Cooperative Governance adjustments budget; Municipal Systems Amendment Bill; with Ministry

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Cooperative Governance and Traditional Affairs

14 July 2020
Chairperson: Mr C Dodovu (ANC, North West) and Ms F Muthambi (ANC)
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Meeting Summary

Video: JM: PC on COGTA and SC on COGTA, Water and Sanitation and Human Settlements, 14 JULY2020

In the presence of the Minister, Ms Nkosazana Dlamini-Zuma and the Deputy Ministers, Mr Obed Bapela and Mr Parks Tau, both the Portfolio and Select Committees received a virtual briefing on the special adjustments budget for the Department of Cooperative Governance (DCoG). They welcomed the comprehensive package intended to make an impact at municipal level, especially for water and housing infrastructure development and the Department’s strong emphasis on effective monitoring in its revised Annual Performance Plan.

Members suggested that the target ensuring the functionality of each Municipal Public Accounts Committee (MPAC) and Audit Committee should be 100% rather than 80%. They were pleased with its intention to work with National Treasury under the umbrella of ‘Rethinking Municipal Finance’ to stabilise municipal finance revenue and expenditure, with a view to minimising the impact of Covid-19. Although the fight against Covid-19 is important currently, they urged the Department to work with municipalities to put in place post-Covid-19 economic recovery plans to ensure not only recovery but sustainability of municipalities. Members welcomed the indicator on the fight against gender-based violence (GBV) and the intention to ensure that municipal integrated development plans are aligned to the One Plan Initiative. They requested the report on the District Development Model pilot project to understand the lessons learned.

The Committee requested clarity on the letter COGTA sent on the Municipal Systems Amendment Bill. The Bill has not been submitted to the NCOP yet so it could be withdrawn. However, COGTA clarified that it is not initiating the redrafting of the Bill but rather it seeks finalisation of the Bill so it can address the challenges in local government. It would resend a revised letter.

Meeting report

Mr C Dodovu (ANC, North West) welcomed the Minister and Deputy Ministers and said this meeting is a continuation of the previous meeting on the special adjustments budgets from the Department of Cooperative Governance. The Minister, Deputy Ministers and Director-General were not present in the previous meeting. The postponement of the meeting was a result of the unsatisfying responses to questions asked by Members. The purpose of the meeting is to receive a report from COGTA on the DCoG adjustments budget. He noted that the original budget was adopted in May.

Department of Cooperative Governance (DCoG) revised APP and adjustments budget
Ms Avril Williamson, Director-General: Department of Cooperative Governance and Traditional Affairs (COGTA), gave an introduction and a summary of the DCoG programmes. She outlined the strategic plan outcomes which are relevant for the next five years. She highlighted the changes made to the 2020/21 Annual Performance Plan for each programme noting revised indicators and targets. The 2020/21 special adjustments budget was presented and the allocation changes per programme and per economic classification were outlined. Of the R20 billion relief package for municipalities announced by the President, R11 billion has been provided through an addition to the Local Government Equitable Share and the remainder is obtained through the repurposing of the existing conditional grants.

Mr C Brink (DA) referred to the District Development Model (DDM) and asked for a clear definition of the One Plan Initiative and how it will affect the planning and budgeting process in municipalities. He asked for information on the lessons learnt by COGTA during the DDM pilot implementation in three municipalities that are used as a guide when drafting the One Plan Initiatives and budgets. He asked if COGTA has the capacity to implement this especially since COGTA cannot account for certain actions and has failed in the past in implementing plans. On redesigning the Community Works Programme (CWP), the programme is relevant to communities and asked what the redesign will look like. He referred to the R20 billion stimulus package announced by the President and asked if R11 billion is enough to assist municipalities during COVID-19.

Mr H Hoosen (DA) said that reports of irregular expenditure of COVID-19 relief funds in municipalities is increasing and noted that OR Tambo District Municipality was previously engaged on its irregular expenditure. He expressed concern on how the money allocated for COVID-19 is being used for "personal benefits". The 'relief expenditure' monitoring indicator would mean that there would be more focus on the way COVID-19 relief funds are being used in the municipalities. The R500 billion relief fund was a good initiative by government but it came with a lot of concerns on how some municipalities are misusing the money. He asked COGTA for assurance that municipalities will use the money for its intended purpose and said that municipalities reporting their expenditure to National Treasury is not enough because by the time irregular expenditure is noticed, it is too late. There should be more effective measures in place. On CWP, there was an extra allocation of R4 billion which is concerning because the programme is poor value for money. He asked what would be done to improve the effectiveness of the CWP.

