Intergovernmental Relations Framework Bill; MTBPS, MTEF & Quarterly Financial Statements:briefings

Meeting report

PROVINCIAL AND LOCAL GOVERNMENT PORTFOLIO COMMITTEE
9 November 2004
INTERGOVERNMENTAL RELATIONS FRAMEWORK BILL; MTBPS, MTEF AND QUARTERLY FINANCIAL STATEMENTS: DEPARTMENT BRIEFINGS

Chairperson: Ms R Ntshulana-Bhengu (ANC)

Documents handed out:
Presentation by the Director-General on the Intergovernmental Relations Framework Bill
Introducing the Intergovernmental Relations Framework Bill
General Notice for Public Comment on the Intergovernmental Relations Framework Bill
Draft Intergovernmental Relations Framework Bill - as approved by Cabinet: 3/11/04
Portfolio Committee on Provincial and Local Government Annual Report 2004
Portfolio Committee on Provincial and Local Government Business Plan: 2004/05
Department Annual Report 2003/04
Department Strategic Plan 2004/2007 (including Project Consolidate)
Department Presentation on the Medium Term Financial Issues
Portfolio Committee on Provincial and Local Government Budget Proposal 2004/05 [email [email protected]}

SUMMARY
The Department briefly took the Committee through the draft Intergovernmental Relations Framework Bill, and also presented its medium-term financial report. The Committee considered its Annual Report, business plan for 2005/6 and its budget. Among others, the following issues were discussed:
- the importance of intergovernmental co-operation in the creation of a single public service;
- how intergovernmental disputes should be resolved;
- the relationship between the intergovernmental relations structures required in terms of the Bill and other existing structures;
- mechanisms and strategies to ensure that Free Basic Services reach the intended recipients and thus close the gap between the first and second economies, and
- the importance of multi-purpose community centres as a source of information.

MINUTES
The Chairperson reminded Members that the Department would only brief the Committee on the policy context of the Bill, and that discussions would take place at a later stage.

Intergovernmental Relations Framework Bill briefing
The Department delegation included Ms L Msingana-Ndlela, Director-General; Mr P Flusk, Deputy Director-General: Free Basic Service and Infrastructure; Mr C Clerihew, Chief Financial Officer, Dr D Powell, Intergovernmental Relations and Dr P Bouwer, Manager: Legal Service.

Ms L Msingana-Ndlela took the Committee through the presentation and noted that the Bill would be enacted in terms of Section 41(2) of the Constitution. This section required Parliament to introduce legislation for the regulation of intergovernmental relations and structures to promote and facilitate co-operative government in terms of Chapter 3 of the Constitution. This Bill would contribute enormously in improving State performance and thus enable the three spheres of government to focus on intensifying their performance, integration and monitoring. In order to achieve this aim the Bill set down five objectives as guiding principles. She thereafter took the Committee through the draft Bill itself and noted that its targets could only be achieved if Government and citizens entered into a social contract. She noted that there had been lengthy consultation around the Bill within the Government sector.

Discussion
Mr L Green (ACDP) asked what how compliance would be enforced without the use of legal action.

Ms Msingana-Ndlela responded that the aim was to ensure that State organs avoided intergovernmental disputes; however should they occur, they would be resolved without resorting to the courts. The provisions of Sections 100 and 139 of the Constitution provided good examples of dispute resolution mechanisms that could be employed by State organs in resolving their disputes.

Dr P Bouwer (Manager: Legal Service) said that it should be noted that Section 41(4) of the Constitution required the courts to form part of the processes aimed at developing mechanisms and procedures to facilitate intergovernmental disputes.

Mr P Smith (IFP) asked why they had decided to introduce this Bill now since it had been contended in the past that South Africa should evolve its own system without them being prescribed by statutory requirements.

Ms Msingana-Ndlela acknowledged that while it had been crucial to allow natural evolvement, they had learnt that lack of co-ordination amongst government organs stalled their progress. Therefore, integration was encouraged through the Bill to ensure that Government improved qualitatively in the coming decade.

Dr D Powell (Intergovernmental Relations) said it should be noted that all three spheres had agreed to develop a system that would be predictable in directing Government efforts.

Mr Smith (IFP) asked what role had been given to Traditional Leadership and whether they would form part of the envisaged intergovernmental relations structure.

