Section 139 intervention Makana Municipality: Eastern Cape progress report

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Meeting Summary

Video: SC on Cooperative Governance and Traditional Affairs, Water and Sanitation and Human Settlements

The Select Committee met on a virtual platform with the Eastern Cape Department of Cooperative Governance and Traditional Affairs (COGTA), a Member of the Executive Council (MEC), Eastern Cape and the Executive Mayor of the Makana Municipality. The meeting was called to discuss the progress of the Section 139 interventions in the Makana Municipality.

The Department presented reasons for the Intervention in the Makana Local Municipality which ranged from

institutional matters to financial matters, governance issues and a lack of service delivery. Municipal audits had resulted in four disclaimers and creditors were claiming in excess of R100 million, including R65 million claimed by Eskom. There were problems relating to water, electricity, sanitation, housing and waste management and the municipality had been close to a state of collapse as it was confronted on an ongoing basis with litigation and attachments of council property and its primary bank account. In 2014, Cabinet had approved an intervention in Makana.

The Department attempted to show the achievements and progress of the municipality in all the areas in which there had been challenges. However, a more recent court case in 2019 had led to a Court Order to dissolve the Makana Municipality. That was the subject of extensive discussion in the meeting.

In 2019, the Unemployed People’s Movement had  made two applications to the Court for the dissolution of the Makana Municipality on the grounds that the municipality was failing to provide services in a sustainable manner. After evaluating the Movement’s application, the Grahamstown High Court judgement approved the application for the dissolution of the municipality, despite the appeal submitted by the Provincial Executive Council. That was followed by several appeals on the grounds that there were numerous efforts in motion to salvage the situation in the Makana Municipality, including the Section 139 intervention.

The provincial Department of Cooperative Governance and Traditional Affairs outlined the current conditions in Makana. Although there were financial constraints, the Department claimed that the situation was stable and that they had achieved most of the objectives of the intervention. The Department listed various projects put in place to help rectify the situation in the municipality. The Executive Mayor spoke on improvements and his hopes for the future while the MEC assured Parliament of the provincial legislature’s engagement with the issue.

Members of the Committee expressed dissatisfaction that the crisis in Makana had reached extreme levels. There were questions about accountability and transparency in the municipality. Although a few Members called for the Council to be dissolved, several Members believed that a solution should be found to remedy the crisis in the municipality.

Members asked for clarity on the audit disclaimers. Had any action been taken concerning the staff that had been implicated in the Kabuso report? How had the municipality found itself entangled in court cases, and who was paying for those court cases? Why had the Executive Committee opposed the application to dissolve the Council?

How could there be no timeframe for the intervention? How much had the interventions cost the provincial department, especially given the reports of the numerous bail-outs given to the municipality? How much money had been channelled to bail out the municipality and could the municipality account for the money it had received from the provincial government during the first intervention? Had the former administrator submitted a satisfactory exit report upon the termination of her contract? How was the municipality going to deal with the issues discussed in the meeting and did it have the capacity to execute those objectives?

Meeting report

Opening Remarks
The Chairperson welcomed everyone in the meeting with specific emphasis on the invited guests. He expressed his condolences on the loss of Ms P Mmola (ANC) who had been a Committee Member. The Committee had lost a very important Member of the team who had passed away due to COVID-19. He urged everyone to take care of their families and constituencies.

The Chairperson had submitted a proposal to Parliament for an oversight visit to Mpumalanga by the Committee. On the agenda was a presentation on Section 139 interventions in Makana Municipality and the current court issue.
Section 139 Municipal interventions in Makana – Cogta, Eastern Cape

The briefing by Ms Charity Sihunu, Director of Municipal Administration, Eastern Cape Department of Cooperative Governance and Traditional Affairs (Cogta), presented the achievements resulting from the section 139 interventions in the Makana Municipality between 2014 and 2016. The interventions at the Makana Local Municipality were a result of numerous challenges. They included institutional matters, vacancies in key positions, lack of capacity including the finalisation of the organogram, skills audit and the Local Labour Forum (LLF) that was not fully functional. Financial matters, including four disclaimers, creditors in excess of R100 million and a below average collection rate of 66%, had reached a critical point.
The municipality owed the Electricity Supply Commission (Eskom) more than R65 million and R10 million to the Auditor-General.

