ADDRESS BY THE HONOURABLE MINISTER OF COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS, MR DES VAN ROOYEN

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ADDRESS BY THE HONOURABLE MINISTER OF COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS, MR DES VAN ROOYEN, ON THE OCCASION OF COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS BUDGET VOTE SPEECH, UNDER THE THEME, “Transforming Municipal Spaces for Radical Socio-economic Development,”

18 MAY 2017,  Cape Town

Speaker of the House,

Colleagues, Ministers and Deputy Ministers,

Honourable Members,

Your Majesties and Royal Highnesses,

MECs,

President of the South African Local Government Association and all Executive Mayors and Mayors,

Chairperson of the National House of Traditional Leaders, Kgosi Maubane Traditional and Religious leaders,

Chairperson of the Commission for the Promotion and Protection of the Rights of Cultural, Religious and Linguistic Communities, Ms Mkhwanazi- Xaluva

President of Contralesa, Kgoshi Thobejane,

The business sector,

Fellow South Africans,

Ladies and gentlemen,

Introduction

Good Afternoon. Dumelang, Sanibonani, Goeie Dag, Avuxeni, Molweni.

Honourable Speaker,

We are meeting today at a time when we are experiencing a wave of attacks and abuse levelled against women and children.

We condemn these barbaric acts in the strongest possible terms as they do not have a place in our peace loving society.

We convey our heartfelt condolences to families who lost their loved ones as a result of these incidents.

It is my honour to present to you the Budget Vote of the Ministry of Cooperative Governance and Traditional Affairs.

In his now famous classic, Native Life in South Africa, author, journalist, founder member and first Secretary-General of the South African Native National Congress, Sol Plaatjie, wrote:

“Awaking on Friday morning, June 20, 1913, the South African Native found himself, not actually a slave, but a pariah in the land of his birth.”

A hundred and one years after this book was published, we are still grappling with the effects of the Land Act and its various manifestations over the years.

While we have achieved political emancipation, too many of our citizens find themselves to be pariahs in the land of their birth.

Changing this reality has been the focus of this democratic government since its inception in 1994.

Transforming the local government sector has been a key element of this.

Last month we convened the Third Presidential Local Government Summit, under the capable leadership of His Excellency President Jacob Zuma.

We believe its theme of, “Transforming Municipal Spaces for Radical Social and Economic Development,” not only addresses these legacies from the colonial and apartheid eras, but also encapsulates our vision for the local government sector for the next five years.

Let me take this opportunity to congratulate the President of the South African Local Government Association (SALGA), Councillor Parks Tau, on his election as President of the United Cities and Local Government association.

Councillor Tau has also been appointed to the United Nations (UN) High-Level independent panel to oversee the effectiveness of the UN-Habitat – a programme that promotes socially and environmentally sustainable towns and cities.

This is what we mean when we say, ANC Lives, ANC Leads.

We are currently engaging Department of International Relations and Cooperation (DIRCO) to ensure that our beloved country takes advantage of this strategic international assignment.

Honourable Members,

Local Government Elections

We met last year on the cusp of the fourth fully democratic local government elections.

The political climate was volatile in some voting districts and the elections hotly contested.

I am glad to report to you that the elections were deemed free and fair.

This was largely due to the work of the Inter-Ministerial Committee on Elections, that convened under CoGTA Leadership.

We thank all stakeholders who participated in this process.

In a bid to break with our apartheid past and to show that we are a caring government we have also ensured the payment of a once-off gratuity to non-returning councillors.

To date approximately 5 000 Councilors were paid a total amount of almost R260 million.

An Ernst and Young study commissioned by the Remuneration Commission of Public Office Bearers established that Councillors are the least paid Public Office Bearers, amongst the three spheres.

Hence we welcome the review of POB’s remuneration currently taking place and hope that it will deal with all remuneration related challenges of POBs in local government.

BACK TO BASICS

Essential to transforming the municipal space and setting the foundation for radical economic and social development has been the Back to Basics programme.

In the past financial year we committed to continue with our second phase of the Back to Basics Programme.

In line with our belief that local government should be in the hands of our citizens, one of the key elements of the B2B 10-Point Plan is fostering more positive community experiences.

During last year’s Budget Vote Speech we promised to create more public participation platforms.

At the end of March this year, 40 dysfunctional municipalities were supported in creating effective community engagement mechanisms.

A total of 4 067 ward committees have been established.

Also, as promised last year, a national induction campaign for ward committee members is in the process of being implemented.

Our experience over the past years has taught us that community involvement is essential to the success of our programmes.

We are also developing ward-based service delivery dashboards and implementing Ward Improvement Plans.

This will ensure that basic services such as the cutting of grass, working streetlights and the fixing of water leaks becomes a cornerstone of our municipalities.

