OR Tambo District Municipality section 139 intervention: engagement with Eastern Cape COGTA MEC

Meeting report

Opening remarks by the MEC

Mr Xolisa Edmund Nqatha, MEC: Cooperative Governance and Traditional Affairs (COGTA), Eastern Cape, greeted the Members of the Committee and all the officials. He thanked the Committee for the opportunity to appear before it. He said the decision was one that was not taken lightly by the provincial government. The decision was considered after efforts had failed to provide support to turn things around as provided for in the legislation. The legislative and executive failures as well as the exceptional circumstances had been considered and those led to the decision. It included the impact of the crisis that engulfed the municipality on the inhabitants of the O.R. Tambo region who faced difficulties around water and other challenges.

He then asked Mr Maqungu, Director, Legal Services, COGTA, Eastern Cape, to lead the presentation.

Submission

Mr Maqungu said the submission sought to present to the Select Committee of the National Council of Provinces (NCOP) the status prevalent at O. R. Tambo District Municipality (ORTDM) and the reasons that led to the Eastern Cape Provincial Executive Council invoking section 139(1)(c) of the Constitution of the Republic of South Africa in the affairs of ORTDM.

He said it should be noted that the decision to invoke section 139 (1)(c) was taken after the municipality had been given support in several areas by the National and Provincial Treasuries and Cogta, all of which did not yield the expected results.

The background was that ORTDM had been facing a serious governance and administrative crisis. In June 2020, the municipal manager had been placed on precautionary suspension following a media exposé that payments had allegedly been made to various companies without them having done any work. Consequently, various investigative agencies came on board to establish the veracity of the allegations as well as to identify who could be held accountable for the allegations.  The President of South Africa issued Proclamation R23 of 2020 in Gazette No. 43546, dated 23 July 2020, for the Special Investigative Unit (SIU), after the request by the Premier, to investigate the procurement of personal protective equipment (PPE) in the district municipality.

Mr Maqungu said the motivation for the request for intervention was based on an in-depth assessment on the institution that was done by the department to assess the political environment in which the municipality operated, how that impacted the social responsibility of the municipality as outlined in section 152 of the Constitution and finally the economic impact as it related to the expenditure of municipal grants as well as the use of the public purse in general. These reflected a bad state of affairs in the municipality. The report revealed major factual arguments that were advanced for a request for intervention. The facts were presented along the following four pillars:

• Financial Management;
• Service Delivery;
• Good Governance
• Institutional Capability.

Financial management

Mr Maqungu explained that the financial position of the municipality was on the brink of collapse with most of the indicators showing signs of distress.

The municipality’s 2021/22 draft Medium Term Revenue and Expenditure Framework (MTREF) revealed an operating deficit of R14 million in the 2021/22 financial year and significant surpluses of an average of R38 million in the MTREF.  The current ratio was reported as 1.1 per cent in the 2021/22 financial year. ORTDM was close to technical insolvency because the available assets were very low compared to the current liabilities. The 2021/22 financial year’s irregularly adopted budget was assessed to be under-funded with a shortfall of R15 million. However, the magnitude of the shortfall might have been higher than the National Treasury calculated if credible information could be disclosed.

Other financial irregularities included the municipality paying a danger allowance to employees who were at the front lines during the national lockdown levels 1 to 3 of the COVID-19 pandemic in the 2020/21 financial year. The South African Local Government Bargaining Council (SALGBC) Circular no 5 of 2020 provided advice to municipalities about employees working at the frontlines to fight the COVID-19 disease. The circular provided that the council of the municipality should have an approved policy which should guide how the danger allowance should be paid. ORTDM could not account for how the allowances were determined, although the municipality did, however, report having a policy at the time of the payment.

Further indicators of financial distress included the fact that the municipality owed National Treasury R234 million which was accounted as prepayments in the 2019/20 financial statements. The municipality budgeted for employee related costs that made up 43 per cent of the total operating budget due to financial decisions that were taken without due diligence. The employee related costs remained higher than the National Treasury norm of 40 per cent. The council’s approval of vehicle allowances of R12 000 and cell-phone allowances was based on a draft policy that was developed a day before the Council meeting. These allowances were offered to employees who did not use cars to perform their duties within the municipality. Continuous wasteful expenditure incurred by the institution included the hiring of VIP security for the Chief Financial Officer at a cost of more than R100 000 a month, which carried on for almost a year. Costs were incurred when councillors slept in hotels while engaged in personal and political activities which were not related to municipal affairs.