There were challenges relating to governance issues and the effectiveness of Council structures and its inadequate delegation system. The municipality faced challenges with water provision, electricity, sanitation, housing and waste disposal. It was also faced with litigations which led to the attachments of council property and primary bank account. It was apparent that the municipality was unable to meet its debt obligations. A series of public protests targeted the municipality and a few stakeholders indicated their unhappiness and displeasure with the situation in the municipality.
Given the deteriorating situation at the municipality, the Cabinet resolved on 10 September 2014 to approve an intervention in terms of Section 139. The Department appointed an Administrator, Ms Pam Yako of Zenande Leadership Consultants, with effect from 6 October 2014 to Makana Local Municipality for a period of six months. On 17 March 2015, the Executive Committee approved a new intervention at Makana, without a timeframe, as the situation was not yet at an acceptable level of stability and proper governance. After the end of the contract, the MEC seconded a senior official, Mr J Gomomo, to act as an Administrator. He was introduced to the Council on 03 August 2015.
There were some achievements in the first intervention. Institutional stability was improved with the long-awaited recruitment of a Municipal Manager, although there were delays in finalising the recruitment because of a court challenge from one of the candidates. A Director for Engineering and Technical Services was appointed, which improved service delivery projects. The Performance Management System (PMS) framework was reviewed and forwarded to the Council for adoption at the end of March 2016.
The supply-chain policies and all finance management policies were developed and were to be reviewed by the new Council. A Financial Recovery Plan had been implemented. Payment plans were arranged with creditors and monitored consistently.
To promote good governance, all the oversight Committees were sitting as scheduled and many audits from issues of the previous year had been dealt with. The municipality received a qualified audit opinion which was an improved opinion from the disclaimers in the years prior to the intervention. The municipal communication strategy was reviewed and adopted by Council. The communication and stakeholder engagement committee was established and led by the Office of the Speaker. A communication strategy for consultation resulted in the establishment of a Petitions Committee, which was fully functional.
The organogram was reviewed, and its content was updated. Job descriptions were developed and reviewed.
The Sanitation Roadmap was started and the roads upgrade proposal was developed. The Regional Bulk Infrastructure Grant (RBIG) funding was allocated to the Belmont Valley and Meyfield Water Treatment plants. An agreement was made with Amatola Water and the upgrade of the Bulk Water Supply plant was to be completed in the 2017/18 financial year. A fence was constructed around the Grahamstown landfill site. The landfill site was being compacted and covered with suitable materials and a demarcation was made for different areas to cover different waste.
The intervention was lifted before the local government elections in 2016. The new Council proceeded without an intervention until 2019 when an application against the Municipality was instituted in the High Court which ordered the Provincial Executive to intervene in the matters of the Makana Municipality. The court proposed the invocation of Section 139 of the Constitution and the dissolution of the Council but, due to its financial constraints, the Municipality was in constant breach of its obligation. Although the provincial government saw the need for an intervention, Section 139 of the Constitution was not the solution. The provincial government resolved to impose a Financial Recovery Plan (FRP) to help the Municipality meet its financial obligations. Currently the situation was stable although existing financial constraints continued to compromise the execution of some of the Council’s duties.
Submission from the Legal Advisor
Mr Maqungu, Legal Adviser at COGTA, Eastern Cape, explained that on 14 January 2020 the Grahamstown High Court delivered a judgement against the Provincial Executive Council. The Council was instructed to dissolve the Council of Makana Municipality. The judgement proclaimed that there were jurisdictional facts that required an intervention. The Executive Council applied for leave to appeal. Immediately thereafter, the Unemployed People’s Movement (UPM) made a second application to the Court that suggested that, pending the Executive Council’s application, the initial judgement had to be affected. Both applications were received by the Court on 8 May 2020 and the judgement was delivered on 21 May 2020. The Court dismissed the Council’s application for leave to appeal but postponed indefinitely the application of the judgement. The Court used Section 172 (1)(b) of the Constitution which gave the Court discretion to make any order as long as it was just and equitable. There were also disagreements with the Court when it had given a grant that was not asked for. The Provincial Executive Council made numerous appeals because it had been mandated to dissolve the Makana Council. The judgement was considered unconstitutional because there were already concerted efforts by all spheres of government to salvage the situation in Makana. The fact that an intervention was also underway meant that the Council could not be mandated to dissolve the Makana Council because Section 139 was a discretionary law and not a mandatory one. The Provincial Executive Council was currently awaiting the outcome of its application to appeal.

