Madibeng Municipality: report by North West Provincial Government & Madibeng municipal manager

This premium content has been made freely available

Cooperative Governance and Traditional Affairs

24 June 2015
Chairperson: Mr N Masondo (ANC) (Acting)
Share this page:

Meeting Summary

Two disputes among members of the Committee prevented the presentations from being submitted for almost three hours. The first dispute arose after a vote to elect an acting Chairperson ended in a tie, necessitating a 25 minute recess, after which Mr Hlengwa declined his nomination in order to allow the meeting to go ahead. Mr Masondo was elected acting Chairperson. The opposition noted, however, that all compromise in the deadlock had been from the side of the opposition parties and the ANC, by contrast, had been prepared to collapse the meeting, at great cost, rather than negotiate a compromise.

A note of hostility characterised the proceedings from this point onwards. The Committee felt that they had been snubbed by the Provincial Government of Limpopo and the Municipality of Mogalakwena, neither of whom had sent delegations. It also criticised the Ministry for sending only one representative.

A second dispute then arose concerning the presence of Mr Philemon Mapulane, an ANC Committee member and former municipal manager of Madibeng. The opposition parties felt he had an interest in the discussion and should recuse himself. This he resolutely refused to do. A lengthy, heated exchange ensued, with members fighting for the floor, interrupting each other and calling numerous points of order. The acting Chairperson struggled to maintain order. He was of the view that it was up to the individual whether to recuse him- or herself. A proposal from the opposition to vote on the matter was tabled and seconded. The ANC asked for a recess before voting, which was granted.

The ANC Committee members returned after ten minutes with several additional members of the ANC. One of these members cited a rule of parliament (Rule 134) that allowed for co-option, by the Chairperson, of up to two members of the National Assembly as voters when members and alternate members were not available. Mr Hlengwa remarked that Rule 134 referred to the establishment of a quorum, which in this case had been established from the start of the meeting. Mr Mathloko (EFF) accused the ANC of trying to rig the vote. The opposition insisted that the motion to vote on Mr Mapulane's recusal had been tabled before the motion to co-opt a member, and it should therefore be dealt with first.

The Chairperson appealed to members to drop the matter of the vote, and invited Mr Mokone Collen Maine (MEC, Local Government and Human Settlements, North West Province) to begin his presentation, ignoring requests to speak from the opposition. He invited Ms Ntunjwa, a co-opted ANC member, to speak, drawing further protests from the opposition and accusations of special treatment of ANC members. Ms Ntunjwa's remarked were inaudible above the furore.

Eventually, Mr Maine was able to deliver his presentation. He did not depart far from the printed text, which described the political and administrative leadership problems that had been plaguing the Madibeng Municipality for several years and what was being done to rectify them. He was followed by Mr Monde Juta (Municipal Manager, Madibeng Municipality) who discussed the operations and financial management of the municipality in some detail. The municipality was facing water and sanitation problems, as was well known. Its infrastructure was aging and stretched beyond its capacity and levels of payment and service delivery were low, but the municipality had several infrastructure projects aimed at solving the problems. The budget for maintenance of water and sanitation infrastructure had been increased from 2% in 2014/15 to 7% of the operating budget in 2015/16, and the amount allocated to capital expenditure on water and sanitation projects had also increased. Mr Juta denied reports that the municipality's own debts amounted to over R1 billion, and presented figures showing that the total outstanding debt was R118 million. Debts owing to the municipality stood at R1.1 billion, of which households were responsible for 75% and businesses for 21%. General challenges of finances included the accuracy of billing, illegal electricity connections and meter tampering, and a major dispute with industry, who were only paying 60% of their electricity bill.

During the discussion, Members raised many points, most in response to Mr Juta's presentation. He was asked to clarify whether the PIC loan was included in the municipal debt figure of R118 million, as the debt on this loan had stood at R730 million in December 2014. It was not included. The high vacancy rate in the municipality was criticised. Service delivery failures reported in the media were discussed, and Mr Juta criticised the media's coverage. The municipality had submitted a complaint to the press ombudsman against the Madibeng Times, and a complaint against Carte Blanche to the Broadcasting Complaints Commission. It was argued by that Mr Juta was overestimating the financial impact of industrial electricity under-payment relative to household non-payment. Mr Juta was asked to explain how the flat rate water bill of R72 per month was calculated, what debt collection methods were used, and what structures were in place to eliminate "ghost employees'. Members asked what the municipality was doing to address about the finding in the SIU report on Madibeng municipality that 341 officials in Madibeng had been found to be doing business with the municipality, in at least eight contracts valued at R21.7 million, on 310 cheques for payments to the value of R2.4 million that were rejected by banks, and the "ghost employees".