Service delivery

Mr Maqungu detailed the municipality's deficiencies in delivering services. There were water and sanitation backlogs. Much of the existing water and sanitation infrastructure had not been not adequately maintained and, in many cases, was non-functional. Ongoing refurbishment and maintenance were therefore a priority for sustainable water services delivery, but this had not been addressed by the municipality.

On the grant performance in the 2019/2020 financial year, Mr Maqungu said the municipality had received R979.793 million, which had been adjusted to R943.093 million during the year, in the form of a Municipal Infrastructure Grant (MIG), Water Service Infrastructure Grant (WSIG) and Regional Bulk Infrastructure Grant (RBIG). At the end of the financial year, the municipality had spent R625.625 million or 66 per cent of the allocation with an unspent amount of R317.468 million. An amount of R223.407 million was approved and R94.061 million was rejected during the rollover process in the 2019/20 financial year. An amount of R36.700 million was stopped through section 19 of the Division of Revenue Act and R94.061 million was lost through rollover. A total amount of R130.761 million was lost in the 2019/20 financial year. For a municipality that was a Water Service Authority (WSA) with no service level agreement (SLA) with its locals, this was a bad situation.

Mr Maqungu said there had also been non-compliance with section 17 of the 2020 Division of Revenue Act. The municipality had allocated a portion of funds to an organ of state (Amatola Water Board) for the MIG and RBIG schedule 5 conditional grants without following the due process. Section 17 of 2020 DoRA stated that, any expenditure incurred by the organ of state, without consulting the Transferring Officer and Provincial Treasury and without approval by the National Treasury, would not be recognised and would be unauthorised expenditure.

Governance

There were also questionable governance practices that occurred within the municipality. Mr Maqungu pointed to problems in the functionality of the Council and Committees. He said the ORTDM Speaker, Mr Xolile Nkompela, invited recalled Councillors from local municipalities to sit in Council meetings. Mr Maqungu said the presence of those recalled Councillors made the resolutions taken at those Council meetings unlawful due to the improper composition. An example of that was the adoption of the Budget and Integrated Development Plan (IDP) for 2021/2022 in a Council meeting held on 30 June 2021. The Budget/IDP was adopted in the absence of Ms Thokozile Sokhanyile, Executive Mayor of ORTDM because she was challenging the presence of the recalled Councillors in the Council meetings. The report was tabled by Mr Robert Nogumla, the Deputy Executive Mayor of ORTDM. The budget was never tabled by Ms Sokhanyile to the Mayoral Committee, which was a procedural imperative according to the law. 

The Audit Committee and the municipal Internal Audit operations were functional but their recommendations were never implemented by both management and the Council. That meant that their existence and operations did not add any value. The Audit Committee members were paid and their work was basically ignored by the institution.

The working relationship between Ms Sokhanyile and Mr Nkompela had broken down to the extent that the former no longer attended Council meetings convened by the latter because she questioned the composition of the Council. Mr Nkompela continuously convened Council meetings with recalled Councillors from local municipalities and those meetings and the resultant resolutions were unlawful. A Council meeting called by 39 Councillors that removed Mr Nkompela and Mr Nogumla had since been nullified by a judgement dated 18 June 2021

Action by Exco

Mr Maqungu explained the factors that were considered by the Eastern Cape Provincial Executive Council (Exco) as the basis for the dissolution of ORTDM. He said that in terms of  section 139(1) (1)  of the Constitution,  when a municipality could not or did not fulfil an executive obligation in terms of the Constitution or legislation, the relevant provincial executive could intervene by taking any appropriate steps to ensure fulfilment of that obligation, including:

• Issuing a directive to the Municipal Council, describing the extent of the failure to fulfil its obligations and stating any steps required to meet its obligations;
• Assuming responsibility for the relevant obligation in that municipality to the extent necessary;
• Dissolving the Municipal Council and appointing an administrator until a newly elected Municipal Council had been declared elected, if exceptional circumstances warranted such a step.

