South African Cities Network on its Annual Performance Report 2010/11 - 01 July to 30 September 2010: briefing; Police Budget Review and Recommendation Report 2010

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Cooperative Governance and Traditional Affairs

25 October 2010
Chairperson: Mr L. Tsenoli (ANC)
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Meeting Summary

South African Cities Network briefed the Committee on its Annual Performance Report 2010/11 - 01 July to 30 September 2010. Since its inception in 2002 the Network’s purpose was to promote good governance and management in South African cities; analyse strategic challenges facing South African cities; collect, collate, analyse, assess, disseminate and apply the experience of large city government in a South African context; and promote shared learning partnerships between the different spheres of Government to support the management of South African cities. The Network’s membership comprised nine municipalities: Buffalo City Municipality, the City of Cape Town, Ekurhuleni Metropolitan Municipality, the City of eThekwini (Durban), the City of Johannesburg, Mangaung Municipality, Msunduzi Municipality, Nelson Mandela Bay Municipality and the City of Tshwane (Pretoria). Based on observations of these municipalities, the Network identified eight challenges which present (and future) local governments faced.

Members were concerned that local government decision makers lacked their own necessary statistics at a local level which would help them deliver and meet their goals. It was generally agreed that it was the responsibility of municipalities to collect their own data: such data would be used to develop municipalities’ long term strategies. Therefore blame could not be placed on Statistics South Africa for its inability to provide such statistics.  It was also noted that there were many challenges which local government faced, which would require interdepartmental and sectoral assistance.

The Committee also briefly discussed its first draft of the Budgetary Review and Recommendation Report. Some important points raised included the fact that it was generally thought that justice had not been done to the report in terms of integrating the oversight work the Committee did on service delivery. There was thus a greater need for the inclusion in the report of some of the key observations that the Committee had made during its oversight visit. It was also noted that these observations would be used as a basis for evaluating the report from the Minister of Cooperative Governance and Traditional Affairs and his Department. Interactions with related entities such as the South African Cities Network, Municipal Dispensation Board, and the South African Local Government Association were also deemed important for inclusion in the final report. It was concluded that at the next meeting adoption of the report would be on the agenda. Copies would be circulated to Members in advance.
           

Meeting report

Introduction
The purpose of the meeting was for the Committee to gain an overview of the combined impact of cities economically and on services. This would thus enable the committee to give the Department of Cooperative Governance and Traditional Affairs a sense of its successes, failures and challenges. He stated that the Draft Budgetary Review and Recommendation Report (BRRR) would be discussed after the briefing.

South African Cities Network on its Annual Performance Report 2010/11 - 01 July to 30 September 2010: briefing
Mr Sithole Mbanga, Chief Executive Officer, South African Cities Network (SACN), thanked the Committee for the opportunity to present updates to the SACN annual report. According to the White Paper on Local Government, it was necessary for municipalities to use knowledge and knowledge sharing as a way to their transformation. SACN was established in 2002 as a knowledge sharing network and joint programme of Government to understand what was happening in the urban space. Over the years the SACN had brought a differentiated approach to supporting local government and attempting to differentiate between the different spaces.

Mr Mbanga stated that the SACN operated as a non-profit voluntary organisation owned by and accountable to its members via a Board of Directors. The Board was comprised of mayors and municipal managers from the nine member municipalities: Buffalo City Municipality, City Of Cape Town, Ekurhuleni Metropolitan Municipality, City of eThekwini (Durban), City of Johannesburg, Mangaung Municipality, Msunduzi Municipality, Nelson Mandela Bay Municipality and the City Of Tshwane (Pretoria).

Mr Mbanga noted that the South African Local Government Association (SALGA) and the Department of Cooperative Governance and Traditional Affairs (COGTA) were the parent entities of the SACN, which operated as a small secretariat of not more than eight people. The SACN was also funded by cities, national Government and select donor entities. He stated that the SACN operated by having a city based or municipal based small team of practitioners who investigated the subject matter as required.

Mr Mbanga also stated that the SACN was, with regard to the built environment, liaising with the Departments of Transport and the Department of Human Settlements. It also sought cooperation with the Department of Rural Development and Land Reform; the SACN believed that land was often considered only in agricultural terms and not in terms of industrial or urban purposes. This lack of focus challenged urban based municipalities with not having secure access to land.

SACN was completing the third State of South African Cities Report. Mr Mbanga explained the eight issues the SACN had identified as challenges facing current and future local government.

Policy
There was a need to ground the differentiated approach in some form of policy. Due to the fact that rural and urban policies coincided, there was a need for urban development also to be considered, as focus should not solely be on rural development. Also the level of performance which should be expected from geographical urban areas should be considered. It was noted that there was thus a need for policy to be more nuanced and made much more specific.

