Dr Beyers Naude Local Municipality status report

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Cooperative Governance and Traditional Affairs

12 August 2021
Chairperson: Ms F Muthambi (ANC)
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Meeting Summary

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The Committee was briefed by the Dr Beyers Naude Local Municipality (BNLM), Eastern Cape Department of Cooperative Governance and Traditional Affairs (EC CoGTA), Eastern Cape Provincial Treasury, South African Local Government Association (SALGA) and National Department of Cooperative Governance and Traditional Affairs (CoGTA) on the status of BNLM and the support provided to it. The Committee last met with Dr Beyers Naude Local Municipality on 19 August 2020.

BNLM said that since its 2016 amalgamation from the three former Ikwezi, Baviaans and Camdeboo Local Municipalities (ILM, BLM and CLM), the municipality had received inadequate financial support so it has been unable to carry out its functions effectively and the residents have suffered as a result. Both the Committee and the officials present agreed that the amalgamation of municipalities should be revisited by the Municipal Demarcation Board (MDB), with more emphasis placed on an analysis of the state of finances and governance structures of the municipalities. In addition, National Treasury should consider increasing the allocation provided to amalgamated municipalities, to ensure they are better able to manage the inherited debt and expenses.

Committee members expressed concern that no officials had been held accountable for the failed amalgamations. Members noted that the residents of these municipalities are not consulted and are often not in favour of their municipality being amalgamated. SALGA recommended that when considering whether to amalgamate a municipality, MDB should consider the extent to which this would affect the quality of democracy for residents.

Due to the high level of debt and irregular expenditure it inherited from the former municipalities, BNLM has struggled to set aside money for service delivery. The only beneficiaries of the amalgamation have been the creditors and employees, as the municipality is only focused on paying creditors and salaries. Pre-amalgamation, two of the former municipalities were on a grade 1 salary level, and they are now placed on level 3.

Drought has been a serious challenge for the municipality, and all the dams in the area have dried up. As a result, the municipality is completely reliant on boreholes but without rain, the boreholes do dry up as well. Water has had to be rationed for the past four years in the municipality.

It is part of the Sarah Baartman District Municipality (SBDM) which had requested along with EC COGTA that the drought be declared as a state of local disaster for the district. The Eastern Cape National Disaster Management Centre (NDMC) has agreed to declare a state of local disaster. With the assistance of National Treasury, Eastern Cape CoGTA is looking for a sustainable solution to alleviate drought in the area, as investors are looking to leave the district.

The Committee was pleased that National and EC CoGTA and Provincial Treasury had applied a hands-on approach in support of the district and its local municipalities. Members agreed that through the use of the District Development Model (DDM), all three spheres of government would be able to cooperate effectively and efficiently in ensuring that local municipalities are stable; and better able to provide services to citizens.

Meeting report

Opening remarks
The Chairperson congratulated Ms Thembi Nkadimeng on her recent appointment as COGTA Deputy Minister on behalf of the Committee. 

Ms Thembi Nkadimeng, COGTA Deputy Minister, thanked the Committee.

The Chairperson announced that the SALGA CEO's wife had passed away on Saturday. On behalf of the Committee, she sent condolences to the family. 

Explaining the reason for the meeting, the Chairperson said that the Committee had previously scheduled to meet DMNLM at its 1 June 2021 meeting with all the SBDM municipalities. However, the municipality was not part of the engagement as it had to host a technical task team deployed by SALGA to assist them with their challenges. The Committee had agreed to defer the engagement to allow the task team to develop a support plan for the municipality. With the extra time, the Committee expected adequate answers from the municipality.

During the 19 August 2020 meeting with the municipality, the Committee expressed its concern that DMNLM had received three consecutive audit disclaimers (2016/17, 2017/18, 2018/19). Although it improved to a qualified audit opinion in 2019/20, more work was required. Since its amalgamation in 2016, the municipality has been under increasing financial pressure and has accumulated continued financial losses.