The Chairperson interjected and said the presentation had not addressed the queries of the UPM. What had driven them to seek legal action and what were the jurisdictional issues that they had raised against the Provincial Executive Council?
Mr Maqungu explained that the UPM claimed that the Makana Municipality had failed to ensure that services were provided to the community in a sustainable manner. They expressed dissatisfaction about the provision of water, sewage leakages, waste disposal, lack of electricity, and bad roads. They said that the interventions employed by the provincial government had not been effective because the situation had worsened. The Municipality had failed to deliver services according to section 152 of the Constitution.
Ms S Shaikh (ANC, Limpopo) said the report did not give sufficient information about the institutional matters around the municipality’s audit and the road construction projects that had led to the intervention. She asked for clarity on the disclaimer that had been issued following the section 139 (1)(b) intervention and for the reasons for regression. She requested updates on the unfinalised appointment of the Municipal Manager and on the existing debt with Eskom. She asked for the total balance that was owed to Eskom and whether there were any payment arrangements. Had any action been taken concerning the staff that had been implicated in the Kabuso report?

Ms Shaik pointed out that it was necessary for the Committee to ensure that monitoring and assessments of interventions were more vigorous in future to avoid similar occurrences.

In response to the first question, Ms Sihunu said that, as the presentation had illustrated, there was no stability around institutional matters. The skewed audit was among the key reasons for the instability and needed to be attended to because the municipality was failing to deliver its services. When the Department had examined the expenditure of the institution during the intervention, it found that there was excessive spending on the cost of employees (COE). There were many hours of over-time and that the heavy expenditure on COE was not consistent with the services delivered. After the assessment, the Eastern Cape Department of Cooperative Governance and Traditional Affairs had felt that it was necessary to embark on a thorough skills audit and to inquire into the powers of the municipality, the skills that were available in the institution, the deficiencies that it faced and why it was lagging behind.

Concerning the appointment of a Municipal Manager, Ms Sihunu explained that there had been a vacancy in the municipality for some time. When the intervention had started in 2014, the Administrator had facilitated the recruitment of the Municipal Manager. One of the applicants was a Councillor.

In response to the question on progress regarding electricity and road works, she stated that, to assist the municipality, the Municipal Infrastructure Support Agent (MISA) had pledged its commitment to undertake those projects. MISA officials present in the meeting could indicate the work already done on various projects concerning electricity, water and roads.

Further discussion
Mr S Zandamela (EFF, Mpumalanga) asked if it was lawful to impose an intervention without timeframes. He requested clarity on matters concerning the Council because he believed that, before the 2016 local government elections, the Council should have been dissolved, thus making way for the installation of a new one. However, that seemed not to have been the case with the Makana Municipality. He asked for more information on how the institution had found itself entangled in court cases, and who was paying for those court cases. He expressed great concern about the absence of the UPW in the current meeting. They were the ones alleged to have taken the provincial government to court and their absence from the meeting posed a great possibility of bias in an understanding of how things had unfolded in Makana, leading to the court case. There were questions that were going to be asked but were not going to be addressed for that reason. He suggested that it was important to engage the UPW to find a solution.

Mr Maqungu responded that the intervention was regulated by section 139 of the Constitution because, when the NCOP objected to the process of the intervention, it had provided solutions on how to deal with the issues. That effectively made the intervention constitutional. In response to the question about the dissolution of Council after the term ended, he explained that, in the case of Makana, the intervention had been in April. That had been before the election which meant that there was no intervention when the new Council came in. He confirmed that indeed it was the UPM that had instituted an application against the Executive Committee to dissolve the Council.

 Due to the high possibility of court cases against the provincial government, Mr Maqungu explained that a budget was set aside specifically to pay the costs of any litigation. The State Attorney represented the government and the Department of Justice and Constitution paid the costs for which it would be reimbursed once it sent the invoices.

Further discussion
Mr Zandamela demanded more clarity on why the Executive Committee had opposed the application by the UPM to dissolve the Council. He argued that it was a lawful procedure and asked why the Executive Committee had opposed and defended a matter that was unconstitutional.

