Engagement on African Charter on the Values and Principles of Decentralisation, Local Governance and Local Development

Meeting report

DCOG African Charter on values and principles of decentralisation, local governance and local development

Mr Tshepo Khasi, Senior Manager, Department of Cooperative Governance (DCOG), said the main purpose of the Decentralisation Charter was to provide a “decentralisation framework” to assist African Union (AU) member states in developing their constitutional and legislative prescripts on decentralising powers and functions from higher spheres/tiers of government to the regional and sub-regional levels within a country. It seeks to give effect to the principles and provide guidance on decentralisation of powers and functions from national governments to local government spheres across the continent.

President Ramaphosa had signed the Presidential minute, providing full authorisation of signing powers to the Minister of Cooperative Governance and Traditional Affairs on behalf of the government of the Republic of South Africa, with the AU representatives. Currently, 17 countries have already signed the Decentralisation Charter, but only nine have ratified and submitted the Charter at the AU headquarters in Addis Ababa, Ethiopia. As soon as the fifteenth member state had ratified and submitted proof thereof, the Decentralisation Charter would universally come into effect in all the signatory member states.

Mr Khasi said the implementation plan of the Charter was guided by Chapter 3 of the Decentralised Charter. This covers implementation:

At the individual state party level;

• At the local government level, which requires that local government shall be equally responsible and accountable to their local population for the implementation of the objectives of this Chapter, and adherence to its values and principles;
• At national government level, where state parties adopt legislative, executive and administrative measures to align national laws and regulations to the objectives of this Charter and adhere to the values/principles;
• At the Commission level:
• At the regional level, in accordance with their constitutive instruments, regional economies shall encourage member states to ratify, accede, implement and monitor the Charter; and
• At the continental level, to ensure and facilitate the implementation of this Charter, the Commission shall develop guidelines for its implementation.

Implications of the Decentralisation Charter

Organisational and personnel

The decentralisation of powers and functions may require organisational reconfiguration and design on both the decentralising and recipient organs of state. At certain stages of the decentralisation of powers and functions, personnel would follow functions. The possible transfer of powers and functions with its concomitant personnel may be effected through existing legislative frameworks, such as the Public Administration Management Act, 2014.

Financial implications

The principles of “funds-follow-functions” would be applied in the distribution and decentralisation of powers and functions. The regulatory framework -- in particular, the Local Government: Systems Act, 2000 -- provides for provisions of appropriate steps to ensure sufficient funding, and such capacity-building initiatives as may be needed for the performance of the assigned power or function by the municipality, if the assignment of the power or function imposes a duty on the municipality, and that power or function falls outside the functional areas listed in Parts B of schedule 4 and 5 of the Constitution, and the performance of that duty has financial implications for the municipality's risk, or risk mitigation.

The risk posed against this continental decentralisation framework was the non-adherence and resistance by higher spheres of governments, to decentralise their power and functions to the lower spheres of government and undermine their constitutional right to exercise their powers and functions, and their actual existence. This may result in centralisms and reservation of the powers and functions to be exercised by the national government in a country.

The Decentralisation Charter, which advocates for the decentralisation of powers and functions, and as a blueprint and an international instrument, would bind all signatory member states to decentralise and assign their powers and functions to the local spheres of government.

Communication implications

The DCOG would lead in distributing the Decentralisation Charter to all organs of state in South Africa, with an emphasis on observing the principles of the decentralisation of powers and functions as provided for in the Decentralisation Charter. Further communication in the process of ratification of the Treaty would be facilitated by the Government Communication and Information System (GCIS).

Constitutional implications:

The legal opinions obtained from the Office of the State Law Advisor at the Department of International Relations and Cooperation, and the Office of the State Law Advisor at the Department of Justice, had confirmed that the Charter conformed to South Africa's general constitutional provisions and principles, and the general international law of application.

Implications for vulnerable groups

Article 15 of the Decentralisation Charter prescribes, amongst others, that:

• Local government or local authorities shall integrate gender, youth and disability issues in the overall process of formulating policy, planning for development and providing services, as well as in implementing, monitoring and evaluating development programmes and projects
• Local governments or local authorities shall promote and ensure the equal and effective participation of women, youth and people with disability in public life, leadership and management positions on all matters relating to local governance and local development
• Local governments or local authorities shall promote and increase participation of women, youth and people with disability in all matters relating to local governance and local development.

Security Implications

Security implications, as experienced in some parts of the African continent, were that there was frequent turmoil and upheavals when power was centralised at the national level, more so when the geographic area of the country was vast. The decentralisation of powers and functions provides security certainty within the context of decentralising powers and functions to the local government sphere.

Mr Khasi conveyed the responses and comments from the departments and parties consulted, and the consideration by the relevant Directors-General Cluster. The DCOG had consulted separately with the Chief State Law Advisors from both the Department of Justice and Constitutional Development; and the Department of International Relations and Cooperation in scrutinising the Decentralisation Charter, and the legal opinions solicited had provided that the Decentralisation Charter conformed with both domestic and international law.