Members were not satisfied with all the responses. They criticised Mr Juta for his ignorance of the Special Investigating Unit (SIU) report on Madibeng, and both presenters for ignoring a question about tenders for emergency water tankerage. Several other questions went unanswered, perhaps due to time constraints.

The Committee called for Mogalakwena municipality to be summoned to the Committee in the next session, and for a Rules Committee investigation into Rules 133 and 134.
 

Meeting report

The meeting began late. The Committee secretary announced that the Chairperson, Mr Mdakane, was attending another meeting. The secretary called for nominations for an acting Chairperson. Mr Masondo (ANC) and Mr Hlengwa (IFP) were nominated, but both received four votes.

Mr B Bhanga (DA) suggested that the first presentation be chaired by Mr Masondo, and the second by Mr Hlengwa.

Mr E Mthethwa (ANC) suggested that the Committee wait for the Chairperson.

Mr K Mileham (DA) reported that the Chairperson was chairing a meeting of the Rules Committee and could not be expected to arrive soon.

Mr A Mudau (ANC) said that they should wait nevertheless.

Mr A Mathloko (EFF) said that the absence of the Chairperson should not prevent the meeting from going ahead. He added that, in his view, committee member, Mr Philemon Mapulane, had a vested interest in one of the items on the agenda (the report on the state of Madibeng) and ought therefore to recuse himself. Mr Mapulane had been the Municipal Manager of Madibeng Municipality and was held responsible in some quarters for the current crisis in that municipality.

Mr Mudau called a point of order. The matter under discussion was who was going to chair the meeting.

Mr P Mapulane (ANC) noted that a deadlock had been reached. He regarded the issue of his recusing himself as a non-issue. He suggested a five minute break.

Mr Bhanga reiterated the call for a break.

Break

The Committee broke for approximately 25 minutes but the voting deadlock remained when they reconvened. Mr Mthethwa proposed that the meeting could not go ahead.

Mr M Hlengwa then declined his nomination, in order for the meeting to go ahead. It was important that taxpayers' money spent bringing the delegations to the meeting, and the preparations of the presenters, were not wasted. He expressed his disappointment that no compromise had been reached.

Mr Bhanga defended the opposition's nomination of a candidate. The rules of parliament allowed it, and he hoped the ANC would take it as an indication that the opposition would remain committed to ensuring that the rules were observed.

Mr Mileham agreed, and added that all compromise in the deadlock had come from the opposition parties. The ANC, by contrast, had been prepared to collapse the meeting, at great expense, rather than give way.

Mr Mudau denied that there was anything for the ANC to learn from the situation.

Mr N Masondo (ANC) began to describe the ANC's long history of compromise, but he was interrupted by Mr Hlengwa on a point of order, who asked that Mr Masondo sit in the chair's seat, perform his function neutrally and get the business of the meeting underway. This was not the moment for a history of the ANC.

Mr Mthethwa defended Mr Masondo, saying that the ANC had a right to defend itself against some of the comments made by the opposition.

Mr Masondo began again, adding that there were underlying tensions within the Committee that needed to be dealt with. He then took the chair's seat. He reported apologies received from Mr M Mdakane (ANC), the Minister of Cooperative Governance and Traditional Affairs (COGTA), Ms N Mthembu (ANC) and Mr C Matsepe (DA).

Mr Bhanga asked whether any departmental officials present.

The Chairperson asked for everyone to introduce themselves before proceeding, and this was done. While there were at least 15 officials from Madibeng Local Municipality and the North West province and national government, there were no representatives from the Mogalakwena municipality in Limpopo that had also been invited. Both municipalities were experiencing challenges with finances, leadership and service delivery protests.

Mr Mileham noted the absence of anyone from the Limpopo provincial government or from Mogalakwena municipality. He said their absence was unacceptable and showed a contempt for Parliament. A strongly worded letter needed to be sent. It was impossible for the Committee to conduct oversight in these conditions.

Mr Mapulane suggested that Mr Themba Fosi (Deputy Director-General, Intergovernmental Policy, Planning and Research; Department of Cooperative Governance), who was present, would have information about the absence of a representative from Mogalakwena.

