Budget and Programmes 2002/3: briefing

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Cooperative Governance and Traditional Affairs

23 April 2002
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Meeting Summary

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Meeting report

PROVINCIAL AND LOCAL GOVERMENT PORTFOLIO COMMITTEE
Tuesday 23 April
BUDGET AND PROGRAMMES 2002/3: BRIEFING

Chairperson:
Mr YI Carrim (ANC)

Documents handed out:
These documents will be available here on 30 April 2002
Progress of Transformation
Performance Management And Monitoring
Institutional Reform and Support: Capacity Building
These documents are available, please email
info@pmg.org.za for a copy
ISRDP/URP documents

CD: Development and planning paper
Traditional Leadership

SUMMARY
A delegation from the Department of Provincial and Local Government briefed the Committee on the budget and programmes of the programme. The progress of transformation of provincial and local government was outlined. It was noted that transformation was reaching its final phase; the Department has divided it into three sub phases, namely the stabilisation, consolidation and sustainability phases. The inability of the poor to access free basic services received main priority in this discussion.

The Committee was updated on the progress that has been made on the division of municipal powers and their functions.

The Department also focused on performance management and monitoring of municipalities regarding the transfer of funds.

During the afternoon session the Committee was briefed on budgetary oversight dealt with governance and development issues. Three briefings were heard, from the Integrated Sustainable Rural Development Programme (ISRDP) and Urban Renewal Programme (URP), the Local Economic Development and Consolidated Municipal Infrastructure Programme (LED CMIP), and Traditional Leadership.

MINUTES
Presentation on transformation of Local and Provincial Government

Ms Jackie Manche, Deputy Director-General: Institutional Reform and Support, briefed the Committee on the progress of transformation.

The transformation of local government is slowly reaching its final phase but the Department of Provincial and Local Government thought it wise to sub divide this last phase into the stabilisation, consolidation and sustainability phases.

Stabilisation phase
The stabilisation phase started with the elections in 2000 and will end in 2002. The Department's aim that by the next election that a strong and sustainable local government will be intact. The key focus of this phase is the reestablishment of municipalities.

During these sub-phases the PCC Resolutions will guide the Department. The Department will initiate ongoing monitoring on the capacity of the transformation process.

The transformation of the local government strategic objectives is to build a strong government sphere. Furthermore, to build stable institutional capacity to deepen democracy and accountability. The Department has identified a number of challenges concerning the first strategic objective.

The Department needs to address the general policy framework to strengthen local government and will guide transformation to insure that the IDP's are central in intergovernmental planning and budgeting. There is a general need to increase the role of SALGA.

The Department aims to adopt a comprehensive policy framework to guide local government. During this financial year the Department stressed that proper financing should be enforced, with The Rural Development Strategy receiving main priority in this Department. Furthermore, they aim to incorporate guidelines for intergovernmental planning.

Plans for this financial year are to hold high level talks with SALGA during this financial year.

The challenges faced during this stabilisation phase are to speed up progress of municipalities and the amalgamation and creation of new municipalities. Furthermore, the Department aims to address gaps in the legislation to successfully implement these new systems of government.

The Department has established a system that monitors the whole transformation process. Moreover, the Department provided additional financial support to improve systems improvement grants to municipalities. The Department initiated investigations to determine resolution issues related to cross-boundary municipalities. Furthermore, the Department drafted a status quo report, which would in future provide a simple policy framework.

Key highlights for 2002/3 would be setting out very clear targets and milestones to enable the Department to intervene. Moreover, implementing an integrated programme of support. The Department has received a report of cross-boundary municipalities and the minister will take up related issues. The Department is in the process of drafting and developing a comprehensive policy concerning the remuneration of councilors.

Consolidation phase
The Department is looking at a number of new initiatives to improve the mechanism that deals primarily with capacity building. There are certain challenges experienced concerning the improvement of service delivery. The debate concerning implementation of free basic services received the most attention during the last few years. Currently, the lack of a proper framework for ensuring integrated services allowing access to services by the poor is prohibiting the work of the Department. Municipalities have been under unfounded pressure during the last financial year to put together guidelines.

The Department proposes to offer financial support and created the LED policy because they believe in building financial viable local governments.

