Local Government, Water & Related Services SETA; Municipal Infrastructure Investment Unit: annual reports

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Cooperative Governance and Traditional Affairs

13 March 2003
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Meeting report

PROVINCIAL AND LOCAL GOVERNMENT PORTFOLIO COMMITTEE

PROVINCIAL AND LOCAL GOVERNMENT PORTFOLIO COMMITTEE
14 March 2003
LOCAL GOVERNMENT, WATER & RELATED SERVICES SETA; MUNICIPAL INFRASTRUCTURE INVESTMENT UNIT: ANNUAL REPORT

Chairperson: Mr Y I Carrim

Documents handed out:
Local Government, Water and Related Services SETA Annual Report [Please note that the graphs do not appear on this internet version, please email info@pmg.org.za for the full document]
South Africa's Municipal Infrastructure Investment Unit Annual Portfolio Budget Hearing

LGWSETA Website:
www.lgwseta.co.za
MIIU Website:
www.miiu.org.za

LGWSETA delegation: Mr V Magagula, Chairperson; Mr S Mofokeng, CEO and Mr E Mnyakini, Communication Manager
MIIU delegation: Ms M Hesketh, Chairperson of the BOD; Ms N Mjoli-Mncube, BOD Member; Ms K Pearce, CEO; Mr J Lesaoane, Financial Administrator; Mr D Magagumela, Ms J Levister, Mr A Bassa and Mr J Leigland, Project Managers

SUMMARY
The Committee received a progress report from the Local Government, Water and Related Services SETA. The Committee was not impressed at all by their report and noted that LWGSETA seems not know its mandate nor are municipal employees, whom it serves, aware of its existence. The Committee would organise an intergovernmental workshop to discuss this issue and what should be done.

The Municipal Infrastructure Investment Unit has worked with both the private and public sectors in an effort of recruiting these sectors to invest in municipal structures. It noted that the next three coming years are about "making it work" for MIIU. So therefore they would ensure that policies are in place and restructuring does take place in all sectors in the society so that they could achieve their goal of sustainable implementation of services and growth delivery. The Committee commended MIIU and noted that its unique placement within the government would be of much assistance to other structures.

MINUTES
Local Government, Water and Related Services SETA
Mr V Magagula, LGWSETA Chairperson, noted that this SETA [Sector Education & Training Authority] had recently undergone restructuring and he had been elected as the new chairperson. He apologised for the absence of the Deputy Chairperson and for not having a female in their delegation.

Mr S Mofokeng, LGWSETA CEO, noted that as the existing Sector Skills Plan (SSP) was inadequate to address the needs of the sector, the LGWSETA had to undertake a review of the current SSP at a cost of R2.5 million.

Only 102 municipalities have submitted their Workshop Skills Plans (WSP's). Levies collected amount to over R113 million with R64 million having been disbursed as grants. A list of service providers an the amount committed and paid to each was provided. The challenges facing LGWSETA include the implementation of the SSP and WSPs. [See document for full details.]

Discussion
Mr A Lyle (ANC) noted that the presentation is silent on the issue of HIV/Aids. He asked what impact the roll-over would have on the learnership programme, especially in rural areas.

Mr Mofokeng replied that the SETA has been divided into three components and one of these deals with the issue of HIV/Aids. However this component is focused at local government and water and related service areas. Money is available for learnership programmes, however municipalities could only access it through application. There were municipalities who had been given the money after they had presented their programme.

Mr B Nobunga (ANC) asked if the SETA had received donations outside of government. He also asked what the presenter meant when stating that the development of new training materials is one of SETA's challenges.

Mr Mofokeng replied that they are able to acquire outside government funding for certain projects. On the development on new training materials he said that people would need to be trained in order to specialise in certain fields, especially in those where there is a shortage of specialists. In order for this to be done new training materials and a curriculum framework would need to be developed which would take into account the growth in technological demands.

Rev D Goosen (ANC) asked what LGWSETA is doing to improve people's lives in the municipalities.

Mr Mofokeng replied that they had developed a marketing strategy that would ensure that municipalities do register since this is the basis laid down by Treasury before any money could be disbursed.

Mr Nobunga noted that most municipalities do not to know of the SETA's existence. This is due to the invisibility of the structure to municipal programmes. Why should Parliament continue supporting this "non-existing structure".

The Chair concurred with this and noted that this was clearly confirmed during the Committee's study tours to municipalities. In all the municipalities that the committee had visited, SETA's influence was lacking and the public was complaining about this. He said that for a long time Parliament had been lenient towards the SETAs and time has come for it to be more hardline in dealing with SETAs. The rules of Parliament should be applied without sympathy, especially on budget matters. The Committee would organise an intergovernmental workshop to discuss this issue and what should be done.

Mr Mofokeng noted that there have been numerous questions asked regarding SETA performance, however he said that it would be important for the Committee and the public to understand the intrinsic working of the structure. After they understood the intrinsic working of SETA then they would be able to appreciate the fact that SETA's progress is based on its performance and not on tangible things. He welcomed the Chair's suggestion of the workshop noting that it would be the right platform to clarify their mandate to members.

Rev Goosen asked how do they manage their affairs in those provinces where there are no SETA offices.