Mr Maqungu said the judgment in Mnquma Local Municipality & another v Premier of the Eastern Cape & others [2012] JOL 28311 (ECB) provided a useful guide on the invocation of section 139(1)(c). It provided that the following factors must exist before an intervention in terms of section 139(1)(c) could be invoked:

• The municipality could not or did not fulfil an executive obligation;
• The obligation not fulfilled must be an executive obligation;
• The steps taken must be appropriate
• The existence of exceptional circumstances.

Mr Maqungu explained why Exco took the view that the Municipal Council could not fulfil executive obligations.  He said representations by Ms Sokhanyile and Mr Nkompela demonstrated extreme divisions amongst the office bearers in the municipality. Ms Sokhanyile’s response was accompanied by 27 signatures of Councillors. Mr Nkompela stated that he was mandated by Council to make the representation.

The MEC, Mr Nqatha, had received a request from the Speaker of Nyandeni Local Municipality. The request was for the removal of five Councillors of Nyandeni Local Municipality. Those Councillors were alleged to have breached the Code of Conduct applicable to Councillors and one of the alleged breaches was that they had been impersonating representatives of the Nyandeni Local Municipal Council within the ORTDM. They had acted fraudulently and continued to extract financial benefit in the form of salaries from ORTDM.

With regard to appropriate steps and consideration of other forms of intervention, Mr Maqungu said the inability to fulfil executive obligations was mainly the result of the conduct of the municipal officer bearers.

It included taking resolutions in Council meetings that were not properly constituted and the non-observation of roles and responsibilities. It was not appropriate for Mr Nkompela to assume executive functions, including administrative functions like taking over legal services and dealing with staff matters like conditions of employment and disciplinary matters. Ms Sokhanyile also had to be corrected by the Court which stated that she could not appoint an acting municipal manager. In conclusion the dissolution of the Council was the appropriate step in the circumstances.

The situation was exceptional and unprecedented in the province. Non-Councillors had never been permitted to participate in the decision making of Council. It was rare for a Speaker to take over an Executive function like legal services.  The Provincial Executive had never received conflicting responses on the proposed or intended invocation of section 139(1) before. The municipality could not fulfil its executive obligations because of the Council. The appropriate form of intervention in the circumstances was the invocation of section 139(1)(c). After considering all other implications in respect of the status quo the Executive Council had resolved to invoke the provisions of section 139 (1)(c) of the Constitution in the affairs of the ORTDM. An administrator would be appointed until a newly elected municipal council had been declared elected. Further, the Executive Council resolved to mandate the MEC, responsible for local government in the province, Mr Nqatha, to facilitate implementation of procedural processes to effect the dissolution. Such processes had since been done.

The Select Committee was therefore urged to seriously consider the decision and support the request as the most appropriate step that the Provincial Government could take.

MEC Nqatha added two further points. He said that Ms Sokhanyile had written a letter requesting support under section 154 of the Constitution. As per common practice an assessment was conducted to inform the terms of reference for support and it would also inform the composition of the team required to support the municipality. That was in line with the team approach in supporting municipalities. The assessment was to determine the period of support required in terms of section 154 of the Constitution. MEC Nqatha said the support given was not arbitrarily drawn up but informed by concrete information. It was in that context that the terms of reference were drawn up. The terms of reference when tabled to the Council were rejected. The Council instead said it would draw up its own terms of reference. MEC Nqatha said that the assessment ran deep and was conducted by a multi-disciplinary team of assessors that included the Provincial Treasury. He said the support would have had a six month span but that period, as proposed by COGTA Eastern Cape, was rejected by the Council which opted for a three month section 154 support period. The Council also rejected the proposed Administrator recommended by COGTA Eastern Cape who was to lead the intervention.