Mr Fosi conveyed the apologies of the Minister, Deputy Ministers and Director-General unofficially, and added that the invitation had been given at short notice.

Mr Bhanga said that the absence of the Minister and his Deputy Ministers was also unacceptable. It was often assumed that it was officials who were accountable to the parliamentary committees, but it was in fact the executive branch of government that was accountable.

Mr Hlengwa asked who was actually invited to the meeting. He said the absence of representatives from Mogalakwena was a symptom of that municipality's contempt for parliamentary oversight, and said there was a need for a delegation from the Committee to visit that municipality in person.

Mr Mileham requested the recusal of Mr Mapulane, on the grounds that, as former municipal manager of Madibeng, he had a vested interest in the discussion. Although Mr Mapulane regarded his involvement with Madibeng to have ended in 2009, Mr Mileham cited a 2013 COGTA Report which implicated him. Mr Mapulane was also referred to in the presentation to be submitted today.

The Chairperson said that, according to his understanding, it was up to the individual to recuse him- or herself.

Mr Mathloko (EFF) interrupted the Chairperson, claiming he was out of order.

Mr Mapulane repeated his position that there was no justification for his recusal. The Committee was discussing the present state of the municipality, but his involvement had ended in 2009 after a dispute between himself and the municipality. The dispute had been resolved by the Commission for Conciliation, Mediation and Arbitration (CCMA) in 2011 in his favour. He had no conflict of interest in the matters to be discussed.

Mr Mileham was adamant, however, that Mr Mapulane was referred to in the presentation to be submitted and therefore there was a conflict of interest. If Mr Mapulane would not take the honourable course and recuse himself or agree not to participate in the discussion, Mr Mileham proposed that the Committee vote on the matter.

Mr Hlengwa seconded this proposal.

Mr Mapulane reiterated his refusal to recuse himself.

The Chairperson noted that the underlying tensions seemed to have surfaced. He asked if these issues could be dealt with after the presentation had been given.

Mr Bhanga said an issue of principle was at stake. A declaration of interest should have been made. Notwithstanding the decision of the court, Mr Mapulane could have avoided the present controversy if he had recused himself. He appealed to Mr Mapulane's conscience to agree that he had an interest in the matter. If the matter went to a vote, and the ANC lost, it would be a good indicator of how they would react to the loss of a national election, he added.

Mr Hlengwa said that no one was passing judgment on Mr Mapulane. It was simply a question of good governance.

Mr Matlhoko agreed, and noted that the period of Mr Mapulane's involvement with the Madibeng municipality was discussed in the presentation. The present problems in that municipality carried over from earlier managers. He requested Mr Mapulane do the honourable thing and recuse himself.

Mr L Basson (DA) pointed out that the case against Mr Mapulane had been withdrawn by the Special Investigating Unit (SIU) but it could be reopened at any time. The Minister's Report of 2013 had contained instructions to the MEC concerning Mr Mapulane, and it would not be fair if they were discussed in his presence.

The Chairperson questioned the relevance of some of the comments. He reiterated his view that it was ultimately up to the individual concerned whether or not to recuse him- or herself.

Mr Mthethwa asked if the presentation could go ahead. He denied that it contained references to Mr Mapulane. It was simply a progress report, and it did not cover the period of Mr Mapulane's management. He countered Mr Mileham's earlier accusation by claiming that it was now the opposition who were wasting time.

The Chairperson invited the MEC of Local Government and Human Settlements in North West Province to deliver his presentation.

The MEC, Mr Mokone Collen Maine, criticised the Committee for wasting their time. Although he recognised that they needed to account to the Committee, it was unfair to expect them to wait for two hours while the Committee argued.

Mr Mileham called a point of order. It was not within the MEC's rights, as someone called to testify before the Committee, to lecture the Committee on how it should conduct its business.

He was interrupted by Mr Mudau, who called a point of order, but the Chairperson asked Mr Mileham to continue.

Mr Mileham said that the presentations could go ahead as soon as Mr Mapulane recused himself. There was, he insisted, a clear conflict of interest.

The Chairperson denied that there was a point of order.

Mr Mathloko interrupted him, accusing him of taking a partisan position on the matter.

The Chairperson criticised Mr Mathloko for interrupting him, saying he brought anarchy into the meeting.

Mr Mathloko demanded the Chairperson withdraw the accusation that he was an anarchist.

The Chairperson withdrew the term "anarchist". He insisted that there was no point of order: invitees to Committee meeting had a right to express themselves.