The Department provided additional grants to local government for the 2001/2 financial year. Plans for 2002/3 are to finalise a comprehensive review of local government funding. Furthermore, they aim to put the Property Rights Bill before Parliament later this year.

Sustainability phase.
In this phase the Department aims to deepen local government's accountability to Parliament and the people. There is a general need for stronger legislation to control capacity problem faced by the municipalities. Work that the Department has done thus far in this phase is the establishment of ward committees and IDP representative forums.

Plans for the future include the consolidation of the IDP representative forums. Furthermore, looking at implementing a programme of support to local government authorities.

Discussion
Ms G M Borman (DP) asked the Committee, in light of the amount of services delivered thus far, if unicities are organised and if structures are in place to provide sufficient services. Furthermore, she inquired about surplus staff in the various local governments. Lastly, she inquired about the financial support and training the Department offered to councilors and officials.

Ms J B Manche answered that the issue concerning unicities were still being investigated. When it comes to statistics the Department has a monitoring system. Currently, there is a report available but they are not confident enough to release this report yet.

On the issue of free basic services, it is very difficult to ascribe to municipalities how they should use their funds. It must be kept in mind that there are not capacity constraints in all municipalities and some are able to provided free basic services.

Ms Borman (DP) asked who was responsible for the installation of electricity and who carries the financial burden of installation.

Mr P Uys (NNP) noted that there are various definitions of free basic services and that it only leads to confusion.

Mr B M Solo (ANC) said that he noted during the constituency period that there are not clear services measuring mechanisms. How could the Department improve such systems?

Mr J J Kgarimetsa (ANC) commented that as far as his knowledge the Department pride himself on the delivery of water to rural areas. He just visited some of these areas in the Northwest and noted that there is urgency for water in those areas.

Mr Y L Carrim (ANC) asked the Department to provide the Committee with some sort of figure of services that have been delivered because these statistics are pivotal in making or breaking a political party or democracy.

Ms Manche answered that the Department's main focus are the provision of water to South Africa and that considerable progress have been made. Concerning the issue of electricity, it must be noted that running pilot delivery programmes does not provide free basic electricity. Sadly, only a few of the poor have proper access to free basic services and only prosperous municipalities go a long way. For now the Department does not have an answer to find a balance between service deliveries.

Mr B J Nobunga (ANC) asked where the free basic service programmes was piloting.

Mr Kgarimetsa (ANC) suggested that the Department must consider his communicative role and that communication and cooperation was paramount between the Department and this Portfolio Committee.

Mr Carrim (ANC) noted that municipalities should stabilise and consolidate before they are given more powers. He stressed his disappointment to SALGA for not attending this discussion and said that clearer milestones and targets will be requested for next year.

Mr Solo (ANC) asked the Department to provide the Committee with proves of investment and allocation of funds for the last 12 months.

Ms Manche stressed that the Department needs to work with SALGA and that their aim is to focus on capacity building for this financial year. Concerning the question of the remuneration of councilors the Department will mobilize more funds to sustain the salaries of councilors.

Mr Carrim (ANC) felt that ideally municipalities should pay the salaries of councilors and officials.

Presentation on Division of Municipal Powers and Functions
Ms Karen Harrison: Department of Provincial and Local Government, briefed the Committee on the government's commitment to a strong sphere of local government.

Background
Ms Harrison noted that the authorisation of powers and functions should be placed in context of local government transformation. Furthermore, she stressed that district councils need to have a significant developmental role and that powers and functions need to be properly aligned to this vision. This eventually gave birth to the Municipal Structures Act, which was amended in November 2001, aligned with the vision for developmental local government and addressing implementation concerns.

Problem Statement
In November 2001, the Department assessed that there was a general lack of service delivery. A report has been drafted and the situation is still uncertain for municipalities in terms of budgets, planning and other transformation issues. The Department maintained the status quo to ensure that the disruption of service delivery are minimise.

Process undertaken to resolve problem
A detailed municipal level assessment was undertaken regarding existing service delivery arrangements, service coverage, and municipal capacity. In the near future there will be a summary report produced reflecting a position that takes into account all stakeholders views.

Emerging implications
The Department aim to review the IDP's and to determine the conditions of service and transfer of staff. The Department needs to consider the capacity and support requirements of local government.

Consultation process
The Department reached an agreement with six provinces: Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Northern Cape, and Western Cape, concerning the transfer of water schemes.