Whilst the Committee acknowledged that the municipality is a casualty of a poorly managed demarcation process, it noted the Auditor-General's findings that there had been limited assurance provided by senior management, the Mayor, the internal audit, Municipal Public Accounts Committee (MPAC) and the Municipal Manager (MM). Thus, the AG recommended that intervention was required to improve the internal controls, as well as key risk areas, such as the quality of the annual financial statements (AFS), performance information, supply chain management (SCM), human resource management and information technology.

The root causes of these audit challenges included a lack of compliance monitoring, a lack of resource management and prolonged vacancies in key positions. Unless all key role players address these, the Committee foresees no improvement in governance.

The Eastern Cape CoGTA MEC, Mr Xolile Nqatha, congratulated the Deputy Minister on her appointment. His department expressed hope that the presentation would show that there has been an improvement in BNLM. He thanked the Committee for organising this meeting. Many lessons could be drawn on how to correct the challenges faced by other municipalities in the province.

The Eastern Cape Finance MEC, Mr Mlungisi Mvoko, also congratulated the Deputy Minister on her appointment. The Provincial Treasury is determined to provide assistance to the municipality, to ensure that it is able to overcome all its challenges.

SALGA National Executive Council Member, Cllr Bheki Stofile, said that SALGA appreciated the condolences on the passing of its CEO’s wife. SALGA has been struggling to fulfill its functions; however, it would continue to work hard within its limitations. The SALGA presentation would include feedback on the recommendations it has provided to the municipality. In addition, it would also the challenges faced by the municipality prior to amalgamation.

SALGA has had productive discussions with the Provincial Treasury and EC CoGTA over the weeks about the municipality. It appreciated the assistance provided by both departments. The organisation is looking to work with all relevant stakeholders to ensure that all municipalities in the country are functional.

SALGA input on its multi-disciplinary support to BNLM
Mr Lance Joel, SALGA Chief Operations Officer, expressed appreciation to the Committee for providing the platform for stakeholders to communicate about BNLM to ensure they better contribute to improved service delivery and functionality.

BNLM is the largest municipality in SBDM, and makes up nearly half the area of the district. Due to its size, councillors have to travel longer distances than councillors in other municipalities.

After the amalgamation, the municipality inherited a debt of R65 million, which has since increased. For three consecutive years, the municipality achieved a disclaimer audit opinion, and only in 2019/20 did it achieve a qualified audit. Much work has been done to improve the audit outcome and indications are that it will continue to improve over the coming years. 

SALGA noted that there are four serious challenges facing the municipality:
• Debt inheritance which has brought a large financial burden to the municipality
• The prolonged drought in the area, which has created significant water shortages
• A significant number of court cases brought against the municipality
• Inability to fund capital projects due to funding constraints.

To address the challenges, the BNLM Executive Committee and SALGA agreed to draft a programme of action (POA) which was developed in June 2021. The POA indicates that SALGA will provide the municipality with support on water, electricity, outstanding legal cases, waste management and financial management. Council has approved the POA and the intention is for the programme to be implemented from 1 September. The POA will be shared with the Committee.

Through its support, SALGA hopes that the municipality can improve its revenue collection rate, institutional delivery mechanisms, enforcement of by-laws, financial management and governance standards.

Dr Beyers Naude Local Municipality input
DBLNM Mayor, Mr Deon de Vos, said that the SALGA presentation had covered most of the challenges faced by the municipality. Due to this, he asked if the municipality should still present. He recalled that in a previous Committee meeting, Members had been left demoralised by the state of affairs.

He agreed that the municipal officials should not be proud of achieving a qualified audit opinion and they have been willing to adopt the AG’s recommendations.

Prior to the 2016 amalgamation, both ILM and BLM had collapsed, with the latter instituting a social delivery lockdown, with no services being provided to residents. Both municipalities did not have senior managers as they had all left. The current administration had inherited serious challenges from both municipalities.