Mr Bhanga said that it was not the MEC but the Chairperson himself who, in allowing the MEC to comment on the business of the Committee, was the target of the point of order. It was members who decided how the meeting was to proceed.

The Chairperson disagreed.

Mr Maine reiterated his unhappiness at having his time wasted. He had other engagements.

Mr Mileham suggested putting the matter to a vote.

The Chairperson reiterated his views on the individual responsibility for recusal.

Mr Mthethwa called a point of order, saying that the opposition's calls for Mr Mapulane's recusal were based on their scrutiny of a report that was still to be submitted. He therefore repeated his request for the presentation to go ahead. Once the report had been delivered by the MEC, recusal could be discussed for particular items if necessary. It was foreign to the Committee to allow scrutiny of a report before it was delivered.

Mr Hlengwa said that a proposal for a vote had been made and seconded, and that the Chairperson was therefore, procedurally, duty-bound to put the matter to a vote. He denied that it was foreign to the Committee to scrutinise reports before they were delivered orally. Why else were presentations sent to the Committee well before the meeting? He also pointed out that the matter of Mr Mapulane's recusal had come up before the MEC's presentation and therefore needed to be dealt with first.

Mr Mileham formally made the proposal that the matter of Mr Mapulane's recusal be put to a vote, and that Mr Mapulane himself not vote because he had a clear conflict of interest in the matter.

The call was seconded by an opposition member of the Committee.

Mr Mthethwa requested that the ANC be given five minutes to discuss the voting.

The Chairperson granted them one minute.

After a break of ten minutes, the meeting reconvened.

Mr Mthethwa referred to the National Assembly Rules dealing with Committees and specifically Rule 138, and claimed that there was no provision for a member of a Committee to recuse him- or herself.

An ANC member who was not a regular member of the Committee and who had just entered the room, requested that the motion be dismissed. Mr Mapulane was present in his capacity as a member of the Committee, not as the former municipal manager of Madibeng. He cited as a precedent an instance in which the Committee on Justice had allowed a DA member, Ms Glynis Breytenbach, who was a former employee of the National Prosecuting Authority (NPA), to engage with a presentation from the NPA. A legal opinion had been sought which had confirmed that in her capacity as a Committee member, she should be allowed to engage with the presentation.

Mr Mileham expressed his ignorance of the identity of the previous speaker. Responding to Mr Mthethwa, he said that it was the Committee members' code of conduct that stated that a member could not participate in a discussion in which he or she had an interest.

Mr Hlengwa asked if the vote could go ahead.

Mr Bhanga suggested that Mr Mthethwa had deliberately avoided any reference to the code of conduct, which was clear on the matter. He said it was up to the ANC to decide whether it was going to destroy the rules of Parliament.

An second ANC member who was not a regular member of the Committee and who had entered the room during the break, reminded the Committee of the Justice Portfolio Committee precedent.

Mr Mthethwa called for the MEC to be allowed to deliver his report.

Mr Mahloko reminded him that there was a motion on the table to be voted on.

The first unidentified ANC member denied that the ANC was scared of putting the matter to a vote, and asked for the matter to be dispensed with in terms of Rule 134 of the National Assembly Rules. He explained that it allowed for co-option, by the Chairperson, of up to two members of the National Assembly as voters when members and alternate members were not available. Mr Mdakane had just arrived, so it remained for the Chairperson to co-opt one more.

This remark was greeted with ironic applause from the opposition.

Mr Hlengwa remarked that Rule 134 referred to the establishment of a quorum. He accused the ANC of using delaying tactics to give Mr Mdakane time to arrive, and expressed resentment at the presence of non-Committee members attempting to tell the Committee how to proceed.

Mr Mthethwa asked for the ANC non-committee member to be co-opted in order to for their quorum to be established.

The opposition protested that there was already a quorum. Mr Mathloko accused the ANC of trying to rig the vote.

Mr Hlengwa said that proposals were being put on proposals. The vote had been put on the table long before.

Mr Mthethwa formally withdrew his request for co-option.

Mr Mdakane apologised for his lateness and explained that he had been delivering a report to the Rules Committee. He explained that a party could co-opt voters up to the number of members determined by their proportional representation in the Committee. In the ANC's case, this number was six.

Mr Mileham took up Mr Hlengwa's point: the motion to vote on Mr Mapulane's recusal had been tabled before the motion to co-opt a member, and it should therefore be dealt with first.