Land
The importance of land, not just as an asset but also its availability, was noted. According to the SACN Report 2006, there was no land internally in the city which enabled people to engage in meaningful social development. The issue of land availability, acquisition, use, and land use management needed attention. Mr Mabanga stated that this would be an important instrument issue for current and future municipalities, especially the big ones which experienced migration on a daily basis.

Transport
This was an issue not only in terms of economy.  The bus Rapid Transport System (BRT) was noted as the start to creating a much more efficient public transport system. Mr Mbanga suggested the need for decision makers to provide more innovative or daring ways in which to change the way in which the public transport system operated. He also suggested that the Committee should approach various municipalities to find out what they were doing about the public transport system in their areas. Should this are not be done, people would continue to be confined to places which made it expensive for them to move from one place to another: therefore they would find it hard to access the city.

Human settlements
Mr Mbanga stated that unless human settlements, land acquisition and transportation – which were part of the built environment - had specific policies; they would not be tackled fervently enough.

Finance
Mr Mbanga said that, according to the National Treasury, it was generally believed that the way in which local municipalities were financed needed to be rethought to allow municipalities to have their own stronger sources of revenue; once they had obtained this, they would be more independent from the national fiscus. This would in turn enable them to grow and be more innovative in their approach.

Energy

Mr Mbanga referred to the natural resource base on which municipalities would depend for their proper functioning in the future, for example, electricity, renewable energy, and water. Not all municipalities prioritised the issue of energy and renewable energy, especially in the case of the smaller municipalities which tended to have a more burdened agenda. There was thus a need for the Committee to have much more direct interaction with the Water Affairs and Environmental Affairs Portfolio Committee on this issue.

Interdependence between rural and urban municipalities
Interdependence could be enhanced in practical ways such as by the bigger municipalities investing in the smaller municipalities, through their own development agencies, in such a way that the products of whatever was invested would be available to the urban municipalities. Examples would be urban municipalities helping rural municipalities purchase equipment for harnessing renewable energy in the form of solar panels and then purchasing energy from those municipalities. Another option presented was food production.

Local government statistics
It was noted that local government decision makers lacked the necessary statistics at a local level which would help them deliver. Thus the decision-making process would not be supported by the necessary statistics, which would hamper municipalities’ ability effectively to respond to issues and trends they faced. Mr Mbanga stated that, according to Statistics South Africa (StatsSA), it was not possible to provide all the figures required. Thus the production by local municipalities of their own statistics would need to be funded, in order to supplement what was done by StatsSA.

Mr Mbanga stated that, since the inception of the SACN, its biggest budget had been R18 million (2009/10 financial year) and when preparations were being made for local government elections the budget had increased. He referred to the SACN Annual Performance Report 2010/11 – 01 July to 30 September 2010, page 3, figure 1, which indicated that the number of publications since 2003 until the present had generally increased. Up to the end of the first quarter of 2010/11, the SACN had delivered knowledge exchange and learning events (such as pieces of documentation which could be used to influence policy). Based on these outputs, the SACN believed that it had been working very well, as its work was also recognized worldwide in terms of innovation.

He also noted that there were a great number of consultation firms who regularly attended the sessions organized by the SACN itself or its donor network and partner organisations. Although the Board had been concerned with this occurrence, the SACN believed it could be attributed to consultants’ best interacting with municipalities at the SACN sessions. 

Mr Mbanga stated that, considering the SACN did not want to be in conflict with SALGA, it was now trying to consider what it would mean to have an expanded network of more municipalities. There was also a call for the SACN to be work with the Southern African Development Community (SADC) in expanding the network. SACN was still addressing this interest.

Discussion
The Chairperson thanked Mr Mbanga for his informative presentation and asked why water, considering that it is one of the biggest problems in South Africa in terms of affordability and provision, was not considered as a priority issue in the presentation. He also asked how was it possible for SACN members to plan if they did not have statistics, and what figures were they using in their planning processes. The Chairperson believed that it should be a priority of local governments to have accurate local statistics. He thus felt that there was a need for the capacity of local governments’ district operations to be improved and be more effective to achieve their ability to produce statistics. He also questioned what had kept cities from prioritisng the need for statistics to inform their integrated development plans (IDPs) and city strategies and thus their building capacity.

In response, Mr Mbanga stated that the SACN did consider water as being a priority issue, as energy was considered in terms of natural resources or sources of energy for the city, which included water, oil, fuel, and electricity. He stated that perhaps there was a need for the SACN to focus on water to a greater extent. Mr Mbanga stated that the SACN had been in talks since 2006 with StatsSA on the provision of local government statistics. StatsSA had responded that it was still building the capacity of its district officers to do this. He did agree that it was the responsibility of municipalities to collect their own data; whilst such data was lacking, municipalities did depend on the statistics of StatsSA. Where local governments did collect their own data, there was a problem with the methodology used as there was no single standard used. Therefore the SACN believed that it would take a long time for municipalities to build the same methodology and systems, and this too would be costly.

