Independent Municipal Authority Demarcation Bill: National & Provincial Departments briefing

Meeting report

Ms M Maseko (DA) was nominated and appointed as the Acting Chairperson of the meeting. She thanked the Members for the appointment. She noted that the Committee would be briefed by the Department of Cooperative Governance (DCoG) on the Independent Municipal Authority Demarcation Bill [B14 – 2022] (the Bill). She welcomed the Members and government officials, and asked that Members introduce themselves to the Committee. She had received and accepted an apology from Mr I Sileku (DA). She further noted and accepted an apology on behalf of the Minister of Local Government, Environmental Affairs and Development Planning, Mr Anton Bredell.

She asked for introductions from the national officials.

Dr Kevin Naidoo, Deputy Director-General: Policy, Governance and Administration, DCoG, introduced himself. He advised that he was joined by Mr Wayne McComans, Chief Director: Municipal Governance, DCoG, Mr Siyanda Nkehli, Manager: Local Government Institutional Establishment, DCoG, Mr Nhlamulo Mathye, Assistant Director, DCoG, and Ms Lisa Naidoo, Senior State Law Advisor, Office of the Chief State Law Advisor (OCSLA).

He advised that Mr Nkehli would lead the Committee through the presentation.

Mr Kamal Makan, Director: Municipal Governance, Department of Local Government (DLG), introduced himself and his team, consisting of Mr Rudi Ockhuis, Legislation Development Unit, DLG, and Dr Sandra Greyling, Director: Municipal Support and Capacity Building, DLG.

Alderman Paul Swart, Provincial Executive Council Member, South African Local Government Association (SALGA), introduced himself to the Committee. Mr David Jansen, Senior Advisor: Municipal Governance, SALGA, introduced himself to the Committee, as did Mr Loyiso Njamela, Advisor: Inter-Governmental Relations, Western Cape, SALGA, Mr Armstrong Mpela, Senior Advisor: Inter-Governmental Relations, Western Cape, SALGA, and Mr Michael Chauke, Specialist: Inclusive Governance and Councillor Welfare, SALGA.

The Acting Chairperson requested that the DCoG proceed with their presentation on the Independent Municipal Demarcation Authority Bill [B 14 – 2022]

Presentation by the Department of Cooperative Governance on the Independent Municipal Demarcation Authority Bill [B14 – 2022]

Mr Nkehli advised the Committee that the amendments to the Demarcation Act had been based on inputs from the present and previous Demarcation Boards, and were also necessitated by lessons learned from previous municipal boundary and ward delimitation processes, litigation as well as inputs from various stakeholders.

The Bill was published in the Government Gazette on 17 June 2020 for public comment. DCoG also convened various engagements. These engagements included workshops convened on 1 and 2 March 2017 with the Municipal Demarcation Board (MDB), the Independent Electoral Commission (IEC), SALGA, various national departments, the Portfolio Committee on Cooperative Governance and Traditional Affairs, and other stakeholders.

Follow-up workshops were also convened on 9 and 14 December 2020, where comments received on the Bill were considered. Due to the many proposed amendments, it necessitated that Act No. 27 of 1998 be repealed and replaced with a “new” Act. On 23 March 2022, Cabinet approved the Bill to be introduced to Parliament. On 21 June 2022, the Bill was introduced to the National Assembly (NA) and referred to the Portfolio Committee on Cooperative Governance and Traditional Affairs. In October and November 2023, the report of public participation held between July and September 2023 had been considered, and the Bill was referred to the National Council of Provinces (NCoP) on 30 November 2023.

Mr Nkehli proceeded to provide an overview of the clauses of the Bill. Of importance was the fact that the term of the MDB aligned with the term of the municipal councils. The Bill provided that the views of the people and communities that lived in a particular area had to be considered. The Bill further stipulated that major redeterminations of the municipal boundary would be done every ten years, and that there had to be public consultations for the determination and redetermination of any municipal boundary. The delimitation of wards may not deviate by more than 30%, and there had to be appropriate public participation in the delimitation of wards.

(See presentation attached for further details)

Discussion

The Acting Chairperson thanked Mr Nkehli for his presentation, and opened the floor to Members to raise questions and/or comments.

