ATC140929: Report of the Select Committee on Co-Operative Governance and Traditional Affairs On Consideration of the notice of Intervention issued in terms of Section 139(1)(C) of the Constitution in Dissolving the Inkwanca Municipal Council – dated 29 September 2014

NCOP Economic and Business Development



The Select Committee on Co-operative Governance and Traditional Affairs, having considered the referral to the National Council of Provinces (NCOP), to consider and report on the notice of intervention issued in terms of section 139(1 )( c) of the Constitution of the Republic of South Africa, 1996, in dissolving the Inkwanca Municipal Council in the Eastern Cape Province, reports as follows:


1. Introduction and Background


1.1 On 15 September 2014, the Premier of the Province of the Eastern Cape signed and sent the notice of intervention to the National Council of Provinces (NCOP), a notice of intervention issued in terms of section 139(1)(c) of the Constitution in respect of dissolving the Inkwanca Municipal Council in the Eastern Cape Province .


1.2 The National Council of Provinces received the notice of intervention on the 17 th September 2014.


1.3 On the 18 th September 2014, the Chairperson of the NCOP referred in terms of Rule 101 of the Council, the notice of intervention to the Select Committee on Cooperative Governance and Traditional Affairs for consideration and report.


1.4 The Chairperson of the Select Committee on Cooperative Governance and Traditional Affairs took a decision to call the MEC for the Department of Cooperative Governance and Traditional Affairs to appear before it on the 29 September 2014. The purpose of the meeting was to brief Members on the procedural, substantive and constitutional nature of the notice of intervention to dissolve the Inkwanca Municipal Council in the Eastern Cape Province .


1.5 On 29 September 2014, the MEC appeared before the Committee and briefed its Members on the intervention in the Inkwanca Municipal Council .


2. Briefing on the Notice of Intervention to dissolve the Inkwanca Municipal Council, Eastern Cape


2.1 Background


2.1.1 On 29 July 2013, the Molteno Branch of the South African National Civic Organisation (‘SANCO’) addressed a petition to the MEC complaining about an array of issues against the Inkwanca Local Municpality

2.1.2 Raised in the petition were complaints on a range of service delivery failures and maladministration outlined below as follows:

· issues concerning inadequate electricity and water supply;

· an uncompleted sports complex;

· delays with a housing development project;

· sewerage spillages;

· concerns about the construction of roads;

· resignation of skilled staff;

· irregularities relating to staff appointments;

· increased costs for municipal services;

· the relocation of the offices of SASSA;

· unlawful motor vehicle purchases and others


2.1.3 The petition concluded with the threat that unless the demands were met within seven days, the community of Molteno would embark on a protest action.


3. Task Team investigation


3.1 In response to the petition, the Department and the Chris Hani District Municipality agreed on the appointment of a task team to investigate the complaints set out in the petition.

3.2 The task team finished its investigations on 15 August 2013 and submitted its findings to the Department.

3.3 On 26 August 2013, after engaging the municipality on the issues raised and noting its responses, wherein the Department noted some issues of concern, the Department presented its findings to the local SANCO executive.

3.4 The Department appointed an independent firm of forensic investigators, Kabuso , in terms of Section 106 of the Municipal Systems Act, and they commenced with their forensic investigation on 1 October 2013.

3.5 On the 18 December 2013, the Kabuso submitted the forensic report to the department and the report revealed the extent of the maladministration and irregularities that occurred in the municipality.

3.6 On 16 January 2014, the Department presented the forensic report to the Inkwanca Municipal Council and recommended various remedial measures to the Council.

3.7 In terms of the implementation time plan of the remedial measures, the Council was supposed to have convened to consider the forensic report and take steps as highlighted in the recommendations.

3.8 The Municipality did not report on their implementation of the remedial measures.

3.9 The Department addressed a letter to the Mayor on 28 January 2014 requesting him to report on what the Council had done to comply with the recommendations.

3.10 The Mayor replied on 31 January 2014, and instead of reporting on the implementation of the remedial measures, the municipality, under the Mayor’s hand, raised peripheral issues with the purpose of discrediting the forensic report, and requested that the Department extend the scope of the investigation and solicit legal advice for the municipality on how they should handle the report.

3.11 The Department again reminded the Council and the Mayor of their respective statutory duties when a report containing confirmed allegations of was brought to their attention. The Department gave the Mayor and the Council a further ultimatum to execute their respective statutory functions.


