“Towards a Review of Districts: Some Initial Thoughts”
Deputy Minister of Cooperative Governance and Traditional Affairs
CONSOLIDATING GOVERNANCE IN SEDIBENG WORKSHOP
19 September 2011
Need for Concerted Discussion
We all know that local government is not working well. And we know too that there need to be changes to the local government model. Maybe not too many changes, but some significant changes certainly. We all agree on the need for changes. What we disagree about is the nature, extent and pace of the changes.
And if we are talking about changes to local government, we are invariably raising issues about provincial and national government. All three spheres of government are, indeed, in need of a review. Based on our experiences of the past 11 years, we need to clarify and refine the respective powers and functions of the three spheres of government.
It is as part of the review of the local government model and all three spheres of government that we need to review the two-tier system of district and local municipalities. We need to look into various issues about this system. Why did we establish districts? How have district municipalities performed? Why? Do we still need them? If so, in the current or some other form? If not, why not? How then would we do away with them? And what would we replace them with?
No doubt many of you here today, especially those of you from the district, are aware that these issues are being considered by the ANC as we move towards the 2012 Policy and National Conferences. The latter Conference is likely to emerge with guidelines for government on policy on this and other local government issues.
The views offered here are initial and tentative. They are not the formal views of CoGTA. We have no final position on this matter. The views are offered as part of an evolving debate as we proceed to the ANC’s December 2012 National Conference. They are meant to elicit your views and encourage you to help shape the debate as important practitioners.
This input will not be comprehensive or in-depth. They are my cursory, initial reflections, and will be developed further through engagement with others in the months ahead.
If I have to make this clear, let me say this again, that there has been no decision taken by the ANC or CoGTA yet on the future of districts. It is the ANC’s 2012 National Conference that will provide direction. And all of us, from differing entry points, must have a say on shaping the ultimate decisions by the ANC, government and parliament.
So why district municipalities?
Why District Municipalities
During apartheid, there were very weak or no municipalities in the rural areas. With democracy, it was decided that there would be “wall-to-wall” municipalities and so every vote for local government elections would have the same weight. District municipalities would assist in the strengthening of local municipalities, especially in the rural areas. Their role is to contribute to reducing the gap between urban and rural areas.
The role of districts, according to the Municipal Structures Act, is to ensure the “integrated, sustainable, and equitable social and economic development of its area as a whole”.
Essentially, the role of district municipalities is to:
• Ensure integrated development planning for the district as a whole.
• Promote bulk infrastructure and services.
• Build the capacity of weaker local municipalities.
• Facilitate economies of scale.
• Encourage a measure of redistribution of resources between municipalities and more equitable services.
• Provide services where local municipalities do not have the capacity to do so.
Outside the metros, districts are meant to serve as the main local government point of entry for national and provincial government programmes and as the location for the regional offices of national and provincial government. They are meant to be the main representatives, outside the metros, of local government in intergovernmental relations.
The precise distribution of powers and functions between district and local municipalities would vary according to circumstances in each district. Decisions about this would be made by MECs after taking into account the capacity assessments of the Municipal Demarcation Board.
In 2000, shortly before the elections, influenced in good part by the work of the Municipal Demarcation Board, the functions and powers of district municipalities were changed. Districts were made responsible for key municipal services like water, sanitation, electricity and health, when previously the local municipalities were meant to provide this. Where districts do not have the capacity to provide these services, local municipalities would do so. There would be a distinction between the “service authority” and the “service provider” roles. Decisions about which districts and local municipalities would be authorized to fulfill specifically these basic services functions, “national functions”, as they came to be called, would be made by the Minister after consulting the MECs. Among the reasons for this change of functions and powers was to provide greater clarity, empower districts, increase their revenue base, strengthen their redistributive role, and ensure that they would be taken seriously by local municipalities.
So how have district municipalities performed?
How Districts have Performed
The two-tier system is obviously complex. It was never envisaged that it would be easy to implement. But it was seen as necessary, with huge potential that would over time come to be realized. Today, 11 years later, it’s clear that while the system has value, it has not realized its potential, and is, in several respects, challenged. It’s not altogether clear to what extent the challenges are of a structural and systemic nature as against being an outcome of leadership, capacity, resource and other inadequacies. Is the model inherently flawed or is it just not being implemented effectively? Is a two-tier system not workable in our country or should we have a different two-tier system? Let’s take a closer look at what’s been happening.