The Chairperson asked Mr Mthethwa whether he wanted to re-introduce the proposal to co-opt a member.

Mr Mthethwa confirmed that he did.

The Chairperson ruled that Ms Ntunjwa become the sixth member of the ANC in the meeting.

Mr Hlengwa appealed to the Chairperson to conduct the meeting impartially. It was unfair for him to "spoonfeed' the ANC members by offering them the opportunity to re-introduce withdrawn motions. He repeated his call for the vote on Mr Mapulane to be taken first. The Chairperson had done them a great disservice in allowing the matter of the vote to be drawn out as it had been.

The Chairperson prepared to put the matter of Mr Mapulane's recusal to a vote that included the co-opted ANC member.

Mr Mileham requested that the opposition be allowed to co-opt Mr Basson before the vote went ahead.

Mr Mdakane called for the Committee to respect the MEC's presence and for them to allow him to deliver his presentation. He gave his view that it was the duty of the individual to decide whether they recused themselves.

The Chairperson said that the voting was uncalled for and could be avoided. The MEC should be allowed to present.

Mr Bhanga agreed with Mr Mdakane, but he asked that (i) conflicts of interests should be discussed by the Rules Committee and (ii) a legal opinion on Rules 133 and 134 should be sought. Rule 134 concerned the establishment of a quorum, which in this case had been established from the start of the meeting.

Mr Mathloko said that the ANC was disgracing its long and distinguished history by invoking this rule purely in order to win a vote.

Mr Mthethwa called for the meeting to be adjourned, as it was clear to him that they were making no progress. His call was seconded by an ANC Committee member.

Mr Mdakane said that this was out of the question, and that the Committee would be called before the Rules Committee if they adjourned the meeting. The MEC must be allowed to present.

The Chairperson appealed to members to drop the matter of the vote, and invited Mr Maine to begin his presentation, ignoring requests to speak from the opposition.

Mr Maine began to deliver his report. Members of the opposition expressed their unhappiness at having been ignored by the Chairperson and Mr Maine was unable to continue.

The Chairperson invited Ms Ntunjwa to speak, drawing further protests from the opposition and accusations of special treatment of ANC members levelled at the Chairperson. Ms Ntunjwa's remarked were inaudible above the furore.

The Chairperson asked Mr Maine to proceed.

State of Madibeng Local Municipality: North West Local Government and Human Settlements MEC
The MEC, Mr Mokone Collen Maine, kept close to the text of his presentation. He began by describing some background to the problems in Madibeng. It had not performed optimally over the past two terms due to political and administrative leadership problems. It had experienced the highest number of community protests of any municipality in South Africa over the past ten years. The former Premier of the North West Province, Ms Edna Molewa, had instituted an investigation into alleged fraud, corruption and maladministration in Madibeng, but the recommendations of the report had not been implemented. The SIU also conducted an investigation, leading to (i) the municipality being placed under provincial government administration in terms of Section 139(1)(b) of the Constitution from March 2010 until the local government elections in 2011, and (ii) charges of maladministration and misconduct against the previous municipal manager, which ended in the award of a settlement to the municipal manager.

The problems in the municipality escalated, characterised by high debt to Eskom and the Public Investment Corporation (PIC), and reliance on Tshwane Metro for bulk water and Section 139(1)(b) was invoked once again in December 2011. A ministerial task team conducted an investigation and recommended disciplinary action be taken against the new municipal manager and other senior officials and councillors. These recommendations were not implemented.

The municipality continues to experience service delivery and financial management problems despite all the interventions that have been put in place since 2010. Problems with the delivery of water and sanitation have led to violent protests. In March 2015, the provincial executive invoked Section 139(1)(b) once more to intervene in the management of water and sanitation in the municipality. A technical team had been set up to implement the intervention on behalf of the Province. It has identified the hot-spots and developed a recovery plan to address them on a short, medium and long term basis. A Joint Operations Centre (JOC) has also been established. However, water tankering still continues in the water distressed areas. Some improvements had been observed. The Provincial government will continue with the intervention on water and sanitation until the end of the current term, and the municipality will continue receiving support on financial management from the North West Department of Local Government and Human Settlements (DLGHS) and Provincial Treasury.

Mr Maine then gave the floor to Mr Monde Juta (Municipal Manager, Madibeng Municipality), who gave more detail on the municipality's operations.