Ms C Murray (DA) asked what the rationale had been for the Bill. She wanted to ascertain the reasons why the DCoG had introduced the amendments at this point as well as the importance thereof. What was the consultation process prior to and during the drafting of the Bill? Would there be any further consultations before the public participation process commenced?

Mr A Van der Westhuizen (DA) thanked the DCoG for the presentation. He recalled that Mr Nkehli had said that the MDB had the right to revoke any decision that any staff member had made. He asked for the specific clause that dealt with this point. He expressed his worry at a possible scenario where a decision on demarcation had already been communicated, only to be revoked at a later stage. He said that he had understood the necessary amendment meant that decisions were binding, in line with the understanding of the principle of functus officio. He appreciated the fact that in certain circumstances, it was not possible to stay within the standard 15% deviation, and that a higher deviation would be required, and thus that the Bill allowed for this in exceptional circumstances.

Mr M Klaas (EFF) apologised for having been late and directed his questions to Section 20 of the Bill that dealt with the conditions of employment. He wanted to ascertain under what conditions employees would be employed.

The Acting Chairperson asked what cost implications this Bill would have on Treasury, in light of the fact that the Bill had been tabled to fix legislative and practical issues.

Responses

Dr Naidoo observed that the Municipal Demarcation Act No. 27 of 1998 (the Act) was the first piece of legislation that emanated out of the white paper process. Many things were not covered in that piece of legislation. For example, the issue around capacity assessments. Capacity assessments, provided for in Section 5 of the Structures Act, had been a key mandate to be considered. The new Bill was a driving force that encapsulated different pieces of legislation that pertained to demarcations.

He further added that it was not only Schedule 5 but also Schedule 1 of the Structures Act that had been imported into the new legislation. Provisions from the Systems Act were also incorporated into this legislation. In fact, the entire Bill would replace the Act of 1998.

The sequencing of the provisions in the Act in its present form was out of sync as Section 21 dealt with publishing the final determinations, whereas Section 26 dealt with public participation and then final determination. The sequencing thus had to be fixed. In practice, this meant that governing issues related to the Act were towards the end of that specific legislation, whereas the new Bill dealt with governing issues first and others would then subsequently follow from this.

On the issue of consultations, he noted that Members would have noticed from the initial slides of the presentation that the genesis of the Bill had its roots way back as far as 2007. The minute the first MDB ended their term in 1999, they had made recommendations to streamline operations. These recommendations set in motion the current legislative process. Various determinations that followed thereafter also contributed. The Bill now provided for major redeterminations major such as moving more than one ward only. These major decisions would now happen after ten years. This ensured political stability and discouraged haphazard demarcations.

He stated that at government level, the DCoG had had various workshops since 2007 to which most government departments were invited, which workshops dealt with the Bill as well as the Structures Act as amended. Members might recall that the Structures Amendment Bill was tabled in Parliament in 2021. Various engagements took place with stakeholders, post the publication of the Bill in 2020 for public comments. After that process, the DCoG also invited other stakeholders again to consider all the inputs received.

He noted that the legislation had also been processed by various committees of Parliament. Inputs made there were also then subsequently incorporated. The process had then headed to the OCSLA for further legal scrutiny before the Bill was tabled before Parliament.

Regarding the revocation of decisions by the MDB, he explained that Section 17 of the Bill, as provided for, stipulated that the MDB could revoke any decisions made by a MDB Committee or employees.

Mr McComans spoke to the consultation process related to Clause 17 and indicated that this specific provision was applicable where no power was allowed in the legislation for particular functionary to revoke decisions. He added that in this instance, the DCoG had assigned powers to the MDB to make determinations on decisions. The DCoG would have to assess the doctrine of functus officio since no provision for that allowance had been made in the legislation. He noted that the legal advisors of the DCoG would be alerted to this.

Ms Naidoo said that she had thought that the particular clause related to the appeals process. She noted that any queries or objections to any decisions made by the Demarcation Board had to be lodged within 30 days of that decision having been taken. She observed that her colleagues had drawn her attention to Clause 17.3 which dealt with a decision taken by a member of the MDB, a MDB committee or an employee of the MDB in consequence of a delegation or instruction. She explained that from the date this legislation became operational, that section would apply to that Demarcation Board.

When it came to decisions taken by previous Demarcation Boards, the incoming Demarcation Board had to follow the decision of the outgoing Demarcation Board, on the principle of successor entitlement, unless it could be proved that the decision was obsolete and grossly irregular. Only under these circumstances could a decision be rescinded.

