the City Prosperity Index rates cities on a scale of 0 to 1, but in its case, the higher the reading the better ; the broader the prosperity. And on the overall index, Cape Town scored 0.590, above Johannesburg with 0.479.

Both cities score low on the equity index (Johannesburg at 0.083 and Cape Town at 0.217). Cape Town does well on the infrastructure index at 0.933, compared to Johannesburg with 0.880. Both cities scored 0.645 on the quality of life index.

Conclusion: The rich/poor gap in Cape Town is high by world standards but narrower than other SA cities

As shown by these UN-produced studies, the claims that Cape Town is the world’s most unequal city are wrong.

Inequality remains high in all South African cities, though it has not worsened in recent years, as the DA and others recently claimed. But the UN study in 2010/2011 show that South Africa and the world’s three most unequal cities, measured on income alone, are Johannesburg, East London and East Rand, with Cape Town having the lowest ranking.

Furthermore, a more recent 2012 study that looked at just two cities in South Africa, among a range of other cities around the world, and examined a broader  range of factors than simply income distribution, showed this broader measure of prosperity was higher in Cape Town than Johannesburg.

Africa Check invited the ANC to comment on this data and will publish their conclusion if they send it to us. On the UN figures, however, Zille is right.

Edited by Peter Cunliffe-Jones

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Comments 1
  1. By Matt

    There are many difficulties in quantifying ‘inequality’, since there are many factors to consider (income, access to basic services, etc). The Multidimensional Poverty Index (MPI) appears in the second figure (the other data is actually irrelevant to the discussion at hand). Importantly, an MPI analysis necessarily examines the extent of poverty as well as the depth of poverty. This would provide a more complete view of the veracity of claims about inequality. Such data, if they were not readily available in the reports used, should have been sourced from the authors of the source material. On the face of it, with the overall MPI scores being equal, there isn’t really room to make such firm conclusions.

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