The Member of the Executive Council (MEC) of the North West Department of Cooperative Governance and Traditional Affairs (COGTA) briefed the Committee on the decision to dissolve the Mamusa municipality. The purpose of the meeting was for the provincial executive to gain support from the National Council of Provinces (NCOP). The Committee had been on an oversight visit to the municipality and had had a terrible experience with the governance and the municipal infrastructure.
The MEC described the main challenges and failures of the municipality which led to the provincial executive deciding to close the Mamusa municipality. There was poor service delivery to the communities, which included water restrictions, delays in the removal of refuse and unpaid water bills owed by the municipality. The municipality has also had unstable changes in management and administration, which included the removal and suspension of two mayors, overdue payments to pension funds, medical aids and funeral polices, due to problems with cash flow. It had been receiving bad audit reports for seven years continuously from 2012 to 2018. It had unsettled debts, which included R230m which had been outstanding for more than 181 days. The Eskom unsettled debt of R57m owed by the municipality was an example of its inability to settle debts on time.
An intervention team was sent by the provincial executive to assist the municipality, but it created an uproar among the councillors as well as the community, with local gangsters closing the gates of the municipality and holding staff hostage, leading to a delay in service delivery for more than a week. The provincial team had implemented strategies to assist the municipality, but they were not fully accepted by the councillors. The provincial Executive Committee (Exco), which met on 25 September, had decided to dissolve the municipality due to the deteriorating situation and non-complying councillors.
The Committee was then briefed by a Parliamentary legal advisor on the legality of the procedures that had been followed in seeking the municipality’s dissolution in terms of Section 139 of the constitution. Members wanted to know what consequences were put in place by the constitution if proper procedure was not followed, and the implications of not waiting for the permission of the NCOP when decisions of dissolution were being discussed.
The Chairperson believed that the legal opinion was enough and covered all clarification points raised by Members. He advised that the NCOP had to decide within 14 days if they approved the intervention at the municipality. After allowing each party’s representative to vote on the issue, he announced that the Committee supported the invocation of section 139 (1)(c) in the Mamusa municipality, and was expecting a report which outlined the progress at the municipality. The province should do everything in its power to resolve the matter, and a competent administrator should be appointed.
Chairperson’s opening remarks
The Chairperson welcomed the Committee Members and two special guests -- Mr Gordon Kegakilwe, North West Member of the Executive Council (MEC) for Cooperative Governance, Human Settlements and Traditional Affairs (COGTA), and Ms Phumelele Ngema, the Parliamentary legal team representative.
The Chairperson said that the MEC would be briefing the Committee on the intervention at the Mamusa Local Municipality in terms of section 139 (1) (c) of the constitution. The legal team had been invited to brief and provide a clear legal opinion that would guide the Committee on any decisions made, especially during discussions on the issues at hand.
Mamusa Section 139(1)(c) Intervention
Mr Kegakilwe began the presentation by giving the Committee and legal representative a brief background on how the decision to dissolve the Mamusa Local Municipality came about. The section 139 (1) (c) intervention had been considered when the decision was made by the Executive Committee, which now required the support of the National Council of Provinces (NCOP) to dissolve the municipality.
The MEC said that the decision had been communicated to the Minister of Cooperative Governance, Human Settlements and Traditional Affairs and the provincial legislature, as well as the MEC for Local Government, who had appointed an intervention team to assist the municipality.
A special sitting of the North West Provincial Executive had taken place on 2 May, where a decision was made by the members to put the Mamusa municipality under administration, based on section 139 (1) (b) of the constitution, for six to 12 months.
The MEC gave sound reasons why the municipality should be dissolved, and had evidence to support the reasons.
He said the municipality was struggling to deliver services to the communities of the North West, which included inconsistent refusal removal, and recurring water interruptions as a result of poor maintenance and unpaid water payments. The municipality had a large expenditure rate which exceeded the allocated Municipal Infrastructure Grant (MIG), which meant that the MIG was inadequate for the municipality’s use. Its infrastructure operations and maintenance were below par.
Section 152 (1)(b) and section 152 (1)(d) had guided the decision to shut down the municipality when it came to overall sustainable service delivery and environmental safety when delivering the services.