Dr Naidoo mentioned that, regarding the 15% to 30% deviations in exceptional circumstances, this was a new provision that had been incorporated. This provision spoke to a split community scenario where the norm constrained demarcation due to the 15% threshold. The norm for calculating the threshold was the number of ward residents divided by the number of councillors. If the norm was 15%, the number of registered voters in a ward compared to a neighbouring ward should be less than 850 and more than 1 150.

He further added that problems would arise when there were an additional 250 registered voters in the next ward of the same community. If the MDB stuck to the 15% threshold, the 250 registered voters would not be able to be incorporated into one ward. A split community would be the result of such an eventuality. If the norm had been 30%, the upper end would have been 1 300. This would have made allowance for the 250 to be incorporated. This rationale formed the basis for the 15% to 30% thresholds. The Bill foresaw such instances to avoid the fragmentation of a continuous build-up area where the voting station fell outside the relevant ward. This was also relevant when the MDB wanted to align a ward with a certain topographical and physical area. Importantly, once you want to apply the 30%, you need to ensure that it is published in the Government Gazette.

On the question on the conditions of employment, he further added that it was aligned to the provisions in the Bill as well as other new generation legislation such as the Border Management Authority Act, where reference was made to the Public Administration Management Act. Section 20 of the Bill clearly stipulated that the Demarcation Authority would be an employer in its own right, having been conferred with the necessary constitutional prerogative.

On the cost implications of the Bill, he stated that the Bill had been drafted in-house by departmental legal advisors and the OCSLA who had vetted it.

He stressed that everything had been done in-house and that the necessary socio-economic impact assessment on the populace was also done. The only area where the DCoG would have incurred costs related to hosting workshops and related activities.

Further discussion

The Acting Chairperson noted that her comments were more related to the cost implications of the legislation on the fiscus. She recalled that a slide in the presentation had mentioned that the National Revenue Fund would foot the Bill. In her view, each Bill would ordinarily have a business plan attached. Her question, she added, should also be read within the context of wholesale budget cuts that the national government had implemented. She asked if the preparation of the Bill would short-change anything else.

Ms Murray observed that the Bill contained a lot of jargon and asked the DCoG for guidance on how she was expected to brief the public on the provisions of the Bill. She also wanted to establish by when the process would be concluded.

Mr Van der Westhuizen once again referred to the term of office of Demarcation Board members. He noted that district councils could only convene once local councils had convened and nominated their delegates to the former. One would often find that district councils only met three weeks after local Councils had convened. He proposed that the DCoG look at the date that election results at national level were proclaimed. In some instances, certain municipal councils might be dissolved, which would result in mid-term elections or a date that fell outside the five-year term cycle.

Further responses

Mr Nkehli stated that the Bill sought to improve the demarcation process and was explicit on the importance of public participation. The Bill also provided for the establishment of the Demarcation Appeals Authority.

On the terms in office of MDB members, he added that the Municipal Structures Amendment Act 3 of 2021 addressed the concerns raised by Mr Van der Westhuizen. He explained that councillors commenced their terms on the date that the IEC declared the results.

Dr Naidoo stated, on the question of the cost implications, that presently, the Demarcation Board received its funding through the Revenue Fund via the DCoG. He also agreed with the Chairperson about the cost-cutting measures that the national government had implemented, and observed that it would remain to be seen how the cost-cutting measures would influence the MDB’s resourcing.

He commented that the Bill placed communities and the citizenry at large in the middle of everything. Public participation was a key component of the Bill. Should the Committee decide to undertake a public participation process on inner- and outer boundary delimitations, it would be able to unpack processes step by step. Sections 23 to 27 of the Bill dealt with what happened to inner and outer boundaries and how they affected communities. The Demarcation Appeals Authority's establishment was another significant step, seeing that should any member of the public feel aggrieved by the demarcation process, they would be able to appeal. Previously, members of the community could seek recourse through the courts, which had been a very expensive endeavour.

