ATC170530: Report of the Select Committee on Land and Mineral Resources on the follow-up oversight visit to the North West Province, dated 30 May 2017

NCOP Land Reform, Environment, Mineral Resources and Energy

Report of the Select Committee on Land and Mineral Resources on the follow-up oversight visit to the North West Province, dated 30 May 2017  
 

The Select Committee on Land and Mineral Resources having conducted follow-up oversight in the North West Province, from 28 – 31 March 2017 reports as follows:

 

1. Background and Introduction 

 

1. During the National Council of Provinces’ (NCOP) strategic planning session held in 2016 and revised in 2017, public participation and consultation was once again identified as one of the key focus areas of the Committees. It was therefore decided that the Committee should prioritise its follow up visit to the Madibeng Local Municipality. The Committee had previously resolved to follow up on issues raised in its oversight report from August 2015. The Committee used the oversight week of 27 – 31 March 2017 to return to Madibeng Local Municipality after a heavy legislative programme in 2016 prevented such a return before.  

 

1. During the last visit (17 -19 August 2015) to the Madibeng Local Municipality (Brits), issues of concern were raised relating to the perceived lack of public consultation during the permit application process and/or decision making processes by the Department during the review of mining and prospecting permit applications. A second matter raised at the time also related to the Department’s management of mining licenses and correlation between Social Labour Plans (SLP) and municipal Integrated Development Plans (IDP). The Social and Labour Plans of mining companies where criticised for doing very little in the form of sustainable development and job creation in a municipality where mining activity has had significant infrastructural, environmental and socio-economic impacts. The Committee also tried to determine the degree to which mine social and labour plans supported the IDP and LED strategies of the local and district municipalities. The Committee at the time was interested in determining the extent of the challenges and sought to investigate what role the NCOP could possibly play in alleviating the IGR challenges highlighted by the municipality.   

 

1. In keeping with the committee past resolution to return to the region, the Committee had a report back session with all relevant stakeholders before engaging the public and undertaking follow up site visits. The committee once again held a public hearing to determine whether or not residents of the municipality have experienced any change since the Committee’s last visit in 2015. Stakeholders from the Department of Mineral Resources (DMR) and the mining industry were again present to respond to matters raised by the public. The Committee once again chose this approach to develop a greater understanding of the issues at hand in order to determine how the NCOP can assist the Department, community and/or the Province with reaching an amicable solution to challenges hampering progress and development in the region.  

 

1. The delegation consisted of the following members of Parliament, Mr OJ Sefako (Chairperson, ANC), Ms E Ncitha (ANC), Ms E Prins (ANC), Mr AJ Nyambi (ANC), Mr A Singh (ANC), Mr CFB Smit (DA), Mr J Julius (DA), Ms C Labuschagne (DA) and Parliamentary support staff, Mr AA Bawa (Committee Secretary), Mr J Jooste (Content Advisor), and Ms A Zindlani (Committee Assistant). 

 

1. The aim of the follow up visit was to receive a detailed briefing from all stakeholders and follow up on issues raised during the last visit (17 – 19 August 2015), determining whether or not progress was made on the recommendations previously made and whether or not any form of integration of the S&LP into current municipal IDP and LED strategies ever took place. Issues for follow-up discussions were:

 

• the status and impact of mine Social and Labour Plan projects since the committee’s past visit;
• the improved functioning of the Mining Forum and support for its operations from senior management of all government stakeholders; and
• Visible improvement of the extent to which IDP and S&LP are integrated, as seen in evidence of improved IGR between the municipality, province and the DMR

 

 

 

 

2. Meetings and Site Visits

 

2.1. Background to Madibeng Local Municipality (MLM)

The Madibeng Local Municipality is located in the Bojanala Platinum District Municipality within the North West province between the Magaliesberg and the Witwatersrand mountain range. The name is derived from the area’s resources that characterise the natural beauty of an area which encompasses the Hartbeespoort, Rooikoppies, Vaalkop and Klipvoor Dams, all of which contribute to the area in terms of tourism.

The Municipality is demarcated into 31 wards of which 10 fall in the urban areas (Brits, Hartbeespoort and Skeerpoort) and 21 in the rural areas and villages. It includes approximately 43 villages and 9 000 farm areas. Madibeng is centrally situated (approximately 50km from Pretoria, 55 km from Johannesburg and 60km from Rustenburg). 

2.1. Presentation by the Madibeng Local Municipality (MLM)  

The meeting was chaired by the Executive Mayor of Madibeng Local Municipality, the North West MEC for Rural, Environmental & Agricultural Development and the Chairperson of the Select Committee on Land & Mineral Resources.

The presentation by the MLM highlighted all the mining houses within the municipality, and that the MLM still faces socio economic challenges and alignment with respect to Social Labour Plans (SLP) and Corporate Social Investment (CSI) and the Integrated Development Plans (IDP) of the MLM. The presentation also speaks to the formation of the Madibeng Mining Forum, established in December 2014, set up with the sole intention of bringing together all stakeholders in an attempt to resolve issues of alignment and synergy between SLP and IDP’s. The activities of this forum was coordinated by the Provincial Department of Economic Development, Tourism and Agriculture (EDTA), whereas the Executive Mayor / MMC for EDTA chairs’ the forum meetings, every second month, with the last meeting being held on 24 March 2017.

The Executive Mayor in her presentation further reported that only a handful of projects were implemented from the five year SLP; which were:

• PPC Mine: Community hall situated in Vaalboschloot (implemented but not completed)
• Samancor Mine: Bokamoso water and sanitation project (implementation of phase one only)
• Evraz Vametco – Renovation of clinic at Damonsville (Implemented)
  1. Challenges and constraints highlighted by Madibeng Local Municipality

The MLM further highlighted certain challenges[1] still facing the municipality, such as:

• Illegal Developments – Increase in informal housing that creates a barrier / obstacle for urban renewal programmes of the MLM;
• Road Infrastructure – Heavy vehicles from the mines are impacting negatively on roads within the municipality, with mining houses contributing only to roads surrounding the mines;
• Illegal Employees – Mines are employing people illegally as well as foreign nationals at the expense of local communities. Thus creating unnecessary tensions;
• Illegal Mining – Illegal mining is still taking place in the municipality after it was reported to the DMR who sent out a time to investigate and conduct workshop for the community on the dangers and consequences of illegal mining; and
• IDP’s – Some SLP are still not linked to municipal IDP’s
  1. Engagement with the Municipality

 

The municipality, led by the executive mayor, during engagements, stated that the S&LP of mining houses are not transparent to the Municipality as limited interaction takes place when S&LP are synchronised with IDP’s[2]. The executive mayor alluded to a level of distrust between mining houses and the municipality, stating that with the simplification of the National Development Plan (NDP) and implementation of the 5-point plan will help ease tensions and foster better relations. Councilors present stated that the mining forum was established to help foster better relations, but has proved ineffective to date. The MLM also highlighted the issue of proper housing facilities for miners and their families[3], stating that whenever the matter is raised as an SLP matter, the municipality was told that the matter is being discussed with DMR.[4] Examples of failure to reach some publicized housing targets of past S&LP (LONMIN) were provided, with the assertion that it does not appear as if the companies in question suffered any penalties.  The mayor felt that this situation gives rise to the perception that mining houses are still not honouring their SLP’s and do not respond to questions and enquiries made to them, further perpetuating the perception that officials from the DMR are colluding with mining houses for their own benefit.

 

The North West MEC for Rural, Environmental & Agricultural Development admitted that a gap exists as to how the provincial legislature plays an oversight role over / between the MLM and the DMR. The MEC stated that mayors should champion socio – economic transformation and should insist and ensure that projects chosen are designed to uplift local communities and that these communities should be consulted. The municipality informed the delegation that to date, the biggest challenge still remains that most and if not all SLP’s are developed and agreed upon without the presence of municipalities and municipalities are still informed that they have no role to play in the drafting of SLP’s. The municipality further stated that some mines intend to establish illegal community trusts without following proper procedures that municipalities are still not informed about SLP projects or when these are implemented. Not having any input in the development of the municipality creates a sense of missed opportunities and mis-directed financial investment within the municipality.

 

During the question and answer session, a councillor of the municipality provided valuable input on the inner operations of some of the municipality’s executive committees. It would appear, from the inputs received at this point, that there is the potential for greater engagement taking place between the DMR and the municipality than what was originally reported. Due to the disconnected manner of the reporting, however, there is a likelihood that not all of it is known outside of that committee structure. This does not suggest that the IGR challenges are over-stated. In a way it points to greater IGR structural problems as there may be a challenge of operating in silos within municipal committees, which dilutes the opportunities from proper engagement with the Department or other government structures.[5]

 

1. Recommendations made by the Madibeng Local Municipality[6]

 

As a way forward, the MLM made the following recommendations;

 

• That current legislation must be reviewed to position local government properly in terms of SLP’s and relations with mines;
• A workshop must be conducted by DMR to educate communities about the establishment and formation of community trusts and especially how they are supposed to operate;
• That mine employment must be done via the unemployment forum within the affected communities;
• That all mining operations without approved SLP’s must be stopped;
• Submission of new SLP’s must be done in consultation with the affected communities in liaison with the municipality;
• An investigation must be initiated to investigate allegations of improper behaviour by DMR officials   

 

1. Presentation by the Regional Office of the DMR

 

The DMR regional office for the North West Province is situated in Klerkdorp and known as office 56. The presentation of the DMR gave a breakdown of the mining operations in MLM, those that are active and also those under care and maintenance. The presentation further explained / highlighted the various projects initiated by the various mining companies, the communities they are situated in as well as the budgeted amount and the actual amount spent to date on projects in these communities.

 

The department stated that companies do consult with municipalities and other government departments on local economic development (LED) projects prior to the lodgement of the mining rights. The DMR confirmed that they do evaluate SLP’s to check that projects are in line with IDP’s and other developmental projects from government and the department does follow administrative justice for non-compliance. The department further added that they do attend the Municipal Mining Forum meetings, stating that they attend as participants and not as those arranging and chairing the meetings. In so far as compliance and monitoring is concerned, the DMR stated that they do conduct compliance inspections and have issued administrative notices to mining companies.

 

The DMR further informed the delegation that on 23 March 2017 a meeting was held with the MEC for Economic Development and that the DMR has seen the need for a new approach when identifying SLP projects. The department explained that a platform needs to be established where the provincial legislature is involved and informed on mining related issues, where projects and municipal IDP’s are aligned with provincial priorities. The presentation also spoke to illegal mining, highlighting that the illegal activities are mostly conducted by subsistence / small scale miners mostly providing for their most basic needs. The DMR conducted several inspections and determined that Notices in terms of NEMA cannot be issued as these miners have neither the financial or technical abilities to appoint an environmental practitioner or apply for rights allocation needed. The DMR added that the way forward would be for the MLM to manage the process by appointing environmental practitioners and contractors who can intercede on behalf of these illegal miners by applying and entering into working agreements with operators. The department however, in collaboration with the MLM held workshops to explain to the affected communities the dangers and environmental effects of illegal mining.

 

With regards to the granite industry, the DMR admitted that because of the relatively small scale of this industry not much attention was given to it, the department was more focused on the larger mining operations. After consulting with all granite mining concerns, a commitment was made that all granite mines will join all right holders and contribute to 1 major project within the MLM. Meetings are to be held between the DMR, the granite mining concerns and the MLM to identify projects in Sonop and that the process should be finalised by end June 2017.           

  

1. Engagement with the Regional Office of the DMR

 

During discussion, the delegation once again raised serious concerns (as was raised in 2015) with regards to the absence of the Minister, Deputy Minister and Director General. The delegation felt further aggrieved that the department once again found it befitting to send junior officials to meet the delegation, especially in light of the seriousness of the oversight and the tensions in the region with regards to the mining industry and its effects on local municipalities.  

 

The MLM, during discussions highlighted that although the mining forums were established, attendance by the DMR was irregular and that at times communications and correspondence to the department went unanswered.  In response the DMR stated that inter-governmental relations (IGR) is practised by the department and that they do attend forum meetings. The department further explained that their attendance at mining forum meetings is to offer assistance where required and that the management of mining forum meetings is the responsibility of the MLM. The department further stated that they do ensure that mining companies consult widely before their SLP’s are approved. Concerns raised by the DMR is that the point of entry for any mining company is the local municipalities and that the challenges experienced by some mining companies is that some IDP’s of municipalities do not address / cater for the needs of the community.

 

In response to questions posed by councillors pertaining to housing for mine workers and their families, the department stated that houses were built on land donated by Lonmin mine and funded by the Department of Human Settlements to the amount of 309 million rand. After the completion of the project mine workers could not afford the rental of these housing units which led to further tension, especially since these units were not suitable for families to occupy. In response to the question raised about housing for families, the Department of Mineral Resources raised concerns as to whether or not a mine housing complex are suitable for families, especially in the absence of schools, proper medical, social and recreational facilities. The DMR however stated that they are currently in talks with the mines, trying to establish a way forward.      

 

During discussions, councillors present once again accused the department of undermining the local municipal structures and colluding with mining companies, even going so far as making it part of the municipality’s presentation. Delegation members cautioned against this type of uncorroborated accusations stating that if anyone has any information or evidence pertaining to any improprieties it should be tabled in the meeting so that it could be addressed.     

 

On the proposal of a member of the delegation and seconded by all present, that the Parliamentary delegation should take up the matter with the relevant minister, since the presence of junior officials to receive, brief and respond to questions of a Parliamentary delegation was unsatisfactory.   

  

1. Issues raised by the Parliamentary Delegation

 

The delegation informed the meeting that the purpose of the visit was a follow up visit after the Committee’s initial visit in 2015 where a resolution was taken to re-visit the area and track progress. Stakeholders present were informed that timeous communication was sent to all relevant stakeholders, namely the Bojanala District Municipality, Madibeng Local Municipality, the North West Provincial Legislature, and the Department of Mineral Resources. 

 

Members of the delegation expressed serious concerns about the presentations being received as they were not reporting back progress, but rather raising new issues of concern. Members of the delegation were not opposed to new issues being raised, but raised concerns over the lack of feedback being given and how they were going to report back to the public during the public meeting, as resolved during their last visit in 2015. The delegation stated that caution had to be exercised during public engagements and that promises had to be kept / fulfilled otherwise all the hard work of the committee will be equated to no more than political talk shows by the public.  

 

The issues that the delegation did respond to during its engagement with the municipality, DMR and councillors were;           

 

• Communication and Consultation – The delegation was of the opinion that the lack of communication and consultation between all relevant stakeholders is the reason for the lack of progress. Members were of the opinion that everyone was working in silos, to the detriment of affected communities.  

 

The delegation resolved to give the department and the MLM 21 days, after the departure of the delegation, to submit a report detailing how communication issues will be resolved and how previous concerns of the Committee will be addressed.

   

•  Synergy between SLP and IDP’s – The department and the municipality were in no uncertain terms told to find a way of ensuring that the Mining Charter’s requirement of alignment of the S&LP’s with IDP’s are adhered to, ensuring that communities are adequately catered for. 

 

The DMR and MLM were asked to provide feedback the same time as they submit their report on communication and consultation matters, 21 days, after the departure of the delegation.

 

• Mining Forums – It was the observation of the delegation that the mining forum meetings are ineffective as no party present can present the delegation with the number of meetings held and the minutes of said meetings. Members were of the opinion that in order for these forums to function properly, they have to be formalised. Within formalised mining forums issues such as Tuberculosis and other heath related matter can be discussed and resolved.

 

• Local Municipal Structures – Stakeholders present were asked whether or not ward councils / committees were consulted prior to engagements with communities. Members of the delegation could not stress more the importance of ward committees, suggesting that ward committees become part of all stakeholder engagements with regards to SLP and IDP’s.[7]

 

• Trust Accounts – The delegation questioned the DMR and the MLM about the establishment of trust and D accounts, how they were administered and by whom. As a result of unsatisfactory responses, the delegation resolved to leave the matter until the Committee returned for another follow up visit.[8] 

  

• Inter-Governmental Relations – The delegation further agreed that a need for better inter-governmental co-operation existed as little evidence of effective consultation was presented to the committee. The role of the local and district municipality and the role played by the various provincial portfolio committees should be refined as a lack of effective communication was evident. This could also serve as a means whereby the Select Committee could verify and confirm information received via inter-governmental engagements.  

 

Members of the delegation agreed that not much was done in terms of addressing issues raised by the committee during their last visit and that the DMR has until the end of the April Parliamentary recess period to work with other stakeholders and report back to the Committee. Upon completion of their progress report, the committee secretariat will communicate a date and time of the meeting in Parliament with all relevant stakeholders.

 

The delegation further agreed / resolved to approach the Office of the Minister requesting clarity on why the Committee was being undermined and treated with such disrespect.

    

2.2. Public Meeting

 

The second day of the committee’s oversight visit was supposed to be used as a report back session at the planned public meeting as well as engage members of the public on related matters affecting their respective communities. Due to the lack of progress during the earlier report back session, the delegation proceeded with the public meeting, giving members of the public an opportunity to air their grievances.    

 

1. Issues emanating from the public meeting

 

1. Unemployment – Members of the public were dissatisfied with the manner in which mines were employing people, accusing them of bring in labour from outside the province and also claiming that they employed foreign nationals. They accused mining operations of by-passing the unemployment committees set up in each community to ensure that local community members are employed whenever vacancies are filled.

 

The mining companies responded, stating that unemployment committees are not bypassed, with one company stating that they have representatives from the three communities surrounding the mine operations that assist them in recruiting suitable employees. The mining companies further stated that they are more than willing to make these employment list from the various communities available for scrutiny, to the community and the committee. The meeting was also informed that some mining companies only accept CV’s of people stamped by the unemployment committee, proving that they reside in the local community.         

 

1. Infrastructure and Development – Mining companies were accused of only developing areas inhabited by mine officials and not places such as Wonderkop which is inhabited by mine workers.

 

The response from mine companies is that they cannot develop land that belong to traditional leaders who do not grant permission for land to be developed. The land in question that was developed with housing and amenities is situated in Mooinooi and belong to the municipality.

 

Infrastructure development is another matter of concern of residents who wish to ascertain why mines are reluctant to contribute to infrastructure maintenance.

 

The response from mining companies are that infrastructure development does take place, but at times are met with challenges outside of their control. Examples of these are the installation and maintenance of mast lights that are damaged due to illegal connections made to them and the continual theft of fencing material protecting the lights.

 

1. Implementation of SLP projects – The mining companies informed the meeting that implementation of SLP are discussed in meetings held monthly with traditional leaders and community representatives such as ward councillors who are supposed to relay the information, challenges and decisions taken about projects back to their respective communities. The meeting was informed that instances do occur when mines are presented with potential projects for inclusion into a S&LP that was clearly designed to benefit a few individuals instead of the community.

 

1. Outsourcing of goods and services – The public raised concerns about larger contracts for goods and services being awarded to companies outside of the affected communities and mostly from outside of the province.

 

The mining companies have admitted to this practice and assured the stakeholders present that going forward local communities will be afforded the contract opportunities provided that their paperwork and company registration comply with government regulation.    

 

1. Site visits

 

The original oversight programme called for delegation to return to sites previously visited but due to unforeseen circumstances in the area, not all sites could be re-visited. From oral submissions received, it was also clear that the dysfunctional brick making project visited in 2015 had not been resuscitated. Stolen and/or missing equipment was not replaced, making a return to the abandoned project futile. Other sites sponsored by mining companies were however visited. 

 

2.3.1. Community hall situated in Vaalboschsloot (not previously visited / not completed)

 

The Community hall project started in late 2013 and funded by PPC cement to the cost of R5 million (initial budget 3.8 million rand) with local SMME benefiting through contracts for paving and fencing. The concept behind the erection of the structure was that it could be used as a recreation center, town hall and payment center for SASSA grants. The building was handed over in 2015 and despite challenges, remains relatively well maintained, although from the sparse furnishings inside it, it is not clear how often it is used. It has never been used for many of the initial activities, such as a SASSA payment site.

 

The challenges observed during the visit include the fact that it does not appear as if the facility was ever connected to service infrastructure. The hall does not have any electricity, running water and sewerage facilities, despite the fact that all the wiring, plumbing and fittings were in place in the building. Talks are under way with the municipality to provide these services so that the hall can be fully functional and be utilised. This matter does raise questions about mine-related S&LP projects such as this community hall as well as the borehole project covered in this report. The expenditure of capital on projects that require maintenance, utility payments or repairs from the community that host them are potentially not sustainable. IDP projects are supposed to be to the social and/or economic development benefit of communities, without imposing a financial burden on them as a result.

 

This must bring to question some of the design criteria used during the conceptaulisation of projects such as these. A more detailed analysis of this challenge and potential way forward will be provided in the oversight analysis.

 

 

2.3.3.  Renovation of a clinic at Damonsville (previously visited & completed)

 

The clinic was previously visited by the committee in August 2015 and at the time renovation work was progressing slowly. Upon the committees follow up visit all work at the clinic has been completed and fully operational at the time of our visit. The day to day operations at the clinic was run by an operational manager, registered nurse, staff nurse, administrative clerk, data capturer and two councilors.

 

Although satisfied with the outcome of the clinic, the delegation still felt that the library and surrounding building could be cleaned and painted with the help of volunteers. The delegation was of the opinion that the library could play a huge role in the lives of the children and that the unoccupied rooms adjacent to the clinic could be appropriately utilised.

 

2.3.4. Borehole Water Provision Project   

 

The borehole project was funded by the Hernic Ferrochrome Mine in partnership with the Madibeng Local Municipality and the Magalies Water for the Magopa tribal authority. The project however has a significant design and operational challenge. It is located in a very isolated area and securing the site is impossible. Because of the lack of security, the electricity transformer, electric wiring, borehole pump and switch gear has been stolen or smashed to remove copper components. Two of the three JoJo tanks used for storing the water has also been stolen.

 

Numerous suggestions for improving the on-site security was discussed. Ultimately, it was decided that nothing will be replaced until a study was conducted and a decision was taken about security or moving the borehole equipment to a more suitable location.      

 

1. Analysis of the challenges encountered during oversight

 

As can be seen from the summary of the follow-up visit, the committee was disappointed to discover that there have not been any significant improvements in the outcomes of attempts to align municipal IDP projects with mine Social and Labour Plans. There was evidence presented that attempts were being made to call for greater transparency during critical periods in the development and evaluation of IDP related projects by the municipality. The DMR insisted that mining operators were instructed to align their S&LP with the municipal IDP, and that the IDP was made available to companies.

The concern is that the IGR challenges remain, particularly with regard to IGR between the Municipal structures, the provincial administration and the DMR. A symptom of this is the continued struggles of the municipality-initiated Mining Forum. The Municipal Mining Forum is the ideal platform from which efforts to improve IGR and project alignment could have been launched. The fact that the Municipality reported that there is still not sufficient representation from decision-making officials of the DMR present at forum meetings is a concern.

 

2.4.1     Comments regarding the alignment of S&LP with IDP

 

 

 

From the two text boxes above, it would appear as if there are plenty of overlap opportunities for S&LP and IDP to align properly, yet the sentiments expressed by many stakeholders consulted during the oversight is that it is still not the case. Breaking down the challenge of S&LP and IDP alignment, the following has to be highlighted:

 

1. The instruction is for S&LP to be aligned with IDP, not the other way around and not “there should be consultation between two parties and the outcome should be a consensus document”. The IDP is the anchoring document, and the S&LP has to align itself with it.

 

1. One of the conditions of the DMR in approving S&LP projects is that these projects cannot be combined, but has to be stand-alone, ring-fenced projects. Mining companies are thus trying to find ways in which their contributions, in the form of distinct projects, can be recognised as S&LP projects by the DMR and at the same time, align with the IDP

 

1. The IDP and S&LP are developed in isolation from each other, using divergent consultative processes. Even though the DMR insists on IDP alignment, the two plans are not developed using the same consultative processes and are not guided by the same pieces of legislation. IDP is guided by the Municipal Systems Act and the S&LP is guided by the MPRDA and the Mining Charter (Which is policy, not legislation). It is very likely that many mining companies develop S&LP projects strictly focusing on DMR legislation and processes, and then, once developed, study the Municipal IDP in order to place it within its requirements.

 

1. Consultation is a legally defined process, but again, the two pieces of legislation, and the policies developed around them, differ. It is therefore not possible to state that a municipal IDP and a mine S&LP was developed while consulting the same ward structures or communities. The MPRDA and the Mining Charter stipulates consultation with the owner of land and those affected by mining activity. Even if the spirit of the legislation requires in-depth and far-reaching consultation, the two divergent consultative methodologies of IDP and S&LP will not necessarily result in the creation of two developmental documents with a shared vision.

 

1. Mining companies are not always well-versed in the Constitutionally allocated competencies of the three spheres of government. In their processes of designing the requisite developmental projects of a S&LP, it is often possible to see confusion over exactly what mandated responsibilities the municipality fulfil, resulting in projects that take on provincial responsibilities instead. To clarify, the list supplied below highlight the municipal duties defined in the Constitution, and around which IDP should be structured: 

 

2.4.2     Revision of local authority responsibilities and obligations that S&LP could contribute towards (considering it should align with a municipal IDP).

 

From the Constitution of South Africa, the following sections are highlighted:

 

Objects of local government

 

Section 152. (1) The objects of local government are—

(a) to provide democratic and accountable government for local communities;

(b) to ensure the provision of services to communities in a sustainable manner;

(c) to promote social and economic development;

(d) to promote a safe and healthy environment; and

(e) to encourage the involvement of communities and community organisations in the matters of local government.

(2) A municipality must strive, within its financial and administrative capacity, to achieve the objects set out in subsection (1).

 

Developmental duties of municipalities

 

Section 153. A municipality must—

(a) structure and manage its administration and budgeting and planning processes to give priority to the basic needs of the community, and to promote the social and economic development of the community; and

(b) participate in national and provincial development programmes.

 

SCHEDULE 4

Part B

The following local government matters to the extent set out in section 155(6)(a) and (7):

• Air pollution
• Building regulations
• Child care facilities
• Electricity and gas reticulation
• Firefighting services
• Local tourism
• Municipal airports
• Municipal planning
• Municipal health services
• Municipal public transport
• Municipal public works only in respect of the needs of municipalities in the discharge of their responsibilities to administer functions specifically assigned to them under this Constitution or any other law
• Pontoons, ferries, jetties, piers and harbours, excluding the regulation of international and national shipping and matters related thereto
• Stormwater management systems in built-up areas
• Trading regulations
• Water and sanitation services limited to potable water supply systems and domestic wastewater and sewage disposal systems

 

Mine Social and Labour Plans could be struggling to produce the desired impacts because of the environment it is developed in. Instead of the plans being developed by individuals with a strong local government and community development background, it is a product of a mining company fulfilling the legal requirements set by the DMR in order to obtain a mining right. The purpose of the document is therefore more likely to be compliance with the legislation of the DMR, rather than any local economic development interest. S&LP requirements initially did not require IDP linkage. It is possible that companies developed a specific process in developing their S&LP during this time and has not made significant effort post-2010, when the revised Charter came into effect, to change their strategies, particularly regarding consultation.

The sentiments expressed during the two oversight events are echoed in research released by NGOs focusing on the impact of Social and Labour Plans. In a recent report, CALS[9] stated that:

 

• First, the information on the background and context of the mining operation and its impact on affected communities tended to be vague and incomplete. Without an understanding of the affected community and the history of the mining operation it becomes impossible to predict impact.

 

• A second and directly related theme, was that SLPs on the whole did not clearly explain the nature and extent of the operation’s impact. In particular, very few SLPs addressed negative impacts at all.

 

• Third, there was a near-universal absence of acknowledgment of, and engagement with, the disparate impacts of mining on the lines of race, gender and socio-economic status.

 

• Fourth, a significant number of SLPs lacked evidence of finality and completion, for example, the absence of signed undertakings and the inclusion of some programmes without targets and timeframes.

 

• Fifth, we found a significant proportion of SLPs difficult to navigate on account of inconsistencies in form and structure coupled with a frequent failure to draft fully legible documents. Sixth, as social beneficiation instruments, one would expect SLPs to be rooted in the needs and aspirations of communities and workers.

 

• However, we found that a vast majority of SLPs made no mention of the processes of consultation with communities in particular.

 

• Finally, the majority of SLPs provided no evidence of clear mechanisms by which communities can hold companies accountable to their obligations. The overall thrust of our assessment of the regulatory system is that it is not capable of producing SLPs that can effectively contribute towards the transformative objectives as set out in the Constitution and mineral legislation.
• One reason for this is that the legal framework does not sufficiently regulate how SLPs are drawn up. In particular, it does not set clear requirements for the public participation of communities in the development of SLPs.

 

• Further, this failure to provide a participatory framework extends throughout the life cycle of SLPs. The regulatory system does also not provide sufficiently clear contextual considerations by which the regulator can evaluate the adequacy of SLPs. The specification of the majority of SLP drafting requirements, including the background information regarding the mine and the community, in guidelines without legally binding status, further weakens the effectiveness of the regulatory framework.

 

2.4.3     Comments regarding inter-governmental relations

 

One of the most visible challenges persisting between 2015 and the current oversight visit is the Inter-Governmental Relations (IGR) breakdown within the government sector. According to the Constitution, IGR is worded such that it is the responsibility of national and provincial spheres of government to support local government structures:

 

Municipalities in co-operative government

 

Section 154. (1) The national government and provincial governments, by legislative and other measures, must support and strengthen the capacity of municipalities to manage their own affairs, to exercise their powers and to perform their functions.

(2) Draft national or provincial legislation that affects the status, institutions, powers or functions of local government must be published for public comment before it is introduced in Parliament or a provincial legislature, in a manner that allows organised local government, municipalities and other interested persons an opportunity to make representations with regard to the draft legislation.

 

It is telling that the IGR breakdowns highlighted during the 2015 oversight does not appear to have been remedied at all. It is perhaps symptomatic of the isolation in which mine S&LP are developed, with the Department stating on numerous occasions during the interaction that the IDP of the municipality is supplied to mining companies when they develop their S&LP. This can be interpreted as an indication that the design, and potentially also implementation and monitoring of S&LP projects is still a DMR function, while the IDP and its implementation is a municipal function. There may be ad hoc interactions between the different spheres of government, but not to the point that it can be interpreted as co-operative governance.

 

One way in which the situation can be improved, is to alter the policy wording regarding S&LP. If the intention of government is to ensure mining company investment in local government IDP, then why not simply word the Mining Charter to that effect? At present, an entirely separate, but supposedly parallel process is called for to develop programmes that ultimately could or should have been envisaged in the IDP of the municipality. Evidence, still in small volumes, but relevant, appear to suggest that the development and implementation of S&LP projects occur separate from IDP to such an extent that the consultation, implementation and impact of these projects do not integrate seamlessly with local government efforts. A better solution could potentially be to request a commitment to invest in the IDP projects of the municipality, rather than to operate in a parallel stream to it. This will require the DMR and mining companies to interact with the municipality directly, and to utilize the outcomes of municipal public engagement processes as far as possible.

 

Activities linked to the Mining Charter, but not requiring interaction with the IDP of the municipality can be better structured through a fully functioning Municipal Mining Forum (MMF). At present, the forum is not functioning correctly and one of the results of this is that many of the assertions levelled at the mining companies by the community is repeated by the municipality, only to be contradicted with credible input from the mining company/companies affected. This scenario would not have developed if the MMF was functioning properly. In light of Section 154(1) of the Constitution, this support must be supplied to the municipality in future. It will also support greater communication and interaction between community members, who currently act on information obtained from non-government channels, and the mining community, who do not appear to have good channels of communication open to them in order to address these statements.

 

2.4.4     Comments regarding the perceived role of mines in the rural economy

 

One aspect of mining activity in the municipality that did not receive scrutiny during the oversight visit is the perspective of the industry. Discussion around economic development projects were tempered with the industry acknowledging that economic pressure is significant, to the point that it has resulted in job losses and mine closures in the municipality. The mining industry is often the central underpinning industry supporting many smaller municipalities in the inland municipalities of South Africa, and as such should also be nurtured and allowed to be sustainable within a fair and equitable labour and community development agenda.

 

An observation made during the oversight is that communities appear overly reliant on mining companies to be a source of employment or development. It is also not clear how much investment in the development of alternative revenue streams municipalities have made. Factors to consider when reviewing the contribution of mining companies towards rural economies is the following:

 

• These companies are major employers in the area in contribute significantly to the non-government sector wage bill;
• As large industries within the municipal boundaries, these companies pay significant rates and taxes to the municipality;
• Mining companies pay royalties to the state in exchange for the mining rights issued;
• Mining companies pay tribal authorities royalties, deposited into a D-account, for the right to operate in tribal authority-controlled areas;
• Where mining is not taking place on tribal land, mining companies will pay royalties to a land-owner or group of owners, often into a Trust account.

 

A counter-argument can be developed stating that S&LP should not be the only answer to the needs of community development. At least some of the multiple income streams flowing from mining activity should be directed towards the upliftment of mining affected communities and labour sending areas. It is not clear how much, if any, of the Trust and D-account revenue received by communities and tribal authorities are used in this manner, yet community members residing on tribal authority land questioned mining companies on their lack of investment in these communities. Should mining companies be expected to pay royalties and invest in S&LP in the communities that are, in theory, paid by the company for the right to mine? Does the local government responsible for the services in mining-affected areas have such restricted revenue streams that the income received from rates and taxes imposed on mining companies is not enough to develop and maintain infrastructure in mining affected municipalities? If this is the case, then the local government is not sustainably funded from revenue generated by it and its equitable share. Under these conditions, it may be worth proposing:

 

• Mining affected municipalities should get a modified equitable share and MIG funding from national government allocations to ensure that the impacts of mining on municipal infrastructure is mediated more effectively;
• The recipients of Trust and D-account payments should be assisted with the sustainable application of revenues from mining to stimulate sustainable economic development as a benefit from the royalties received. At present, reports from independent investigations into the application of Trust and D-account funding is required to determine whether mining-affected communities actually benefit from these payments at all.

 

2.5        Recommendations

 

As there were few signs of improvement at the municipality regarding the oversight focus areas, the recommendations of the previous oversight still hold value, coupled with follow-up recommendations. The committee’s mandate, derived from the mandate of the NCOP calls for a focus on:

 

• Improving the functioning of IGR;
• Improving and expanding public engagement opportunities; and
• Legislative oversight.

These three areas, and in particular the improvement of IGR and the review of policy and legislation, remain core requirements for the solution of this impasse. The proposal is repeated that the committee:

 

1. Continue to engage the Department of Mineral Resources with the aim of improving the relationship between the Department of Mineral Resources, the provincial government and municipal authorities. The most critical outcomes of such an improved relationship will be:

 

1. Improved IGR in order to make constructive, positive efforts towards improved linkages between S&L Plans of mining companies and the IDP and LED strategy of municipalities. Additionally, it was suggested that the mining houses should be given the option to initiate and fund their own projects that are aligned to municipal IDP’s and LED’s, and not have to be limited to contributing funds to municipal initiatives.

 

1. Improved functioning of the Mining Forum

 

1. Additionally, the delegation resolved during the follow-up visit that the continued absence of political decision makers of the Department at these oversight engagement was unsatisfactory.  It was decided that the committee should make time in its meeting schedule to invite the Minister, Deputy Minister and Director General of the DMR to a meeting where this situation will be discussed.

 

Linked to this is the two instructions the committee gave during this follow up visit. These were directed at the municipality as well as to the DMR. The delegation resolved:

 

1. To give the department and the MLM 21 days, after the departure of the delegation, to submit a report detailing how communication issues will be resolved and how previous concerns of the Committee will be addressed.

 

1. The DMR and MLM were asked to provide feedback the same time as they submit their report on communication and consultation matters, 21 days, after the departure of the delegation

 

1. The return visit continued to reveal challenges with mine Social and Labour Plans, and in particular, how the municipality and community is engaged during planning. The type of projects initiated, as well as the sustainability/maintenance of projects after the initial donation from the company was also questioned. It is clear that there is a need to review how the Mining Charter directs public consultation during the Development of Social and Labour Plans, the suitability of projects initiated and the linkages to municipal IDP. The following list was carried over from the 2015 oversight:

 

1. The amount of autonomy given to mining companies to manage the application and public engagement process;
2. The consultative process;
3. Regulations pertaining to environmental and agricultural impacts, as well as mine rehabilitation;
4. Improved inspection and conflict resolution mechanisms to prevent mining activity severely impacting on community property and livelihoods.

 

The 2017 oversight re-enforced that validity of these recommendations, but highlighted the need for additions:

 

1. The perceived consultation differences between S&LP and IDP development, as well as the long-term feasibility of projects initiated within the municipality;

 

Report to be considered.

 

 

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[1] Please note that these were assertions made by the Municipality and that no evidence was produced in support of claims such as the employment of foreigners at mines. These statements were repeated in community submissions and contested by mines, that declared themselves willing to release personnel information in certain instances.

[2] Indeed, the DMR confirmed that the mining companies are supplied with copies of municipal IDP documents in order to align their S&LP to those. This potentially creates limited consultation between mining companies and the municipality. This is particularly true of companies that also stick to the letter of the law regarding “community consultation” required for the satisfaction of criteria required during the development of their S&LP. “Community” does not include any local government structures.

[3] This matter was also raised in the community engagement process. It was worth noting though, that in some of the examples cited, communities resided on tribal authority land mining companies therefore could not link to IDP projects related to services and housing. The municipality did not distinct between any area within the municipality when making its statement, thus complicating the interpretation thereof.

[4] Again, this is not an act of defiance or breach of law, as the Mining Charter and all its requirements fall under the mandate of the DMR. Mining companies are not required to discuss matters related to the Mining Charter with local government structures by any legislation.

[5] From the inputs, it would appear as if there have been many instances were dialogue between the DMR and structures of the municipality had taken place. Due to many potential problems, such as incomplete communication of these discussions, or different officials participating in discussions at different times, diluting the knowledge and communication of past interactions and their outcomes.

[6] Please note that some of these recommendations are followed up on through a discussion of public participation inputs. The fact that these are listed as recommendations does not imply that the status quo is significantly different in all instances.

[7] Please note that this statement will be discussed further on in the report.

[8] It has to be noted that neither the DMR nor the municipality has legal access to these accounts. This was communicated to the committee. As the question is valid and will have bearing on the way forward regarding mining town development, it is worth following up on this line of enquiry.

[9] The Social and Labour Plan Series. Phase 1: System Design Trend Analysis Report. March 2016. Centre for Applied Legal Studies.