To further improve the state of our municipal finances a generic revenue plan was developed and implemented in 30 municipalities.

Implementation entails the review and update of municipal financial policies, assistance to recover outstanding government debt and data cleansing.

Municipalities were introduced to new and cost effective technologies of providing services.

IUDF

Honourable Members,

In 2016 we attended the Habitat 3 conference, which unanimously adopted The New Urban Agenda – that is – The Quito Declaration on Sustainable Cities and Human Settlements for All.

Also formally adopted by the United Nations, were the new post-2015 Sustainable Development Goals (SDGs), which recognised the importance of the role of cities during this century, with SDG 11, which seeks to “Make cities inclusive, safe, resilient and sustainable.”

The adoption of the Integrated Urban Development Framework (IUDF) last year, as our national urban policy,  signifies how South Africa is now well-positioned to respond  to both national urbanisation challenges, to interface with global dialogues and agreements, and to be a thought leader in international dialogues on urbanisation and urban policy development.

Traditional Leadership

Speaker, Traditional leaders form an integral part of our democracy.

In a bid to further democratise our municipal spaces we have pushed for greater involvement of traditional leaders in municipal councils.

For the first time, following the 2016 Local Government Elections, traditional leaders attended the Integrated Councillor Induction Programme that was hosted by SALGA.

Our efforts to ensure zero tolerance towards the deaths of initiates are beginning to bear fruit.

While the number of initiate deaths was greatly reduced from the previous year, that is never good enough.

Our condolences go out to the families who lost loved ones during the initiation phase.

We commend the work done by CRL Commission in probing further the initiation practice.

Their findings will be used to enhance and strengthen our collective efforts to have a death free initiation practice.

To address most of the policy and legislative gaps and challenges within the traditional affairs sector, COGTA Ministry will focus on strengthening the current legislation.

The Ministry has prioritised supporting the parliamentary processes towards the enactment of the Traditional and Khoi-San Leadership Bill

The Bill will address amongst others, the recognition of Khoi-San communities and leaders.

It will also support the participation of traditional leaders in municipal councils.

We also intend finalising and tabling the Customary Initiation Bill to Parliament to regulate the cultural initiation practice

We believe this will go a long way to reducing the number of fatalities emanating from the practice.

Deputy Minister Bapela will provide further details on this subject.

Whilst we meet in the midst of the Africa Month celebrations, we continue to recreate our municipal spaces by ensuring that this is indeed an African democracy through the enhanced role of traditional leaders.

To this end, the COGTA Ministry in partnership with the National House of Traditional Leaders is organising an Indaba of traditional leaders to discuss and address most of the challenges facing traditional affairs.

The indaba will take place from 28 May to 01 June 2017.

Community Work Programme

Ladies and gentlemen, the Community Work Programme is a flagship programme of this department.

A reimagined municipal space cannot happen without the involvement of the poorest of the poor.

The number of municipalities that have CWP programmes has increased  from 198 to 229 in the last year.

Out of an annual target of 234 823, we were able to provide 243 162 work opportunities, as at 31 March 2017.

We also conducted training for 23 483 participants during the same period.

Speaker we have engaged with CWP beneficiaries.

They have thanked the government for this intervention and called on us to improve this programme by inter alia ensuring that training provided to them is accredited and relevant to the demands of the labour market.

They have requested professional business enterprise support.

They want to run their own businesses, they don’t want to be perpetual dependents of this programme.

They want to exit this programme so as to create space for other less fortunate citizens.

We are currently working with National Treasury to develop a new CWP model which is intended to address identified gaps.

Infrastructure for Basic Services

Speaker of the House,

We want a transformed municipal space to become a reality for all our citizens.

To that end we have identified the misalignment between bulk and reticulation infrastructure as one of the major causes of delay in the delivery of basic services.

Working through the Municipal Infrastructure Support Agent (MISA) in collaboration with our partners, the Development Bank of Southern Africa, and Department of Water and Sanitation, we have developed an implementation plan for seven municipalities.

The plan will include the rollout of reticulation infrastructure in the Ugu, Harry Gwala, Sekhukhune and Mopani District Municipalities; the Alfred Nzo District Municipality will focus on the Mbizana Dam;  OR Tambo District Municipality and the Madibeng Local Municipality will also be included.

Municipal Infrastructure Grant

The Municipal Infrastructure Grant plays a vital role in changing the face of municipalities so that citizens’ experience first hand the work of local government.

As at the end of March 2017, 63 percent (R9,5 billion) of the total MIG allocation of R14,9 billion was spent.

Municipalities in Mpumalanga Province are performing the best at this point as they have spent 72,42% (R1,3 billion) followed by KwaZulu-Natal that have spent 69,4% (R2,3 billion) of the total allocation of R3,8 billion.