A state of the municipality report and audit action plan for the 2019/20 and a 2020/21 Medium Term Revenue and Expenditure (MTREF) Adopted Budget Assessment Report have been submitted to the Committee. He congratulated the Deputy Minister on her appointment. 

The Chairperson requested that the audit action plan be presented. The Committee was encouraged that Eastern Cape Provincial Treasury and CoGTA have adopted a hands-on approach in assisting the municipality. 

Eastern Cape CoGTA input on support provided to SBMD municipalities
EC CoGTA Acting DDG: Developmental Local Government, Ms Charity Sihunu, stated that the presentation coverede the support it has provided to the municipalities of the SBMD.

The department assisted the local municipalities on the following aspects:

• Municipal Infrastructure Grant  Management Information System (MIG-MIS) Training, which assisted municipalities in capturing and reporting on their MIG Expenditure performance
• District Wide Infrastructure Forum (DWIF). The forum is held monthly with all municipalities' Technical Division and Political Principals present. It is a platform to present performance and challenges each municipality has in utilising their Capital Infrastructure Grants.
• Project Registration. The department Pre-District Appraisal Committees (DAC) and DAC sessions to advice municipalities on project prioritisation, applications and approvals by National CoGTA
• With assistance of Provincial Treasury, the department has assisted the municipalities with the preparation of their AFS; and also in retrieving debt owed by government departments.

Provincial Treasury briefing on state of SBDM local municipalities
Deputy Director-General (DDG) of EC Provincial Treasury, Ms Bulelwa Nqadolo, said that its focus was on the state of BNLM and the support it has been provided. Some of which were:
• As the municipality adopted an unfunded budget, Provincial Treasury facilitated a Municipal Standard Chart of Accounts (mSCOA) workshop and facilitation with system vendors undertaken with a National Treasury Municipal Finance Improvement Advisor.
• Provincial Treasury provided the municipality support during its discussions with Eskom and other creditors on a repayment plan.
• It assisted the municipality in the review of its financial recovery plan and monitored its implementation monthly.

National COGTA input
Mr Themba Fosi, CoGTA DDG: Local Government Support and Interventions Management, congratulated the Deputy Minister on her appointment.

BNLM should be used as an example to inform the discussions on the redetermination of municipal boundaries. These discussions should look at the criteria and support required for municipalities once they have been amalgamated, to ensure that they are sustainable.

Officials from the Municipal Infrastructure Support Agent (MISA) have been working with the SBDM municipalities. Funding for infrastructure projects has been provided by CoGTA to the districts, which is in line with the DDM. The DDM has provided the department with a platform in which it can provide direct assistance to municipalities.

COGTA will continue to work with SALGA and the provincial government to configure a plan to deal with the challenges of the municipalities in the district.

Discussion
The Chairperson appreciated SALGA’s presentation and said that it showed that there had been recognisable progress in the municipality. The DDM is an important platform for provincial and national government to make significant change in municipalities.

Greater focus has to be placed on the provision of funding to municipalities after amalgamation, because once a municipality has been amalgamated, much of its budget is spent on salaries.

Ms H Mkhaliphi (EFF) said that the MDB must provide clarity on what criteria it uses to amalgamate municipalities, as there has been a trend where the intentions for amalgamating a municipalities are not realised.

In the previous meeting with the District, it mentioned that water security was a serious challenge. She asked what measures the municipality had put in place to mitigate the effects of the drought.

The R161 million debt owed to Eskom is a serious concern, particularly due to the poor financial state the municipality finds itself in. She asked how the municipality intended to address its Eskom debt. Further, what plans had the Provincial Treasury put in place to assist the municipality to emerge from its poor financial state.

No timeframes had been provided on when the municipal council intended to write off the irregular expenditure incurred.

She asked if consequence management had been enacted in the municipality. In what state were the disciplinary boards?

Mr I Groenewald (FF+) referred to the R6.2 million cost of contractors and consultants and asked if the consultants had assisted in stabilising the finances of the municipality. The presentation stated that the municipality has security costs of R6.2 million and he asked for clarification on what services had been provided.