Ms H Mkhaliphi (EFF) thanked COGTA for the presentation and asked for clarity on the R20 billion allocation in the COGTA budget. Why was the R9 billion remainder not reflected in the budget. On the GBV initiative, the DDM is still in the early stages to able to address the serious issue of GBV. The Department has not provided much detail on the plan of COGTA to address GBV.

On Rethinking Municipal Finance, municipalities are corrupt and do not deliver services and she asked COGTA on its role in the plan to address this. She requested the names of the reprioritised municipalities under programme 4 and how the 10 municipalities were prioritised out the 254 municipalities. On the COVID-19 relief fund, she asked how it would benefit people during COVID-19. On the National Disaster Management Plan, she asked for details on who the plan would benefit. in various municipalities, there is no clear policy or plans in place. Water bills are too high for people to afford and municipal officials are unaware of the policies that address rate reductions. She asked how COGTA will work with municipalities to ensure that people benefit from the COVID-19 relief fund. On CWP, the Committee is still awaiting the Department written responses to the CWP concerns raised by Members and the role on NGOs and corruption in the CWP. How were the concerns resolved?

Mr S Zandamela (EFF, Mpumalanga) asked for clarity on the DDM addressing GBV and asked about the kind of support being provided to municipalities for the 2020/21 local government elections. He asked for the amount allocated for the local government elections. He asked if there are monitoring measures in place for the R20 billion COVID-19 relief grant announced by the President especially since there are municipalities under administration and misuse of funds is popular in municipalities.

Mr K Ceza (EFF) asked on the monitoring and measures in place for the extra R11 billion allocated to municipalities especially since municipalities are not reliable. He asked for the impact of the 139(c) interventions in municipalities and the consequences for municipalities that are not properly monitored. On the CWP, there are participants that have not been paid in North West and asked if there are monitoring systems in place to ensure that participants are paid.

Ms M Tlou (ANC) welcomed the presentation and asked how the R11 billion will be allocated to municipalities and how much will be allocated to District and Metro Municipalities. There have been problems with the inefficiency of municipal officials and she asked how this would be addressed. Are there strategic measures in place for the additional R11 billion allocation and monitoring and evaluation measures to enable the monitoring of the impact. the Department of Planning, Monitoring and Evaluation (DPME) should be involved in the process to monitor funds used by municipalities. She asked how COGTA will ensure that the Committee is involved in the GBV process.

Ms P Xaba-Ntshaba (ANC) said that since the lockdown most municipal offices have been closed which meant people were unable to pay for municipal services and asked about the structure of future bills for people who could not pay and how the matter would be addressed. The plans highlighted in the COGTA presentation were clear.

Ms C Visser (DA) asked about municipalities that had failed interventions and failed administration and how COGTA and the Minister are planning on establishing good governance in municipalities that are in poor financial shape and have service delivery challenges.

Mr B Hadebe (ANC) was not happy about the Programme 3 indicator for the Municipal Public Accounts Council (MPAC) and the Audit Committee achieving 80% functionality. Municipalities are expected to be fully functional so why does COGTA set targets of 80% instead of 100%.

Mr G Hendricks (Al Jama-Ah) asked if it is the Committee’s mandate to ensure that money is not looted. The Zondo Commission had talked about Portfolio Committees not performing proper oversight and asked for assurance from the Sixth Administration that the Portfolio Committee will not be found to have allowed the looting of money.

Mr I Sileku (DA, Western Cape) said that there are residents who are struggling to pay for municipal services and that COGTA’s campaign to encourage people to pay will not be relevant in rural areas where people have valid reasons for not paying for services. What assistance would be given to municipalities with 53% indigent population before COVID-19? Development is needed so there are more people able to pay instead of being subsidised After COVID-19, the municipalities will have a higher percentage of debt and non-sustainability will increase. He noted that municipalities have negative audit outcomes as a result of the poor capacitation of the audit committee and MPAC. How does COGTA define a "functional" audit committee and MPAC. If they were functional, it would reflect in improved audit outcomes.