MEC Nqatha said the Provincial Executive were of the view that if MEC Nqatha compromised with the Council’s demands, he would be setting a bad precedent. MEC Nqatha raised the issue with Dr Nkosazana Dlamini-Zuma, the national COGTA minister, who sought to intervene. MEC Nqatha was advised that to solve the problem, COGTA had to compromise. The compromises were to change the official who would be the acting Municipal Manager, to agree to the three month section 154 support period and to agree to the Council’s terms of reference and not those informed by the technical process. It was exceptional that a municipality should dictate support that had not been informed by any technical procedure. COGTA was mindful of the fact that the longer the support was delayed, the deeper the crisis would be. He said the compromise was reached so as to arrest the deteriorating situation. Eventually, the team was allowed in. It was led by Mr Basil Mase, General Manager, Strategic Management and Communication Services, COGTA Eastern Cape, and other officials focused on technical, financial corporate services. The team worked there from December and then there was an illegal strike which made the municipal offices inaccessible. There was destruction of water valves and a continuing crisis of non-availability of water due to the vandalism. The intervention support team approached the South African Municipal Workers Union (SAMWU) and the Independent Municipal and Allied Trade Union (IMATU). SAMWU responded to the call for engagement while IMATU boycotted the meetings. SAMWU distanced itself from many of the activities that were taking place. After that engagement, the team decided to apply for a court order interdicting the blocking of the road so that there was access to the offices for people to work. The offices were then opened and only then was relative stability restored and the municipality was able to function and fix the valves that had been destroyed. 

MEC Nqatha said the report on the intervention indicated that the municipality was plunging deeper into a crisis and there was a case to extend the section 154 support. The Council flatly rejected support that the municipality urgently required. He wanted to highlight the steps taken prior to the current step which was one of last resort.

The Chairperson indicated that the case was exceptional, as it was clear from the presentation that there were deep divisions between Ms Sokhanyile and Mr Nkompela. The Chairperson said that in such meetings the norm was to allow one presentation from the municipality, but because of the nature of the issue he would take submissions from Ms Sokhanyile and from Mr Nkompela. The Chairperson asked the speakers to be as brief as possible without restricting themselves.

Submission by ORTDM Mayor

Ms Sokhanyile greeted everyone on the virtual platform. She said she would try to be brief but her report was long as she had written down every anomaly she had observed.

She said the issues in O.R. Tambo began to appear when there was a strategic planning meeting. In that meeting and in front of stakeholders and officials from the President's office, the Speaker, Mr Nkompela, and some Councillors attempted to close the session through a coup d'etat. It was frustrating for her, because there were stakeholders who were in attendance to assist the Council as it was a pilot for the District Development Model. Ms Sokhanyile said she found it unfortunate that it came from Councillors who were supposed to emulate the separation of powers doctrine. She detailed how the separation of powers was not observed in the municipality.

Ms Sokhanyile referred to a disagreement she had had with Mr Nkompela and the Deputy Mayor, Mr Robert Nogumla. She said the two tried to suspend the late Mr Owen Hlazo, Municipal Manager, ORTDM. Ms Sokhanyile had objected that this was being done without a report. She said the report was speedily crafted by Mr Nkompela and Mr Nogumla who barred her from attending the virtual meeting in which Mr Hlazo was suspended. Ms Sokhanyile said she had not agreed to that because due process had not been followed in the face of the allegations that service providers had been paid for work they had not completed. She had been made aware of those allegations by Mr M Moleko, Chief Financial Officer (CFO), ORTDM.  She had told him that actions regarding accountability could not be taken based on verbal accusations and asked for them in writing. He refused and approached Mr Nkompela instead. Ms Sokhanyile said MEC Nqatha gave her a report with allegations against Mr Hlazo which he had been given by an unknown person and she wrote to Mr Hlazo asking him to respond to the allegations. Mr Hlazo responded in two days, so when Mr Nkompela and Mr Nogumla tried to suspend Mr Hlazo, Ms Sokhanyile informed them she was already carrying out the process. They objected and told her she was delaying the process of suspending Mr Hlazo. The bone of contention with Mr Hlazo was that he refused to approve the door-to-door COVID-19 expenditure that had been carried out by Mr Nkompela’s office. Mr Hlazo had asked for a report on that expenditure, which Ms Sokhanyile agreed with, because budget items could not be arbitrarily changed.

She gave further details of expenditures that had been approved without her consent and which she had directed to the Special Investigating Unit (SIU). She said there were irregularities in a report outlining COVID-19 expenditure that was prepared by the CFO, Mr Moleko. She said the names of directors of COVID-19 service provider companies had to be published but that was not done in ORTDM. She had reported the anomaly and asked the Council to take action against Mr Moleko. There were anomalies around how an independent investigator and lawyer were selected. She had tried to query the irregularities, but was met with opposition from Councillors. She had found that Mr Moleko knew the independent investigator, who would produce a favourable outcome.  She had the reports.