In the 2015/16 financial year, ending in June 2016, 131 337 households benefitted from the provision of water infrastructure,

A total of 134 327 households benefitting from the provision of sanitation infrastructure.

Spending on MIG resulted in the provision of community lighting to 136 786 households;

As well as the upgrading and maintenance and provision of 2 150 kms of roads and storm water drainage;

the development of 10 waste facilities and 76 community or public facilities; 221 sport and recreation facilities were also provided for.

All this work created 161 697 jobs in the previous financial year.

A total number of 1 362 project site visits were conducted nationally in 2016/17 to verify projects being implemented by municipalities.

The MIG annual allocations over the 2017 MTEF includes an amount of R900 million, which is allocated outside of the grant formula and earmarked for specific sport infrastructure projects identified by Sport and Recreation South Africa.

In addition to the above, municipalities are required to spend 4.5 percent on sport and recreation infrastructure identified in their own Integrated Development Plans.

In addition to this R2,3 billion is for municipal infrastructure that supports social institutions and micro enterprises.

 Municipal Infrastructure Agent (MISA)

To accelerate the spending level of struggling municipalities, CoGTA has planned to strengthen its capacity to support municipalities to improve spending by, amongst others, developing its financial unit capacity to handle MIG conversions for municipalities that fail to spend MIG allocations and also by transferring the MIG Programme from the DCoG to MISA.

The objective of this transfer is to foster synergy between projects monitoring and technical support functions.

An Inter-Ministerial Committee (IMC) on Service Delivery announced in last year’s Budget Vote Speech has been playing a coordinating role with a view to unlocking obstacles hampering consistent provision of basic services at the right quantity and standards.

In the last year the main focus of the IMC was the provision of technical support to 27 priority Districts that together account for the highest proportion of the current backlogs on access to basic services.

These Districts are lagging behind in terms of investment in municipal infrastructure, which is a reflection of the past legacy of bias against rural areas.

A Project Management Office (PMO) has been established with the role of facilitating the collaborative implementation of inter-government initiatives aimed at reducing backlogs in these 27 Districts.

The PMO is located within the Municipal Infrastructure Support Agent (MISA) and reports to the IMC.

One of the flagship programme being driven by the PMO is the Regional Management Support Contracts (RMSCs) that was started in the last financial year.

This programme involves the contracting of companies with experience in institutional turnaround to support municipalities with the goal of improving processes and systems for delivering infrastructure and services.

The Sekhukhune District Municipality in Limpopo, Amathole and OR Tambo District Municipalities in the Eastern Cape Province are  to benefit from the delivery of water and sanitation services, through the Regional Support Contracts.

As part of its efforts to transform the municipal space, MISA trained 372 apprentices towards qualifying as artisans in various trades critical for municipal infrastructure delivery and management.

This apprenticeship programme is targeted at producing electricians, plumbers, diesel mechanics and bricklayers.

A total of 62 apprentices from this cohort have since passed their trade tests to qualify as artisans and are now available to join the local government sector.

MISA also provided training to 884 municipal officials through short courses in technical skills to enhance their technical capabilities.

The focus of capacity building in 2017/18 will be on the continuation of apprenticeship training for 300 learners currently in the programme.

In addition to this 160 graduates will be provided with opportunities for workplace experience in selected municipalities.

Training on technical skills will also be provided to about 500 officials currently employed in infrastructure and service delivery departments of municipalities.

Minimum competency requirements

During the past financial year the Department strengthened measures to monitor the appointments of senior managers to enforce compliance with minimum prescribed competencies.

In the past year we also developed and consulted extensively on Municipal Staff Regulations incorporating minimum competency requirements for lower level staff.

As part of our effort to ensure that competent people are appointed, the Department intends promulgating the regulations applicable to all staff members below management echelon, during the 2017/18 financial year.

Architecture of Local Government

Honorable Members, the two-tier system of local government has not been without its challenges.

As such, with our intergovernmental partners, we are embarking upon a holistic review of our system of local government, informed by such emerging realities as the impact of urbanisation in our municipalities, the developmental role of local government as reflected in Phase 2 of Back to Basics, and how to govern effectively, the many socially and economically differentiated environments that characterise the municipal landscape along the rural-urban continuum.

A Discussion Document is under preparation during the current term.

Municipal revenue and Eskom debt

The department is gravely concerned about the excessive growth of debt owed to municipalities to the tune of R117 billion as at 31 December 2016.

The culture of non-payment in our society is becoming a pandemic.

National departments are owing municipalities R2,3 billion, while Provincial departments are owing municipalities R3,1 billion.