The Chairperson interjected, saying that the response of the of the Executive Committee was constitutional because they were being litigated by UPM and were acting on the basis of not incurring costs. Although he suggested that the Committee should not venture into the court cases, he emphasised that it was the right of the Eastern Cape Executive Council to decide whether to challenge the matter in court.

Mr S Mfayela (IFP, KZN) began by greeting the delegation from Makana and from the Eastern Cape Province. He said that, although he appreciated the report covering the years 2014 and 2016 given by the Makana Municipality, a report from 2016 to date would have done better justice to an understanding of the situation in Makana. The Committee wanted to know more about what had happened after the intervention because there was obviously a change of leadership in the Council between 2014 and 2016. That was necessary considering that members from the UPM might have still been under the impression that nothing had been done after the intervention. He agreed with Mr Zandamela on the issue of instigating interventions without timeframes and noted that it was rare to do so.

In his final remarks, Mr Mfayela asked for a general status update of the Makana Municipality. If one were to visit, what would one see?

Mr Mzukisi Mpahlwa, Executive Mayor, Makana, greeted members of the NCOP, the Member of the Executive Council, and colleagues present in the meeting. He confirmed that a new administration was in place after 2016 in the Makana Municipality and that indeed the municipality had many creditors. Most of them had taken the municipality to court and one of those was Eskom. When Eskom had taken legal action against them and threatened to disconnect electricity, the Council was mandated by the court to draft a new payment plan because the one that was in place was unsustainable. In terms of the new payment plan, the Municipality was to pay R7 million per month. Since then, the Municipality had paid regularly, to the extent that Eskom and the National Treasury had applauded the Makana Municipality for being the only organ of state that had remained consistent in its payment of debt.

Mr Mpahlwa emphasised that financial constraints was the main challenge for the Makana Municipality. When he had come into office, the Municipality was owed R539 million by the residents and businesses. Since then, the debt has escalated to almost R600 million although the Municipality’s collection was up to 70%, as reported in the presentation. The figure fluctuated as it had dropped to 55% during the COVID pandemic but seemed to be rising gradually. In August and December 2018, a Municipal Manager and Chief Financial Officer were appointed. That was evidence of how the Makana Municipality team had a relatively new administration. Various programmes had been implemented with the assistance of the national and provincial governments, including the James Kleynhans Water Project which would double water capacity. To date, the project had completed level two of four levels. The Water and Sanitation Department had committed over R500 million towards the project and Amatola Water was appointed as the implementing agent.

He said that there were several other projects to improve access to water, including the sewage facilities which was a huge concern for the Municipality. Due to old infrastructure, sewers in the area were over-capacitated leading to occasional leakages around the city. However, with the strained resources discussed above, the municipality was trying its best to upgrade.

The Municipality also lacked funds to rectify the collapse of the road infrastructure as a result of potholes. Mr Mpahlwa stated that the estimated cost to resurface all the roads in Makana was R350 million but the Municipality had only managed to allocate R200 from its revenue. A company had been appointed to manage the landfill sight which, in the past, had led to another court case. The Municipality was receiving monthly reports from the company which were submitted to the litigants and the court. He stated that the Municipality owed creditors about R263 million. If the Municipality were to receive money owing, it would be able to pay the creditors and still have enough to deliver services.

The chairperson interjected and asked where he had been before he joined the Municipality as the mayor. Had he been part of the previous Council?

The Executive Mayor responded that he was not part of the Council and that he had been recruited from outside the structures of the Council.

Mr K Motsamai (EFF, Gauteng) spoke in seTswana and the chairperson translated to English. He requested  clarity on how the Municipality was sustaining the R7 million it  had to pay to ESKOM monthly, who had taken the matter to court and who was paying the legal costs.

The Executive Mayor said that the Municipality had not taken the matter to court. It had owed the ESKOM money and Eskom had threatened to disconnect the electricity supply. Businesses had gone the court to prevent the disconnection of the electricity supply. The court had revised the debt payment plan and that was how the Municipality had arrived at the R7 million monthly payment to the ESKOM. The arrangement stipulated that the debt was to be completed in 2021.