The failure by the municipality to perform executive obligations was strongly felt by the executive council. The municipality has also had unstable changes in management and administration, which included the removal and suspension of two mayors, overdue payments to pension funds, medical aids and funeral polices, due to problems with cash flow. It had been receiving bad audit reports for seven years continuously from 2012 to 2018.
Mr Kegakilwe said section 153 (a) of the constitution and section 129 of the Municipal Finance Management Act (MFMA) had guided the decision to shut down the municipality when it came to poor governance and financial reports.
Another challenge for the municipality was poor financial management, which involved the municipality’s inability to draw up a draft budget for 2019/20 and adopting a budget that was not proportional and in line with the Integrated Development Plan (IDP). The municipality had unsettled debts, which included R230m which had been outstanding for more than 181 days.
The MEC said that the reason for the unsettled debts in the municipality was mainly because the municipality did not settle debts within the legislative period on 30 days, so the debts were recurring. The Eskom unsettled debt of R57m owed by the municipality was an example of its inability to settle debts on time.
Section 153 (a) of the constitution and section 95 of the Municipals Systems Act had guided the decision to close the municipality when it came to badly managed financial administration and systems
The intervention team that was established on 8 July had not been fully accepted by the municipal councillors. The MEC had personally gone to the municipality to introduce the intervention team to the council. No one else was sent.
As a result of the councilors’ resistance to having an intervention team, the team was no longer allowed on to the municipality’s premises and therefore could not continue working in July. Community members had also not shown an interest and acceptance of the intervention team
During March, councillors had had a meeting to remove a mayor according to Section 29 of the Municipal Structures Act. The act was not properly constituted, and the municipality ended up having two serving mayors who were also paid simultaneously from March till May 2019.
In May, one of the mayors had resigned and a municipal manager had been suspended. As a result of having an acting municipal manager, the municipality had ended up having two municipal managers in office. The instability of the municipal structures resulted in the Integrated Development Plan (IDP) budget not being drafted.
Councillors had held another special meeting to remove the other mayor, despite the advice that was given by the intervention team not to do so. The councillors lifted the suspension of the municipal manager – illegally -- and the municipal Chief Financial Officer ignored the terms of reference of the administrator.
The MEC said that by law, the municipality was supposed to send a notice to remove the mayor, but had not done so.
The two mayors were not paid in September, and the council wrote to the municipal bank requesting that the signatories be changed.
In July, the councillors forced the municipal administration team to vacate the offices. The municipal staff was held hostage and the municipality’s gates were closed, which prevented anyone from leaving the premises. It was believed that rented thugs -- well known gangsters in community -- were the perpetrators of that incident. A councillor was injured due to a confrontation with municipal staff, and this had resulted in services not being delivered for more than a month. The rented thugs had forced the closure of the municipal gates for more than a week because of empty employment promises by the councllor.
The issue of the two mayors had resulted in divisions among the staff because of different leadership instructions, resulting in further failed staff meetings.
The MEC said that the provincial executive Committee (Exco), which met on 25 September, had decided to dissolve the municipality due to the deteriorating situation and non-complying councillors. The decision was constituted by section 139 (1)(c) of the constitution which allowed the provincial executive to intervene and possibly dissolve a municipality, the municipal council and administrators, that were failing to fulfil executive obligations.
The provincial Exco must still appoint an administrator who will intervene on behalf of the Exco, if the decision is supported by the NCOP
The MEC mentioned that section 139 (3) of the constitution outlines the necessary steps that should be taken when a municipal council is dissolved, which includes submitting a notice of the dissolution to the Cabinet Member for local government affairs, the provincial legislature and NCOP, and the dissolution is effective during 14 days from when the notice receipt is received
The MEC concluded that the decision to dissolve the municipality was based on the reasons listed in the presentation, which awaited approval from the NCOP
The MEC added that the Minister of COGTA had addressed about the matter of the Mamusa municipality.
Regarding the Kagisano Molopo municipality court case, which is still being appealed by the province, this had raised a lot of issues around the municipality. Kagisano Molopo case was lost by some municipalities who had tried to fight the court case. Some Mamusa councillors took the province to court, pleading that intervention should not occur in the municipality.
