Thembisile Hani Local Municipality intervention: briefing by Mpumalanga Department of Co-operative Governance and Traditional Affairs

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Meeting Summary

The Provincial Department of Co-operative Governance and Traditional Affairs in Mpumalanga briefed the Committee on the situation in Thembisile Hani Municipality. Prior to the intervention of the Department there had been service delivery protests, destruction of property, governance issues of corruption and mistrust and the institution of a Section 106 investigation. The municipality could not discharge its functions and was thus placed under administration by the executive council on the 15 April 2010 for a period of six months. At the end of this period, it was decided to extend the period till the local government elections. The Section 106 report resulted in investigations against nine senior officials being instituted and the municipal manager being found guilty and dismissed. A financial turnaround strategy was formulated in conjunction with the Development Bank of South Africa (DBSA).

Basic services, roads and storm water drainage were still problems in Thembisile Hani Municipality. It was built on wetlands and had a drainage problem. It also had a water shortage as the infrastructure was very old and often broke down, resulting in water supply disruptions. The municipality was still unable to plan and implement infrastructure. The municipality had a big population but a small tax base with 82% of bills returned as undeliverable. It was in the process of cleansing its data to ensure proper billing and it had to improve the document management system. Asset management had also been a problem. It was still regarded as being vulnerable. It had received a disclaimer in its audit report because of systems problems but they were optimistic that the next one would have no qualifications.

The municipality was now stabilised but still needed high care and the Department was providing after care support so that no relapse could occur but the intervention order had been lifted. The municipality had not found suitable, qualified candidates to take over vacant positions. The Department had learned lessons, that the six month period was too short and that there was a need for financial support for the turnaround in a rural municipality likes this where there was a big population. The Department had used the lessons learned to assess all municipalities. They had also used this as an opportunity to introduce councillors to issues and as part of councillors’ induction program

Members commended the administrator on the good work done. Members wanted to know how a building had caught fire and whether this impacted on the intervention. Did the fire destroy documentation? Members proposed an oversight visit. When was roads maintenance contractors appointed? Members suggested that the that the units investigating the municipal manager and the fraud cases be called to appear in front of the committee to answer on the apparent slow pace of the task team as expressed by the presenters. Members felt it necessary that the Department needed to keep monitoring the municipalities closely and to intervene, even with the contractors. Members asked if the two former employees that had been arrested were still in prison. Members drew attention to the oversight role of councillors.

The Chairperson said that the North West Province had not forwarded a report on the termination of Section 139 intervention in Ngaka Modira Molema District Municipality as they had challenges and would brief the Committee at another time.

Meeting report

Mr David Mahlobo, Head of the Provincial Department of Co-operative Governance and Traditional Affairs in Mpumalanga, briefed the Committee on Thembisile Hani Municipality. He said prior to the intervention by the Department there had been service delivery protests, destruction of property, governance issues of corruption and mistrust and the institution of Section 106 investigation by the MEC. The municipality could not discharge its functions and was thus placed under administration by the Executive Council on the 15 April 2010 for a period of six months. At the end of the period, it was decided to extend the period till the local government elections. The Section 106 report resulted in investigations against nine senior officials and the municipal manager being found guilty and dismissed. A financial turnaround strategy was formulated in conjunction with the DBSA.

Basic services, roads and storm water drainage were still a problem in Thembisile Hani Municipality. It was built on wetlands and had a drainage problem. It also had water shortage as the infrastructure was very old and often broke down, resulting in water supply disruptions. It had a scheme where water was provided and shared with J.S. Moroka Municipality. Sometimes the municipality did not have the available funds to purchase water.

The municipality was still unable to plan and implement infrastructure. The municipality had a big population but a small tax base with 82% of bills returned as undeliverable. It was in the process of cleansing its data to ensure proper billing. It had to improve the document management system. Asset management had been a problem. It was still regarded as being vulnerable. It had received a disclaimer in the audit report because of systems problems but they were optimistic that the next one would have no qualifications.

