Local Government Municipal Systems Amendment Bill [B22-2010]: discussions with Deputy Minister & Department

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Cooperative Governance and Traditional Affairs

08 February 2011
Chairperson: Mr S Tsenoli (ANC)
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Meeting Summary

The Committee conducted informal discussions on issues raised during the public hearings on the Local Government: Municipal Systems Amendment Bill [B22-2010] (the Bill). The Deputy Minister and representatives from the Department of Cooperative Governance and Traditional Affairs, as well as the Office of the Chief State Law Advisor, also gave input.

The Committee extensively discussed a provision in the Bill relating to municipal workers being allowed to be members of the executive bodies of political parties. Although a DA delegate expressed some support for the proposition that this should be prohibited, it was pointed out that this would not find favour with the unions and would be impossible to enforce, since people had freedom of association. However, it was recognised that political interference in the affairs of local government was not desirable and the Department was taking steps already to try to limit this. A DA Member also was adamant that anyone dismissed from a municipality by reason of fraud or theft should not be permitted to work again for a local government. Members agreed that the current provision was too vaguely worded and needed to be tightened up, and three main issues were identified for attention. There was, however, a challenge with those who resigned before any disciplinary hearings were held. This led to a discussion on the appointment of municipal workers. A Member expressed the view that Municipal Managers should have the power to appoint employees who were accountable to them for their actions and although the managers should consult with the Municipal Councils prior to making the appointment, the control over and responsibility for the appointee remained with the manager. It was recommended that any contracts entered into under previous or existing legislation would need to be re-examined once the Bill was passed. The Department conceded that there was some uncertainty around option of renewal of contracts, but that the matters could be addressed on expiry. The Deputy Minister noted that the legislation could not have retrospective effect.

The discussions then focused on the separation of powers at municipal level, which was highlighted in a submission the previous day setting out the judgment of the Supreme Court of Appeal in Manana v King Sabata Dalindyebo Municipality. Informal views on the impact of this judgment were given by the Department’s legal advisor and the Office of the Chief State Law Advisor, who differed in their interpretation of whether this judgment contradicted the earlier ruling by the Constitutional Court as to the constitutionality of the Municipal Systems Act. The Chief State Law Advisor thought that the judgment was reaffirming the powers of the Municipal Council, although it was recognised that the powers of appointment could be delegated, whereas a Technical Advisor to the Deputy Minister expressed concern about the powers granted to Municipal Councils in respect of administrative issues. The Committee agreed to seek further comment from the Community Law Centre.

The Deputy Minister indicated that the Department would be engaging further with stakeholders and the Committee on outstanding issues, whilst the Committee would continue its deliberations.

Meeting report

Local Government: Municipal Systems Amendment Bill [B22-2010]: Informal discussions
The Chairperson reminded the Committee that public submissions were received the previous day in regard to the Local Government: Municipal Systems Amendment Bill (the Bill). He said that it was important to note areas of agreement between civil society and the Department of Cooperative Governance and Traditional Affairs (COGTA or the Department) on some of the provisions in the Bill. However, it would also be important to iron out issues where there was disagreement, before the Bill was finalised. This meeting had been scheduled to receive comments and hear concerns from Members of the Committee, before the Department responded formally to the submissions.

Mr J Matshoba (ANC) commented that there was nothing presented that was not in line with the Committee’s views on the Bill, nor in the one submission which had not been orally presented to the Committee.

Mr J Lorimer (DA) commented that the South African Local Government Association’s (SALGA) submission was very interesting. He thought the proposal by SALGA to prohibit municipal managers and other senior municipal staff from being members of executive bodies of political parties was a good one, which should be seriously considered.

The Chairperson said that the Deputy Minister of Cooperative Governance and Traditional Affairs and the South African Municipal Workers Union (SAMWU) had indicated that there was staunch opposition to the SALGA proposal that Mr Lorimer mentioned, and that it would not be supported should it be included in the Bill.

Mr Lorimer said that it was important to look into including stronger sanctions against people who were dismissed from municipalities for fraudulent activities. Municipal Managers should have the power to appoint employees who were accountable to them for their actions. These Managers should consult with the Municipal Councils before appointing an employee, but should have ultimate responsibility for that appointment. Contracts which were already enforced under previous legislation should be looked at again once the Bill was implemented, to ensure that all municipal workers fell in line with the intentions of the new legislation.

The Chairperson said that the Department had a problem with the provision relating to issue of contracts as there was uncertainty created over the option of renewal of contracts for people employed by a municipality.

Mr Nhlakanipho Nkontwana, Special Advisor to the Ministry of Cooperative Governance and Traditional Affairs, said that the issue of contracts and uncertainty created around the renewal caused problems. The Department was trying to ensure there was stability.

The Chairperson sought clarity as to what problems the Department anticipated about the issue of contracts once the new legislation had been enacted.