Mr Themba Fosi, COGTA Deputy Director-General: Local Government Support and Interventions, replied that the District Development Model is a practical model of institutional obligation on all spheres of government. It is influenced by different initiatives within various provinces. The One Plan initiative does not replace any development requirements such as replacing the Integrated Development Plan (IDP) and the Annual Performance Plan of a municipality. The One Plan Initiative is an expression and investment of all three spheres of government. It is a long-term view of programmes developing the 53 district spaces and address socio-economic issues, infrastructure as well as the needs and aspirations of people. The One Plan has a report compiled on the pilot lessons learned which have served as a guide for the DDM issues that need to be addressed. Integration of various plans will determine how issues are addressed. On COGTA’s capacity to implement the District Development Model, he explained that the role of COGTA is to coordinate and support processes that bring the spheres together. There are processes in place to build capacity in establishing district hubs that will assist in the monitoring of implementation and to provide support to local municipalities. Shared services will also be established to provide support to assist local municipalities in addressing service delivery and financial challenges. Support measures will enhance COGTA’s ability to support and perform its role.

Mr Fosi explained that municipalities are expected to have a clear and responsive plan that commits to the GBV initiative. The One Plan on GBV should be expressed clearly and determine how GBV will be addressed. Municipalities are expected to identify measures and interventions to address GBV.

On the effectiveness of the section 139(c) interventions, section 139 has proven that municipalities are unable to meet constitutional objectives due to challenges. The Department will introduce an Intergovernmental Monitoring, Support and Intervention Bill which will provide clarity on the process of how interventions should be implemented and the support measures to be used. The Bill emphasises monitoring and support before intervention, which is the last resort. On section 154 support, he explained that when provinces intervene, they are required to provide support. There have been challenges with how interventions have been applied and an administrator is expected to turn around the items identified by COGTA. The Bill will allow COGTA to provide dedicated support to municipalities.

Ms Williamson replied that the R20 billion allocation to municipalities is based on the local government equitable share formula which determines how the R11 billion is allocated. The remaining R9 billion has been repurposed within COGTA from the following conditional grant allocations:
Municipal Infrastructure – R4.4bn
Integrated Urban Development – R190m
Urban Settlements Development – R2.2bn
Public Transport Network – R1bn
Regional Bulk Infrastructure – R401m
Regional Bulk Infrastructure – R409m
Water Services Infrastructure – R689m.

A tool is used by municipalities to measure allocation and report back to National Treasury on a weekly basis. Expenditure input is expected weekly and COGTA has access to the report that shows how municipalities used the money allocated against the budget.

On GBV, COGTA had to align its plans to the National GBV plan. One of the pillars COGTA had to align with was economic empowerment. The Annual Performance Plan reflects that 250 000 people need to participate and a significant number have to be females. The third pillar focuses on protection, safety and justice and COGTA focused on child friendly and gender responsive districts and how this has been included in the One Plan. Gender responsiveness will be strengthened.

Ms Williamson replied that the first workshop on redesigning the CWP has been held and the process of redesigning is still in progress. Full details will be provided at a later stage.

Mr Mbulelo Sigaba, COGTA Chief Director for Municipal Finance, replied that the municipal bills of people who cannot afford or who could not pay will be addressed by the local government equitable share. The additional R11 billion will be allocated for people who cannot afford to pay and that municipalities should have interactions with community members to identify those that have stopped working and cannot afford municipal services.

Dr Batandwa Siswana, DDG & National Programme Manager: Community Work Programme: COGTA, said the remodeling of the CWP aims to ensure that the programme is efficient and that there is value for money and that skills provided to participants can be used in the future. The programme needs to start working without a middleman. He explained that the matter is still being discussed. For the COVID-19 response plan, participants should participate during COVID-19 lockdown and be active in serving communities by helping where needed. In May and June there were challenges experienced in the payment of participants. This was communicated to participants and all provincial COGTA departments. All participants were now paid according to COGTA’s system. If participants have not been paid, the details of the participants will be required so that they can be located on the system. The system will be cleaned to trace any errors. On the monitoring system, the system will equally be evaluated and monitored so that when the system is redesigned errors can be detected. All details will be provided when COGTA presents the CWP action plans.