He asked if there is a service level agreement with a particular farmer in the area to provide water to the communities. What challenges had BNLM had during the negotiations with the farmer?

He asked how many criminal cases had been opened with the South African Police Service (SAPS) and what their progress was.

The report said that BNLM has had challenges with service delivery, and he asked if it had a plan to motivate its staff to be more productive so as to ensure that all master plans are implemented.

The Municipal Systems Act requires that the municipality must have a client services communication mechanism to communicate with the community. He asked how the municipality planned to effectively communicate with its residents if its staff did not answer telephone calls to the municipal office.

Mr K Ceza (EFF) asked if preventative methods had been put in place to ensure that public money is not spent on legal fees and is solely focused on service delivery.

He asked what plans had been in place to ensure that someone is held responsible for the failed amalgamation. What informed the department’s decision to recommend that the three municipalities be amalgamated.

To improve its ability to service its debt, BNLM should look to recover the money owed to it by government departments and businesses. He asked how much money was owed to it by departments and businesses.

A Municipal Water Infrastructure Grant (MWIG) amounting to R303 million was allocated to the municipality to drill boreholes and to conduct water cleaning. He asked what actions the municipality has taken to ensure that residents have access to clean and safe drinking water, as required by Section 152 (1)(d) of the Constitution. Also, what action had SALGA taken to assist the municipality in this?

He asked what local economic development strategies had been put in place that would ensure there is a conducive environment to create job opportunities. The creation of jobs would also improve revenue collection.

The report states that revenue levels were stable prior to Covid-19. He asked BNLM to provide evidence to substantiate the statement.

He asked MPAC to share its findings on the investigations into irregular expenditure. Had the municipality put in place preventive internal controls? aHadHad consequence management been implemented against those found to be responsible for the irregular expenditure?

Dr Beyers Naude Local Municipality response
Mayor De Vos replied that the only amalgamation beneficiaries have been the creditors and employees, as the municipality is focused only on paying creditors and salaries. Pre-amalgamation, two of the former municipalities were on a grade 1 salary level, and now they are placed on grade 3.

At the start of the current administration's 2016-2021 term, labour relations had completely collapsed, and municipality did not have a Director for Corporate Services or a Human Resource Manager. However, since then, the municipality has appointed the relevant staff to attend to organised labour. In addition, a labour forum has been established, which has allowed for greater communication between the municipality and organised labour.

The municipality also appointed forensic investigators to investigate suspected irregularities. After investigations were concluded, a report was submitted to Council by MPAC which was adopted and several officials have since been dismissed. Criminal cases were opened at SAPS and have been referred to the Hawks for further investigation.

Two directors have also been dismissed for poor performance. No consequence management has been taken against officials responsible for irregular expenditure, as the documents from the previous municipalities have gone missing. Much of the irregular expenditure is inherited, but the municipality admits that it has since then recorded irregular expenditure.

Referring to revenue collection, he noted that Eskom directly supplied electricity to four settlements in the municipality and as a result, it has been unable to implement its credit control bonuses.

The municipality has a number of turnaround strategies but is unable to implement them as it lacks the required funding. It has had to work within its limited means to provide services to its residents.

Drought has been a serious challenge for the municipality, and all the dams in the area have dried up. As a result, the municipality is completely reliant on boreholes but without rain, the boreholes do dry up as well. Water has had to be rationed for the past four years in the municipality. The Department of Water and Sanitation (DWS) has provided the municipality with water tanks, which have assisted the communities.

Some of the communities have been receiving water from a farmer in the municipality but this supply has stopped as there have been disagreements between both parties. The municipality’s legal team is currently working to resolve the outstanding issues.

On the unfunded budget, the municipality has been working with the Provincial Treasury on its budget, and it has since adopted a budget with a plan.

The municipal council is trying to capacitate MPAC to ensure that it can fulfill all of its functions.