The work of the National Task Team on Government Debt is making progress in resolving the historical debt and government departments have made commitments to adhere to their current debt.

This culture of non-payment has also extended to municipalities themselves as certain municipalities have become persistent defaulters to their creditors.

As of the end of December 2016, the total creditors amount was R34.6 billion of which Eskom and water boards were owed 77 percent.

Poor revenue management has meant that payments due to creditors far exceed the revenue collected.

The department is working with municipalities to implement municipal specific revenue plans in order to ensure proper internal controls to protect revenue and improve collection.

The focus of this project is to review municipal tariffs for electricity and water, which are not cost reflective; to identify and put measures to curb the theft/losses of electricity which equates to as much as 50 per cent of purchases in some cases.

Last year we drew up recovery plans and improved municipalities payments to Eskom.

While somewhat successful, they did not resolve all the challenges faced by municipalities.

The Minister of Public Enterprises and I have set up a task team inclusive of the DPE, Eskom, CoGTA, SALGA and the National Treasury to find solutions to the challenges faced by municipalities who owe Eskom.

Added to the systemic challenges, the Inter-Ministerial Task Team is also attending to the Constitutional complication on the “dual competency” for Eskom and Municipalities when it comes to electricity distribution and reticulation.

Free Basic Services (FBS)

Honourable Members,

The provision of Free Basic Services has been a cornerstone of this democratic government.

An important element of this is that we ensure that the most deserving among us benefit from such services and that the system is not abused.

The Department of Cooperative Governance has been tasked with the responsibility of developing the standard national Indigent Register (IR).

We thank the South African Revenue Services for their assistance in the verification and development of this register.

During the coming financial year we will support municipalities to review and update Indigent Registers to ensure credibility and manage the implementation of the Service Level Agreement between DCoG & SARS on the verification of the municipal indigent registers.

Local Economic Development (LED)

Through Our Local Economic Development initiatives we were able to support 21 municipalities to implement red tape reduction initiatives as part of eliminating rigid rules that are bureaucratic and hinder decision-making or the ease of doing business.

We have, over the years, partnered with a number of businesses who are keen to help build a better South Africa.

We are currently drawing up Draft Guidelines on Mutual Partnerships to Support Local Government.

Amendments to other pieces of legislation

In this financial year we will also be processing amendments to the Municipal Demarcation Act and introducing the Intergovernmental Monitoring, Support and interventions Bill.

National Disaster Management Centre (NDMC)

Madam Speaker,

The country has just experienced severe drought conditions, which is said to be the worst since 1926.

We are also aware that parts of the Western Cape Province remain under severe stress as dam levels are now said to be standing at below 13%.

Let me commend the National Disaster Management Centre (NDMC) for its role in its coordinated drought intervention plans across the country to address the drought’s devastating effects on our country.

Among the practical measures undertaken, were the training of 50 Fire Safety Officers from 27 municipalities, on Fire Risk Assessment, Investigation and Safety Strategies, in partnership with the Fire Protection Association of Southern Africa.

Youth

As the department responsible for local government, we recognise the need to involve young people in planning and in the programmes of local government.

Accordingly, we have partnered with COGTA Provinces, SALGA, the South African Youth Chamber of Commerce, the NYDA, the DPME and the Afrika Leadership Institute to establish the Local Government Youth Development Forum.

Budget allocations

The 2017 Medium Terms Expenditure (MTEF) allocations to the Department amount to R78,414 billion in 2017/18, R85,114 billion in 2018/19 and R91,060 billion in 2019/20 reflecting an average growth of eight (8) per cent over the 2017 MTEF period.

The total allocation of R78,414 billion in the 2017/18 financial year is divided as follows:

  • Department of Cooperative Governance: R78.269 billion (99.8%)

–           Transfers and subsidies: R73.916 billion (94.4%).

–           Operational costs (Including Compensation of employees, goods and services and payment of capital assets): R558.229 million (0.7%).

–           Special allocations: R3.796 billion (4.9%)

  • Department of Traditional Affairs: R145.006 million (0.18%)

Conclusion

We believe that today we have outlined our programmes and plan that will further enhance the economic transformation agenda of South Africa, so that all South Africans can enjoy prosperity.

My heartfelt gratitude goes to my colleagues, both Deputy Ministers Nel and Bapela, for their hard work and diligence over the past year.

We would not have achieved as much without their sterling contribution.

My thanks also go to the various directors-general, including the current DG, Dr Charles Nwaila, who is serving both departments.

Also to the staff of the ministries and the departments, I thank you for your effort over the past year.

It has been my pleasure to serve with you.

Thanks to all hardworking MECs and Councillors.

Finally, to my family, who have remained my anchor and a blessing.

Madam Speaker, I have the honour to submit Budget Vote 4 for your approval.