Mr Sigaba clarified 'Rethinking Municipal Finance' and said that focus is placed on the entire local government fiscal framework and exploring alternative revenue sources. Grants are meant for three years, so municipalities have to look at long-term sources of 15-30 years. Supply chain management was observed as a source of irregular expenditure and COGTA is looking at having transversal contracts on some commodities used by all municipalities. Pool financing is considered for municipalities that have identified projects on municipal boundaries such as the Lanseria Airport project which lies on the border of the City of Johannesburg and the City of Tshwane. Finances have to be pooled for the project from the two municipalities. Revenue lost by municipalities due to electricity distribution is also being considered so that municipalities can get electricity distribution licences so that they can get revenue. There are programmes planned involving Treasury and SALGA to look at the local government fiscal framework.

Mr Manyedi Nkashe, Chief Director: Anti-Corruption, COGTA, explained COGTA's plans for addressing corruption during COVID-19. COGTA has not registered any cases or received forensic reports from municipalities on investigations. The Department is working with Hawks and Anti-Corruption Task Team to address any cases.

Mr Mmaphaka Tau, Head: National Disaster Management Centre: COGTA, assured Members that the disaster grants are dealt with in a value chain system of financial management. The system starts with ensuring that municipalities submit business plans with detailed costs and identify activities and items that require funding. Once the business plans have been received, money is allocated. Regular reports must be submitted monthly on the expenditure progress. If challenges are identified, they are escalated to the Director-General and the provincial leadership to ensure that funds are used for their intended purpose. He highlighted that there is a redirection issue on the instructions that were given by the Minister which encourage municipalities to report expenditure to the municipal council.

The list of reprioritised municipalities includes municipalities from across the country.
Ngaka Modiri Molema District Municipality (North West)
Thabo Mofutsanyana District Municipality(Free State)
OR Tambo District Municipality (Eastern Cape)
Namaqua District Municipality (Northern Cape)
Frances Baard District Municipality (Northern Cape)
Waterberg District Municipality (Limpopo)
eThekwini Metropolitan Municipality (KwaZulu-Natal)
City of Ekurhuleni Metropolitan Municipality (Gauteng)
Dr J.S Moroka Local Municipality (Mpumalanga)
Nkangala District Municipality (Mpumalanga)
City of Cape Town (Western Cape)

Mr Tau explained that there have engagements with municipalities. Western Cape and Gauteng have already provided plans and feedback has been provided by the National Disaster Management Centre (NDMC). On the question of whether municipalities provide funding for disaster management planning, one of the core elements of plans is that they should have funding arrangements. The drought funding has not been spent but there are interventions to ensure that the funds are spent.

Follow-Up questions
Ms Xaba-Ntshaba emphasised that municipal offices were closed which meant people could not pay municipal rates and asked if municipalities will be encouraged not to increase bills and charge interest for those who cannot afford to pay.

Ms Mkhaliphi was dissatisfied with the COGTA response to her previous questions. COGTA had received more money to support municipalities and she asked what its role will be in ensuring that municipalities do not act recklessly. She requested clear responses to the questions.

Mr Hoosen said that the manner in which questions were responded to was disappointing. The importance in addressing the COVID-19 challenges by COGTA is clear. He asked for the measures in place to monitor the COVID-19 relief fund expenditure. COGTA is not conducting proper oversight on the usage of funds by municipalities. There are no preventive measures in place to ensure that the money is used properly by municipalities. The money is being allocated but not used properly. Investigations are long overdue especially when the money is long gone. The people are not being protected.

Mr Ceza said that there is no clear plan or measures in place to monitor the expenditure of funds to ensure value for money. If there were plans, municipalities would not be in the horrible state they are currently in. He asked how COGTA planned on ensuring supervision and consistent oversight of municipal expenditure when poor expenditure is common in municipalities. He asked if COGTA has a programme or intervention in place for indigent people in rural municipalities to bridge the revenue gap between rural and urban municipalities.