The municipality has been reliant on consultants to assist it with its AFS, but it was pleased that for the past financial year, it was able to compile and submit its recent AFS without their assistance. The municipality is now looking to achieve an unqualified audit through its internal auditors. 

A communications application and an internal municipal response team have been established to improve the municipality’s communication. However, due to the mountainous landscape and the vastness of the land there has been a challenge with the reception.

Much of the infrastructure in the area is old and was built to accommodate a small population. Through the Municipal Infrastructure Grant (MIG), the municipality is trying to repair its ageing infrastructure but without increased funding, it will not be able to make the required improvements.

MPAC Chairperson, Mr Willem Saffers, said that the report presented to Council showed irregular expenditure amounting to R130 million from 2013 to 2017. R79 million of this amount was inherited from Ikwezi, and cannot be accounted for, as the financial documents have been lost (Council sent three teams to Ikwezi to search for the documents). As a result, MPAC recommended that this amount be written off. Council has been able to reduce R40 million of the debt, where documentation has been found.

Irregular expenditure incurred during 2017/18 and 2018/19 (amounting to R28 million) was investigated by internal audit, and upon recommendation from MPAC, it was written off. MPAC hoped that the remaining irregular expenditure would be attended to in its next meeting.

Internal systems have been put in place to prevent unauthorised, irregular, fruitless and wasteful expenditure (UIFW) from occurring in the future. Provincial Treasury has assisted MPAC in previous investigations. If it required assistance for UIFW investigations, MPAC would request assistance from  Provincial Treasury.

Municipal Manager, Dr Edward Rankwana, stated that in line with the Municipal Financial Management Act (MFMA) the municipality had to appoint a security company to protect its equipment from theft and vandalism.

Most of the legal costs have been inherited from the former ILM. However, the municipality has taken steps to ensure that all the actions it takes are in line with the law, to avoid unnecessary litigation. Consequence management is being implemented and will continue to be implemented.

Breaking down the debt owed to the municipality, businesses owe R17.9 million, residential areas owe R180 million, government departments owe R12.3 million and farmers owe R9.7 million.

Director of Infrastructure Services, Mr Bennie Arends, said that the municipality received R6.4 million for drought relief from CoGTA and this assisted in alleviating the effects of the drought.

The R303 million grant provided to the municipality has been used to dig 38 boreholes, including a reservoir for additional storage capacity. He thanked the DWS for its assistance on the project.

Water is sampled on a monthly basis and the subsequent reports are submitted to Municipal Council and the Standing Committees for Infrastructure.

Acting CFO, Ms Delphine Thorne, said that the municipality received assistance from Provincial Treasury, who worked with them for 24 months, in implementing effective internal controls. This improved the audit outcome for 2019/20. The municipality is confident that it will have effective financial controls for the year.

SALGA response
Cllr Stofile said that both Eastern Cape CoGTA and Treasury have assisted the municipality in attending to its challenges. The lack of financial support provided to the municipality during the amalgamation process has left SALGA disappointed. A different approach must be designed in the future to ensure that such municipalities are provided adequate support. As BNLM has said an amalgamation without proper planning and implementation can seriously affect a municipality. Mechanisms to ensure accountability for failed amalgamations must be put in place. SALGA will continue debating with CoGTA on amalgamation.

Cllr Stofile requested that the Committee consider what the value of establishing water boards is, as the Constitution requires the provincial and local government to render water services. The utilisation of water boards carries an extra cost to government. He recommended that in the future the intergovernmental platform should be used to ensure that all spheres of government are better able to communicate with each other. Local government should also be repositioned to ensure that it can render services to residents. 

On plans to settle the Eskom debt, Mr Joel said that the municipality was forced by Eskom to enter into a settlement agreement that was unsustainable. BNLM is currently engaging with Eskom, with the assistance of EC CoGTA on its debt repayment. SALGA recommended that an affordability study should be done to determine what the municipality can pay Eskom each month. This would provide certainty to Eskom on what will be paid on the current account and what will be paid towards debt servicing.