The Chairperson said he understood there were many issues and items she might want to highlight but reminded her that she had already submitted the report and therefore asked that she speak to the decision of the provincial government to dissolve the municipality. He fully understood there were a lot of issue but it was important to speak to the purpose of the meeting.

In summary, Ms Sokhanyile said it was an unfortunate situation the municipality found itself in but she agreed with MEC Nqatha. She added that she had tried raising the issue of Councillors who were not on the Independent Electoral Commission’s list attending Council meetings. She detailed multiple issues with the CFO Mr Moleko. People were opposed to her section 154 request as they wanted a person who would approve monies for them. For these reasons she wanted an administrator to come into the municipality to assist and thus supported the section 139 decision to dissolve the Council.

The Chairperson reiterated that in essence Ms Sokhanyile supported the Provincial Government's decision to invoke section 139 (1)(c) of the Constitution in O.R. Tambo District Municipality. The Chairperson said that he understood that Ms Sokhanyile’s report that she had submitted to the Provincial Government formed the basis for its intervention. That information was then presented to the Committee. It sufficed to say that Ms Sokhanyile supported the Provincial Governments intervention. 

Submission by ORTDM Speaker

The Chairperson asked Mr Nkompela to address the Committee on his view on the intervention.

Mr Nkompela greeted everyone present. He began by asking whether it was an offence to lie before the Committee, because it was proper for the Committee to be told the truth. He said a lot had been presented and therefore he had a lot to say.

The Chairperson asked Mr Nkompela to address the Committee on his submission on the matter at hand and not based on what others had said. What was required was his opinion on the decision taken by the provincial government.

Mr Nkompela said the Council had observed that corruption was deeply rooted in ORTDM and outsiders were beneficiaries. The Council had received a report of the Auditor General of South Africa (AG), and realised that ever since they had arrived in 2018, there had been no contract between ORTDM and the Amatola Water Board. There had been observations that ORTDM had more than R3 billion in fruitless and wasteful expenditure.

The previous Chief Whip was Ms Sokhanyile, the current Executive Mayor. They worked well to fight corrupt practices in the municipality which had a disclaimer in its audit outcome when they arrived. He applauded Ms Sokhanyile when she was the Chief Whip as she made sure everyone worked well together despite political affiliations or the fact that some were traditional leaders. They worked together to root out corruption in the municipality.

Mr Nkompela said the previous Executive Mayor was elected to the Provincial Legislature and when that happened Mr Nogumla was appointed by the Council as the Executive Mayor. Thereafter, the Council continued to raise issues of maladministration and looting that had been previously identified. He said that he himself, together with Ms Sokhanyile and Mr Nogumla, went as far as organising a meeting with the Amatola Water Board in East London where they tried to investigate the contract with Amatola and an allegation involving R168 million. It was a collective effort. The meeting didn’t materialise as the CFO of Amatola had gone to Cape Town.

Mr Nkompela said the Council took a decision about consequence management in response to the AG’s findings in the 2018/2019 financial year. Time frames were set but nothing was done. He said Ms Sokhanyile then took it upon herself to assemble all the Chief Whips of the opposition parties and section 79 Committees to go and visit projects. She then produced a detailed report of what had transpired in the ORTDM projects. She was applauded for that initiative. Mr Nkompela said rooting out corruption was the Council's main priority and Mr Hlazo was suspended after all legal processes had been followed. Despite that, Mr Nqatha had been very angry, saying that the Council had not followed proper processes. Mr Nkompela said he had objected and they were more than ready to pay any legal costs that stemmed from the Council’s decision to suspend Mr Hlazo. What mattered was that it was rooting out corruption.

The Chairperson interjected and said that with the problems in mind, the main reason for the meeting was that the Provincial Government wanted to dissolve the Council. Speakers were taking too long and not sticking to the topic at hand which was whether or not they agreed with the Provincial Government's decision to dissolve the Council. The Chairperson reminded everyone that the Committee had interacted with the ORTDM multiple times in the last two years. Members were therefore aware of the background issues, but what was required for the present meeting was  an opinion on the decision taken by the Provincial Government to dissolve the municipality.