Mr Mofokeng replied that since there are currently only two provinces where SETA has offices (Western Cape and KZN), they have entered into agreement with different government departments in order to effectively manage other provinces. Some provincial administrators and SALGA have provided them with personnel and resources so that they could be able to manage these other provinces.

Ms G Borman (DP) commented that since she had became a Member of Parliament she had never come across a worse report than the one presented by LGWSETA. She asked if they had considered empty government offices since there are quite a number of vacant offices around the country.

Mr Magagula asked the Committee to note the fact that this is a new leadership. It was elected after it became clear that the original one was not able to do its duty since members were engaged in commitments other than those of the SETA.

Mr Mofokeng acknowledged that they could easily access vacant government offices. However this was not the issue as the problems were the lack of personnel and resources.

Mr W Doman (NNP) asked why the SETA feels compelled to train councillors.

Mr Mofokeng replied that even though councillors are not involved in permanent service with municipalities, in order that they can discharge their duties satisfactorily, they need to be trained. By this means, government would be investment in public management, as some of those councillors would continue to be involved in public management even after their term of office has expired.

The Chair noted that members' questions could be fully answered at a follow-up meeting on 12 May.

Adv B Komphela (ANC) requested that a written response by LGWSETA should include their highlights during the past three-year period in existence.

Ms L Msengana-Ndlela, Director-General: DPLG, said that her department would provide assistance to the SETA whenever necessary to ensure that the delivery programmes are implemented. She noted that the department had prepared a paper on HIV/Aids and that paper would be distributed to all role players. She questioned the fact that the SETA has been allowed to partly administer R90 milllion in terms of its discretionary fund and said a new arrangement should be developed.

The Chair acknowledged the LGWSETA restructuring and the fact that its leadership was new but he said that this did not prevent the Committee registering its dissatisfaction with the state of the structure with Parliament. He noted that the workshop would clarify some important issues since the Committee believes that the SETA had failed to fulfil its mandate. He wished the new leadership all the best but the Committee hopes it will improve the standard of its report and also make the structure more visible.

South Africa's Municipal Infrastructure Investment Unit
Ms K Pearce and Mr J Lesaoane presented for the Unit which is a Section 21 company established in 1998 to facilitate private sector investment in municipal services in a controlled and sustainable manner. The presentation looked at strategy, its budget and the lessons it had learned about municipal service partnerships. [See presentation for full details.]

Discussion
The Chair commended MIIU's well-prepared presentation. He asked what could be done to assist the municipalities in delivering free basic services to their communities.

Ms Pearce replied that the issue is not about free basic services but about the source that is funding it and the kind of infrastructure in place to implement those free basic services. She said these are the issues that the private sector is also concerned about.

Mr Nobunga noted that there is a problem of viability within the municipalities and asked how MIIU could assist the municipalities to become viable, deliver services and also attract the private sector, especially in rural areas.

Ms Pearce replied that since their staff is experienced in the municipal environment they would work with municipalities in ensuring that all those things that prevent investors from investing in municipalities are addressed. At the moment they are in the process of inviting community-based organisations into partnership.

Mr Mshudulu noted that as MIIU is more advanced and capacitated than SALGA and LGWSETA it would be important for those two to work alongside it so that they could also be capacitated. How does MIIU intend to address the capacity problem of smaller municipalities?

Ms Pearce replied that there are number of projects looking at these municipalities in order to ensure that they are also developed, thus the focus has not only been on the bigger municipalities.

Mr J Kgarimetsa (ANC) commended MIIU. He noted that theory and practice applied together complement each other. He asked how often MIIU visits the rural areas to ensure that what they have taught the councillors, they indeed put into practice.


Ms Pearce replied that MIIU and the DPLG had had numerous discussions on this matter and they had noted that MIIUU would need to be capacitated in order to have any real impact, especially in rural areas.

Ms Msengana-Ndlela (Department Director General) noted that it is important for the key role players to work together in this process. The Department had received an infrastructure investment grant - even though it might not be enough - which would enable development of infrastructure.

Mr Kgarimetsa noted that there is a difference in the allocation of the projects to the provinces and asked what criterion is used to allocate these projects.

Ms Pearce replied that a project is allocated based on demand and this would be determined after MIIU had received a request from a municipality to launch it in a particular area.

Adv Komphela proposed that MIIU should also submit a written response to the questions posed. He asked what problems MIIU experiences with private partnerships aimed at the development of remote municipalities - taking into account that investors are always profit oriented.

Ms Pearce replied that the success of the project is not determined by whether it is a public or a private one but on the basis on which it would unfold from.

Ms Borman commended the MIIU presentation and asked what is meant by "intergovernmental alignment".

Ms Pearce replied that intergovernmental alignment is what would guide MIIU in its process of assisting municipalities thereby constantly reviewing the success of each specific project.

The Chair asked for clarity regarding the R6 and R7million mentioned in the budget.

Ms Pearce replied that due to the structural changes that have been made, the MIIU financial year has been extended from twelve to thirteen months, unlike other structures that have a twelve month financial year. Thus the R6 million is the current budget and R7 would be the budget in the following financial year.

The Chair thanked MIIU for the excellent presentation and hoped that they would be able to attain their goals. The meeting was adjourned.

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