Next steps
The Department has initiated an action plan to finalise formal consultation process in mid May 2003. Furthermore, the Department aims to undertake a thorough costing exercise.

Discussion
Ms G M Borman (DP) asked how many out of the 47 district municipalities is able to hand over power and when will statistics be available concerning the cost of every municipality.

Mr P Uys (NNP) asked what was the agreement of the six provinces regarding sanitation.

Ms Harrison answered that regarding to electricity that the status quo is maintained and that sanitation is included with water provision. On the issue of the districts a multi criteria methodology was created.

Mr Y I Carrim (ANC) commented that to his understanding consensus between the various stakeholders have been met.

Ms Harrison noted that although there has been communication no full consensus has been accomplished.

Presentation on Performance Management
Mr Simpiwe Dzangwa: Department of Provincial and Local Government, briefed the Committee on performance management and monitoring in terms of the key focus areas.

The Department's focus was primarily on fiscal transfers, municipality finance policy, municipal finance support and performance management and monitoring.

Regarding the issue of fiscal transfers the Department focused on poverty and the provision of basic services. Furthermore, equity issues are being addressed to improve the overall status of municipalities.

The allocation of the equitable share indicates an overall increase from the financial years 1998/99 to 2004/5. Looking at the question of spending some of the work done emanates from the establishment of the Inter-Ministerial Committee. This Committee will have short and medium term review and in the coming period work with other stakeholders will be initiated.

Provinces should assist municipalities to render services with quarterly monitoring. Furthermore, the provision of free basic services should be monitored closely.

The Municipal Finance Policy (MFP) deals with the division of fiscal powers between category B and C being finalised, due to the fact that the fiscal policy impact on the social infrastructure.

The four Project Viability quarterly reports that are published look at how the Department could assist the 100 municipalities. Municipal performance is measured looking at: finance, governance, compliance with legislation, capacity to deliver services and reports used to determine intervention measures in terms of the MSP.

The Performance Management Pilots was undertaken in 26 areas. The Department provided municipalities with technical support and mentoring. Furthermore, the nine general KPI's was developing and a number of guidelines and manuals have been provided to the municipalities.

The key focus areas for 2002/3 are to ensure that a framework for the National Incentive Scheme for PM is developed. Details of this are in their business plan for this project. Moreover, a framework for the monitoring of provinces was drafted and the finalization of the Property Rates Bill was anticipated.

Discussion
Mr G M Borman (DP) asked if all the district municipalities would qualify for an equitable share.

Ms Jackie B Manche answered that for the 2002/3 financial year they will receive this share. They are each receiving the entire percentage that has been allocated.

A Member (ANC) asked how could the Department assist various municipalities to pay their outstanding fees.

Ms Manche answered that the Department do support local government and that they have build a relationship with the Auditor-general. Institutions, like the treasury, have their own issues and it has become clear that municipalities have received incorrect bills.

Mr B M Solo (ANC) asked the Department if there were not sufficient funds for salaries. In his constituency it was noted that ordinary workers were not given their salaries at the end of every month.

Ms Manche responded that the municipalities are only agents and that provinces are not transferring funds to the municipalities.

Ms Karen Harrison added that coordination between these agencies was needed.

A Member (ANC) raised the issue of overall mismanagement.

Ms Manche responded that working with the treasury was problematic but that it was due to the economic problems of South Africa and not solely mismanagement.

Ms Borman (DP) asked if the Property Rights Bill would be finalised by the time they closed in December 2002.

Ms Manche ensured her that this Property Rights Bill would be approved.

Afternoon session

The Chairperson opened the meeting and handed the floor over to the Unit Managers of the ISRDP and the URP.

Integrated Sustainable Rural Development Programme (ISRDP) And Urban Renewal Programme (URP)
Ms Mogane-Ramahotswa explained that they had been given a mandate by the newly democratic government of tackling the legacy of apartheid, colonialism, poverty and underdevelopment. Her next point involved describing the motivations of the ISRDP and the URP.