SALGA noted that the municipality’s collection rate has improved. 

SALGA Eastern Cape Director of Operations, Mr Sonwaba Gqegqe, said that it would be necessary to revisit the approach taken during the analysis of Section 71 reports. When considering amalgamation, one must consider the financial state of the municipalities, demarcation costs, the long-term implications of the amalgamation and how a new municipality would affect the quality of democracy for the residents. For example, how accessible will councillors be to the residents, and would councillors be able to fulfill their functions effectively.

Mr Gqegqe recommended that more institutions be permitted to study Section 71 reports (currently only National Treasury is allowed to do so). SALGA is looking to trial these recommendations in future amalgamations.

The Chairperson said that his recommendations would be considered by the Committee. 

Eastern Cape CoGTA response
EC CoGTA Head of Department, Mr Andile Fani, said that the drought in the Nelson Mandela Bay Metro has also affected the SBDM, hence it has been difficult to assist BNLM. However, EC CoGTA has managed to persuade the National Disaster Management Centre to declare a state of local disaster in the district. With the assistance of National Treasury, EC CoGTA is looking for a sustainable solution to alleviate drought in the area, as investors are looking to leave the district.

Provincial Treasury response
On the unfunded budget, Ms Nqadolo explained that the municipal budget is supposed to be informed by the revenue collected. In discussions with the Provincial Treasury, the municipality has said that it wants to improve its collection rate from 78% to 95%. It has since taken steps to do so, which include the finalisation of a revenue enhancement strategy through the Development Bank of Southern Africa, recruitment of a qualified debt collector, identification of 3000 residents who are not paying their debts to BNLM and the sale of land parcels (which have been advertised).

Household debt has been a serious challenge faced by Eastern Cape municipalities, with the current amount owed standing at R16 billion. Provincial Treasury has assisted the municipality in developing a credible funding plan. It is looking to conduct an analysis of the financial state of all Eastern Cape municipalities that will aid in structuring financial payment plans to service the Eskom debt.  This would assist greatly as Eskom has a tendency of imposing repayment plans on to municipalities, even if they cannot afford the repayment amounts. The Provincial Treasury is also working to assist municipalities in overcoming their ageing infrastructure.

On the irregular expenditure written off by Council, Ms Nqadolo said that even though the money has been written off, the Council must implement consequence management, to ensure that officials accused of wrongdoing are held responsible. Presently, the disciplinary board is looking to assist the municipality in doing so.

During discussions on its organogram, BNLM said that it is looking to reduce its workforce by 25% and overtime pay to workers. In response, Provincial Treasury requested that the municipality provide timeframes on when they anticipate to conclude each matter.

Eastern Cape Finance MEC response
Finance MEC Mvoko said that many of the challenges faced by the municipality will take time to be resolved, mainly because it has a low revenue base, and significant debt. However, Provincial Treasury was pleased that there has been progress in setting up adequate governance structures and that there has been an improvement in the audit outcome.

Recently, Provincial Treasury has encouraged municipalities to apply pressure on government departments to service their debt to them. If the departments refuse to pay, the municipality should write to the Provincial Treasury requesting assistance.

On the disagreement between BNLM and a farmer in the area, it was Provincial Treasury’s understanding that all the minerals and water resources in the country were owned by the state. He requested that the municipality write to DWS to receive assistance during the talks with the farmer in question. 

Finance MEC Mvoko noted not much had been said on how the District Municipality has assisted BNLM with the challenges it is facing.

The Chairperson agreed with this last point and said that the District must submit in writing what initiatives it has taken to assist the local municipality.  

Eastern Cape COGTA MEC response
CoGTA MEC Nqatha replied that through the DDM approach, government has been able to cooperate and collaborate effectively on the challenges faced by municipalities. EC COGTA was confident that with this collective effort and the support provided by the Committee, BNLM would manage to overcome its challenges. He requested that the Committee lobby National Treasury to allocate additional funds to CoGTA so that it can provide more support to municipalities.