Mr Nkompela said the Provincial Government had misrepresented his report before the Committee. In his view, the report was misleading. Based on section 56(6) of the Local Government Municipal Structures Act 117 of 1998, the Deputy Executive Mayor was to assume the Executive Mayor’s duties in the latter’s absence. Mr Nkompela further referenced subsection 7 of section 56 and said that in the absence of both the Executive and Deputy Mayors then the Council had to designate a Councillor to act as the Executive Mayor. Therefore, Mr Nkompela disagreed with everything that had been presented before the Committee that depicted the Council of the ORTDM as being dysfunctional. He insisted that the Council had always observed the rule of law and vehemently disagreed with everything that had been said before, and with the decision to dissolve the Council. In his view the decision to dissolve the Council was to protect corrupt practices inside the municipality and to this end he presented a lengthy narration. He said the municipality was being dissolved to kill the evidence of all the corrupt activities that the Council of the ORTDM had taken a stand against. He said Mr Nqatha had been approached for help before but only chose to invoke section 139(1)(c) of the Constitution when he realised that the report of the independent investigator reflected what the Council had said about corruption. That was the reason he did not present the report.

The Chairperson said it had been captured that Mr Nkompela was opposed to the intervention and that he had said they were the pioneers of anti-corruption in the municipality and that he did not agree with any of the reasons the provincial government had advanced for dissolving the municipality.

Political parties

The Chairperson asked political parties from the municipality to give their input.

Mr Chris Xangayi (DA Cllr) said the Democratic Alliance in ORTDM had suggested to MEC Nqatha that section 139(1)(a) or (b) of the Constitution be effected in the municipality but  MEC Nqatha decided not to comply. He said the Council was in tatters in its attempt to fight corruption in the municipality, but lacked support. He said the DA moved for section 139(5) of the Constitution which imposed a financial recovery plan to assist the municipality. He said that apparently the support the provincial government was supposed to have provided to the Council had been lacking.

Mr Xangayi objected to the dissolution of the municipality because the DA had observed that there were factional battles in the ANC that did not serve the people of ORTDM. The Municipality had had R1.5 billion in fruitless and wasteful expenditure for multiple years which was not possible for the new Council of 2016 to resolve. The DA was not involved in the factional battles of the ANC but the people of ORTDM were not being serviced and Mr Hlazo as the accounting officer was not held accountable. Mr Xangayi referred to an incident of violence between himself and Mr Hlazo that resulted from him trying to hold him accountable for the fruitless and wasteful expenditure. In essence, the DA was opposed to the decision to dissolve the municipality which it felt was based on internal ANC factional battles.

The Chairperson acknowledged the DA’s position and noted the highly publicised case that Mr Xangayi had opened against Mr Hlazo.

Mr Lindelani, EFF, said they felt that the invocation of section 139 of the Constitution and the administrator that would be appointed would not make any significant difference to the municipality. 

Mr B Malghas, ANC, said that when they arrived on the Council in the municipality in 2016, irregular expenditure amounted to over R3 billion and that was under Mr Hlazo. In 2018 the ANC surprisingly extended his contract against the will of opposition parties who questioned why there was so much irregular expenditure under his watch. An Ad Hoc Committee had been formed to investigate the irregular expenditure and the main culprit had been exposed to be Amatola Water. In response, it was suggested that the contract be regularised or cancelled but none of those suggestions were implemented. He detailed accounts of corruption and a non-observance of the separation of powers. He said those accounts of corruption were raised but MEC Nqatha did not act on them but instead moved to invoke section 139 of the Constitution. Mr Malghas said neither MEC Nqatha nor Minister Dlamini-Zuma had gone to the municipality in person. He added that the dissolution of the Council was in contradiction to President Cyril Ramaphosa’s, District Development Programme which was meant to be a vehicle for providing services in rural areas. For those reasons he did not agree with the decision to dissolve the municipality because it was a mere perpetuation of corrupt activities in the municipality.