Programme objectives
The spirit of 'doing things differently' informed the broad programme objectives. [After dealing with the elements of the programmes, the rural nodes throughout South Africa were cartographically illustrated to the Committee.] She pointed out that the vision of the ISRDP was "to attain socially cohesive and stable rural communities with viable institutions, sustainable economies, and universal access to social amenities and retain skilled and knowledgeable people who are equipped to contribute to growth and development". A description of the programme was given, after which she outlined the ISDRP trajectory. After referring to the numerous achievements made by the programme, she gave an example of a node project by dealing with the Kgalagadi Dipudi Enterprise. She emphasised the fact that the project did indeed exist, and commented that they would be seeing many great things come out of the project.


Programme Challenges
Although there are numerous challenges in carrying out the programmes, these challenges are of political and developmental significance. Upon mentioning the key outputs and activities of the programme, she noted that this was a critical time for all concerned to become involved. All rural projects are currently in the process of drawing up project business plans.

Mr Marion showed the Committee a map of the urban nodes. After describing the URP programme, he outlined the progress that had been made to date, and the challenges that had been faced. They were in the process of engaging national and provincial government as to what resources they would be directing towards the nodes. He reflected upon an overhead representation indicating the funds going to the urban renewal nodes and the municipalities, and pointed out that R400 million had been allocated to the Department in terms of the programme. Of this amount, 30% would be directed towards the renewal projects. He referred the Committee to links to equitable allocation per urban renewal node, and stated that these would assist in implementation.

Mr Marion stated that the aim is to promote co-ordination between the various ministries, and went on to state the progress made, and the challenges faced in this regard. He gave an example of the three spheres of government working together. He noted that they were also engaging with local authorities as an effort in co-operative government. Project examples were given, and he emphasised the fact that they were all directed at promoting integration, and sustainable human settlement development. He referred to the Galeshewe Urban Agricultural and Food Security project as a direct example of national, local and provincial government working together.

Mr Marion moved on to the expected outcomes for the year 2002 to 2003, and explained that KPI referred to the Key Performance Indicator. As he moved towards his conclusion, he stated that it would be important to note that they had experienced some delays, and that there had been tension between the importance of "doing things correctly and fast-tracking delivery".

Please refer to the full presentations attached hereto.


Discussion
Ms Borman (DP) commented that the plans of the respective managers were great. Nevertheless, her real concern lay with the implementation of the plans. Approximately 62% of the anchor pilots relating to urban renewal were underway. However, she was concerned about whether there were projects implementing the plans.

Ms Mogane-Ramahotswa stated that the programmes were completely new. As a result, structures had to be put in place, and in this regard, they were still grappling to develop key performance indicators. Nevertheless, the projects were ongoing, and she pointed out that she would be able to take the Committee through the nodes.

Ms Borman (DC) referred to the link between the IDP and the poverty alleviation project. She was concerned with the fact that local government would not be able to fully fund such programmes. Thus she sought clarification as to whether this was indeed the point that had been raised.

Mr Solo (ANC) expressed great concern with the fact that the Dipudi Project had been mentioned in the newspapers over several occasions. However, he wanted to know, with absolute clarity, whether or not the project really existed. He went on to ask whether the Department was aware of the comments that had been made by the papers, and noted that the issue tied up with the Beaufort West and Karoo Projects. He emphasised that the Committee would have to be fully briefed in order to be able to respond to any challenges that the public could make, otherwise the whole situation created a bad perception of what the Committee was doing.

Ms Mogane-Ramahotswa responded that the project did exist, and added that they had picture proof of this. The media representations were another thing because they had selected to criticise Dipudi, while failing to mention the progress that had been made in other areas.

Ms Mogane-Ramahotswa added that they were clearly facing problems with their municipalities in Beaufort West and it is because funds were being withheld. Nevertheless, project implementation was set to be 'kick started' in May 2002 because funds were now available. This means that they would begin to see implementation beyond May, and she added that she was confident that their ground structures would function. She emphasised that they could definitely expect to see progress by the 2003.

The Chairman stated that although it all sounded very good, he could not understand why the impact could not be felt on the ground. He realised that it was a ten year programme. However, he said that it would be crucial to know exactly where the programme stood as far as progress was concerned. He pointed out that although there was not anyone to blame, as the Chairman of the Committee, he had a duty to know a more accurate reflection. He added that for the 2003/2004 budgetary meeting, the Committee would be expecting more concrete results.