The Chairperson asked if CoGTA has considered reviewing and revising the 1998 White Paper on Local Government.

Deputy Minister response
COGTA Deputy Minister Nkadimeng said that in addition to the White Paper, the Municipal Property Rates Act should be reviewed. The Department will look to conduct an assessment of the financial implications of the amalgamation process, in an attempt to ensure that it becomes sustainable. COGTA has requested that BNLM compile a report on the costs of the amalgamation. All amalgamated municipalities are facing similar challenges; however, some municipalities are better able to absorb the costs.

COGTA will organise a meeting with the MDB to discuss, amongst other things, why it has not reviewed the progress of amalgamated municipalities. The Department agreed that greater support structures should be provided to municipalities that have been amalgamated.

The Department will have to revise its approach in assisting municipalities with their debt payments. To assist municipalities in easing their debt burden, government departments must pay municipalities what is owed to them. As a suggestion, departments could be given 90 days to pay recently accumulated debt to municipalities, and the older debt can have a separate deadline. If need be, departments must be forced to pay their debts. Municipalities must also apply credit management policies, by ensuring better revenue collection and enhancement.

With the assistance of the provincial departments and SALGA, COGTA will look to ensure that the municipality’s audit action plan is implemented; and that there is a permanent solution for the water crisis that the municipality currently faces.

Further discussion
The Chairperson requested that CoGTA submit a report on the support it has provided to local municipalities.

Mr Ceza said that no new measures had been provided by BNLM to alleviate its water crisis. The municipality must improve on the delivery of its services.

Ms Mkhaliphi said that the Deputy Minister’s input showed that she had an appreciation and understanding of the challenges faced by municipalities. She suggested that the short and long term measures should be implemented to ensure that BNLM is able to overcome its challenges.

Municipalities should ensure that residents are provided water tanks if there is a shortage of water. She requested that the Deputy Minister engage the Water and Sanitation Minister on the issues faced by water boards.

The Committee should also request that CoGTA submit a report on all the municipalities that need funding to repair ageing infrastructure. The lack of funding for infrastructure should be raised in the next Ministers and Members of Executive Council (MinMEC) meeting.

There has been a trend of failed amalgamations in the country, yet no one has been held responsible. She requested that MDB provide a progress report on all amalgamated municipalities.

Whilst she was pleased by the support provided by EC CoGTA and Treasury, she requested that both departments provide more support to the municipality.

The Chairperson said that legislation empowers district and local municipalities to be designated water service authorities. However, it seemed that water boards were taking over this role, yet their function is to act as DWS implementing agents.

She suggested that the Committee should look to call in the previous MECs in the provincial government, to question why they had decided to impose this amalgamation on the communities; as it is the residents who have suffered from this amalgamation.

She appreciated the supported provided by the provincial departments to the municipality.

The Committee should consider inviting MDB to a meeting prior to the elections.

Cllr Stofile agreed that poor policy decisions had led to poor amalgamation outcomes. SALGA is looking to engage in a debate on the best way forward. 

It was pleasing that the departments in the Eastern Cape were cooperating to bring stability to local municipalities.

Referring to the water boards, he said that the boards have not invested in the municipal infrastructure. No servitudes are paid to municipalities. Government needs to act as one to ensure that services are provided to citizens.

Finance MEC Mvoko said that the Provincial Treasury appreciated that the Committee had provided a platform to attend to such issues. He suggested that National CoGTA allocate a budget to assist municipalities with the challenges they face during an amalgamation process.

COGTA MEC Nqatha said that it was important for CoGTA to relook at the amalgamation of municipalities. The funding model should also be relooked as only 9% goes towards municipalities.

The Chairperson said that it was clear that the matters were ongoing. The Committee agreed with the recommendations on the way forward.

She thanked the MECs for always being available when called upon as well as all the officials for their participation.

The meeting was adjourned.

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