Ms Msingana-Ndlela responded that the Bill only focused on the executive level of Government. However, legislation on Traditional Leadership gave them the right to participate in all development issues.

Mr Smith (IFP) asked what kind of authority the envisaged structure would have and whether its decisions would be binding or would be mere recommendations.

Dr Powell responded that Clause 29 of the draft Bill clearly stated that the structure would act as an intergovernmental consultation and discussion forum, without having any executive decision-making powers. However, it could adopt resolutions and makes recommendations in certain cases.

Ms Msingana-Ndlela said that the powers and functions of the three spheres of government were clearly articulated in the Constitution and what the Bill did was to facilitate and promote co-ordination and integration at the strategic level of government.

Mr S Mshudulu (ANC) welcomed the policy direction taken by the Government and saw the Bill as entrenching the fact that SA, despite having three spheres of government, was a unitary State. He also saw it as being instrumental in ensuring that all three spheres addressed their constitutional mandates and thereby positively responded to capacity issues.

Ms M Gumede (ANC) asked how the Premiers Intergovernmental Forum would differ from SALGA.

Ms Msingana-Ndlela said the Premiers Intergovernmental Forum would be a statutory forum headed by the Premier as its Chairperson and thus SALGA would form part of its membership as the representative of organised local government structures.

Mr W Dorman (DA) asked for clarity on the processes that had taken place so far and whether local government had been formally consulted on the Bill.

Dr Bouwer said that the Rules of Parliament allowed for a preliminary process to take place before a Bill was actually introduced. The Bill had been referred to Parliament in terms of Rule 159 of the Joint Rules of Parliament and as required by Section 154(2) of the Constitution, the Bill had been published for comment. They were awaiting the public response to the Bill before other parliamentary processes could take place.

Mr Mshudulu (ANC) asked whether the Bill would apply only to the three spheres of government or also to other Government departments as well.

Ms Msingana-Ndlela responded that the Bill would apply to all Government departments and thus not only those dealing with Provincial and Local Government issues.

Mr M Lekgoro (ANC) was concerned that the forums that would be created by the Bill would significantly affect the autonomy of the spheres.

Ms Msingana-Ndlela responded that the intention was to ensure that there was co-operation between the three spheres of Government as laid down in Chapter 3 of the Constitution.

Mr Lekgoro (ANC) asked what the relation would be between the Bill’s proposals and the envisaged single coherent public service.

Ms Msingana-Ndlela responded that the Bill would contribute tremendously towards the creation of a single public service.

Mr M Swathe (DA) asked how the intervention by the Intergovernmental Relations structure would take place.

Ms Msingana-Ndlela responded that there would be broad guidelines that would assist the forum in the execution of its functions.

Mr Green (ACDP) asked what financial implications the Bill would have.

Ms Msingana-Ndlela responded that they would not require any additional funding since the Department would use the funds that were allocated to it during this fiscal year.

The Chairperson thanked the Department for its presentation and noted that the Bill was required to ensure that Government organs operated in an integrated manner.

Medium-term financial issues briefing
Mr C Clerihew (Chief Financial Officer) noted that the Department’s medium term financial report consisted of three elements, namely the Medium Term Budget Policy Statement (MTBPS), the Medium Term Expenditure Framework (MTEF) and a quarterly financial statement. He noted that the central theme was Government’s recognition of the fact that it had to pursue higher economic growth in realising its programme.

Ms Msingana-Ndlela stated that it should be borne in mind that the structure of the presentation covered issues relating to the broad Medium Term Strategic Framework as they affected the local government and administration cluster.

Discussion
Mr Green (ACDP) asked the Department to elaborate on what it meant by stating that it would facilitate activity within the second economy.

Mr Clerihew responded that they believed that municipal grants could play an important role in directing projects within the IDPs, thereby resulting in increased participation from the community.

Mr Lekgoro (ANC) asked what mechanisms and strategies had been put in place to ensure that free basic services reached their intended recipients.

The Chairperson asked whether people really understood and appreciated free basic services. She also asked to what extent Government’s plans related to those of the entities charged with promoting municipal economic mobility. Lastly, she asked how the Department dealt with the question of reinforcing partnerships with other sectors.