Municipal status report focussing on service delivery & financial management
Mr Monde Juta (Municipal Manager, Madibeng Municipality) also remained close to the text of his presentation. He began by outlining the municipality's institutional capacity and vacancies. Three out of eight directorates and six out of 32 divisional manager posts were vacant. The vacancy rate at other levels was 48%. The state of the municipality's water and sanitation infrastructure was a source of major concern. It had exceeded its lifespan. The 60 megalitre capacity of the aging Brits Water Treatment Plant was inadequate to meet demand of 80 megalitres per day, increasing up to 108 in peak season. The Hartbeespoort Water Supply Scheme was, however, operating without any problems. The municipality was spending close to R2 million per month on water tankers (4 owned, 18 hired) supplying almost 25 000 households in rural areas. Losses in the water network reached 55%, of which 20% was attributed to technical losses (resulting, for example, from the age of infrastructure) and the other 35% mainly to illegal connections. The City of Tshwane and Rand Water were supplying roughly 28 megalitres per day to the ODI areas, but no revenue collection was being done in these areas.

Going forward, the municipality had introduced a flat rate of R72 per month in areas without water meters. The supply was being augmented with boreholes in several areas and meters were being installed. A new reservoir and bulk pipeline was about to be connected in Hebron/Kgabalatsane and an upgrade of the Brits Water Treatment Plant by 20 megalitres would be complete in August 2017, at which time a further 20 megalitre capacity increase would be implemented to cope with future demand until 2030. The municipality's four waste water treatment plants (Brits, Rietfontein, Letlhabile and Mothuthlung) were being refurbished. Hartbeestpoort network pump-stations were also being refurbished, and a balancing dam was being constructed at the Rietfontein waste water treatment plant inlet.

Mr Juta then moved on to budgeting. The municipality's total operating budget in 2014/15 had been R1.375 billion (R1 billion municipal revenue, R375 million grants and subsidies), of which 2% had been allocated to water and sanitation infrastructure maintenance. In 2015/16, the approved budget was R1.523 billion (R1.055 billion municipal revenue, R468 million grants and subsidies), of which 7% had been allocated to water and sanitation infrastructure maintenance. This increase was the result of a conscious decision by the Council. The capital expenditure (capex) allocation in 2014/15 had been R265.7 million, of which 37% had been allocated to water and sanitation. 39% of the R292.4 million approved for capex in 2015/16 had been allocated to water and sanitation, excluding grants. The maintenance budgets for roads and electricity infrastructure had also seen substantial increases.

Turning to financial management, Mr Juta said that in 2014/15 they had collected revenue amounting to 76% of the R1 billion budget. Total debts to the municipality stood at R1.1 billion, of which households were responsible for 75% and businesses for 21%. Mr Juta denied reports that the municipality's own debts amounted to over R1 billion, and presented figures showing that the total outstanding debt was just R118 million. He described the municipality's cash flow over the past year. At the end of May 2015, the municipality had spent 82.1% of its R234 million municipal infrastructure grant (MIG) resulting in National Treasury withholding R11.1 million.

General challenges of finances included the accuracy of billing (were all consumers being charged for what they actually used?), illegal electricity connections and meter tampering, and a major dispute with industry, who were only paying 60% of their electricity bill. Mr Juta pointed out that tariffs were determined by the National Energy Regulator (NERSA), not the municipality, but in any case a court case was underway. The municipality had been ordered not to withhold supply from industry, which was unfortunate. Measures had been put in place to meet these challenges, including a 50/50 system of arrears collection whereby a consumer with an outstanding electricity bill would receive half the electricity paid for. Going forward, the percentage of electricity received would decrease in stages. The filling of critical staff vacancies was going ahead.

In closing, Mr Juta said there was a communication shortfall between the municipality and its consumers, but they were working to improve it. He admitted that Madibeng had received some very bad press in the last few weeks, but claimed that most it was far from the truth. The municipality had submitted a complaint to the press ombudsman against the Madibeng Times, and a complaint against Carte Blanche to the Broadcasting Complaints Commission.

Discussion
Mr Basson asked whether the PIC loan was included in the municipal debt figure of R118 million. The debt on this loan had stood at R730 million in December 2014.

Mr Juta replied that it had not been included, because there was an ongoing dispute with the PIC.

Mr Mileham asked Mr Maine whether the recommendations of a 2013 COGTA report had been implemented by his department. These recommendations included criminal proceedings against certain people.

Mr Mileham asked Mr Maine to comment on the Minister's claim that every time Madibeng had been placed under municipal administration, its financial situation has deteriorated.

