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LOCAL GOVERNMENT AND ADMINISTRATION SELECT COMMITTEE
18 May 2005
Chairperson: Mr S Shiceka (ANC)
Documents handed out:
Project Consolidate Programme:
Members met to hear a briefing by the Department of Provincial and Local Government on the Budget Review. Information on the various programmes in place was provided including human resource matters, finances, intergovernmental relations and urban and rural development. Numerous questions were asked by Members about Section 139 interventions, Project Consolidate, local government remuneration, improved service delivery to neglected regions, levels of underspending, assistance to African governments, fraud and corruption prevention strategies and current monitoring systems.
Ms L Msengana-Ndlela provided an overview of the Department's programme of action and a review of recent achievements. Insights into challenges were obtained from two working sessions involving the Finance Select Committee and the Mpmumalanga Provincial government respectively. A meeting was currently underway in the Western Cape involving all three spheres of government and representatives of the community to ascertain needs and address fragmentation in delivery of services. A priority was the maintenance of existing infrastructure to avert future cost implications. A core group of local government leaders had been assembled to guide developments and provide oversight to programmes of action. High level indicators had been identified to evaluate the implementation of strategy over a ten-year period. The Department was working with municipalities to improve the reporting system and redirect efforts towards key government objectives such as free basic services and poverty alleviation. Improved progress reports would be expected from municipalities in future indicating use of resources and quality of service. The Department's capacity would be enhanced to meet the new requirements and increase regular contact with local government on the ground. The strategy focused on practical performance and implementation of objectives.
Chief Financial Officer’s briefing
Mr C Clerihew provided an overview of the previous year's financial results and salient features of the 2005/06 programme. Detail on under-expenditure and over-expenditure was expressed. The financial implications of Project Consolidate were elucidated and information provided on data-gathering regarding the use of consultants. The Department budget had undergone an 18.6% increase. Various sub-programmes had been established requiring financial provision including anti-corruption and transformation initiatives. Detail on fiscal transfers and grants was put forward including those earmarked for the Municipal Demarcation Boards. The allocation to the Municipal Infrastructure Investment Unit would cease in March 2006 although discussions regarding possible extension were taking place.
Ms T Mketi (Chief Director, Human Resource Management) outlined the strategic objectives of the Administration programme highlighting capacity building and corporate services. The achievements of 2004/05 were listed and the priorities for the next financial year explained. Key priorities included the implementation and monitoring of the Business Plan, the integration of monitoring and evaluation systems and the development of a marketing strategy. The budget of the programme was explained. The Department would be moving to a new building in March 2006 to co-ordinate activity and ensure a closer working relationship between management and staff. A summary of the Medium Term Expenditure estimates was outlined.
Governance, Policy and Research briefing
Mr D Powell (Acting Chief Director, Intergovernmental Relations) provided an overview of the purpose of the branch and the measurable objective focused on improving governance. The two key strategic objectives were explained and the sub-programmes outlined. Estimates for expenditure were provided for 2004 and the next financial year. Key priorities were elucidated including the Intergovernmental Relations Bill, the Assignment Framework, section 139 interventions and the provincial support framework. Hearings would be held in all provinces to align service delivery involving the three spheres of government. The Local Economic Development strategy would be implemented to adjust economic activity where necessary and an operational plan for donor relations had been completed.
Urban and Rural Development briefing
Ms Y Silimela (Chief Director, Urban Renewal) highlighted the rural and urban nodes where activity would be concentrated. Key programme objectives were outlined including poverty alleviation and the promotion of social cohesion. Principles underlining the programme were explained and progress during 2004/05 expressed. Priorities included Skills Development and Social Cohesion and Moral regeneration. The efficient use of Urban Renewal Programme resources would be closely monitored. The challenges and priorities for 2005/06 were presented including the contribution to Project Consolidate and the communication and marketing of the various plans.
Systems and Capacity-Building briefing
Ms S Makotoko (Chief Director, Inter-governmental Fiscal Relations) explained the purpose of the branch and outlined the measurable objectives focused on developmental local government. The role and sub-programmes of the branch were presented highlighting the need to achieve sustainable local government. Key priorities for 2005/06 included Cabinet approval of the Local Government Employees Bill, the local government elections and dispute resolution support to municipalities. Project Consolidate remained a core component of the strategy as well as anti-corruption measures.
Free Basic Services and Infrastructure briefing
Ms M Montwedi (Chief Director, Free Basic Services) explained the purpose of the branch and the measurable objective focused on improved service to poor communities and under-serviced areas. The strategic role of the branch included the co-ordination of infrastructure development, accelerated free basic service delivery and accountable local government. Progress and achievements were presented including the Municipal Infrastructure Grant, Municipal Services Partnership, Public Participation and Free Basic Services. Priorities focused on capacity-building, monitoring systems, electricity provision and partnership creation between municipalities and communities.