Further discussion
Mr I Sileku (DA, Western Cape) welcomed the delegations from the province and from the Municipality. He expressed great grief about the passing of Ms Mmola and sadly exclaimed that no one will call him “Booitjie” again. Nonetheless, the work continued. His concern was that provinces had the responsibilities of being intervening authorities but they did not do their best to making sure that they intervened at the right time and put proper mechanisms in place to turn around those Municipalities. He said it was therefore expected that the court had decided that the Municipality had to be dissolved. The provincial government had failed in its duty as an intervening authority to salvage the Municipality. When the intervention commenced, there was supposed to be a Financial Recovery Plan (FRP). Although the provincial government had an FRP, it had never implemented it. He requested clarity from the Department on the allegations that the previous administrator had been earning R300 000 per month. How much had the interventions cost the provincial department, especially given the reports of the numerous bail-outs it had given to the Municipality? How much money has been channelled to bail out the Municipality and could the Municipality account for the money it had received from the provincial government during the first intervention?

Mr Sileku shared Mr Zandamela’s concerns about the absence of other stakeholders in the matter and asked why they had not been invited to the meeting, including the oversight bodies who could have added a much-needed balance on the feedback about what was truly happening in Makana. Such feedback was crucial especially during the ongoing COVID-19 pandemic when Committee Members were unable to travel to provinces to see the situation in the Municipalities for themselves. He mentioned that the issues that had convinced the judge to consider the dissolution of the Makana Municipality was that when the provincial Department opposed the UPM application, it could not dispute the allegations it was facing. The provincial Department had no proof that it had intervened. He suggested that a new system had to be designed to account for the money spent on interventions because currently financial resources were being spent but without any results. He asked the Municipal Manager and the Executive Mayor about fact that they had been found to be in contempt of in court. A court ruling had been referred to an independent public prosecutor because perjury had been committed in an affidavit that the Municipal Manager or the Executive Mayor had submitted to the court. What was the status of the case and was it going to be followed up?

The Chairperson stated that the core business of the meeting was the section 139 intervention. However, the provincial Department’s meeting included the court cases. As a result, it was inevitable that there would be discussion of the court issues. He requested that the Committee be briefed on matters concerning the court’s verdict and the finances involved in those procedures. He asked the members to avoid the court cases in the meantime.

Ms Sihunu replied to Mr Sileku’s question by objecting to allegations of not implementing the FRP. It had been implemented from 2014 up until the lifting of the intervention in 2016. She referred to the presentation which showed the achievements of the provincial Department after the first intervention, adding that the provincial department had approved an intervention for six months. The Department had provided reports to the Executive Committee on a quarterly basis. Those reports at the end of the six months convinced the provincial government to extend the intervention period because there were many issues that needed to be resolved following the strategies of the FRP. That extension was not time bound as it was agreed that it would only be lifted when tangible results were witnessed. Ms Sihunu confirmed that the administrator was paid R300 000 per month. She explained that the package was based on the Department of Public Service and Administration (DPSA) rates which had specific packages for administrators or consultants that worked for the government. Since the Administrator had joined the Department from a national department where she had occupied the position of the Director General, she was paid according to that level. Although the media suggested that she was being paid exorbitant amounts, her salary was within the stipulated salary gazetted in the DPSA.

The Executive Mayor said that it was not a sewage problem that had resulted in the court case, but it was a landfill site. The Makana Unity League (MUL) was the one that had taken legal action. In 2015, the court order had stipulated that the municipality had to make sure that the facility complied with eight conditions. In 2019, the MUL went back to court and claimed that the Municipality had failed to comply with that court order. He said that the action was malicious and intentional. The judge agreed with the application and had declared that the Municipality, Municipal Manager, and the Mayor had been found to be in contempt of the court of 2015. Clarifying the issue of the affidavit, he explained that the dates in the affidavit had not been consistent.

Further discussion
Mr M Nhanha (DA, Eastern Cape) expressed deep gratitude for the invitation he had received from the Chairperson to join the meeting. He praised the Executive Mayor and emphasised that he was a very capable man. He wished him luck because in his position as the Executive Mayor, he had inherited a system that was already overwhelmed by its problems. He referred to a time when the Makana Municipality was regarded as a strategic Municipality in the Eastern Cape. In the late 1990s, it had had approximately R60 million in reserves.