Recommendations

The DCOG recommended that the Portfolio Committee and the National Assembly take note of the African Union “Charter on the Values and Principles of Decentralisation, Local Governance and Local Development” which seeks to provide a framework and guiding document on the decentralisation of powers and functions from national governments to lower spheres of governments across the continent; and requests that they support and ratify the Charter in terms of section 231 (2) of the Constitution of the Republic of South Africa.

See attached for full presentation

Discussion

Mr K Ceza (EFF) said he was a bit rusty and confused. Historically, decentralisation was understood as the victor over federalism during the reform and democratisation process of negotiation during that time. Now that the concept of decentralisation had to be ratified, he asked whether the devolving evolution of these powers to sub-national governments would impact and give rise to the intended outcomes. In the current status quo of local government, decentralisation was complicated by various factors like incomplete statutory reforms, and resources retained by central actors. There were also issues of resources being controlled at the national and provincial levels. The mandate of decentralisation had been given to the municipal demarcation board. Did it mean it had its intentions fulfilled with fiscal decentralisation? The resources of local communities were being consumed to pay the salaries of officials, ineffective local councils, poor organisations and internal divisions. He asked whether these things were not inviting decentralisation- a restorative process meant to correct how those municipalities discharged their mandates. These were used for the political scoring of opponents.

He said that with fiscal decentralisation, local resources were being controlled and local government was expected to execute highly complex tasks with few resources. The division of revenue of the funds that were raised nationally and ultimately controlled by national and provincial governments, resulted in a government at the coalface of service delivery. This happened in front of the people, who were not receiving enough resources. Had decentralisation achieved its intended outcomes?

He asked whether the decentralisation concept had considered the period of coalition governments. How would it consider this period? It was a very long period, wherein there would be the warring of ideologies. For instance, on its side, it did not believe that people resided in provinces -- they were national and everyone resided in local government, and yet local government was the worst-funded sphere of government. This was without an actual explanation of the roles of the province and district, which looked like a duplication of structures. This was in terms of the demarcation board’s categorisation, which it questioned.

Mr G Mpumza (ANC) said the Charter was an important and critical document in ensuring that communities in villages and cities throughout the African continent fully participated in the affairs of their own lives. This was done through the values and principles created in articles five and six. At the genesis of these specific values and principles, there was awareness that in some of its sister countries, there would be a situation where a minister of local government could also be a mayor of all the cities. He thought this was what triggered the development of the Decentralisation Charter. It was to deepen democracy through decentralisation, local governments and local developments.

Whilst the principles and values were of great importance, there was a concern in the article on risk and mitigation. It stated that some national governments would resist the implementation of other articles concerning decentralising responsibilities and powers to local levels so they could achieve local development. The article did not make provision for mitigating measures. Mr Mpumza noted that structures were identified for executing these values and principles in all three spheres of government. However, where these risks existed, it did not have mitigation measures for such bodies, because the higher structures would resist decentralising the responsibilities and resources as required. Therefore, it would be important for this decentralisation to be within the context of deconcentration. It should be a deconcentrated decentralisation, not concentrated decentralisation, where the higher structures would retain resources. Besides that, he accepted these values and principles as outlined in the Decentralisation Charter. This Charter was a gateway towards decentralising power and ensuring democracy in the local space.

Ms G Opperman (DA) asked what opinions the state law advisor had given to the Cogta Minister, prior to her signing this Charter. How did articles seven and 17 enhance or affect the district development model at a provincial level? How does it also enhance the current intervention strategies at a national level to the local levels?

Ms H Mkhaliphi (EFF) thought this was progressive in terms of the AU, and that more of these charters needed to be developed for the African continent. She thanked the Department, although the process seemed to have taken too long. In one of the presentations, either from the Department or the AU, it was said that the process of developing this Charter had started in 2014.

She asked if the Southern African Development Community (SADC) had a similar Charter. How would one ensure that SADC also adhered to this kind of progressive Charter developed by the AU? She welcomed the Charter -- she thought it was progressive, and was what the Committee wanted. It had already been said that the local government should serve the people. All resources had to go to the local government to provide services to the people. How did the Department intend to ensure this Charter was implemented? It was faced with a situation where local governments were unresponsive to their people. The presentation spoke about the Charter at a national level, and said political parties were meant to implement it.

Decentralisation meant that all resources had to service the local government. When they engaged with their colleagues at the AU level, how had they viewed the issue of provinces? The Committee had said there was no need for the provinces to exist if it wanted to ensure that the local government was what it intended it to be. The intention was to ensure people did not suffer under the local government. Where this Charter spoke about decentralisation, did the people representing South Africa in those discussions also engage in discussions about the provinces which exist in South Africa? In all other African states, there were provinces. What was the role of the provinces, if this Charter had to be implemented at the local level? How did they intend to implement this? Most of the things, especially the principles displayed in the Charter, were the things that should happen on a daily basis when engaging with departments.

The Charter spoke the Committee’s language. As a Department, were they ready to implement the Charter? The Committee would not have an issue supporting the Department and asking the National Assembly to also support and adopt the Charter as a member state of the AU. The Department had just summarised what was already there in the form of an AU presentation. It did not tell the Committee exactly what it was going to do to ensure all those principles were implemented, and how it would implement them.