Mr Nobunga (ANC) said that the Committee was not saying that they did not trust the fact that the Department was saying that it was doing something. However, the problem lay in the manner with which they put forward their progress. He pointed out that "underway" could mean anything, and he asked that the Committee be placed in the exact stage within which the process was, in order to allow the Committee to support the Department. He noted that the Committee did not want to 'walk with ghosts'.

Mr Goosen (ANC) stated that there was no allocation for the urban renewal programme (URP). He asked whether this was included in the rural programme (ISRDP).

Mr Goosen (ANC) pointed out that there must have been many challenges to both the URP and the RDP. He wanted to know how the challenges compared with one another, with particular reference to the actual challenges made against the RDP.

The Chairman interjected at this point and asked whether there were Members of Parliament present from either the urban or rural nodes.

The floor was silent.

Mr Africa (RDP/URP) began by pointing out that the major difference with last year was the fact that they were currently able to refer to actual experiences. Reflecting on the dilemma put before the Cabinet during the previous week, he stated that they were quite unapologetic. While he understood the desire for quick delivery, a counter imperative existed, and this involved building government by ensuring that the technical relationships would be in sync. The approach they had taken during 2001 was deliberately aimed at putting the necessary enabling conditions in place. They did this by undertaking anchor projects, involving all three spheres of government. The result is that by the end of 2001 they were confident that the conditions were in place. Key projects were identified, with some already being in place. Thus he hoped that the Committee could understand that during 2001, they had consciously decided to deal with enabling conditions, and commented that the hope was that this would pay off during 2002.

The Chairperson emphasised that there was not a person in the cCmmittee that was ignorant to the fact that the challenges faced were considerable. Nor was there anyone who was unaware of the need for the Committee, as public representatives, to become involved. He suggested that the Members of Parliament in the respective areas become increasingly involved, and stated that this would be in the aim of them all playing a more active role.

The Chairman stated that the Committee required clearer outcomes to be anticipated during the year in order to have a progress measure when meeting in 2003. Thus he asked what they were hoping to achieve before meeting with the Portfolio Committee in 2003.

Mr Solo (ANC) stated that it was first necessary to see something from the inputs, before visualising the outcomes. In this regard, they were dealing with unsophisticated communities. As a result, it would become a political problem in cases where individuals would be moved out of the townships. He referred to the situation in Alex, and questioned why this was not reflected in the inputs. Thi`s he explained to the Chairperson by stating that the starting point would be with the inputs.

Mr Marion assured the Committee that delivery was taking place on the ground, and he used Alex as an example. He apologised for not bringing before and after pictures. Nevertheless, development was happening, albeit at a municipal level, and this meant that their task was to sustain the projects.

In terms of funding, Mr Marion stated that they were currently in the process of seeking grants. This meant that the municipality alone would not fund the Business Plans. He readily welcomed the members to tour the ground, and noted that they were very encouraged by the progress that had been made.

Mr Nobunga (ANC) assumed that the intersectoral co-ordination did not only include the public sector. He wanted to know whether the private sector had a role to play. If so, what co-ordination existed, and if not, were there any plans to involve them?

Mr Marion explained that the private sector was indeed a critical component. The Department of Social Development was presently looking to assist them, and he noted that this was encouraging.

Ms Borman (DC) wanted to know who could be held accountable for the money injected into the projects.

Ms Mogane-Ramahotswa responded by saying that the funds would eventually move via the municipality. She pointed out that they were currently proposing to work together with the municipalities in the rural nodes, in which case procurement would be by both. Nevertheless, as the position stood, most of the Departments had contracted consultants. She added that there were projects not of nodal municipal competence at the provincial level, and in this case they would be accountable to the treasury.

Mr Marion added that flows from National Government had criteria to be met. In this case, the process would be regulated specifically by the existing fiscal and legislative requirements.

Ms Borman (DP) repeated her question because it had not been answered directly. She wanted to know whether they could confirm actual results in the projects where money had been injected, accountability in that sense.

Mr Marion responded that this definitely was the case for the URP in Alex. He added that he would be able to make the report available.

Ms Mogane-Ramahotswa added that there had yet been any funding to the rural nodes. Nevertheless, the financial controller would assist the municipality in order to ensure that the money would reach the projects.

Mr Africa felt that he had to explain the complexity of what they were dealing with. He stated that the programmes were trying to macro-manage distinct and emanating projects. This was in stark contradiction to collapsing all the programmes into a single project. As a result, serious monitoring problems were faced. This is because they presently did not have a single over-arching monitoring system, and as a result thereof, they were currently negotiating such a consensual macro-level monitoring mechanism. This turned on the complex nature of the programme, and that this is what they were in the process of setting up.

