Select Committee on Appropriations: Consideration of Final Mandates on Division of Revenue Amendment Bill

NCOP Appropriations

09 November 2010
Chairperson: Mr T Chaane (ANC)
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Meeting Summary

The Committee met to consider the final Mandates on Division of Revenue Amendment Bill. Seven provinces had delivered their mandates on time. Of the seven mandates that were presented the Western Cape and the Northern Cape’s mandates were presented with amendments. The Western Cape Provincial Government cited dissatisfaction with the current Division of Revenue Act because it did not discuss the amendment of allocations to municipalities. The Committee noted that the majority of provinces voted in support of the Bill.

Meeting report

Final Mandates: Division of Revenue Amendment Bill
The Chairperson noted that he had received the mandates from Limpopo, Northern Cape, Mpumalanga, North West and Eastern Cape and requested apologies or excuses from the provinces that failed to present their mandates.

Mr B Mnguni (ANC; Free State) indicated that his province would only consider their mandate the next day. In addition, he promised that the mandate would be available when the final decision is taken in Qwaqwa.

Mr S Montsitsi (ANC; Gauteng) reported that the Gauteng mandate was ready; however it had not yet been signed as yet. The mandate would be delivered to the Committee once that had been done.

Mr Montsitsi informed Members that he had just received the Western Cape’s mandate via fax and said it would be brought to him during the meeting.

The Chairperson confirmed that KwaZulu-Natal and Free State had failed to present their mandates.

Mr Montsitsi explained that the KZN had failed to meet and therefore did not submit their mandate.

The Chairperson said that the late submissions of KwaZulu-Natal and Free State provinces were accepted. He confirmed that Limpopo had voted in favour of the Bill. Mpumalanga, Eastern Cape, Northern Cape and North West all supported the Bill; however they highlighted some areas of concern.
The Western Cape Provincial Legislature voted in favour of the Bill; however it requested amendments to be made and sought clarity on a few issues.

Ms Wendy Fanoe,
Intergovernmental Policy, National Treasury, said that certainty needed to be given to municipalities concerning the provision that at the beginning of a financial year a province that made transfers to municipalities from its own funds must gazette the indicative allocation to the municipalities concerned.

The current Division of Revenue Act was silent on what ought to be done when a province wanted to amend such allocations.

Ms Fanoe explained that housing was not a local government function, it was a provincial function and that provincial governments used municipalities as agents to act on their behalf. When the Western Cape realised that one municipality was functioning well and another one was not, it reallocated funds to the well performing municipality. The Western Cape Provincial Government had been trying to achieve its provincial mandate as well at it could

Mr B Mashile (ANC; Mpumalanga) said that he did not think that allocating funds to one municipality that seemed to be performing well and not making those same funds available to other municipalities would work for all parties concerned or be in line with the ideology of government.

Mr C De Beer (ANC; Northern Cape) recalled that yesterday the Minister of Corporative Governance and Traditional Affairs had been interviewed on television on the question of the transfer of funds to municipalities. The Minister had replied said that his Department intended to review the idea of transferring funds from one municipality to the next.

Mr S Mazosiwe (ANC; Eastern Cape) said that Members should debate the role of National Treasury and the support it gave and should give to provinces.

The Chairperson said that the Western Cape’s suggested amendment needed to be referred to National Treasury.

The Chairperson noted that the Committee had received seven supporting mandates and anticipated that the two outstanding mandates would be no different, as their negotiating mandates did not raise any concerns. More than 50 % of the provinces accepted the mandate with no amendments; therefore the Committee would record it as such. The standard report relating to the meeting at hand would be circulated on the same day before noon and the Division of Revenue Amendment Bill would be passed in Parliament on the 16 November 2010.
The Chairperson proposed that the Committee should just pass a statement next week, but then debate the Bill on 24 November 2010.

Members accepted the Chairperson’s proposal.

The meeting was adjourned

Present

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