The provincial executive had been dealing with numerous legal issues from various municipalities and individuals.
Chairperson thanked Mr Kegakilwe for the briefing and presentation, and asked the legal advisor to present the legal opinions to the Committee
Ms Ngema, Parliamentary Legal Advisor, asked if the Chairperson would allow the MEC to first clarify any questions that the Committee had about the Mamusa Municipality before presenting the legal opinion.
The Chairperson asked the Committee Members to decide whether to ask the MEC questions or have Ms Ngema present the legal opinion on what the MEC had presented.
Ms S Shaikh (ANC, Limpopo) asked for the process report.
Mr G Michalakis (DA, Free State) said that a legal opinion was important and therefore the legal advisor should ask the MEC questions about the Mamusa municipality before giving a legal opinion
The Chairperson replied that it was a fair approach for the legal advisor to get clarity before presenting the legal opinion.
Ms Ngema asked for clarity about the intervention team, which had not reached the 180-day lapse period before the decision was taken to dissolve the municipality, when the letter to the Chairperson was sent only on 9 October.
The MEC replied that the decision to dissolve the municipality was taken on 2f May and a notice was sent to the Minister on 6 May, and a 28-day contesting period was set by the Minister. A few days later the Members of the NCOP had gone to the municipality.
The legal advisor acknowledged the response from the MEC
The Chairperson asked the legal advisor to commence with asking the MEC questions for clarity purposes.
Mr E Mthethwa (ANC, KwaZulu Natal) asked that the Chairperson allow the Committee to ask the MEC questions before a legal opinion was given so that the legal advisor would have a complete brief from Members who had gone to the municipality
The Chairperson explained to Mr Mthethwa that the purpose of the legal opinion was not a platform to express individual observations and visions, but rather to track the authority of the provincial government in line with section 139 (1) (b) and 139 (1) (c) of the constitution. He asked the legal advisor to proceed with the line of questions directed to the MEC.
Ms Ngema said that the constitution’s legal framework provides for the Kagisano Molopo municipality appeal, considering the current Mamusa municipality challenge. All the previous matters of the Kagisano Molopo municipality should still be in place because of the pending appeal with the supreme court. Therefore, anything that is occurring with the Mamusa municipality is according to legal procedure. However, if there is a decision to invoke section 139, there will be no interruptions during the process.
She said that local government and provincial government had different interventions, which were section 100, the intervention for local government, and section 139, the intervention for provincial government against local government. In addition, the North West departments were under different interventions -- some were under section 100 (a), and others under section 100 (b).
Ms Ngema concluded that the NCOP should proceed with all functions.
The Chairperson asked Committee members if there were any questions regarding the legal opinion for the Mamusa municipal dissolvement.
Mr Michalakis asked why section 139 (1)(b) was being finalized, when the NCOP had not officially approved the notice which was sent on 6 May. Furthermore, what were the consequences of the provincial administration proceeding to section 139 (1)(c) of the intervention when the NCOP had not provided a clear go-ahead for section 139 (1)(b).
Ms Z Ncitha (ANC, Eastern Cape) asked the legal advisor to provide the Committee with the basics of the constitution that assisted a province to get to section 139 (1)(b).
Ms Ncitha acknowledged that the section 139 (1)(b) was not finalized, and said that this was because the process had to recommence at the municipality. It was important to keep the Committee and the constitution balanced.
The Chairperson added to Ms Ncitha’s question by asking what the status of the intervention section (1)(b) would be if the NCOP was inactive, and the 180 days intervention period lapsed
Ms Ngema replied that the Committee Members needed to be aware of the interim constitution which stated that activities had predecessors, but the current constitution allowed for activities to be performed simultaneously. The Provincial Executive had the jurisdictional right, according to the constitution, to act accordingly in an exceptional situation, such as deciding to dissolve a failing municipality, without the NCOP deciding on the matter or giving permission.
The basics of the constitution state that the provincial executive may mediate in local government by taking the appropriate steps to ensure the fulfilment of local government, which includes assuming responsibility in the municipality to maintain minimum standards, especially in a municipality where there is poor service delivery and citizens are not receiving services. The MEC had outlined in the presentation the poor service delivery by the Mamusa municipality, which therefore attests to the validity of the constitution in this circumstance.