There are considerable provincial variations in the distribution of powers and functions between district and local municipalities. Overall, though, the functions and powers fulfilled by districts do not match those allocated to them in the Municipal Structures Act. The 2000 amendments to the role of districts that gave them the responsibility to provide basic services to end-users has been difficult to implement. In urban areas in particular, the larger local municipalities have been exercising many of these and other functions of district municipalities. Less than half the district municipalities perform the water and sanitation functions. Many local municipalities perform the municipal health function on behalf of the districts on an agency basis. Local municipalities or Eskom largely attend to electricity. In some cases local municipalities perform district functions even though they are not authorized to do so leading at times to confusion and duplication. In 2007/08 it was found that 74% of the district municipalities performed less than 50% of their functions.
There have been significant difference in performance but, overall, Districts have played a reasonable role in providing a framework for and coordinating the IDPs (Integrated Development Plans) of local municipalities. Where there are strong local municipalities, these have taken the lead in IDPs. Districts have served as an important conduit for national and provincial department programmes.
On 1 July 2006 the RSC business levies that made up 34% the revenue of districts was repealed, serving to significantly hamper the redistributive role of districts. The RSC levy was replaced by a grant from the national fiscus as an interim measure, and there is still no clarity on what exactly would replace this lost revenue stream. Almost half the districts are now entirely funded by national transfers.
Districts also find it difficult to redistribute resources from urban to rural areas because they do not always have economically strong local municipalities in their areas. Districts have not played a significant role in the capacity-building of local municipalities, especially in urban areas. National and provincial government have also often provided direct support to weak local municipalities, overlooking districts.
Overall, the extent of cooperation between district and local municipalities has not been good. There have often been turf battles. The complexities of the distribution of powers and functions between these two tiers and the related uncertainties have compounded the problem. Tensions within political parties over power have also at times been transferred to this difficult terrain with different political factions becoming embedded in the districts and local municipalities. They use their dominance in these different tiers to advance their respective interests in internal political party disputes rather than shaping a relationship between districts and local municipalities that most serves the developmental goals of local government. Often, the senior leaders of local councils do not serve in district councils so weakening their legitimacy and undermining effective cooperation.
To differing degrees districts remain important in intergovernmental relations. Apart from the metros, they are the main representatives of local government in the Premiers Intergovernmental Forums. The District Intergovernmental Forums bringing together the mayor of the districts and local municipalities within their areas work with differing degrees of success.
Clearly, the two-tier local government system is experiencing challenges. So what do we do?
There are several possibilities, ranging from strengthening the current model to replacing it with a single tier system and a whole variety in between. We will not here be able to deal with all of them or in any depth. But among the options are the following:
1. RETAINING THE CURRENT MODEL: The current model, it is argued, is basically right for our country. It is simply not being implemented effectively. There may be minor tweaks necessary. But all the problems raised about the model can be adequately addressed. The model must be strengthened through, among other measures, clarifying ambiguities in policy and legislation, choosing more effective and politically powerful councilors, appointing more skilled officials, allocating more funds and resources, ensuring provincial and national government work more actively with districts, and educating local government practitioners, civil society organisations and communities about the importance of districts. Districts have just not been given enough time and space to consolidate. Moreover, dismantling them would be extremely difficult and disruptive, and exacerbate “transformation fatigue”. It would also create anxiety among district officials and councilors and be resisted. There are interests in the local municipalities that will also oppose the disbanding of the current model. Doing away with it will cause unnecessary political tensions in a context in which the country needs greater political stability.
2. DISTRICTS IN RURAL AREAS ONLY: Districts are not working and will not work in urban areas, it is argued, but they are important in rural areas. They should play this role either with their current functions and powers or with amendments to them, based on experiences over the past 11 years. Districts have been playing a useful and necessary role in rural areas. They would be very valuable in facilitating national and provincial department programmes in rural areas and have to be assisted by these departments to do so. They should be strengthened to play a more effective role. Many of the proposals in option 1 above to strengthen districts would also apply to this option.