Mr N Mzimane (UDM) said the decision of the provincial government to dissolve the municipality was prompted when the Council discovered the corruption that had been taking place in the Water and Sanitation department. He said the ANC could not be both player and referee. The crisis began on 17 June 2020 when the allegations of corruption were tabled. In essence, Mr Mzimane felt that the crisis was due to internal ANC factional battles. The exposure of corruption had moved MEC Nqatha to invoke section 139 of the Constitution despite being called upon to intervene at an earlier stage and failing to do so. The corruption was evident by how much protection Mr Hlazo received.

Unions’ views

The Chairperson said all the political parties had given their input and it was time for the organised labour to give their input.

Mr Sandise Nyembezi, Chairperson, SAMWU OR Tambo, said the matters had already been displayed in detail. He said the manner in which the leadership had presented itself is what had caused employees belonging to SAMWU to suffer. He said SAMWU took a resolution in a General Meeting on 27 June to advance support for the invocation of section 139(1)(c) of the Constitution. Many issues were raised in that meeting. Mr Nyembezi said that ORTDM had not reflected the zeal against corruption that was presently being displayed before the Committee. SAMWU agreed that the Council of ORTDM did not serve the interest of workers and voters and the only way to deal with the problem was for Mr Nqatha to intervene and appoint an administrator.

A representative of IMATU, said the union was totally against the invocation of section 139(1)(c) of the Constitution. He said there were no substantive issues MEC Nqatha had raised in relation to his invocation of the section. He claimed that MEC Nqatha was a role player and at the centre of the crisis in ORTDM and thus he could not be a solution unto himself. The main motivation was to protect the thieves in ORTDM which had been doing well all along until the Council took a resolution to challenge corruption. MEC Nqatha had only taken action when Mr Hlazo had been suspended and provided details of irregularities which pointed to the fact that the provincial government was fighting the people who were rooting out corruption from the municipality. MEC Nqatha and Ms Sokhanyile had acted irregularly in a bid to protect the corruption. MEC Nqatha did not respond to a request under section 154 of the Constitution but instead sent corrupt individuals to investigate allegations of corruption in the municipality. MEC Nqatha had not followed Constitutional processes. It was improper for MEC Nqatha to invoke section 139(1)(c) without considering section 139(1)(a) or (b). The reason why MEC Nqatha invoked section 139(1)(c) directly was because he wanted to install a corrupt Administrator that would enable the corruption in the absence of the municipal Council. The beneficiaries were reflected in the Amatola report. 

Business views

Mr Ndumiso Ngcebetsha, Secretary, O.R. Tambo Business Forum, said the organisation was against the invocation of section 139(1)(c) of the Constitution because it was suspicious. The suspicion was held because the Provincial Executives seemingly tried to hide the corrupt activities taking place in the ORTDM. The AG’s reports covered the 2016 financial year to the current financial year and those detailed what took place within the municipality. Similar findings were detected in reports conducted by private service providers who were appointed by the Council following a petition by the Business Forum. The reason for the petition was the countless monies that had been written off without any investigation. The Business Forum noted that the resolutions taken by Council were not implemented, nor were the officials implicated in the reports compiled by the private service providers acted against. The matter was litigated to address those failings. The reason why the OR Tambo Business Forum opposed the provincial Government's decision was because it too had failed to act on the reports.   

Mr Lwazi Macingwane , OR Tambo Business Formation, said the ORTDM had in recent years failed people dismally which was why the Business Formation supported the Provincial Government’s invocation of section 139(1)(c) of the Constitution. Mr Macingwane agreed with everything Mr Nyembezi had said on behalf of SAMWU. He added that when service providers were not paid for months on end, it had the potential of destroying those SMMEs. Mr Macingwane reiterated similar sentiments to those expressed by SAMWU in detailing instances of corruption that affected local business.

The Chairperson intervened to remind speakers to be succinct in stating whether or not they supported the decision.

Ms Noxolo Bunn, OR Tambo Business Chamber, was in full support of the invocation of section 139(1)(c) by the provincial government. Ms Bunn detailed reasons for the support which stemmed from in-fighting and maladministration.

Mr Mbaleki Nkoliso, Chairperson, South African Youth Council, OR Tambo District Municipality, was against the Provincial Government’s invocation of section 139(1)(c). He said it was not in the best interest of young people who made up the majority of the population of ORTDM. The young people were unemployed and lived in poverty. The reasons advanced by the Provincial Government could not be accepted as exceptional circumstances that warranted the dissolution of the Council at a time when it was about to eradicate corruption in the municipality. He said the Local Council were party to the same frustrations. He could not support that leaders would milk the municipality of its resources that were meant to assist the downtrodden.