The Chairperson stated that he was not implying that they had to have CMIP statistics. However, the Committee needed something more than what had been heard at the meeting. He pointed out that they did understand the great challenge faced. However, they would have to understand that in a spirit of "comradeship", bearing ideological connotations. They would have to appreciate the fact that as Department officials, the Portfolio Committee would probably give them 'flack' once a year. However, Portfolio Committee Chairpersons are particularly volatile for reasons such as individuals being unable to reach the Minister, and respect for seniority. This meant that they were all under pressure. He noted that this was another way of saying that they were desperate that the process work, and that delivery occurs.

The Chairperson ended the discussion by outlining the steps that the Committee would be willing to take from its side:
-Put a report to the effect that members of parliament must be notified of the problem.
-Report back on what they as a Committee are doing.
-The fact that the Committee wishes to become more involved. He suggested that this could be in the form of closed workshops. Nevertheless, there would still be time to work on the detail.

The meeting was then handed over to the LED and CMIP team.

Local Economic Development (LED) and Consolidated Municipal Infrastructure Programme (CMIP)
Ms Gumbi-Masilela, Chief Director of Development and Planning explained that they had taken a different approach, in terms of which the RDP was seen as the centre of development.

Ms Gumbi-Masilela gave a description of the project. This was followed by a list of the objectives of the programme. She dealt with the programme budget, and highlighted the fact that this would increase significantly over time. After dealing with the specific outputs and "political" outcomes, she referred to two project examples. The Lambert's Bay Birds Sanctuary illustrated the significance of the role of private partners. She emphasised that the project was well managed, and that this therefore indicated that projects would be sustainable in the event that the private sector and other sectors are mobilised. The Khulani Xhosa Village was the second example. She explained that the key challenge faced was the need for skills for project management because the potential for success was there.

Ms Gumbi-Masilela outlined the challenges faced by the programme as a whole. This was followed by an indication of further outputs to the programme. She gave a sense of targeted projects from the CMIP point of view, and pointed out that she was in no way underplaying the needs in other areas. She stated the challenge in so far as infrastructure was concerned using a rural/urban break down, and this showed the fact that rural areas were in greater need. The need to strengthen the support to municipalities in order to implement the projects was dealt with by reference to the resources for implementation. She concluded her presentation by explaining the monitoring and evaluation of the programme, and she proudly pointed out the fact that they have a sophisticated monitoring programme, in addition to current negotiations to embark on external evaluation facilities.

Discussion
Mr Solo (ANC) questioned whether the Department feared the Committee. He wanted to know why they did not keep coming back to the Committee because CMIP programmes needed clarification.

Ms Gumbi-Masilela referred to the two programmes and explained that they by and large provided infrastructure. As a result, it would not make sense to run them separately. She emphasised the need for supportive infrastructure, hence the attempt to balance the two. She also pointed out that the result of a separation would be the loss of maintenance.

Mr Kruger, Director: Municipal Infrastructure, added that they decisively indicated CMIP projects on signboards.

Mr Solo (ANC) wanted to know how the municipalities went about actually assessing the said factors.

Ms Gumbi-Masilela explained that all the municipalities received an allocation. This made it necessary to ensure the viability of RDPs. She referred to a process within the RDP, known as Community Based Planning, which built some of those factors into its strategy, thereby showing that the municipalities had the task of marketing. Nevertheless, they would also assist.

Mr Solo (ANC) referred to the success stories in the Western Cape, and explained that he would be happy to rely on them. He asked to one day be taken to the projects. Nevertheless, he cautioned that the chosen names could become controversial.

Ms Gumbi-Masilela pointed out that referring to Western Cape success stories was a bad example. However, she noted that there were others, and in this regard referred to the Far Limpopo and Mpumalanga projects where the communities were generating income.

Mr Nobunga (ANC) expressed concern with the marked increase in the CMIP expenditure.