Mr K Motsamai (EFF, Gauteng) said that there is no explanation on the municipalities under section 139 intervention. He asked how municipalities that have communities with no access to public services such as water, electricity, health and sanitation will be assisted. He also asked for clarity on the 1 million graves that were dug for people in Gauteng.

Ms F Muthambi (ANC) said that in Programme 4: NDMC is the core of COVID-19 responsiveness. The Municipal Infrastructure Grant (MIG) reprioritised allocation aims to provide water to households and sanitise public transport facilities to municipalities that do not receive the Public Transport Network Grant. She asked why the COGTA presentation did not reflect the adjustment to the MIG grant and why the Integrated Urban Development Grant was not affected in the adjustments budget.

Ms Williamson replied that the budget for the local government elections is held by the Electoral Commission (IEC). She explained that the business plans submitted by municipalities indicate the exact amount required and what it will be used for in detail. The Department ensures that there is evidence of the expenses. On the oversights of municipal expenditure, COGTA does not have all the mechanisms in place and Treasury is being engaged with for a tool that can be used for the R20 billion. On the affordability of municipal bills, she explained that some issues belong to other departments and agencies and not necessarily COGTA but there will be engagements with these departments so that assistance is provided.

Mr Kevin Naidoo, Executive Manager: Municipal Governance, COGTA,explained that the MPAC falls under section 179 of the Municipal Structures Act. COGTA, through interactions with stakeholders, identified a need to legislate and the conclusion was reached that all municipalities must have an MPAC. The Select Committee was briefed on the Municipal Structures Amendment Bill [B19B-2018] in February.

The second intervention involved Treasury and SALGA and a manual was developed and provided to municipalities on how functions should be performed. MPACs are being made more functional. All MPAC reports must be submitted to the speaker who must table such reports in the next municipal council meeting. There are situations where MPAC reports are processed but not submitted to the speaker and tabled in municipal councils for various reasons. It is for this reason that it is now mandatory for MPAC reports to be tabled in councils. He noted that 67% of MPACs in municipalities were found to be functional by the Auditor General and COGTA is taking steps to achieve 100% functionality in all municipalities.

On local government elections, COGTA intends supporting the preparations for the process of elections as reflected in the Annual Performance Plan. Four major stakeholders are involved in the preparations for elections: COGTA, Municipal Demarcation Board (MDB), IEC and the municipalities. COGTA is the first stakeholder to prepare for elections because the Minister has to issue the formula used by MECs to determine the number of councillors for each municipality. The MDB then delimits wards in metropolitan municipalities. The IEC prepares for the actual election by finalising boundaries for voting stations and voter registration matters. The municipalities have to assist in providing infrastructure and entities. In the previous year, there was the approval for an Inter-Ministerial Committee (IMC) by Cabinet for preparations to be made for the upcoming elections.

Mr Parks Tau, Deputy Minister of Cooperative Governance, replied that the R20 billion allocation was part of COVID-19 response interventions. There was an indication between the President and the Minister of Finance that there would be an additional allocation from the reprioritisation of budgets later in the year. Many departments and entities were requested to make reductions in their budgets. The R11 billion is identified as part of the R20 billion and is not a reduction. The equitable share formula is used to distribute the money to municipalities based on poorer communities. The R9bn from the conditional grants system will be reprioritised to respond to COVID-19 challenges. The R20 billion excludes any previous commitments made by COGTA from the National Disaster Relief Grant. The National Disaster Relief Grant money was requested to be repurposed and rolled over by COGTA to Treasury. Additional weekly reporting was established so that municipalities account for this expenditure.

On the payment of municipal bills, municipalities have policies that allow for discounts to households depending on affordability. Municipalities can provide relief and have done so. On the one million graves in Gauteng, this has been addressed by Gauteng government who said that the graves have not been dug yet but it reflects capacity. There are processes in place to reduce the infection rate.

COGTA Minister, Ms Nkosazana Dlamini-Zuma, said that lessons have been learned from the OR Tambo and Waterberg municipalities during the DDM pilot that these municipalities have all the required personnel to deal with challenges. Some municipalities have been identified as not having proper finance personnel. There is also a shortage of expertise and Local Economic Development (LED) unit plans are not functional and have no staff. The lessons learned inform COGTA on the way forward and have determined that there must be shared services in a district for local municipalities until they are self-sustainable.