In the past, Demarcation Boards were responsible for different competencies during their tenure. One Demarcation Board was responsible for the delimitations of outer boundaries, whereas its successor Demarcation Board, had to determine inner boundaries. The present Demarcation Board had been responsible for determining outer boundaries and its term would conclude at the end of February 2024. The new Demarcation Board should be installed by 1 March 2024 and would assume responsibility for the delimitation of inner boundaries. The Bill under discussion sought to end the current practice and assigned both outer and inner delimitations to a particular Demarcation Board.

Mr Van der Westhuizen said that he had found the response on the term of the Demarcation Board a very interesting one. He noted that the Municipal Structures Amendment Act indicated that elected councils assumed office on the date the IEC declared the results. District councils were only elected 14 days later. In his opinion, the five-year term was an interesting one, as the determination of the dates for the election of the Demarcation Board was dealt with quite ambiguously in the Bill. He also proposed that the word “council” in the section in the Bill should be in plural.

The Acting Chairperson noted that Mr Van der Westhuizen could always raise his points as part of the Western Cape's negotiated mandate.

Dr Naidoo agreed with the Chairperson’s proposal.

Presentation by the Western Cape Provincial Department of Local Government

Mr Makan stated that the DLG had provided comments on a previous version of the Bill, whereby some of the comments and recommendations as submitted had been considered and amendments had been affected and incorporated into the current version of the Independent Municipal Demarcation Authority Bill [B 14B – 2022] before the Committee.

The comments, as presented, entailed inter alia, comments that were not considered and included further comments based on a review of the Bill as referred by the NCOP. He reported that there was currently no definition of the term “President” in clause 1 of the Bill, whereas reference was made to the term “President” in various clauses within the Bill.

Regarding the composition of the Demarcation Board, in terms of Clause 7(2), the DLG emphasised the need to ensure that the composition of the Demarcation Board fairly and accurately reflected the composition of African Society.

The DLG was also of the view that the language contained in Clause 11(4) of the Bill should be revised for the sake of avoiding redundancy. The DLG felt that the factors provided in Clause 25(3) of the Bill to be considered in determining the establishment of a single category A municipality were too broad. The time frame stipulated in Clause 26(1) of 10 years to determine or redetermine a municipal boundary was too long. The DLG further felt that Clause 29(8) had to make provision for a translator in public consultative meetings. The DLG was also of the view that the costs associated with the public consultative meetings should be borne by the authority, and this should be provided for in the Bill. Finally, the transitional arrangements contained in the Bill should be revised.

(See attached presentation for further details)

Presentation by the South African Local Government Association

Mr Chauke reported that SALGA proposed additional responsibilities to be added to that of the Demarcation Board in Clause 8 of the Bill, that limitations be provided on the number of members of the MDB committees which could be co-opted in terms of Clause 16 of the Bill, and that these co-opted members be required to fulfil the requirements set out in Clause 9(1) of the Bill.

SALGA recommended that there must be a rationalisation of municipalities, in line with the powers provided in Section 41 of the Municipal Demarcation Act to the Minister of the Department of Cooperative Governance and Traditional Affairs to make regulations which prescribed objectives and general targets for the rationalisation of municipalities as contemplated in section 25 (l).

This rationalisation policy had to take into account socio-economic and developmental needs of municipalities, as well as how to address cases where provincial boundaries affect municipal boundaries.

SALGA further noted that the formula to determine councillors, whilst distinguishing between Categories of municipalities and their overall budgets, population and the like, had resulted in situations where contiguous municipalities might have very different arrangements in terms of the number of councillors relative to voters. If municipalities merged, the “smaller” municipality appeared to be underrepresented in the new municipality. SALGA was thus calling for a longer, three-year period in which transitional grants would be provided to new municipalities. The merging of municipalities was not the way forward. The MDB should do a feasibility study in all cases during the demarcation process. It was also vital that local government senior management members be adequately qualified and competent to ensure stability in management.

SALGA supported the longstanding proposal for a 10-year interval for municipal boundary re-demarcation, as this addressed the governance and financial sustainability challenges resulting from frequent changes.

SALGA agreed that the Bill also addressed the impact of a lack of presence of a provincial authority of the Independent Municipal Demarcation Authority. Alternatively, the Bill provided for provincial commissioners and provincial staffing. The Bill also eased up the appeals load with a provision for provincial appeals authorities, to decentralise activities of the board that ensured cost reductions of re-demarcation outcomes. The Bill also called for swift responses to aggrieved persons and ensured that the newly provided-for dispute resolution mechanisms and appeals process were involved, effectively and timely.