The municipal manager, Mr W K Mahlangu, had been dismissed. Mr S Mahlangu, Director: Corporate Services was found guilty and took the municipality to court and the case was postponed but he was not with the organisation anymore and Mr R S Ruiters resigned. He said he was not happy with the speed that the task team was dealing with the issues.

The municipality was stabilised but still needed high care and the Department was providing after care support so that no relapse could occur but the intervention order had been lifted. They had not found suitable, qualified candidates to take over vacant positions. They had learned lessons, that the six month period was too short and that there was a need for financial support for the turnaround in a municipality like this where there was a big population.

Mr Madala Masuku, the MEC for the Department of Co-operative Governance and Traditional Affairs in Mpumalanga Province, said they had used the lessons learned to assess all municipalities. They had used this as an opportunity to introduce councillors to such issues and as part of councillors induction program i.e. it was not only looking at the improvement of the municipalities but also how they could improve themselves as a Department. In other words: did it they have the capacity to support the municipalities?

Discussion
Mr A Matila (ANC: Gauteng) commended the administrator on the good work done. He said apparently some weeks ago buildings had caught fire and wanted to know how this impacted on the intervention. Did the fire destroy documentation? He said he supported the lifting of the intervention.

Mr D Bloem (COPE: Free State) proposed an oversight visit. When were maintenance contractors appointed as he had driven on roads in the area recently? He proposed that the units investigating the municipal manager and the fraud cases be called to come in front of the Committee to answer on the apparent slow pace of the task team as expressed by the presenters.
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Mr B Nesi (ANC: Eastern Cape) said the Department needed to keep monitoring the municipalities closely and to intervene even with the contractors.

Mr Mahlobo said the municipality where there was a fire was Dr J S Moroka municipality. Regarding the roads, it was internal roads not the provincial roads or access roads. The MEC and Premier supported their work through the multi task team but it required lots of money. There were certain municipalities that would not improve without the intervention of the fiscus. It would never improve because of its historical background and the fact that it operated from a large population but low revenue base in a rural area with weak infrastructure. He assured the Committee the Department would not leave until municipalities were comfortable.

Mr Masuku said they would be keeping an eye on the municipality. He appreciated the mayor who had been appointed, a former Premier, Mr Ndaweni Mahlangu, and also appreciated the Committee’s oversight visits to the area.

Mr Bloem asked if the two former employees that had been arrested were still in prison. Could the fraud be clarified?

Mr Matila said that seeing as the speaker was in attendance he wanted to draw attention to the importance of council’s oversight role and for him not to be absorbed by the executive.

Mr Tseko Taabe, former Deputy Administrator at Thembisile Hani Municipality and now with the Department's “After Care” unit, said the cases were not being resolved quickly because the Department had come across information that the an assistant director had offered bribes to the initial lead investigator. The Department had been instructed to contact the Hawks and a meeting had been convened with General Meiring. The officer, of Middelburg, had been confronted and removed as there was proof that money had changed hands and so the case had escalated. He would find out what the status of the case was and whether the two former employees were still in prison.

Mr Ndaweni Mahlangu, the Mayor of Thembisile Hani Municipality, said the place had challenges. There was a water shortage and it received its water from Gauteng and JS Moroka municipality. The Department and the district were involved in repairing the very old pipes. The coming year should see Thembisile Hani turning around but the tax base was a problem. It was a rural area, but the municipality was in the process of collecting data and soon would be able to bill people. The municipal members had a lack of knowledge on oversight, if they could take charge of the oversight function in the municipality, the problems in the municipality would automatically decrease. The speaker alone could not do oversight.

The Chairperson congratulated the Department on the way they had approached the issue. Future interventions must have findings. The Committee would assist in the issue of the police cases. An example could then be made and this would help all municipalities. He thought that extra councillor induction  programs on their oversight role was needed. The termination was welcomed.

The Chairperson said that the North West Province had not forwarded a report on the termination of section 139 intervention in Ngaka Modira Molema District Municipality as they had challenges and would brief the Committee at another time.

The meeting was adjourned.



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