To date, the Indicators Reference Group (IRG), statisticians from the nine member municipalities, were putting together a proposal, which would be taken to COGTA, asking for direction into a better local government statistical system (it was expected that this would be tabled by March 2011). The other challenge the SACN was facing in terms of data collection of local government, was that there were not enough tertiary institution graduates specializing in statistics who could be deployed to local government level. Should this challenge be met this would make local government less dependent on private entities.

Mr P Smith (IFP) enquired about the board composition of the SACN and why it was democratically oriented instead of politically driven, as he felt mayors should lead the forum and not municipal managers. He also published, but there was no mention of a report for 2008. Mr Smith (ANC) expressed the need for secondary cities, which were largely metropolitan driven, to be included with the nine member cities, making them part of the 21 largest cities. He also asked whether there was scope within the SACN challenges for governance capacity, and he also asked what the impact of the SACN’s knowledge sharing and research had been exactly, as outputs could not be classified in terms of the number of reports which had been produced.

Mr Mbanga replied that there was thus a need for political support. Well governed cities remained the priority of the SACN; of the priority list mentioned earlier in the presentation, governance was one of the key issues which present and future local governments should focus on.

Mr Mbanga replied that the SACN hoped to produce State of Cities reports at five year intervals prior to the local government elections. The 2004 report was produced when the network had been operating for 18 months and had thus decided to publish a report so as to see what response it would receive.  The 2006 SACN report was produced in preparation for the local government elections. Specialised reports would also be produced by the SACN, such as the State of Cities Finances Report.

It was noted that the SACN could only publish reports with recommendations; it was for the municipalities to take decisions on the recommendations made. Sometimes action on recommendations was taken and sometimes it was not. For example, with regards to the Gauteng City Region, it was the work of the SACN which made the provincial leadership in Gauteng begin to think around this concept of a city region. The SACN had also worked with the Deputy Minister of Transport on issues of transport and how to establish a public transport fund. 

Ms D Nhlengethwa (ANC) asked how many of the 21 membership municipalities had experienced service delivery protests and what the main issues raised were. She also asked what lessons were learnt from the interactions with the 12 SADC based municipalities, and whether some of them were performing better than some municipalities in South Africa. Ms Nhlengethwa enquired why the SACN wanted to remain a small organisation and what experience the SACN had with member municipalities and their budget management, according to the Auditor-General’s reports.

In response, Mr Mbanga stated that should the SACN become a large organisation, it would not be able to focus on its niche; focus would thus be lost as the network would be attempting to be everything to everyone. He also stated that all municipalities of the SACN had experienced service delivery protests but the Network believed that these protests were actually systematic problems which reflected themselves in the local municipality space as service delivery protests. The reason was that larger municipalities also experienced service delivery protests, despite their being the ones which provided more services to their communities.

Mr Mbanga explained that there was much for local municipalities to learn from SADC based municipalities. Examples included the Windhoek Municipality which was doing well despite having less budget resources. For example, it had managed to keep its fleet of buses for 20 years because the municipality spent money on maintaining them. This enabled it to provide a good public service and for the last 20 years it had not purchased any buses. In this example, Mr Mbanga pointed out that the Windhoek Municipality has a governance system whereby the city reported directly to the Government. Thus a great importance was attributed to the local government space. It was also noted that this system did not always work, as was the case in the example of Tanzania. Therefore, although this system could not just be applied in a blanket approach in the South African situation, lessons could be learned from the SADC municipalities. Local government could thus be considered as doing its best under the very challenging circumstances it had been facing.

Nkosi Z Mandela (ANC) asked how urban spaces were defined in South Africa, considering the country’s dual economy. He also asked who, the political head or consultants, took the lead in developing cities. He lastly enquired what the best principles learned from the SACN were for municipalities which had experienced service delivery protests (such as Buffalo City Municipality which also had a problem with its ratepayers association).

Mr Mbanga stated that there was no single definition of what constituted an urban space as any urban space in South Africa should have both urban and rural characteristics. Municipalities were basically defined according to the function of spaces in relation to the national development objectives of the country. Thus mayors would describe themselves according to the typology of South Africa and therefore take the lead in their city’s development.

Mr J Lorimer (DA) asked whether the SACN’s being short of half its directors, compromised its activity. He also asked whether there was a way in which the Committee could drive the collection of statistics in local government, and what was needed for StatsSA to provide statistics to local government. He also requested that a hardcopy of the priority list of challenges of local government be provided to the Committee.