Local councils’ views

Ms Ntandokazi Capa, Mayor, Ingquza Hill Local Municipality, ORTDM said the issues in ORTDM were serious ones water and sanitation. She supported the decision to dissolve the Council of ORTDM. She agreed that corruption had to be dealt with but felt that it could not be dealt with to the detriment of the people. There was no water or sanitation. She said Ingquza Hill Local Municipality had constructed a road which had been damaged because of the non-service of the sewerage systems by the ORTDM. There had been no water for over six months so the sooner the issue 2was dealt with the better. She asked if the water service authority could be delegated to local municipalities.

Ms Nompumelelo Dywili, Mayor, Mhlontlo Local Municipality, ORTDM said she was deeply frustrated by the situation.

Mr Mesuli Ngqondwana, Mayor, Nyandeni Local Municipality, said he was in support of the implementation of section 139(1)(c). Whoever was responsible, the fact remained that ORTDM could no longer execute its responsibility to deliver services to the people. In Nyandeni there was less than 35 per cent availability of accessible clean drinkable water. The communities had no water services and had to accept that they could not get clean drinking water. He added that an excess of half a billion Rand in grants had been returned to the National Fiscus, which was against the interests of the citizens of the community. Adding to these deficiencies, he raised the irregularities around the contract with Amatola to provide water services. He said clear efforts had been made to oppose MEC Nqatha’s intervention efforts.

The Chairperson asked Mr Ngqondwana to speak for his municipality.

Mr Ngqondwana said he represented members of the public who were frustrated. The voters had to be convinced that the services were being managed properly. He reiterated reasons why he did not support the Council of the municipality.

Mr Goodman Nyaniso Nelani, Mayor, King Sabata Dalindyebo Local Municipality, fully supported the invocation of section 139(1)(c). tion. 

Mr Ayanda Gantsho, Speaker, Port St Johns Local Municipality, agreed that ORTDM required help. However, he said the decision to dissolve the Council could not be supported.

The Chairperson said the meeting had to be concluded by 22:00 and if the meeting could not be concluded in the next 20 minutes then it would have been an exercise in futility. He urged speakers to speak succinctly in making their points.

Mr Zukiswa Gana, Councillor, King Sabata Dalindyebo Local Municipality, said he supported all efforts to fight corruption but the decision to dissolve ORTDM depended on whether or not the Council could deliver services under the current circumstances. King Sabata Dalindyebo Local Municipality was heavily dependent on receiving an equitable financial share from ORTDM. If the Council Members of ORTDM could not understand their responsibility to have a budget to enable them to deliver services, then the youth did not want them. They were not able to carry out the two functions of fighting corruption and adopting a budget. That was the basis upon which the decision to dissolve should be based. He said the National Government and Parliament should play an active monitoring role.

Ms Kosi, Women in Business, said that MEC Nqatha had failed to prove any actions he had taken to assist ORTDM in all the areas it had failed according to him. She was against the invocation of section 139(1)(c). It did not make sense to dissolve the municipality instead of mitigating the issues at an earlier stage.

The Chairperson thanked everyone for their input and asked for a 30 minute extension for Members to ask questions. Thereafter an urgent meeting would be convened for Members to deliberate on the matter. The Chairperson opened the floor for questions.

There were no questions and in conclusion the Chairperson said the Committee had listened to everyone’s articulations and expressions. He thanked everyone for their input. As pointed out in the beginning, an intervention of this nature was drastic, tough, abnormal and was exceptional in all respects.  If the Committee said yes then the municipality would no longer be in existence but if the Committee said no then the decision of the provincial government was reversed. That was why it was important to listen to everyone’s views. The views expressed would help in addition to the documentation that had been submitted to all Members in advance. Documents were received from the Provincial Government and from the officials of the ORTDM. Additionally, there had been discussions with ORTDM in the past and those discussions would be drawn upon. The final analysis would be submitted to Parliament in a report detailing the decision of the Committee.

The meeting was adjourned.