Mr Nkontwana responded that existing contracts would be interrupted if the new legislation came contained a provision relating to contracts. The issue could be addressed after the expiration of a municipal manager’s contract.

Mr Jackie Maepa, Director, COGTA said that the current provision would have serious implications for existing contracts if it was implemented. Municipal residents would end up footing the bill if costs were incurred by prematurely ending existing contracts in order to implement new contracts under this legislation.

Mr Lorimer asked whether there was any remedy to deal with this problem.

The Chairperson responded that the issue could be addressed after the local government elections scheduled for later in the year.

Ms M Wenger (DA) commented that the processes of interviewing municipal staff such as Chief Financial Officers and offering staff positions were ongoing.

The Chairperson asked whether Ms Wenger though that that would lead to the hiring of ill-equipped people in key positions.

A member of the Committee said that the inefficiencies of administrative processes around the issuing of contracts could not be the basis for writing legislation in a certain way.

Mr Nkontwana said that there was nothing wrong with employing people under current circumstances, unless there was uncertainty whether they were being employed following proper procedures. Most municipal managers had individual clauses in their contracts that regulated termination and cancellation of contracts. The issue should be properly addressed at a later time, when contracts were due for renewal.

The Chairperson asked Ms Wenger whether the Committee had any grounds on which it could stop the appointment of new municipal staff.

Ms Wenger responded that outgoing municipal managers who were in the final stages of their contracts should not be permitted to appoint new municipal employees, as they would be accountable to people who had nothing to do with their appointment.

Mr Yunus Carrim, Deputy Minister of Cooperative Governance and Traditional Affairs said that, instead of engaging in endless theoretical discussion, the Committee should be guided by the existing legislation, as it was a simple legal matter. When he had been Chairperson of the Committee, there had been no legislation passed that applied retrospectively. This could simply not be done. There was some debate as to whether national government should intervene in the appointments of people at a municipal level, whilst at the same time giving those municipalities autonomy to carry out their own work and appointments. The current practice was that national government gave municipalities the right to make appointments, and in turn did not interfere in that process.

Mr Stephanus Louw, Legal Advisor, COGTA, agreed with the Deputy Minister’s points that legislation could not be retrospective and that national government could not interfere in the appointment of municipal employees. Municipalities could not be expected to operate without key personnel while they were awaiting an election. The legislation could not interfere with existing contracts, but could only affect contracts that came into being after the Bill was implemented.

The Chairperson said that the Bill’s current provision around rehabilitation of municipal workers who were dismissed must be reworded, in order to avoid victimising innocent municipal workers. The provision was too vague as it stood.

Mr Lorimer believed that if a worker was found guilty of stealing money from a municipality, then that person should be banned from working for a municipality ever again.

Mr Mohammed Bhabha, Technical Advisor to the Deputy Minister of Cooperative Governance and Traditional Affairs said that three solutions needed to be found in relation to the provisions around dismissal and rehabilitation. Firstly, the offence for which a worker was dismissed needed to be explicitly stated. Secondly, if an individual was charged to appear before a disciplinary hearing and failed to appear, for whatever reason, then the reasons for that must be explained. Lastly there must be clearer definition of specific punitive measures for certain offences. This could be addressed in a reworded provision.

The Chairperson agreed with Mr Bhabha and said that it was a useful contribution. He added that the Committee could also look at some way to ensure that a person dismissed from one municipality for having committed theft or fraud could not be allowed to work elsewhere in the local government system.

Mr Nkontwana said it was possible to stop who had been people dismissed for specified reasons from working elsewhere in local government. However, there remained a challenge was in dealing with people who resigned prior to the carrying out of a disciplinary hearing.

Mr Louw said that there was a section in the Municipal Systems Act that addressed that issue. An applicant had to submit details of his or her former work in local government, if it was relevant.

Mr Nkontwana said that the issue needed to be addressed through a specific and clearly worded provision in the Bill, to avoid ambiguity or misinterpretation.

Ms Yolande van Aswegen, Principal State Law Advisor, Office of the Chief State Law Advisor, agreed with Mr Nkontwana. As currently worded, this provision could be misinterpreted, so it should be made clearer.

A Member of the Committee asked what could be done for municipal workers who had been wrongly implicated in wrongdoing and suspended for a prolonged period of time while the issue was being addressed.

Mr Bhabha said that the regulations which were to be drafted after the Bill was passed would address that issue.

The Chairperson asked the Department to provide comment on the Manana judgment which had been referred to in a submission by the Community Law Clinic the previous day.

Mr Carrim said that the Department had not yet studied the judgment and could not give a formal response to it as yet.

The Chairperson allowed for an informal discussion on the Manana judgement. He noted that Mr Manana had sued the King Sabata Dalindyebo Municipality after he was promoted to Manager of Legal Services by the Municipality’s Council, since he was not properly paid due to delay in altering of his pay grade. The case eventually went to the Supreme Court of Appeal, which ruled that in terms of the Municipal Systems Act, the Municipal Council did not have the power to make resolutions employing people at the municipality. That power lay solely with the municipal manager. This was an area of concern as there was not enough clarity on who had the power to appoint municipal employees. This was a matter that had to be addressed by the proposed legislation.