DCOG's response
 
Mr Khasi thanked the Chairperson and the Committee members for their questions and comments. Immediately after finishing his presentation, he lost connectivity and had not heard the first part of the questions.

He started with the question of resource control by the national government and fiscal decentralisation. On the Decentralisation Charter itself and its own legislative and constitutional framework, it was saying that funds followed functions. This was the ideal situation. It had the Division of Revenue Act (DORA) and schedules four and five of the Constitution on how the powers and functions were allocated. Fiscal decentralisation was done through the division of revenue. In the division of revenue, some funds were allocated specifically and could not be used for anything else, while others were for the equitable share, which the provinces and municipalities could use.

Regarding coalition government issues, the decentralisation of powers and functions, by and large, was not affected by coalitions. It was the decentralisation of power and functions to a sphere of government, rather than a probable coalition government.

The issues around articles five and six deal with local governments and governance. It was good that it was given this kind of observation. On the risk articles, the mitigating factors were more centralisation of powers and functions in African countries. The Charter itself was brought in to assist African countries in dealing with assigning powers and functions to lower spheres of government.

The Chairperson said he would let the speaker continue once he was audible again. The Decentralisation Charter was a framework for all African countries that were members of the AU.

Mr Khasi continued speaking, as he was audible again. He said that with the risks, the Charter helped to mitigate against centralising powers in national or central governments. The ideal situation was to decentralise powers and functions to suit the regional economies or provincial circumstances in huge countries like the Democratic Republic of Congo (DRC), where there would be a risk of war, because of the centralisation of power. Decentralisation was a way to try and mitigate against those kinds of situations.

Regarding the legal opinions obtained, to take this Charter to Cabinet as an international instrument, it had to be taken to the Department of International Relations and Cooperation's (DIRCO's) and the country’s state law advisors to link a justice department. They had safely and conveniently indicated that the bottom lines of the two legal opinions indicated that the Charter conformed and complied with international law and South Africa’s constitutional and legislative designs. This confirmed that the Charter was developed with the help of the country’s experts on decentralisation. It conformed with the country’s constitutional design, as did schedules four and five and sections 99 and 126 on the devolution of powers and functions.

The Charter fitted in very well with the district development model, because it advocated for decentralising all powers and functions, including funds following functions.

He agreed with one of the Members in saying that the process took too long. There had been confusion within government as to who was meant to be processing the Charter. DIRCO representatives had said they were the ones who were meant to process it, only to find out that it belonged to DCOG. It had entered into that fray and taken over the process so it could come to a better conclusion.

On southern African countries having a similar instrument, he confirmed that the AU Charter was universal for all AU member states. He was not sure whether the southern African countries would be interested in cascading it down, and in what sense they would do so.

Follow-up discussion

Mr Mpumza said that while the Committee recognised and fully agreed that the values and principles of this Charter embedded the values and principles of the Constitution and the resultant laws around devolution, there was a serious challenge around the issue of devolving, mobilising and allocating the necessary resources for local economic development. This was a serious limitation in South Africa. The country did not have a dedicated budget for local economic development -- it was hidden within the municipal infrastructure grant (MIG). This was not realisable in several small municipalities and small "dorps." That was why a serious change in the economic landscape could not be seen. If this African Charter had such limitations, it could not bring about a realisation of this local democracy, which involved full participation by the citizens. The portfolio of local economic development was not fully funded, so the Charter had no call around where it needed to be implemented throughout the African countries.

Response
 
Mr Wayne McComans, Chief Director: Municipal Governance and Structures, National Treasury, said he fully understood all the comments from the Members. It was important for the Charter to be understood within context. As a country, the local government system was a model of decentralisation. As a country, there was already a system in place, and many of the laws and policies in place to support the system were based on the concept of decentralisation. As a Department, one of the projects it was doing with the South African Local Government Association (SALGA) was reviewing the local government’s fiscal framework. To what extent was that framework giving effect to some of the challenges raised by Mr Ceza? This framework was based on principles of decentralisation. Because South Africa already had it, it was up to African countries to assess to what extent they could review their own systems, which were largely centralised, and align them to the concept of decentralisation. The risk mitigation had to come from those countries, and not South Africa. This was because the country’s system was decentralised, and many of its laws and policies were aligned with decentralisation. There were challenges that were being addressed through the various projects it was busy with. This was either done individually as a Department, or with its partners within the sector.

Adoption of Charter

The Chairperson said this was a framework, as suggested, and acknowledged it had taken time to be brought to where it was. Considering the inputs made by the Committee, if there were any gaps, they would still engage with the Charter in Parliament. He asked for a proposal that recommended approval or submission for approval by the National Assembly.

Ms Mkhaliphi moved for the Charter to be adopted and sent to the National Assembly.

Mr Mpumza seconded the adoption of the Charter to be sent to the National Assembly, and was supported by Mr B Hadebe (ANC)

The Chairperson said the Committee had agreed for the African Charter to be sent to the National Assembly for approval.

The meeting was adjourned.