Mr Z Ntuli (ANC) referred to the numerous incidents of section 139 interventions undertaken by provincial governments into dysfunctional municipalities. He asked whether Project Consolidate could not be involved as an initial intervention to attempt to address shortcomings before further drastic steps were taken. He suggested that this might reduce the likelihood of costly and damaging court cases that tended to accompany Section 139 actions. He stated that the plan to increase the monitoring of municipalities could result in heightened resistance and animosity between the three spheres of government. He asked what steps had been taken to improve the vetting of municipal managers' qualifications to enhance service delivery.
Mr D Worth (DA) sought clarity on the composition of technical teams assembled to investigate troubled municipalities as an attempt to avert section 139 interventions. He asked whether the current remuneration system utilised within local government would be standardised to promote uniformity and greater control over financial reward.
Mr A Moseki (ANC) asked how potential conflicts regarding interventions could be avoided to prevent disruption of service delivery. He claimed that a major obstacle to improved delivery was the poor functioning of infrastructure such as pre-paid water meters that tended to malfunction after a short period of time.
Mr J Le Roux (DA) asked for feedback on Project Consolidate and whether the Director-General was satisfied with the project up to now. He asked whether the key objectives of the Department had changed during the last ten years.
The Chairperson added that recent government initiatives had imposed five-year planning cycles onto government Departments and asked whether this development had impacted on Department objectives and evaluation procedures.
Mr L Mokoena (ANC) asked for clarity on the level of under-spending and whether the Department continued to monitor the use of resources by the Demarcation Board. He asked whether the current monitoring system to detect problems within municipalities was effective. He sought clarity on the type of communication strategies undertaken by the Department and whether problems around the use of unscrupulous developers had been reduced. He asked for a progress report on the implementation of recent legislation on traditional leadership within the respective provinces citing certain obstructionist tactics. He asked whether the Department assisted foreign governments, in particular within Africa, regarding the enhancement of local government activities. He asserted that capacity building initiatives such as workshops tended to be ineffectual and asked how this service could be improved. He questioned the effectiveness of the equitable share approach to resource allocation as different regions had different needs. He highlighted the high levels of corruption prevalent across a wide spectrum of municipalities and emphasised the need for urgent intervention to reduce mal-administration and nepotism. He requested an expansion of electricity provision particularly within the rural areas and improved billing systems. Members would play a prominent and more pressured role in increasing service to poor and marginalised communities including the eradication of the iniquitous bucket sanitation system. He advocated the increased employment of recent graduates to municipalities to address capacity shortfalls and improve service delivery.
Mr A Manyosi (ANC) suggested that provincial governments be accorded the right to monitor municipalities more extensively before the onset of functional problems by enhancing their capacity to monitor municipalities on a regular basis. He stated that capacity building should therefore focus on both local and provincial government. He asked for further detail on the fraud prevention and anti-corruption strategies.
Ms F Nyanda (ANC) referred to the training of ward committee members and asked whether wards without committees would also receive assistance. Fraud prevention strategy was bearing fruit citing the example of Mpmalanga province where twenty staff members had been suspended for the erroneous allocation of performance bonuses.
The Chairperson concurred that the equitable share system was problematic as different regions required particular focus in relation to needs. He stated that the Committee would meet with the Department in the near future to debate the standards of service delivery. He confirmed that the Property Rates Act regulations had to be finalised in the short term and asked for feedback on the recent Ward Committees Conference to which Members had not been invited. He stated that the new approach promoting intergovernmental partnership would also have to be discussed with the Department. He supported the notion of addressing anomalies in municipal remuneration and enhancing management performance. He asked for further detail on the current level of internships within local government and clarity on the Department's relationship with traditional leadership structures. He advocated the promotion of working relationships between Department and the private sector to increase service delivery and infrastructure development.
Ms Mketi responded that the Department would receive reports from municipalities on a monthly basis highlighting key programmes such as the Municipal Infrastructure Grant and free service provision. Reports would be submitted to National Treasury on a regular basis. The Department would participate in the cluster approach to government to improve co-ordination of activities and cost-efficiency. She stated that communication continued on an on-going basis including the monitoring of media reports. She stated that the move to new facilities was designed to improve interaction between management and staff and contribute to cost cutting. Approximately thirty internships were in place and the Department supported the proposal to increase the recruitment of graduates. The Department intended to address fraud prevention at the provincial level and impose heightened discipline within local government.