Mr Bhabha said that the judgment had particular relevance and impact on the Municipals Systems Act of 2000, the Municipal Structures Act of 1998 and the Municipal Financial Management Act (MFMA) of 2003. It related to the separation of powers in local government and the power to appoint municipal workers. The MFMA stated that the Municipal Council could not interfere in the carrying of the Municipal Manager’s fiduciary functions, which could relate to the appointment of municipal employees. The Manana judgment flew in the face of that provision, and it should be appealed or overturned. The Municipal Systems Act had been challenged before the Constitutional Court, which had ruled it to be constitutional, so now the Constitutional Court and the Supreme Court of Appeal were saying two different things.

The Chairperson said that the Manana judgement challenged the MFMA’s constitutionality in separating the power to appoint at a local government level.

Mr Enver Daniels, Chief State Law Adviser, respectfully disagreed with Mr Bhabha’s views. In his view, the judgment had merely explained that Municipal Managers were expected to carry out and implement resolutions decided by the Municipal Council. It reaffirmed the powers of the Municipal Council. He did not think that this judgment raised any great concerns.

Mr Carrim said that this was a legal as well as a political issue. He reiterated that he himself had not read the judgment, but the Department’s legal division would be doing so and providing direction to the Department. Executive authority seemed to include the ability to employ any level of municipal worker. The Municipal Council had the power to oversee the appointment of people to positions in a municipality, and this had been done to ensure that no individual could be given a “job for life” if he or he was ineffective or not performing. The legislation should allow for delegation of certain tasks, such as the employing of a municipal worker who was of a lower level.

Mr Maepa thought that the judgment created a problem in that a person could be employed by the Municipal Council and yet would serve under the Municipal Manager. This created confusion on the identity of the individual to whom the employee must answer directly.

Ms van Aswegen said that the Municipal Systems Act of 2000 aptly separated the powers at a local government level and properly addressed issues of who was responsible of appointing municipal employees. Municipal Councils had executive authority, but also had the power to delegate tasks such as employing municipal employees.

Mr Nkontwana said that the Manana case had no impact on who could appoint municipal staff. That power resided with the Municipal Council, and this case did not alter the division of powers.

Mr Bhabha said that he was worried about the powers granted to the Municipal Councils in relation to administrative issues. The Council should not have the power to interfere in administrative issues if governance was to be carried out professionally. A Municipal Manager must have certain powers, so that he/she could aptly carry out the functions of his/her office and meet performance targets.

The Chairperson agreed that the Municipal Council had the powers of delegation.

Mr Daniels reiterated that the Manana judgement did not alter the interpretation of the Municipal Systems Act. Municipal Councils had the ultimate power to appoint municipal employees, but could delegate that function. He thought that there was an unjustified over-reaction to this judgment.

Mr Carrim said that he would ask Prof Jaap de Visser, who had made the submission on the previous day on behalf of the Community Law Centre, for proposals on this judgment, and how to remedy issues arising from it.

Mr Carrim said that there were good reasons for the provision relating to the ability of municipal workers to be members of the executive bodies of political parties.

The Chairperson agreed with the Deputy Minister’s views on the reasons behind the provision. He asked Members to move on to other points.

Mr Lorimer restated his views on senior managers not being permitted to hold office in a political party. He asked for a definition of “political party”.

Mr Louw said that it was defined in the Municipal Electoral Act of 2000.

Mr Lorimer said that he did not have that definition in front of him, but that pressure groups should not be permitted to have their supporters in the municipal system.

Mr Bhabha said that ideally it was preferable that all municipal employees were free of other interests,  but that could not be controlled by the Department, as people were free to associate themselves with whatever they wanted. However, the idea behind the provision in the Bill was to stop political influence on municipal affairs.

Mr Carrim said that the aim of the provision was to have an appropriate balance of power between managers and municipal employees, and to regulate political influence in local government.

The Chairperson said that the point was interesting and would be discussed further as the Bill progressed through the parliamentary system.

Mr Carrim agreed that municipal workers could not be limited from being members of a political party. There would be serious opposition to such a proposal, as most of the workers were unionised. The Department was addressing the issue through practical means. If the problem persisted, then the Department would need to take other steps to address it.

Mr Lorimer disagreed with the Deputy Minister, and said that there were differing views on what was practical and achievable.

The Chairperson said that where there was agreement on issues, the Committee would incorporate this into the Bill and clause by clause deliberations would be held in the following week.

Mr Carrim said that the Department would engage further with stakeholders and would be prepared to return to the Committee to look at outstanding issues.

The Chairperson thanked the Department and all those who had participated in the meeting. The Committee would try to cover all areas of consultative issues as it worked on this key piece of legislation.

The meeting was adjourned.


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