The Minister mentioned that another example of lessons learned is that there are no economic activity plans for developing municipalities and districts. Municipalities are required to have these plans. On COGTA's capacity to deal with and implement the DDM, COGTA does not have enough capacity which is why there is collaboration with the Development Bank of Southern Africa (DBSA) to capacitate and implement the DDM. Collaboration between the Districts is important in ensuring that there is impact. On the one million graves, COGTA is not involved in the matter. One million graves cannot be dug in Gauteng when deaths have not reached one million globally.

Ms Mkhaliphi asked about the people who have received messages about allocated grave numbers.

The Minster replied that COGTA has no knowledge of any grave allocations.

Ms Mkhaliphi said her questions were not properly responded to by COGTA and that questions should be responded to with clear explanations so that when the Committee conducts oversight, the concerns raised by communities can be properly addressed. She asked how COGTA will ensure interventions take place.

Mr Brink requested that COGTA provide the DDM pilot report so that decisions that inform the DDM can be understood as well as the achievements made.

The Minister said that there are programmes in municipalities for people who cannot pay municipal bills. People have to report to the municipalities on the reasons they cannot pay for municipal services. She stated that there is no money allocated for small businesses. The DDM pilot report will be provided in due time.

Mr Ceza clarified that the question on decreasing the number of indigent people in municipalities was because he wanted to establish if COGTA has a programme to decrease the number as this will assist rural municipalities in gaining revenue by ensuring that people can pay for municipal services.

Ms Mkhaliphi noted a woman who has tenants who cannot afford to pay her rent due to COVID-19 challenges. The woman received an "excess" on her municipal bill as she has not been paying her rates.

COGTA Minister, Ms Nkosazana Dlamini-Zuma, explained that COGTA does not have money allocated to assist small businesses that have to pay municipal rates and that municipalities must deal with the matter. There is no plan for this but it is being dealt with generally by government. On the decreasing the number of indigent people, the Minister replied that most municipalities have non-functional Local Economic Development (LED) which is responsible for initiating programmes to assist communities. 1 000 youth were supposed to be trained in agriculture to give back to the communities. She explained that other departments have to be involved so that the number of indigent people can be reduced, employment opportunities created and the economy strengthened.

Mr Hoosen said that the comments made by the Minister about one million graves are concerning especially since the issue has been in the media for a while. There were preparations for the graves to be dug and there has been news that government was procuring one million body bags. The Minister is not being transparent and honest. What are the plans for the burial spaces in Gauteng and what is the Minister’s role in the plans?

Mr G Mpumza (ANC) referred to the revised adjustment of R50.7 million in Programme 1 and asked if the amount allocated for COVID-19 is enough. The post COVID-19 plans should be aligned with the DDM and One Plan initiatives. He referred to the new indicator - Indicator 2.5 Economic Recovery Plans. Despite the economic plans being meant to be informed by the DDM One Plan Initiative, it cannot wait for this due to the current crisis. The indicator should be expanded to encourage communities to participate in local government processes and in community building and development.

He raised concerns on how the R4 billion for the CWP was used even though there were no systems in place to manage the money. Cooperatives are welcomed but they would have to be trained in reporting and record management so that there is value for money. Management principles must be fully applied to ensure that there is value for money in fighting poverty and unemployment. The local government equitable share needs to be developed by COGTA to ensure that the ratio allocated to municipalities is maximised so that development takes place.

Mr Fosi replied that the economic recovery plans are important especially with the impact of COVID-19 in addressing poverty and unemployment. It is a critical intervention that has to be implemented as part of the One Plan. One of the lessons learned from the pilot project is that most communities have industry potential which has not been utilised. The One Plan aims to unlock this potential for industries to create employment opportunities. Community based economic development initiatives will empower communities and address some of the challenges posed by COVID-19. Sustainable economic activity must be established.

Mr Siswana noted the comments by Mr Mpumza on the efficiencies of the CWP. The evaluation report will be completed and ready to be presented by the end of July 2020 to the Committees.