Mr Maine did not know why the Minister had made this claim.

Mr Mileham criticised Mr Juta for not mentioning the suspension of the municipality's technical director along with the senior management vacancies. He asked what was being done to lower the vacancy rate at all levels.

Mr Juta explained that a suspension did not create a vacancy. He assured the Committee that critical vacancies were being filled, but admitted that the vacancy rate was a problem.

Mr Mileham question the figure of 55% water losses. A Department of Water Affairs report of April 2014 gave an estimated figure of 75%.

Mr Juta said that the latest data indicated a figure of 55%. The important point, he said, was to distinguish between technical and non-technical losses.

Mr Mileham asked whether all households being charged the flat rate for water were actually receiving water. The Carte Blanche programme had indicated that this was not always the case.

Mr Juta admitted that this was the case in some areas.

Mr Mileham also cited the Carte Blanche programme as indicating that boreholes in the Jericho area had been installed by the community, subsequently taken over by the municipality, and since then had not been receiving water from them.

Mr Juta said the allegation made by Carte Blanche was unfortunate. Nothing like that had happened. Magalies Water was responsible for boreholes in the Jericho area.

The Chairperson asked Mr Mileham to summarise the remainder of his questions.

Mr Mileham expressed some irritation at the attempt to curtail his engagement. He asked for a timeframe for interventions in water shortage hotspot areas.

Mr Juta said that this matter was currently under discussion by the JOC and he could not give specific dates.

Mr Mileham asked what the revenue collection rate of the municipality was.

Mr Juta said that the average collection rate was 71.1%.

Mr Mileham queried whether industrial electricity payments were as great a problem as Mr Juta made out. He pointed out that debt from businesses made up only 21% of total electricity debt, whereas household debt made up 75%.

Mr Juta regarded 21% as a very large amount. He regarded this money as "low hanging fruit". The household debt had a long history and might not be accurate.

Mr Mileham claimed that he had firm evidence that the municipality had received a letter of final demand from the City of Tshwane for R3.5 million in electricity debt.

Mr Juta said that he had not received such a letter.

Mr Mileham pointed out large fluctuations in the municipality's employee-related costs. Why had they dropped by 40% in September 2014? Similarly large fluctuations in spending on bulk water and electricity were also pointed out.

Regarding levels of MIG expenditure over the past few years, Mr Mileham asked what percentage had been fruitless or wasteful expenditure, given the audit disclaimers that the municipality had received.

Mr Juta was not aware of any fruitless or wasteful expenditure other than interest on unpaid accounts.

Mr Mileham asked whether tenders had been issued for the 18 water tankers that were being hired. He understood that the contracts had been in place as a result of a Section 36 supply chain management regulation which provided for an emergency, but noted that the contracts had now been in place for three years. He also asked why the municipality had not taken measures to reduce its dependence on hired tankers.

Mr Hlengwa noted that the municipality had received a qualified audit for 2014/15. He did not see how, given the high vacancy rate, the municipality would be able to conduct an internal audit.

Mr Juta said that a chief audit executive was in the process of being hired.

Mr Hlengwa also did not recall anything in the presentation about how the municipality was going to rectify its financial management challenges. Mr Juta had talked only about operational challenges.

Mr Juta mentioned a case of an employee who had been revealed to have been duplicating invoices. Disciplinary processes were ongoing.

Mr Maine said the State of the Province Address in March 2015 had directed all municipal councils to incorporate the issues raised by the Auditor-General into the performance contract of municipal managers and Section 56 managers.

Mr Hlengwa asked how much was being spent on consultants, and for what purposes. In particular, had consultants been responsible for the financial statements of the 2014/15 year?

Mr Juta confirmed that they had used consultants to prepare financial statements in 2014/15, but it would be the last time. Going forward, they would build their own auditing capacity.

Mr Matlhoko noted with interest that the ANC members who had been co-opted had now left the meeting. He asked several questions relating to the SIU report on Madibeng municipality. He said 341 officials in Madibeng had been found by the SIU to be doing business with the municipality, in at least eight contracts valued at R21.7 million. This was irregular. What was the municipality doing to address these findings? He also asked for a comment on 310 cheques for payments to the value of R2.4 million that were rejected by banks, and on the situation regarding "ghost employees" reported by the SIU.

Mr Juta said that he was not aware of the SIU report and therefore declined to comment on the allegations and recommendations it contained.

Mr Matlhoko said that this was unfortunate, because the SIU report was in the public domain.