According to Mr Nhanha, that had changed for the worse after the 2011 local elections. During that period he had served as a Councillor in the municipality and had been on many committees, including the revenue committee. That background made him quite knowledgeable about the operations of the municipality. To reinforce Mr Sileku’s enquiry about salaries, he  stated that in 2014 the Administrator was paid R27 000 a day and she worked for only four days in the week. After her six-month contract was extended to nine months, she was paid just under R3.1 million in total. Even the President of South Africa did not earn that much. He said that despite the huge salary that the former Administrator received, she was not proud of the work that she had done during her tenure. He asked Ms Sihunu if the Department had obtained value for money after appointing the former Administrator. Had she submitted a satisfactory exit report upon the termination of her contract?

He confirmed that there was an FRP, although it was not entirely implemented. He said the people were pleased with the new mayor because he displayed commitment to his work. He recalled a time when the people would march to the city hall but the former mayor would remain in his office and not address the people.

Mr Nhanha lamented that the Committee could “talk until the cows come home” but Makana had a huge problem. He referred to the Municipality’s bloated workforce and said studies showed that for the Makana Municipality to function optimally, it needed just under 370 employees. On the contrary, the Makana Municipality had 38 middle managers and deputy directors. Although he did not have information about their salaries, he claimed that they had very generous travel allowances of R8 000 a month. He recalled a time when the middle managers had no work to do and had resorted to issuing proof of residence to people who wanted to open bank accounts. The Municipality had a bloated workforce that did absolutely nothing. He invited members to his twitter account where he had evidence of workers who slept under the city hall’s trees from 8am in the morning to 3pm in the afternoon. He asked Ms Sihunu to respond to his comments.

Mr Nhanha challenged the claims made by the municipality that since 2014 there had been improvements in Makana. As a resident of Makana, he testified that the situation had become worse. Potholes in the city had multiplied. He said that, although Mr Maqumbu had suggested that the municipality had not reached the stage of dissolution, many rate payers in the Municipality thought the opposite. He asked the provincial department and the municipality to listen to the voice of the voters and ratepayers as their opinions were very important.

He referred to sewage in kwaThatha location that ran through people’s houses and into the Kowie River. That river flowed to Port Alfred where a large population consumed water from the river. He challenged the Executive Mayor’s claims that sewage leakages were occasional. They were common and had been a problem for a very long time.

Mr Nhanha argued that nothing had been done about the Kabuso Report. Individuals implicated in the report were not held accountable for their misconduct and the Department owed the Committee an explanation. He strongly supported the dissolution of the municipality and suggested that moving forward, improvements needed to be made with regard to minimizing the wastage of resources and revenue collection.

Mr Xolile Nqatha (Member of the Executive Council (MEC), Eastern Cape) acknowledged the contributions made by the Committee Members. He said that the provincial government was also deeply concerned about the situation in Makana. Despite all the challenges, the Executive Council was trying to resolve all the issues discussed, but it was not an easy task. Even if the municipality were to be dissolved, the infrastructural backlogs were not going to be resolved overnight. It was therefore necessary to focus on finding solutions for the crisis and not to support dissolution. The existing infrastructure was meant for a small population but as, the cities continued to grow, the infrastructure became overwhelmed.

MEC Nqatha reiterated the actions, referred to by the Executive Mayor, that had been put in place to resolve the water and road works issues. One of the reasons why the provincial government was appealing the court ruling was that there had been judicial overreach in the judgement passed. Parliament had its own role and if it failed to execute it, other bodies could usurp its functions. Therefore, if the judiciary were to direct the provincial government to exercise its discretion, it would be a judicial overreach. That would have negative implications, not only for the province but for the country, especially in rural areas where the municipalities had a very small revenue base.

The Executive Mayor offered to give the Committee a comprehensive report on the projects underway to rectify the sewer, water, roads and the landfill site problems. The municipality had employed the services of Kagiso Trust to clear their debt books and to implement revenue improvement strategies. One of the strategies was the debt relief scheme where residents that owed the municipality more than 180 days’ debt could approach the municipality for a discount of 50%. From there, an arrangement would be made with the resident to pay back the remaining 50%. He agreed with the MEC’s view that the municipality needed support, not to be dissolved, especially considering that its administration was relatively new. A dissolution would result in the acquisition of an Administrator for nine months whilst waiting for local elections and that would be counterproductive.

He stated that, as part of consequence management, the Municipality was rooting out individuals that were not performing adequately, particularly those in senior management positions.