Ms Msingana-Ndlela referred the Committee to pages 9, 10, 11, 13, 17 and 21 of the document titled "Project Consolidate" and noted that it was in terms of this programme that they intended to address the concerns raised by the Members, especially those relating to free basic services. She commended Government’s social partners and the private sector for the willingness they demonstrated in ensuring that this programme became a success. It was only through such commitment and co-operation that the economic gap between South Africans could be closed.

The Chairperson noted that in developing financially sustainable municipalities it was important that all policies that affected indigent people should also take into account those people’s social conditions.

Ms H Mpaka (ANC) asked whether there was an integrated approach to the creation of multi-purpose community centres since there seemed to be many Government departments involved in their creation.

Ms Msingana-Ndlela responded that all departments were integrated from the planning to the programming stages of these multi-purpose community centres.

Mr Clerihew said that it should be noted that the creation of these multi-purpose community centres rested with the GCIS. However, the DPLG had an interest and therefore it collaborated.

Mr I Mogase (ANC) asked whether the Department believed that these centres would provide a solution to the unemployment crisis and would result in a sustainable and long term employment solution.

Mr P Flusk (Deputy Director-General: Free Basic Service and Infrastructure) responded that they believed that the fact that these centres would be reflected within the IDP’s of the municipalities would address the issue of sustainability. Furthermore, the fact that GCIS had also agreed to ensure the engagement of other sectors, would result in the process being owned by the communities themselves.

Ms Msingana-Ndlela also noted that it should be borne in mind that when GCIS introduced this programme to the local government and administration cluster it aimed at ensuring that these centres would act as information points where information on government could be accessed. However, they noted the concerns and comments raised by Members.

Mr Mogase (ANC) noted that it was imperative that Government should interact on a regular basis with young South Africans through their organised youth or student formations to ensure that they were orientated about SA and their role in it.

Mr Smith (IFP) asked what contingency plans were in place to prevent MIG grant rollovers since this financial year was almost over.

Ms Msingana-Ndlela explained that, amongst other things, what contributed to this was the decision to roll out the MIG in totality within the first year of its operation and not within the three-year period as was initially planned. However they had put in place operational structures to assist in gathering the necessary information and were also working very closely with grant managers to ensure that municipalities’ capacities were increased. This would ensure that they were able to present their business plans in time and were also able to verify their data information to better manage their capital budgets. However the difficulties brought about by the difference in accounting periods between the municipalities and the national government should be noted.

Mr Dorman (DA) asked how far the Department had come in filling vacant positions and what challenges confronted it in this regard.

Ms Msingana-Ndlela responded that they had systems in place to ensure that they recruited quality individuals in terms of public service standards to fill the posts and the process to do so was already in place.

Committee Annual Report

1. Name of the Committee
Mr Smith (IFP) proposed that the name of the previous Chairperson, Mr Y Carrim, be inserted in conjunction with the one of the present Chairperson of the Committee since the report also covered activities that were done under his Chairpersonship. The Committee concurred with the proposal.

3. Chairperson’s overview
Mr Smith (IFP) proposed that the last sentence be expanded to make it clear what these different entities had to respond to in relation to local government.

4.2.1 Institutional Oversight

Mr Mshudulu (ANC) noted that the use of the plural form in the last sentence of par 4.2.1 while the Committee had only received a single briefing might cause confusion and asked that it be corrected.

Mr Smith (IFP) noted that the briefing that they had just received from the Department on the Intergovernmental Relations Framework Bill and the Medium Term Financial Statement was missing from the report and had to be inserted.

4.2.2 International / national visits
Mr Smith (IFP) said that while he acknowledged most of the visits in this paragraph were directly related to the Committee’s oversight functions, he wanted to know how the COSATU Conference related.

The Chairperson said that the conference would be debating, amongst other things, local government and the forthcoming elections. She further proposed that each page should be numbered accordingly.

The report was unanimously adopted, with amendments.

Committee Business Plan
The Chairperson took the Committee through the plan and asked the year to be changed from 2004 to 2005/2006 since the business plan related to the next fiscal year.

The plan was unanimously adopted, with amendments.

Committee Budget Proposal
The Chairperson took the Committee through the proposed budget for 2005/2006. The budget was unanimously adopted.

The meeting was adjourned.