3. DISTRICTS WITH FEWER POWERS: Districts should revert to the role set out in the original Municipal Structures Act of 1998, it is argued. The functions and powers given to them in the 2000 amendments to the municipal Structures Act should be repealed. They are not able to exercise these functions and powers to deliver the basic services of water, sanitation, electricity and health, which are being delivered by local municipalities in many cases. There is no sign that the districts not exercising these responsibilities are developing the capacity to do so. In any case, basic services should be provided by local municipalities as these are closer to the people who can hold them to account for their performance. It is local municipalities, after all, which have ward councilors and ward committees. Districts are comparatively remote from the residents. Districts should focus on their original functions of integrated planning, bulk infrastructure and services, building the capacity of weaker local municipalities and equitable distribution of resources and services. Even if they fulfilled these functions modestly, they would be serving a useful role.
4. DISTRICTS AS ADMINISTRATIVE STRUCTURES: Districts should be administrative structures, it is argued, either without councilors or with very few councilors nominated by local municipalities. There should not be directly elected councilors to the Districts. The role of Districts would be basically to ensure coordination of local municipalities to ensure greater operational efficiency and cost savings. The Districts should serve as Shared Services Centres. This approach may need to be developed further if it is to be considered seriously.
5. SCRAP THE TWO-TIER SYSTEM: Any two-tier system, it is argued, would not work in our country. The current one certainly doesn’t, and has no prospects of doing so. The two-tier system, it is held, is more appropriate in countries which have a large number of small municipalities. Examples would be India with its 227 689 village councils organised into 5 906 block councils grouped into 474 district councils. Or Spain with its about 8000 municipalities organised into 50 district-like structures. Or Germany which has 12, 125 municipalities grouped into 323 structures that are like district municipalities. In South Africa, on the other hand, we have on average possibly the largest local municipalities in the world. The two-tier system has been too costly and rather than being complementary has often resulted in duplications of structures and personnel. We should simply have a single tier local government system. There are various forms this could take. The Districts could be scrapped and politicians, personnel and assets mainly absorbed into local municipalities and provincial structures. Another option would be to use the Districts in rural areas as the basis for new local municipalities and change the present local municipalities into sub-councils (with possibly delegated powers) as part of a single tier system in the country as a whole.
Of course there are other options and various permutations of the above options. Some of these options could also be combined.
But how do we decide on these options? And what happens in the meanwhile?
Deciding on Options
We have to be very careful in deciding what we do. This is a major, major decision to make. Possibly the most important decision of those we have to make in our review of the entire local government system.
Local government has gone through huge transformation since 1994, and cannot be subject to endless transformation. Whatever decision we take must endure for a significant time to come. It must be based on a sound and accurate understanding of how the two-tier system has performed so far and what the practical possibilities are for improvement. Any changes to the system must take into full and concerted account the capacity and resources necessary and possible. Changes that affect the position of councilors and staff have to be managed adroitly. There has to be a clear, practical programme to implement any changes, preferably with phases.
As wide as possible of the stakeholders concerned must be involved in the final decision. As a district municipality you must actively engage in the processes of this debate that will open up shortly.
Obviously, many of you and others involved in district municipalities will be anxious about where this debate will lead to and how it will affect you personally. This is perfectly understandable. But as yet no decision has been made. And we could end up with a strengthened district model in some form or the other.
Of course, in Gauteng the option of a global city region or some other form of a single tier system gets raised. This will need to be discussed further.
But right now we have district municipalities. You have only just been elected as councilors to the District or the local municipalities falling under the district. Others of you serve as officials. All of you have a very important role in making the district work. You owe it to the people out there to do your best. They need your engagement like never before.
Your district has performed better than most. Your extent of service delivery is certainly better. And it’s noteworthy that you have received unqualified audits in recent years. Congratulations! But if you have been doing well compared to other districts, you can, you will agree, do better. And you should.
And we as CoGTA offer you our full support. We convey our very best wishes to you in this new term of your councils.