Ms Gumbi-Masilela responded that under-spending was their largest challenge. She pointed out that they were worried, and as a result had introduced mechanisms to cushion the effects. She referred to R94 million worth of business plans that had already been approved, and explained that they were awaiting the commencement of operations. She added that the MTEF allows municipalities to plan, whilst they had the task of monitoring. Nevertheless, she pointed out that they were working with the treasury in an attempt to develop monitoring mechanisms.

Mr Kruger added that there had been a rollover of R31.9 million in 2001. He used this point to illustrate the fact that although the projects were there, progress was not being made fast enough.

Ms Borman (DP) asked whether in the event of such a marked increase in expenditure, they had the capacity to facilitate it, both as the Department and as Municipalities.

Ms Gumbi-Masilela felt that they did have the capacity. She referred back to the comments made by her colleague and emphasised the fact that the focus would rest on the areas where the need was greater.

The Chairperson wanted to be informed of the expected aims for 2003.

Ms Borman (DP) asked for and indication of the maintenance arrangements that would be made when adopting infrastructural programmes. She referred to "managing" the arrangements, and wanted to know whether they would take care of it themselves.

Ms Gumbi-Masilela stated that they were basically not leaving this to the municipalities. However, they needed the capacity to carry out these functions. During the course of the day's proceedings, reference had been made to conscious Portfolio Committee efforts to assist the Department, and this had been a concern of theirs.

Mr Kruger explained that they required business plans for CMIP, including operation and maintenance plans. He added that they would assist where necessary, but only on the phasing out level. He gave the example of the Eastern Cape Municipal Mentorship Programme. Nevertheless, they would conduct regular site inspections, irrespective of the status of the project.

Mr Solo (ANC) wanted to know who would approve the projects.

Ms Gumbi-Masilela responded that the process would move between the council, provincial government and national government, in a two-way manner. This ensured that there would be many stopovers.

Mr Goosen (ANC) spoke in light of the fact that RDPs were now being submitted to provinces. He wanted to know whether they foresaw the situation where much of the money would go to the provision of priorities in the RDPs.

Ms Gumbi-Masilela explained that the process of RDPs was legislated. Nevertheless, she did not think that this would impact on the approval of the projects because the projects were running parallel.

Mr Goosen (ANC) rephrased his question and stated that he was asking whether in light of the increase in CMIP, the funds would cater for the needs in the RDPs.

Ms Gumbi-Masilela responded affirmatively. She added that additional allocations had been made to the nodes.

Traditional Leadership
Mr Thabo Seboko stated that he would be taking the Committee through the policy programme progress made by the Department. He explained that he would give background information, state where they are, and end by showing where they want to go.

Mr Seboko referred to the relevant Constitutional provisions, and pointed out that in his State of the Nation Address 2002, President Thabo Mbeki had committed the government to finalising the status of traditional leadership. He moved on to deal with the White Paper Process on Traditional Leadership, and emphasised that it would be ready by the end of 2002. He explained the three phases of the process, and pointed out that phase three coincided with the holding of municipal election in December 2000, and traditional leaders raised which many concerns. He emphasised the need to amend the Constitution in order to make it more in tune with the cries of traditional leaders, and that this led to the new Bill.

Mr Seboka explained that even with the resolution to introduce a new Bill, the process went on in order to produce a satisfactory Bill. The Interim Bill was withdrawn in light of the President's commitment to have the new Act by the end of 2002. He noted that this was in order to expedite the completion of the process.

Mr Seboko moved on to the time frames set for the Department, and he added that these were at the latest. The legislation would assist provincial governments to formulate their own provincial legislation.

Mr Seboko went on to explain to the Committee where the process currently stood. He stated that they had almost completed research on the White Paper, and pointed out that it contained many issues. He highlighted the role in governance and development, and explained that his would be critical. This is because it is on this very issue that traditional leaders wanted local government elections to be stopped in 2000. He referred to the institutional issues faced by the process, and explained that these would be crucial in the process.

Mr Seboko concluded his presentation by referring to the National House of Traditional Leadership. He pointed out, like the Chairperson had, that the House would be presenting to the Committee on Friday. Nevertheless, from the Department's point of view, he felt that it was very important to show the Committee that they, as the Department, continued to support the traditional leaders. He gave the examples of human resource assistance, administrative empowering, and the capacitating of the leaders. He ended by reminding the Committee that the term of office of the National House would be ending in April 2002. Thus they were currently in the process of assisting the House in the institution of the new House.

The meeting was adjourned.

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