Further discussion
Ms C Visser (DA, North West) said that the presentation that the provincial government had given was sugar-coated. The report on the budget did not make sense. She claimed that she knew people who lived in Makana and who occasionally reported to her on the situation there. It was public knowledge that there had never been a successful intervention in South Africa since the democratic government had taken over. She agreed with the Mayor that there needed to be improvements in consequence management, accountability and discipline, especially the discipline of representatives sitting in the Council by political parties. The provincial government had neglected the municipality and that was why the situation had reached the levels discussed in the Committee. She strongly disagreed with Members who supported the dissolution of the municipality because that was not going to resolve anything. The solution was to identify the problems, own them, and find solutions. She urged members of Cogta to comply with Section 154 of the Constitution.

Ms Visser requested both the Kabuso and Financial Reports.

The Chairperson disagreed with Ms Visser’s observation that there had not been any successful interventions. However, that she was entitled to her view.

Ms Visser interjected that it was not her personal view but contained in a report that had been presented to the National Assembly the previous week.

The Chairperson was not sure about the credibility of the report because between May and June 2020, the Committee had engaged provinces with Section 139 interventions and four municipalities in KwaZulu-Natal had registered significant improvements as a result of interventions.

Mr G Michalakis (DA, Free State) said that his questions had already been discussed.

The Chairperson said that he was disappointed at how the Makana Municipality had deteriorated. He reiterated Mr Nhanha’s claim that it was once the best municipality in the country. He opposed the move to dissolve it. A dissolution had very important implications for all municipalities. A major concern was how the municipality was going to deal with the issues discussed in the meeting and whether it had the capacity to execute those objectives. He asked for positive expectations that the Mayor and the MEC had for the future of the municipality, despite its problems.

The Mayor said there were some strategies that had been put in place and that promised to yield positive results. He referred to the conglomeration of civil societies in the “Makana Staple of Unity” that were working in collaboration with the municipality towards improving service delivery. He emphasised the important role that Kagiso Trust was playing in salvaging the municipality from its problems. Although Kagiso Trust had ventured into local governance from educational institutions, its work was already producing positive results. Knowing of its numerous successes in the education sector, Mr Mpahlwa believed that the Trust’s work was going to yield positive results in the local governance space. He emphasised that Kagiso Trust was also working to change the unwanted culture in the municipality that was rightfully depicted by Mr Nhanha. He emphasised that if it were not for the assistance from the provincial and national governments, the situation in Makana would have been much worse. The water situation was an example where the Department of Water and Sanitation had committed more than R537 million to upgrade water facilities. When that project was completed in a year’s time, the municipality would be able to supply 20 million litres of water which was well above the city’s average consumption of 13 million litres. The municipality was using the revenue collected to refurbish underground pipes. Therefore, he had a positive outlook on things but emphasised that it would take some time to fully realise a complete turnaround.

The MEC said that most of his observations have been presented by the Mayor. He emphasised that the provincial government was going to intensify support for the Municipality. He anticipated that more progress would be reported in the municipality as there was political stability within the institution. They wanted to demonstrate to the court that there had been a change in the municipality.

Concluding remarks
The Chairperson said he was going to request permission from Parliament to visit provinces on an urgent basis so that the Committee could observe what was happening in the municipalities. That would also allow them to engage other stakeholders. Important reports relating to Makana had been promised to the Committee, including the exit report from the outgoing Administrator. That report would indicate whether the provincial government and the Municipality had obtained value by appointing an Administrator. The second one was the report from the Mayor on infrastructural projects, service delivery and the finances. That report should address Ms Shaikh’s unanswered question on the status of the audit outcomes and the Municipality’s post-audit strategy to deal with issues raised by the audit.

On behalf of the NCOP and Select Committee, he informed the provincial government that it had to improve its support for the Municipality. He suggested that intervention mechanisms be developed to deal with immediate problems like electricity, water and sewer leakages.

The Chairperson praised the new Mayor, saying that he seemed like a capable man and that, from his presentation, he seemed a politically stable individual and that offered good prospects for improvements in the municipality. However, his success and that of the municipality depended on the support he received from the provincial and national governments. Therefore, the NCOP also had to play its role in closely monitoring municipalities in similar predicaments.

He thanked the Mayor and the MEC for attending, and their delegates as well as the guests that had attended the meeting

Meeting adjourned.

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