Mr Mbanga stated that it was noted that there were many changes in the board composition of the SACN in the last 24 months, either in mayors or municipal managers who were either not permanent, occupying acting positions or remaining in the same position for long periods. He agreed that such leadership issues did affect SACN activity but at present the network was waiting for the upcoming local government elections; and once mayors had been put into place, talks would be had with municipal managers so that they would be oriented towards the need for them to play a role in the SACN. Another problem the SACN faced was that sometimes some mayors or city managers did not see the need to be a part of the board of the SACN, and thus this task would be delegated to one of their mayoral committee members. This was therefore another contributing factor as to why the SACN board comprised elected and unelected officials. So whilst the SACN believed that this was a problem, it did not believe that it had reached crisis proportions.

Ms M Wenger (DA) observed that SALGA was on the board of the SACN, and asked why the SACN was not a part of SALGA, instead of SALGA being a part of the SACN. She considered that the better option would be for the SACN to be a part of SALGA instead.

In response, Mr Mbanga stated that there was no need for the SACN to be a part of SALGA as it was important that the network remain an independent entity governed by its board, but accountable to SALGA with COGTA as the parent entity. The reason for this was institutional rather than a matter of principle, as the SACN was considered a specialised entity in extracting information and should thus remain in that niche. He explained that if the SACN was a part of SALGA it would become part of the institutional problems which were faced by SALGA. The SACN should thus have its own institutional problems to deal with.

The Chairperson asked what the relationship of the SACN was to the Planning Commission. He also asked whether the SACN had explicitly submitted its view as a Cities Network on the issue around powers and functions. He also enquired what the SACN’s view on transport and human settlements was. The Chairperson also noted that the Committee would have liked to have received more information pertaining to migration urbanization dynamics.

Mr Mbanga responded by saying that the SACN did interact with the Planning Commission, as planners from the various SACN cities were invited by the Planning Commission to their sessions. The SACN had been asked by the Planning Commission what it thought it should do, to which the SACN responded that there was a greater need for the Planning Commission to be stronger. Also stated was the need for the Planning Commission to have a different agreement with city regions, as it would have with service centres. There was also a need for the Planning Commission to negotiate and not just dictate.

The Chairperson asked whether the SACN had made a submission to the Department of Energy’s Draft Strategy on Energy Resources for the next 20/30 years, for which the deadline had been extended to December 2010.

Mr Mbanga replied that the SACN had made a submission around the issue of energy and electricity, with the submission made being biased towards the issue of renewable energy. This was because municipalities want to pursue this issue and to feed into the tariffs, and make money for the communities.

The Chairperson thanked Mr Mbanga for the engaging information that he had presented to the Committee; he stated that matters would be followed up, with a particular interest on submissions being made on long term policy issues. He requested in writing the SACN submission to the Planning Commission and submission on the long term energy resource strategy. He stated that there was a need for the Committee to follow up on the issue of statistics for local government.

The Chairperson suggested that the composition of the SACN board should consider the issue of continuity so that stability can be brought to issues of government structures. He also noted that there needed to be a greater look at what the human resources needs of the local government were.

Mr P Smith (IFP) requested that the Committee be presented with the SACN key recommendations or policy review positions tabled over the years, as well as its standing on these currently.

The Chairperson reiterated this need, requesting that the Committee be posted on any strategic information which the SACN had and which would be useful for the Committee in view of its oversight responsibility.

First draft of the Committee’s Budgetary Review and Recommendation Report: consideration
The Chairperson stated that he did not think that justice had been done to the report in terms of integrating the oversight work of the Committee on service delivery. There was thus a greater need for the incorporation of some of Members’ key observations during their oversight visits. He also noted that these observations would be used as a basis for evaluating the report received from the Minister of Cooperative Governance and Traditional Affairs and his Department. There was a need to refer to population dynamics and the intense urbanization which put immense pressure on large towns, and how a lack of statistics impacted on this. Also the non-payment of debts needed to be included in the report, as big businesses owed large amounts to municipalities; it was not just the municipalities which owed money.


The Chairperson noted that page 3 of the report did not refer to the Committee’s interaction with entities such as SALGA, SACN, and the Municipal Dispensation Board. These interactions needed to be included as it was these entities which accounted to the Department of Cooperative Governance and Traditional Affairs and received funding based on their performance and their relationship with the Department. The Committee must reflect on this.

The Chairperson had received a letter from the Chairperson of Committees to the effect that, in their reports, Committees needed to reflect on the Millennium Development Goals and report their observations of progress.

The Committee still needed to make recommendations on practical institutional support and functioning in Gauteng.

Mr P Smith (IFP), referring to the table of contents and page five, stated that more detail was needed about issues which were responded to.

The Chairperson stated that the final report should state that the committee would write to the Public Service Commission on staff practices, with reference firstly to the Department. He also stated the need for an objective resolution in order to move forward.

The agenda of the next meeting would include adoption of the report, a copy of which would be circulated to Members in advance.
           
The Chairperson informed Members about a meeting on budget outcomes to which they had been invited by the Committee of Chairpersons.

The meeting was adjourned.





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