The Minister explained that the one million graves was not raised by COGTA but by the Gauteng Health MEC. When raised, the Gauteng COGTA MEC was questioned on the discussions that took place on the matter and the response was that there were no discussions. A statement was issued by COGTA on the matter. The Minister said that the statement made by Members are not fair especially since there is no knowledge by COGTA on the matter. Questions should be directed to that department.

Ms Muthambi noted that several provinces must still brief the Committee so questions on specific provinces should be reserved for when the provinces appear before the Committee.

Local Government: Municipal Systems Amendment Bill [B2-2019]
Chairperson Muthambi noted that in the previous meeting it was determined that COGTA should provide the Socio-Economic Impact Report on the Bill. The Committee received the requested letter from the Director General on 8 July on the resubmission of the Socio-Economic Impact Assessment Systems (SEIAS) sign off certificate. The letter notes a consultation process due to the amendments about municipal employees. The Chairperson confirmed that this process is correct because it will provide the Committee the opportunity to outline what local government should involve in the consultation process and give the opportunity to review the 1998 White Paper on Local Government. The Bill will be allowed to have a consultation process. The Chairperson asked the Director General to clarify the letter for further understanding.

Ms Williamson confirmed that the letter was submitted as per the request of the Committee and said that the understanding of the letter is as described.

The Chairperson asked for the views and proposals of Members on the letter from COGTA.

Mr Brink asked the Director General to explain if there is a delay in the proposed consultation process for the review of the White Paper on Local Government. He asked about the effect of the delay on the Constitutional Court judgment on the Bill and constraints by government to fulfill the Constitutional Court ruling.

Ms Williamson replied that the aim of the letter was not to delay the Bill. Page 5 of the letter outlines the impacts of the Bill as requested. The action plan supports consultation, but the timeline for completion is still anticipated between November and December. On the financial impact, estimations were provided as per the legal requirements.

Mr Brink said that the comments from COGTA clarify ensuring that consultation takes place.

Mr Hadebe asked for further explanation about the consultation process because the Committee had asked previously whether the process will follow procedure and address legal requirements.

Mr Brink asked for the implications the proposal has on the Committee’s work if the timeline is prolonged.

Ms Williamson replied that the explanation on the impacts are on page 5 and 6 of the letter. The issues raised for clarity are already being dealt with. There will be implications because the Department of Planning, Monitoring and Evaluation (DPME) still has to be consulted.

Mr Tebogo Motlashuping, Acting Deputy Director General: Institutional Development, COGTA, explained that the letter was not intended to delay the processing of the Bill but aimed to explain the SEIAS process that was undertaken by DPME in the Presidency. The Presidency confirmed that it has dealt with the socio-economic impact. Page 5 requests the finalisation of the Bill so that it is made law due to the challenges in local government. It follows the normal process for Bills and COGTA is not initiating the redrafting of the Bill.

The Chairperson mentioned that there were paragraphs in the letter that were not included in the initial memorandum on the Bill by COGTA. The confusion by Members was that the Bill would be rehashed due to the additional paragraphs that have been inserted. The Parliamentary State Law Advisor will be engaged to assist the Committee on the matter.

Mr Motlashuping explained that the Bill has had deliberations and stakeholders have been engaged with. After deliberations by the Committee, the Bill will be taken for public consultation. The Bill will not be rehashed or reintroduced by the Executive. The intention of the Bill being presented to Parliament is to ensure that the Bill is subject to public comments.

Mr Frank Jenkins, Senior Parliamentary Legal Advisor, said that the procedure for Parliament cannot be prescribed by COGTA because Parliament has its own procedures. The Bill can be withdrawn because it has not been submitted to the NCOP yet. The confusion can be clarified if there is an error in the letter, but the most important aspect is that public consultation takes place. The Bill has had deliberations and must be understandable for the public.

The Chairperson said that public consultations have been done on the Committee’s side and asked for further clarification on the matters in paragraph 5 and 6 of the letter. Has the Bill gone through the Socio-Economic Impact Assessment?

Ms Williamson replied that point 5 will be removed and said that no confusion was intended.

The Chairperson mentioned that a new date will be confirmed for deliberations and a proper letter with all the withdrawals and revisions should be resent to the Committee.

Meeting adjourned.


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