Ms Ngema added that the constitution states that a provincial government can assume responsibility where necessary to prevent a municipal council from taking unreasonable action. Again, the MEC had outlined in the presentation that there had been mismanagement of funds at the Mamusa municipality. The constitution did not provide for the 180-day lapse, but Members of the NCOP may need to give reasons if a decision cannot be taken.
The Chairperson accepted the legal opinion given by the legal advisor, and said that the legal opinion had addressed all clarification issues by members.
He invited Members to question the MEC’s presentation report.
Discussion on MEC’s report
Mr M Dangor (ANC, Gauteng) said that the NCOP must act immediately on the matters addressed about the Mamusa municipality, as well as other matters. A conclusion should be discussed and decided on the following day. Nothing should be left undealt with
Mr S Mfayela (IFP, North West) said that the Mamusa municipal conduct had been shameful when the NCOP had visited the municipality
Mr Mthethwa asked why the Mamusa municipality was exempted from dissolution under section 139 (1)(c), when other municipalities in the province were being dissolved, especially since the physical structure of the building was crumbling, the municipality had two mayors in office instead of one, assets were being wasted by councilors and the community was enraged.
Mr S Zandamela (EFF, Mpumalanga) said that politically unstable municipalities should be dissolved, and time should not be wasted trying to do so
Ms M Mokause (EFF, Northern Cape) agreed with fellow Members that the municipality should be dissolved and that the legal opinion given was enough to pave a way forward for the municipality after dissolution. A new administration should be put in place in poorly governed municipalities after a municipality had been dissolved, to allow for new plan
Mr S du Toit (FF+, North West) asked what rule was in place if an intervention team had already been implemented before the NCOP approved of the decision, and the position of the district giving surplus equitable shares to the municipality to settle municipal debt. The municipal election time frame was requested from the legal team.
Ms M Mmola (ANC, Mpumalanga) agreed with Members to dissolve the Mamusa municipality and asked whether the dissolving process included removing councillors. The municipality was chaotic and needed some form of disciplinary action. Based on slide 13 of the MEC’s presentation, the NCOP Exco was still looking to appoint an administrator. Therefore, who was currently occupying the position and what necessary actions had been taken to fill the vacancy?
Mr Michalakis disagreed with the legal opinion relating to the NCOP’s complete involvement in the approval of dissolving a municipality, referring to the departmental guidelines which outlined that intervention had subsequent steps and that a solution could not be the first step before the NCOP had given an opinion on the matter.
In addition, the intervening section 139 (1)(c) had to follow the intervening section before it, which was section 139 (1)(b). This meant amendments needed to be considered before solutions could be made. Challenges needed to be assessed. The MEC was asked which of the changes to notice that were outlined in the guidelines had been implemented to try and improve the situation at the municipality.
Mr Mthethwa replied that members of the NCOP had gone to the Mamusa municipality under section 139 (1)(c), and not section 139 (1)(b).
The Chairperson clarified to Mr Mthethwa why section 139 (1)(b) needed to be considered before section 139 (1)(c).
Mr Michalakis was allowed to proceed with the point of clarity for the MEC to respond to. He said that there was a high possibility that the municipality had unqualified administrators who may not fulfil the expected duties. The provincial executive must utilise resources and options before the dissolution. The difference that section 139 (1)(c) would have was questioned by Mr Michalakis, and the removal of councillors and not the administrator was a concern
Ms C Visser (DA, North West) asked about the effectiveness of municipal administrators, and why no report had been received from the municipal administrators regarding the financial recovery plan for the municipality.
Mr I Sileku (DA, Western Cape) said that the municipality had to determine its obligations, and ineffective councillors had to be identified and dealt with accordingly. The success steps of the provincial executive in relation to section 139 (1)(c) needed to be determined. In addition, he asked why the NCOP should support a decision that had already been finalised and publicised by the provincial executive
Ms Shaikh asked about the validity of the NCOP visiting the municipality, and what the progress was on dissolving the municipality since a decision had already been taken.