An ANC member asked whether industry was paying full fees for services other than electricity.

Mr Juta explained that they did, but electricity was the "cash cow".

Mr Maine added that his instruction had been that service to under-paying industrialists should be terminated, but that they had been taken to court over this.

Mr Bhanga agreed that industry needed to pay, but warned that municipalities needed to exercise a certain amount of responsibility. Simply switching off the power supply could lead to job losses.

An ANC member asked how the flat rate water bill of R72 per month had been arrived at. Was it effective?

Mr Juta explained that it had been thoroughly researched. It was calculated on the assumption of a household consuming 18 kilolitres per month. Six kilolitres were given free, and the remaining twelve charged at R6 per kilolitre.

An ANC member asked how often the municipality investigated ghost workers.

Mr Juta explained that a circular was issued yearly, as part of the municipality's pre-audit, requiring employees to present themselves to its Salaries division.

An ANC member asked what revenue collection methods were used.

Mr Juta said that normal debt collection methods were used. Bills were issued, followed by letters of demand, followed by disconnection of the service.

Mr Mthethwa asked if the municipality had considered the possibility that the 50/50 billing system was one of the issues causing the community protests.

Mr Mthethwa asked what the JOC had reported on the various infrastructure projects.

Mr Juta said they had responded positively.

Mr Bhanga was pained by the four deaths that had occurred in protests. He raised several issues arising from a COGTA report to the Select Committee (not sure which one he meant) on 15 July 2014.

Mr Bhanga asked whether compliance with regulations, which had been a problem in the past, had improved in the municipality. What systems, if any, had been put in place to ensure compliance?

Mr Bhanga asked about an alleged ratepayer's trust in Madibeng. Did it still exist? If it did, was it hindering the municipality's revenue collection activities?

Mr Juta denied the existence of a ratepayer's association. But even if there was, consumers were billed directly by the municipality.

Mr Bhanga cited the same COGTA report as calling for criminal charges to be laid against the municipal manager and the acting chief financial officer of the municipality. Who were they and what had been done? The report had also called for investigations into the contracts awarded. Had they been carried out?

Mr Maine said that the municipal manager referred to was Mr Juta, the chief operations manager was Mr Andrew Modise, and the corporate support director was Xola Magwala. A private law firm had been appointed to deal with these issues. Messrs Juta and Modise had been found not guilty.

Mr Bhanga asked whether the 1% allocated to subsidies for the indigent was adequate. He admitted that he had not looked into the demographics of the area.

Mr Juta said that about 6 500 indigents had been registered in the previous financial year, but the actual number was much higher. This year, the register provisionally stood at over 21 000.

Mr Bhanga cited another report to the National Council of Provinces which claimed that the municipality had a R62 million monthly budget deficit. Was this true?

Mr Basson asked for a comment on an alleged fraudulent payment to Maximum Profit Recovery Ltd in April 2014 of R2.217 million.

Mr Juta was not aware of this allegation, so he could not comment on it.

Mr Basson said he would pass on his information to Mr Juta.

Mr Matlhoko asked about non-payment of companies doing business with the municipality. Apparently, non-payment amounted to over R10 million.

Mr Maine said that the provincial government had directed that payments should be made within 31 days, but only once they were satisfied that the service had been rendered.

Members expressed some dissatisfaction with the responses as a whole, noting that some of their questions had not been answered.

Mr Maine closed by saying that issues of water and sanitation should not be politicised, as some political parties wished to do. These parties were only heard when the Hartbeespoort Dam was affected. He asked that any unanswered questions, and any further questions, be submitted in writing, as the delegation had a flight to catch.

Mr Mileham expressed his dissatisfaction at the fact that his question about the tenders for water tankers had not been addressed. He also objected to Mr Maine's closing comment, calling it disingenuous. If the city of Tshwane cut the electricity supply, it would affect the water treatment plants that serve Madibeng. Madibeng also received water from the Hartbeespoort Dam.

An ANC member said that there was a precedent in the matter of industrial electricity payments in which the court found in favour of the municipality. He suggested Mr Juta follow up on this case.

Mr Matlhoko observed that the co-opted members of the ANC had remained in the meeting for less than half an hour. He noted that the Committee was not a playground for the ANC.

Mr Mdakane said that Mogalakwena municipality would be called to the Committee in the next session.

Mr Bhanga reiterated his call for an examination of Rules 133 and 134.

The meeting was adjourned.

Share this page: