ATC210512: Report of the Portfolio Committee on Cooperative Governance and Traditional Affairs on the 2021/22 Annual Performance Plans And Budgets and the Entities Reporting to them, Dated 11 May 2021

Cooperative Governance and Traditional Affairs



Having met with the Departments of Cooperative Governance and Traditional Affairs, and their associated entities, on their 2021/22 Annual Performance Plans (APPs), Strategic Plans and Budgets, the Portfolio Committee on Cooperative Governance and Traditional Affairs reports as follows:




  1. Section 77 (3) of the Constitution stipulates that an Act of Parliament must provide for a procedure to amend money Bills before Parliament. This Constitutional provision resulted in Parliament passing the Money Bills Amendment Procedure and Related Matters (Act No. 9 of 2009) (the Money Bills Act). The Money Bills Act sets out the process that allows Parliament to make recommendations to the Minister of Finance to approve, reject or amend the budget of a National Department.


  1. From 14 – 28 April 2021, the Portfolio Committee met and considered the 2021/22 Annual Performance Plans, Strategic Plans and Budgets of the Departments and Entities reporting to it. These consist of the Departments of Cooperative Governance and Traditional Affairs, the Municipal Infrastructure Support Agent, the CRL Rights Commission, the Municipal Demarcation Board and the South African Local Government Association.




  1. Department of Cooperative Governance.


  1. The Annual Performance Plan (APP) of the Department of Cooperative Governance for the year ending on 31 March 2021, reflects many of the issues, which the Committee has been seized with recently. These include the District Development Model, Municipal Infrastructure Grant expenditure, the implementation of Section 139 of the Constitution, municipal financial viability, the functionality of Municipal Public Accounts Committees and disaster hazards. With regard to Section 139, the Department has finally put a definite deadline for tabling the Monitoring and Intervention Bill by 31 March 2022. This Bill has been on the Department’s APPs since the Fourth Administration and is now long overdue.


  1. As the Table below illustrates, the budget allocation to the Department of Cooperative Governance in respect of the 2021/22 financial year reduces by almost 10 percent – from R106.9bn in 2020/21 to R100.8bn in 2021/22. Programme 3: Institutional Development accounts for nearly 100 percent of the Department’s overall budget reduction, which amounts to R10.4bn in real terms. A further breakdown of Programme 3 indicates that the Local Government Equitable Share is responsible for the bulk of the budget reduction in the Programme and in the Department as a whole. Programme 5: Community Work Programme is the second highest contributor to the budget reduction, as the allocation to the Programme decreases by R54m in real terms. Programme 1: Administration is the third largest contributor to the budget reduction in the Department, as the allocation to the Programme decreases by R52m in real terms.




Nominal Rand change

Real Rand change

Nominal % change

Real % change

R million





Programme 1: Administration



-  40,2

-  52,0

-12,05 per cent

-15,60 per cent

Programme 2: Local Government Support and Intervention Management

 16 003,8

 17 154,3

 1 150,5


7,19 per cent

2,87 per cent

Programme 3: Institutional Development

 85 920,9

 78 602,9

- 7 318,0

- 10 486,3

-8,52 per cent

-12,20 per cent

Programme 4: National Disaster Management Centre





4,26 per cent

0,05 per cent

Programme 5: Community Work Programme

 4 104,1

 4 220,2


-  54,0

2,83 per cent

-1,32 per cent



 106 942,8

 100 875,9

- 6 066,9

- 10 132,9

-5,67 per cent

-9,48 per cent


  1. Municipal Infrastructure Support Agent


  1. MISA receives its budget allocation through Programme 2: Local Government Support and Intervention Management. The Table below indicates that, although the entity’s budget allocation appears to have increased from R339.8m in 2020/21 to R344.9m in 2021/22, there is an actual reduction of 2.6 percent in the allocation when inflation is taken into account.




Nominal Rand change

Real Rand change

Nominal % change

Real % change

R million







Sub-Programme 1: Administration







11,94 per cent

7,43 per cent

Sub-Programme 2: Technical Support






-  7,9

0,46 per cent

-3,59 per cent

Sub-Programme 3: Infrastructure Delivery Management





-  6,9

-  7,8

-23,15 per cent

-26,25 per cent








-  8,9

1,47 per cent

-2,62 per cent


  1. MISA has committed to supporting 44 District to reduce infrastructure backlogs and to improve performance in respect of their Municipal Infrastructure Grant Programmes. The Committee has had a series of engagements with a number of Districts and their local municipalities over the last two months or so. One of the issues that came up strongly from these engagements concerned the support provided by MISA, in particular the limited role it played in some Districts due to capacity constraints.


  1. For example, during the Committee’s engagement with the Lejweleputswa District on 09 March 2021, it emerged that there were only four MISA engineers available for the whole of the Free State. Consequently, the support MISA provided to the District was insufficient. The APP therefore needs to be realistic in terms of the envisaged support to the 44 Districts and give due consideration to MISA’s capacity constraints. Otherwise there is a risk of poor achievement due to setting too ambitious targets.


  1. Department of Traditional Affairs.


  1. The Department of Traditional Affair’s APP places extensive emphasis on the role of the institution of traditional leadership in terms of fighting COVID-19, Gender Based Violence, Femicide, as well as violence against the LGBTQ+ community. This also includes promoting gender representation and women empowerment within the structures of traditional leadership.


  1. The institution is also expected to mobilise and raise awareness in support of the implementation of the District Development Model (DDM). The Committee has previously highlighted the challenges around the involvement of traditional leaders in the DDM, based on its oversight findings and engagement with traditional leaders on the ground.


  1. The APP makes further reference to the participation of the institution of traditional leadership in investment programmes for inclusive growth through the promotion of land reform, rural development and the full utilisation of communal land in Districts. In this regard, traditional leadership is urged to insist on the inclusion of smart villages in the development of plans for specific investment in the development of smart cities and towns. There is a further call for the institution of traditional leadership to support the implementation of the Mining Charter in Districts and Metros, as to promote employment and entrepreneurship.


  1. Finally, the institution is called upon to avail Traditional Council infrastructure for use as municipal satellites or Government’s supplementary service centres. However, it is difficult to see how some of these Traditional Councils will be in a positon to avail infrastructure whilst they are in dire need of support in the form of construction of offices as well as support staff to assist with administration. Overall, the APP seems to be envisaging numerous roles and responsibilities for the institution of traditional leadership without availing the necessary resources to fulfil these.


  1. As seen in the Table below, when taking inflation into consideration, the budget allocation to the Department to fund the implementation of its 2021/22 APP increases by a mere 1.73 percent, from R161.7m in 2020/21 to R171.4m in 2021/22.  The bulk of the expenditure is earmarked for Programme 3: Institutional Support and Coordination, whose allocation increases from R94.1m in 2020/21 to R101.1m in 2021/22. The Programme makes transfers to the National House of Traditional Leaders, the CRL Rights Commission and the Commission for Traditional Leadership Disputes and Claims. The Programme’s real increase of 3.1 percent is still not adequate to place the Department in an optimal positon to provide the requisite support to the institution of traditional leadership.




Nominal Rand change

Real Rand change

Nominal % change

Real % change

R million







Programme 1:Administration






-  0,5

3,16 per cent

-1,00 per cent

Programme 2: Research, Policy and Knowledge Management







6,51 per cent

2,22 per cent

Programme 3: Institutional Support and Coordination







7,44 per cent

3,11 per cent












6,00 per cent

1,73 per cent


  1. Municipal Demarcation Board


  1. The MDB’s APP emphasizes its commitment to ensuring that the demarcation of municipal boundaries results in the creation of sustainable municipalities that can fulfil their constitutional obligations. This commitment however is still far from being a reality. Between 13 November and 04 December 2020, the Portfolio Committee convened meetings with the municipalities that had been subject to demarcation during the 2016 local government electoral cycle. This is after the Committee became aware of serious municipal financial management problems that were directly related to the amalgamation processes.


  1. The overwhelming majority of the municipalities that honoured the invitation to brief the Committee were of the view that the amalgamation process worsened, rather than improved financial viability. In a recent presentation to the Committee, the Board indicated that some of these municipalities are demanding a reversal of the amalgamation that took effect in 2016. All this suggests that the Board is still far from realising the commitment to demarcate boundaries that create sustainable municipalities able to meet their constitutional obligations in terms of Section 152.


  1. On previous engagements, Committee members have also highlighted the need for the Board to improve on its public awareness and stakeholder education processes. In the APP, the Board also commits to addressing this matter. So far the Board has registered encouraging achievements, including obtaining clean audits for the last two consecutive financial years, as well as improving organisational performance from 59 percent in 2015/16 to 95 percent in 2019/20. It also managed to finalise the ward delimitation process in time for the 2021 local government elections despite a challenging COVID-19 working environment.


  1. The Municipal Demarcation Board derives its budget allocation from the Department of Cooperative Governance, under Programme 2: Local Government Support and Intervention Management. As highlighted in the Table below, the budget allocation to the Board has increased from R63m in 2020/21 to R70.6m in 2021/22. When taking inflation into account, the increase amounts to 7.55 percent. However, this increase is still not adequate to address the Board’s financial resource constraints, especially in terms of establishing a local or regional presence. The Board will therefore continue operating from one national office, with continued reliance on municipalities to assist in its local and regional public participation and consultation processes. This is not an optimal scenario.




Nominal Increase / Decrease in 2021/22

Real Increase / Decrease in 2021/22

Nominal Percent change in 2021/22

Real Percent change in 2021/22

R million



Sub-programme 9:Municipal Demarcation Board





12,06 per cent

7,55 per cent



  1. South African Local Government Association


  1. SALGA’s APP highlights some critical gaps that continue impede SALGA from maximising its impact in terms of the support provided to municipalities. For example, mention is made of the lack of legal provisions for extending Section 106 and Section 71 reports to SALGA, which deprives the organisation of critical data that could be used to inform intelligent planning. This is indeed an anomaly, particularly given the gaps seen in relation to the implementation of Section 106 recommendations by municipalities, as well as the use of Section 71 reports as early warning mechanisms. A statutory role for SALGA in these critical accountability mechanisms is crucial.


  1. Another critical matter highlighted in the APP relates to the general economic decline in many towns due to deceleration of output in the mining, manufacturing and agricultural sectors. About two months ago, the Committee started a series of engagements on issues of local economic development and small town regeneration - beginning with a discussion on SALGA’s Small Town Regeneration Programme, including a case study on the organisation’s Small Town Regeneration Project for the Karoo Region. The Committee was subsequently invited to attend and make input on SALGA’s 5th Karoo Region Small Town Regeneration Conference, which took place on 18 and 19 March 2021.


  1. It is instructive to note the APP’s reference to the underutilisation of infrastructure in mining towns and agricultural or farming communities and how this misses a potential revenue generation opportunity towards vibrant local economies. This is a serious and urgent matter, which would be advisable for the Committee to pursue with all the relevant stakeholders over its remaining term of office.


  1. CRL Rights Commission


  1. The CRL Rights Commission receives its budget allocation from the Department of Traditional Affairs’ Programme 3: Institutional Support and Coordination. For the period under review, the Commission receives a total amount of R46.3m, which represents a budget cut of 7.2 percent compared to the previous financial year, as tabulated below. This is a different figure from that of R50.5m stated in the APP. The bulk of the reduction in the Commission’s budget is in respect of Programme 1: Administration, whose budget allocation decreases by approximately 12 percent in real terms.




Nominal Rand change

Real Rand change

Nominal % change

Real % change

R million





Programme 1: Administration



-  2,7

-  3,9

-8,23 per cent

-11,93 per cent

Programme 2: Investigation and Conflict Resolution





6,67 per cent

2,37 per cent

Programme 3: Research and Policy Development





14,29 per cent

9,68 per cent

Programme 4: Public Education and Community Engagement





7,41 per cent

3,08 per cent

Programme 5: Communication and Marketing





4,55 per cent

0,33 per cent





-  1,6

-  3,5

-3,34 per cent

-7,24 per cent


  1. The 2021/22 Annual Performance Plan of the CRL Rights Commission highlight some challenges, which are said to be impeding the Commission from fulfilling its mandate optimally. These are not new challenges, as they have also been raised in the previous APPs going as far back as the Third Administration. The main challenge that underpins all the other difficulties relates to inadequate funding, which hinders the Commission from deploying all the resources necessary to enable it to deliver on its mandate. The Committee also noted this in its 2020 Budgetary Review and Recommendation Report where it recommended that the Committee must use every opportunity to lobby and advocate for adequate funding to the Commission.


  1. At the same the Commission also needs to have a clear resource mobilisation strategy. During the meeting of 20 November 2020 on the Commission’s 2019/20 Annual Report, there was an indication that a draft resource mobilisation strategy was in place, and that this would be finalised by 31 March 2021. It is now towards the end of April and the Commission should be in a good position to update the Committee on the strategy.


  1. The other issue worth highlighting is that many of the Commission’s APP targets involve hosting seminars, conducting campaigns, dialogues, conferences, outreach events, roadshows and colloquiums. Traditionally, these are face to face events, which are not practical to execute fully in the context of COVID-19. The APP notes that the Commission does not have adequate ICT infrastructure capabilities to transition effectively to the new normal way of working. This is a serious drawback, especially in relation to the Commission’s work on rural community involvement and participation where connectivity problems are particularly acute.


  1. Many of the risks and challenges that may hinder the implementation of the Commission’s 2021/22 APP are external to the organisation and are beyond its sphere of control. On the other hand, matters of internal control, such as the prevention of irregular expenditure, are within the Commission’s sphere of control. Previously, the Committee has noted that there is room for the Commission to improve in this regard, as it remains the only entity in the COGTA portfolio that has not achieved a clean audit in recent years.





  1. All the Departments and entities reporting to the Committee must ensure consistent submission of Quarterly Performance information, irrespective of whether or not there is a pandemic. This is a legislative requirement


  1. The Department of Traditional Affairs must consider arranging a session, within this quarter, to brief the Committee comprehensively on the key issues central to its mandate, as to enable the Committee to engage the Department from a well-informed perspective.

Briefing session still outstanding

  1. The Department of Traditional Affairs must immediately furnish the Committee the report on the finalisation and implementation of the Programme of Action on the Resolutions of the 2017 Traditional Leaders Indaba, as well as the Engagement Model between Government and the Institution of Traditional Leadership.

Report still outstanding

  1. The Department of Traditional Affairs must immediately furnish the Committee the report on the resolutions emanating from the dialogue for women in traditional leadership reportedly held in Mpumalanga and the Gender-based violence workshop reportedly held in Limpopo.

Report still outstanding

  1. On 27 November 2020, the Department of Cooperative Governance must provide a full report to the Committee on the revised CWP model, including the implementation of the recommendations from the five forensic reports commissioned in respect of the CWP, their turnaround time and cost.

Report still outstanding

  1. Within this term, the Department of Cooperative Governance must furnish the Committee the Report on the assessment of Ward Committee functionality nationally, including the Department’s interventions in this regard.

Report furnished

  1. Within this quarter, the Department of Cooperative Governance must brief the Committee on all its local government interventions – from Project Consolidate up to the District Development Model – reflecting on lessons learned.

Briefing received on 01 April 2021



  1. The Committee must use every opportunity to lobby and advocate for adequate funding to the CRL Rights Commission.


  1. The CRL Rights Commission should guide municipalities in respect of the zoning of land for religious purposes.


  1. The Committee must have structured engagements with CRL Rights Commissioners on a quarterly basis, as to understand better the various work streams Commissioners are leading.


  1. In the next year, the Committee must consider hosting a colloquium on male cultural initiation to address the challenges associated with the practice.


  1. The Committee must engage the National Treasury regarding the exemption of the Community Work Programme from Supply Chain Management processes in terms of section 79 of the Public Finance Management Act (PFMA).

Engagement still outstanding







  1. The Municipal Demarcation Board’s achievements over the last financial year are notable and deserve commendation, especially in the context of the difficult working environment arising from the COVID-19 pandemic. It is critical to ensure that these gains are maintained and sustained.


  1. Decentralisation of the Municipal Demarcation Board’s offices is important to enable it to have a provincial footprint, as to deepen local democracy. The present arrangement, where the Board operates from one national office, constrains meaningful public participation in the demarcation processes.


  1. The South African Local Government Association presented an accurate reflection of the problems engulfing local government. This kind of honesty is an important step towards addressing these problems. Issues of corruption and political interference remain the elephant in the room. Without addressing these, there is no prospect of fixing the current challenges facing local government.


  1. There is a disjuncture between the improved municipal service delivery performance portrayed in the Annual Performance Plan presentation of the South African Local Government Association vis-à-vis the actual situation at household level. The reported improvement in municipal service delivery performance should therefore be treated with caution.


  1. There seems to be no best practices shared among the association of municipalities under the banner of the South African Local Government Association. The apparent lack of a mechanism for the municipalities to hold one another into account is also not conducive to a thriving environment for municipal accountability. A Code of Conduct that is binding to all the municipalities belonging to the association should be considered.


  1. The issues of safety and security for traditional leaders and customary initiation did not seem to reflect adequately in the presentation by the Department of Traditional Affairs.


  1. The Committee resolved to reject the presentation by the Department of Cooperative Governance on the Community Work Programme as the answers provided by the Accounting Officer were not satisfactory.


  1. The funding model of the Municipal Infrastructure Support Agent is not optimal, given the responsibilities which the organisation is expected to fulfil.


  1. The CRL Rights Commission’s role in terms of supporting communities adversely affected by COVID-19 Regulations has been unclear, and its voice in terms of condemning incidences of police brutality and unfair treatment of some religious and cultural individuals has not been audible.


  1. Some Committee members did not derive comfort from the response of the Accounting Officer of the CRL Rights Commission relating to the institution’s unfamiliarity with the District Development Model, as this is a whole of government approach that also affects the Commission’s constituencies.




  1. The South African Local Government Association must revisit its promise to the Committee in relation to the review of local government legislation and policy, including the White Paper on Local Government.


  1. The Municipal Infrastructure Support Agent must re-examine its funding model to ensure that it is aligned to the responsibilities expected of the organisations.


  1. Both the Departments of Cooperative Governance and Traditional Affairs must henceforth take the Committee’s reporting requests seriously and provide the required information within the stipulated time-frames. There are too many outstanding reports from these Departments.


  1. The CRL Rights Commission must work on sharpening its Communication Department to ensure that its voice is audible when it comes to condemning the violation of the rights of religious and cultural communities.


  1. Within three weeks of the publication of this Report, the CRL Rights Commission must furnish the Committee with a report explaining its role and relevance in relation to the District Development Model.


  1. The CRL Rights Commission must immediately furnish the Committee with the actual timeframes in relation to the process of amending the CRL Rights Act to address some of the identified impediments to the optimal fulfilment of its mandate.



The Committee wishes to thank the Departments of Cooperative Governance and Traditional Affairs, CRL Rights Commission, SALGA, Municipal Demarcation Board, and MISA for their fruitful, cordial and constructive engagements. The contributions of Committee members, as well as Committee and other Parliamentary support staff is highly appreciated.


Report to be considered



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