4 High Court Application


4.1 The Department continued to receive reports of an apparent abuse of powers by the municipality as follows:

4.1.1 Suspension of municipal employees who were seen to be in favour of the forensic report;

4.1.2 Abrupt disconnection of electricity supply to Molteno based entities and threats of disconnection to public hospitals and schools;

4.1.3 Municipal council orchestrated pro-Mayor and pro-Municipal Manager and anti-forensic report public protests in Sterkstroom ;

4.1.4 Illegal relocation of the municipality’s administrative seat from Molteno to Sterkstroom .

4.2 The MEC reported the situation was becoming volatile by the day due to the Council’s recalcitrance in acting on the forensic investigation report.

4.3 The Department decided to seek the legal route and launched a High Court application out of the Grahamstown High Court for a mandamus to compel the municipal council to implement the recommendations of the forensic report.

4.4 The municipality opposed the application and, after legal arguments, the Court ruled in the Department’s favour on 12 May 2014.

4.5 The Council, on 20 May 2014, took a resolution to appeal the order.

4.6 A Special Council Meeting convened on 23 May 2014, as ordered by the Court, took a decision not to implement the Order and to await the determination of the appeal.

4.7 The majority party in the Council summoned its councilors and gave them instructions to implement the forensic investigation report and the Court Order, and further instructed them to convene a Special Council Meeting for this purpose on or before 5 June, 2014.

4.8 On 5 June 2014 the Special Council Meeting was convened, but was disrupted by a rowdy crowd.


5 Decision to dissolve Inkwanca Municipal Council in Terms of Section 139(1)(c) of the Constitution


5.1 The MEC reported that for the provincial executive to intervene in terms of Section 139(1) it must establish that the municipality concerned cannot or does not fulfil an executive obligation in terms of the Constitution or legislation .

5.2 In the instance of the Inkwanca Local Municipality its Council had failed or refused to execute its executive function in the following instances-

5.2.1 In contravention of Regulation 5 of the Disciplinary Regulations for Senior Managers the Council had failed to initiate disciplinary processes against the Municipal Manager despite evidence pointing to his irregular conduct.

5.2.2 The Council has, by its conduct, contravened, in amongst other legislative prescripts, Section 4(2) of the Municipal Systems Act.

5.2.3 The Council ’s conduct has further breached the provisions of Section 4(3) of the Systems Act which provides that “a municipality must in the exercise of its executive and legislative authority respect the rights of citizens and those of other persons protected by the Bill of Rights”.

5.2.4 The unilateral decision to move the seat of Inkwanca Municipality from Molteno to Sterkstroom without following due processes.

5.2.5 A number of employees were left in Molteno without any direction as a result they have not been paid for more than 7 months.

5.2.6 The removal of the municipal server has not only rendered the town of Molteno dysfunctional but it has grossly violated the basic human rights of the elderly; the indigent and the general public of Molteno who were forced to commute to Sterkstroom to access municipal services.

5.2.7 The municipality’s failure or refusal to co-operate with the task team that is addressing the service delivery challenges at Molteno is another example of the municipality’s lack of respect for the enshrined human rights of the citizens of Molteno they are meant to serve and act in their interests.


6 Committee Observations


6.1 Dissolution is the final step in a process of intervention consisting of more than one attempt to resolve the problem that may exist in a municipality. Dissolution is clearly designed as a corrective measure to ensure that appropriate steps are taken that would resolve the problems that may be experienced in a particular municipality. The existence of special circumstances is a prerequisite to the exercise of the power to dissolve a Municipal Council.


6.2 In its recommendation to the NCOP, the Committee took into account all relevant factors, including those challenges that were prevalent and decided that the seriousness, extent and cause of the Municipality’s failure to fulfil its obligations constitute exceptional circumstances warranting dissolution of the Municipal Council and the appointment of an administrator to ensure fulfilment of the obligations.


7. Committee Recommendations


7.1 The Select Committee on Co-operative Governance and Traditional Affairs recommends as follows:


7.1.1 The NCOP approves the Notice of Intervention Issued in terms of Section 139(1 )( C) of the Constitution in dissolving the Inkwanca Municipal Council of the Eastern Cape, and the appointment of an administrator to fulfil the Municipal Council’s obligations.

7.1.2 The South African Local Government Association should facilitate the training and capacity building for Municipal Councillors post elections; to further deepen their understanding of the oversight role; legal framework and policies that govern the activities of the Municipality.

7.1.3 The relocation of the seat of Inkwanca Municipality back to Molteno from Sterkstroom .

7.1.4 The Eastern Cape MEC for the Department of Co-operative Governance and Traditional Affairs, should table quarterly progress reports to the NCOP and the Provincial Legislature, including achievements and challenges.



Report to be considered.



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