The Chairperson sought clarity on the current initiatives to build capacity within provincial governments and thereby improve provincial governments' ability to promote service delivery.
Ms Montwedi replied that plans were in place to enhance provincial government's ability to monitor and improve service delivery at the municipal level and promote effective infrastructure development. She stated that this required an enhanced understanding of backlogs through continuous research to record changes in demographics and other factors. She stated that housing policy was in place to implement grants and develop infrastructure. She stated that government would co-ordinate sectors to achieve better results. She confirmed that sanitation remained a key issue and appropriate service levels in different contexts would be considered as needs were variable. She stated that no reports had been received from municipalities indicating problems with specific developers although some projects had been withdrawn in certain regions due to poor technical planning.
Ms Y Silimela replied that a practice handbook had been developed regarding the building of capacity within local government focused on best practice. She stated that the equitable share formula would be reviewed to consider ways to improve the system.
Ms S Makotoko replied that Project Consolidate should be seen as a response to failures in preventing Section 139 interventions and sought to promote a developmental state approach involving government and the private sector in partnership. She stated that infrastructure development would be undertaken together with relevant private companies to produce more sustainable local government. She stated that the local government capacity-building grant would assist in improving service delivery. Project Consolidate would seek to increase the amount of resources used by provincial governments to promote sustainable local government. She stated that the new approach to revenue provision was to consider revenue-raising capacity of municipalities and effective entities would receive less share in future. She asserted that the Department would aim to achieve greater balance in resource provision centered on levels of poverty, unemployment and economic activity. She stated that new regulations had been produced to reduce levels of corruption in municipal procurement activities.
Mr Clerihew stated that the Project Management Grant had ceased following discussions with National Treasury and provinces would now provide for project management through the equitable share scheme. He stated that under-spending was difficult to avoid as each Department only had one occasion to realign spending allocations but regulations were pending that would address this. He stated that the Department did move certain funds during the course of the year such as provision to the National House of Traditional Leaders. He stated that savings were achieved due to a failure to fill certain management posts and savings were achieved in the two smallest sub-programmes. He stated that the amount that could be moved between programmes was restricted by regulations. He stated that under-expenditure would be addressed going forward given existing needs. He stated that the Department had no control over the spending of resources by the Demarcation Board that reported directly to Parliament. He confirmed that the Demarcation Board did receive additional funds following a request that was approved by Treasury. Additional funding was also forwarded to the NHTL.
Mr Powell replied that all provincial bills had been published for public comment and four had been tabled. He stated that extensive assistance was being provided to African governments such as Ethiopia and Lesotho. He added that the Department was also working with the SADC Local Government Forum to formalise local government institutions. He stated that a high-level bi-lateral commission was involved in the DRC dealing with pre- and post election planning. He confirmed that uneven capacity existed at the local government level and that Department had sound relations with provincial Departments including a combined overview of capacity levels and the joint production of solutions. He confirmed that attention had to be focused on enhancing the ability of provincial Departments. He stated that various inconsistencies within schedules 4 and 5 were being investigated and an assessment of sector Departments had been completed. He stated that certain definitions of functions had to be reconsidered and no policy was in place that governed the assignment of functions between spheres of government. He added that the Department was determined to address the housing function and improve delivery.
Ms L Msengana-Ndlela stated that Department management had listened carefully to the questions and inputs which would be acted upon in due course. She stated that a priority of the Department would be to encourage sustainable provincial and local government. She reiterated that Project Consolidate would be pursued to bring about meaningful improvements over a two-year period. No short-term solutions were expected and agreed that urgent action was needed to address shortcomings. She confirmed that service delivery facilitator teams were composed of Department officials which would visit municipalities to identify challenges and produce solutions where need arose. She acknowledged certain problems with the current model of capacity enhancement that would be altered where necessary. She stated that support would be provided within a partnership framework recognising good practice in certain areas and expanding to deficient parts. She stated that the Department was determined to appoint effective managers and promote sound management throughout provincial and local government. She confirmed that aspects of the fiscal framework would be revisited including the equitable share scheme, conditional grants and financial remuneration. Provincial governments would be tasked to improve provincial and local government and project management units would be established in accordance with Project Consolidate. She added that the Department would concentrate on reducing levels of underspending to ensure increased service delivery.
The Chairperson acknowledged the difficulty in co-ordinating the three spheres of government and committed Members to assisting in this task. He hoped that Department would continue to interact with local government on an ongoing basis. He stated that Members extensive knowledge of provincial issues would contribute to a successful attempt to enhance the service delivery of provincial and local government.
The meeting was adjourned.
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