(See attached presentation for further details)

Discussion

The Acting Chairperson said that she was not going to open discussions on the SALGA presentation as the Committee still had to process the legislation in preparation for the public hearings. She asked for a list of the stakeholders who had been identified for the public hearings to be held, as this would assist the Committee with its preparation for the public hearings.

Dr Naidoo felt that identifying the stakeholders was the prerogative of the Committee, however he could obtain the list of stakeholders with whom the MDB normally engaged with, and share that.

The Acting Chairperson clarified that she wished for the Committee to be advised of which stakeholders had already been engaged within the prior public hearings, so that the Committee could know who had not been engaged and thus proceed accordingly to include all the necessary stakeholders.

Dr Naidoo directed the Chairperson to the memorandum to the objectives of the Bill, which listed the stakeholders who had already been consulted.

The Acting Chairperson thanked Dr Naidoo for the clarification. She thanked and excused all the presenters.

Actions to be taken by the Committee in respect of public hearings

The Acting Chairperson indicated that the Committee had very limited time to process the Bill. She noted that in terms of the Committee’s plan, the negotiated mandates by provinces had to be submitted by 8 March 204, and the Committee’s deadline was 22 March 2024. She asked that Members apply their minds on how the Committee should proceed. She was of the view that the Committee had to apply for an extension but sought Members input on the length of that extension.

Ms Murray said that other committees faced the same scenario. Her proposal was that the Committee’s deadline should carry over to the next term, alternatively, to the end of March 2024.

Mr Klaas supported the proposal raised by Ms Murray.

The Chairperson thanked Members for their inputs and asked Adv Romeo Maasdorp, Legal Advisor, Western Cape Provincial Parliament, to provide his input on how the Committee should proceed, in light of the fact that the Committee still had to process the budget as well as other legislation during the remaining time.

Adv Maasdorp indicated that he would prefer to defer the request the Committee’s Procedural Officer, Mr Johannes Coetzee, to provide guidance.

The Chairperson indicated that she first wanted to hear what legal options had been available to the Committee.

Mr Coetzee indicated that he already discussed this issue with his NCOP counterpart. The three months allotted for this Bill would not be sufficient. He thus suggested that the Committee put forward Ms Murray’s proposal to the NCoP and let the NCoP decide if it would accept the request.

Adv Maasdorp stated that he agreed with the above sentiment, however it was still incumbent on the Committee to exhaust whatever it could to conduct public hearings and use its time optimally rather than pre-emptively asking for an extension. He cautioned the Committee not to pre-empt a decision by the NCOP as the Western Cape was not the only province in the country. The Committee should explore all possibilities to conduct as many public hearings as it could, and only in the event that it cannot conduct those hearings fully in the manner required, then the NCoP could be engaged for an extension. The Committee should conduct as many meetings as possible, and as it got closer to election time, it could decide whether to request an extension.

The Acting Chairperson suggested, subject to the Members' approval, that the Committee’s procedural staff conduct the necessary research and identify the relevant stakeholders in preparation for the public hearings. She also asked that the necessary information be communicated with members of the public who might want to make submissions, including oral submissions. She understood from Adv Maasdorp that the Committee could also dovetail on other public participation process already scheduled.

Mr Coetzee sought clarity on whether he should draft a letter to the NCoP requesting an extension to the new administration and simultaneously also proceed with reaching out to stakeholders and requesting submissions by a particular deadline, whereafter the Committee could proceed with the public hearings.

The Acting Chairperson noted in the affirmative, and asked how long the advertisements for submissions would be out for.

Mr Coetzee suggested that the Committee avoid using advertisements, as if it did, the public would have to be given three weeks to submit their comments. The cut-off date for advertisements would be on 22 February 2024, so the Committee would try to get those advertisements then. The closing date for submissions would then be 8 March 2024. If the Committee did not get to engage in public hearings thereafter, it would have wasted costs. It would be better for the Committee to use social media and write to the stakeholders to ascertain the nature of the written comments and whether the stakeholders would want to make oral submissions. The Committee could then advertise and advise the public of hearings to be held.

The Acting Chairperson noted that the Committee could not deviate too much from the regulated process for public consultations. The Committee had to do what was expected of it. She thanked Members for their attendance and participation.

The meeting was adjourned.