Ms Mmola said that the court case between the North West provincial executive and municipalities had resulted in the NCOP ceasing discussions on section 139 (1)(b) until the court cases were over. The NCOP was still well within the 180-day lapse period and could still compile a report on both section 139(1)(b) and section 139 (1)(c). Administrative reports had not been received by the NCOP because there were constant disruptions at municipalities and the provincial executive had had to handle the situation, therefore making it impossible for analysis to occur administratively.
Mr Dangor recommended that the provincial Exco appoint an administrator on behalf on the NCOP, saying that Members may agree or disagree with the decision.
The Chairperson thanked Members for the questions and asked the MEC to respond to the questions.
The MEC began by stating that the legislature did not mention anything about the municipality under section 139 (1)(a), and for this reason the municipality had taken all decisions without consultation.
The provincial executive had deployed the report received from the Minister after the 28-day contesting period and had eagerly awaited the NCOP’s visit to the municipality. The constitution allowed for the provincial government to proceed with the drafting of section (1)(c), considering that the municipality was in a chaotic state. The provincial government had assisted the municipality in every way possible to ensure the delivery of basic services, and had even helped to compile the municipality’s budget. The situation was so out of hand that the Auditor-General could not audit the books of the municipality
The MEC explained that section 139 (1)(c) allowed the provincial government to manage and resolve the issues with councillors who did not fulfil their responsibilities and duties, especially since they have been participating in unlawful actions such as removing a mayor without following proper procedure.
The provincial government had the right to proceed with any decision that required urgent attention without having to wait for the 180-days period to lapse.
The MEC agreed with Committee Members that a report must be compiled by the provincial government on the progress of the Mamusa municipality, including what had been done to resolve the issues occurring there. He offered to return to the Committee and present the report.
The provincial government had previously sent financial experts to assist with the Mamusa financial mismanagement crisis but had soon realised that a technical expert needed to be sent as part of the package to assist the Mamusa municipality with the transfer of information from the district.
The MEC said that the administrators were present at the Mamusa municipality, and the provincial government ensured that the administrator was at the municipality regardless of how difficult and chaotic the state of the municipality was.
The province was doing everything to assist and support the Mamusa municipality in delivering services, addressing policy matters and compliance issues within the municipality
He said that the issue with the equitable share, as mentioned by Mr Du Toit, had been with the district not wanting to sign with the Mamusa municipality to provide the three basic services, which included water. The district’s reason was the chaotic and uncontrollable state at the municipality
The MEC thanked the Members for the questions and hoped that clarity had been provided. More information would be provided if necessary
The Chairperson thanked the MEC, and commented that the situation at the municipality was very serious and urgent, which required an intervention. The Committee was on track with the legal proceedings.
The Chairperson acknowledged that the NCOP did visit the municipality according to the constitution, but had not yet sent a report in support of the final decision to dissolve. Everything must be carefully considered before a decision was taken
The NCOP must decide within 14 days if they approve the intervention at the municipality.
He asked if there were any exceptional circumstances that would result in a disagreement over the intervention by NCOP members.
All Members agreed that there should be a turn-around in the situation at the Mamusa municipality, and that all decisions should be law abiding.
The Chairperson said that the issue had increased from section(1)(b) to section (1)(c), and there had been no improvement.
He allowed each party representative to express whether they agreed with the decision to support the provincial executive’s decision.
Mr Michalakis asked that the MEC provide a report on the action that had been taken by the provincial executive.
The Chairperson asked Mr Michalakis to make a clear decision.
Mr Michalakis resisted giving a final decision because there was an exceptional circumstance.
The Chairperson said that the MEC had provided enough reason for the implementation of section 139 (1)(c)
Mr Michalakis disagreed with supporting the intervention, because the process of section 139 (1)(b) had not been properly implemented
The IFP representative agreed on the intervention, and said it would provide a new way forward
The EFF representative agreed with the intervention
The FF+ representative agreed with the intervention
The ANC representative agreed with the intervention.
The Chairperson announced that the Committee supported the invocation of section 139 (1)(c) in the Mamusa municipality, and was expecting a report which outlined the progress at the municipality. The province should do everything in its power to resolve the issue, and a competent administrator should be appointed.
All parties present were in support, except the DA.
Chairperson thanked the MEC for attending the meeting, and the legal team.
The meeting was adjourned.
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