Chairperson

Honourable Members

Allow me to acknowledge the protocol already established by the Honourable Minister Hlabisa

Good Day

I am honoured to stand before you to highlight the significant work accomplished by the Department of Cooperative Governance and to outline our plans moving forward under the National Government of Unity. With the guidance of Minister Hlabisa, we present Vote 3 confidently, as a step towards enhancing cooperative governance for the benefit of all South Africans.

Standing here today, we recognize the unique opportunity the NCOP provides, as it closely aligns with our work and our shared commitment to cooperative governance for the benefit of our provinces and, ultimately, the people we are humbled to serve.

The local government transformation process has been complex, driven by the increasing demand for essential services that impact our citizens daily. As we commemorate 30 years of democracy, we reflect on our nation’s achievements and the transformative work of the 6th Administration.

Despite our successes, challenges persist within local government structures – for example, lack of capacity, improper governance, lax financial management, corruption, and political instability affecting 66 identified dysfunctional municipalities. In the 7th Administration, we are prepared to confront these challenges head on, aiming to strengthen local government to fulfill its constitutional mandate effectively.

Today, we present this budget under the theme “Every municipality must work.” This is a clarion call to action for all South Africans to unite and contribute to building an effective, efficient, and community-centered local government that responds positively to the needs and aspirations of our people.

Let me remind this August House that the 2026 Local Government Elections are around the corner, marking the end of the current local government’s term. We owe it to our communities to improve their lives through effective and impactful service delivery.

The time for lamenting is over. The 7th Administration has opened a new chapter, which must be a turning point for the CoGTA sector, after 30 years of freedom and democracy. We are committed to building on the work of the 6th Administration, which positively impacted various communities.

WARD COMMITTEES

We are aware that as we embark on this journey of ensuring that every municipality works, we would equally require the participation of citizens in local government. Ward Committees play an important role in this regard as they facilitate citizen participation in local government in South Africa, serving as a vital link between Ward Councilors, communities, and municipalities. By 30 June 2023, an impressive 4,358 out of 4,468 ward committees (97%) had been established nationwide, highlighting our commitment to inclusive governance.

However, we recognize that challenges persist, particularly in areas such as the Tshwane Metro and parts of the Northern Cape. Issues such as the functionality of Ward Committees, Ward Councillors not convening meetings, inadequate community feedback, and unresponsiveness to community complaints leading to protests over basic services need urgent attention. We are committed to strengthening our oversight role to address these challenges, ensuring that Ward Committees function effectively and that citizens’ voices are heard and acted upon. Our ultimate goal in this space is to build a responsive and accountable local government that truly serves its people.

THE MUNICIPAL INFRASTRUCTURE GRANT

Working with our provincial counterparts, we continue to support municipalities during the pre-implementation and implementation phases of MIG projects by guiding them to meet the MIG Programme requirements. This work is reinforced on a technical level by the Municipal Infrastructure Support Agent (MISA), which participates in verification processes during cost reimbursements.

We will remain vigilant in preventing unspent MIG allocations from being returned to the national treasury, which deprives communities of essential services. During the 6th Administration, CoGTA began intervening in municipalities with under-expenditure by utilizing provisions of the Division of Revenue Act. This allows the department to retain a portion of the municipal MIG allocations and implement projects on behalf of these municipalities. We assure the House that we will continue this practice in the current administration to ensure that residents in the affected municipalities receive the services they need and deserve.

We have identified 25 municipalities that have an increase in the allocation of Municipal Infrastructure Grant (MIG) funding for the purpose of repairs and refurbishment. These municipalities will be supported to utilised 10% of their MIG budget towards enhancing their infrastructure. These municipalities are:

• Eastern Cape (4 municipalities): Makana, Amathole, OR Tambo, Joe Gqabi
• Free State (5 municipalities): Maluti a Phofong, Kopanong, Metsimaholo, Mantsopa, Masilonyana
• Gauteng (2 municipalities): Emfuleni, Merafong
• KwaZulu-Natal (4 municipalities): Umsunduzi, Ugu, Umzinyathi, Amajuba
• Limpopo (2 municipalities): Lepelle Nkumpi, Greater Giyani
• Mpumalanga (3 municipalities): Lekwa, Pixlie Ka Seme, Dipaleseng
• Northern Cape (3 municipalities): Phokwane, Siyancuma, Dawid Kruiper
• North West (1 municipality): Bojanala
• Western Cape (1 municipality): Kannaland

We have also identified 55 MIG receiving municipalities to support them in ensuring increased access to basic services on water, roads, solid waste, and sanitation. The municipalities, categorized by province, are as follows:

• Eastern Cape (7 municipalities): Makana, Amathole, Enoch Mgijima, OR Tambo, Joe Gqabi, Dr Beyers Naude, Great Kei
• Free State (7 municipalities): Metsimaholo, Letsemeng, Masilonyana, Mafube, Ngwathe, Maluti-a-Phofong, Tokolong
• Gauteng (4 municipalities): Emfuleni, Merafong City, Lesedi, Mid-Vaal
• KwaZulu-Natal (8 municipalities): Mpofana, Msunduzi, Uthukela, Umzinyathi, Zululand, Ugu, Amajuba, Umkhanyakude
• Limpopo (7 municipalities): Thabazimbi, Sekhukhune, Lephalale, Fetakgomo, Lepelle-Nkumpi, Modimolle-Mookgopong, Mogalakwena
• Mpumalanga (6 municipalities): Msukaligwa, Dipaleseng, Govan Mbeki, Lekwa, JS Moroka, Pixlie Ka Seme
• Northern Cape (10 municipalities): Siyancuma, Ubuntu, Renosterberg, Phokwane, Magareng, Gamagara, !Kheis, Kareeberg, Nama-khoi, Khai-ma
• North West (4 municipalities): Kgetlengrivier, City of Matlosana, Madibeng, JB Marks
• Western Cape (5 municipalities): Kannaland, Beaufort West, Prince Albert, Bitou, Theewaterskloof

INTEGRATED URBAN DEVELOPMENT GRANT

As part of implementing the Integrated Urban Development Framework (IUDF), we have launched a support program specifically for intermediate cities, focusing on three key areas: fiscal framework, implementation support, and enabling environment support. The fiscal framework support introduced a consolidated infrastructure grant, making all identified intermediate city municipalities (ICMs) eligible to apply for the Integrated Urban Development Grant (IUDG), which began in the 2019/20 financial year.

The IUDG features programmatic grant monitoring. The business plan for the IUDG is a three-year capital programme aligned with a long-term (10-year) Capital Expenditure Framework (CEF). The CEF serves as the primary instrument for grant qualification in IUDG funding applications. The Department of Cooperative Governance (DCOG) is currently assisting ICMs in developing their Capital Expenditure Frameworks, with 10 ICMs targeted for the 2024/2025 fiscal year and 15 ICMs for the 2025/2026 fiscal year.

MUNICIPAL SYSTEMS IMPROVEMENT GRANT

The MSIG is a Schedule 6 grant spend and accounted for directly by the Department, for the benefit of municipalities. Its purpose is to assist municipalities to perform their functions and stabilize institutional and governance systems as required in the Municipal Systems Act and related local government legislation. The accounting period for the implementation of the grant starts on 01 April each year, and end on 31 March of the ensuing year. Twelve (12) projects are currently budgeted for in the 2024/25 financial year. A comprehensive list of these projects and the implementation status is available on the APP.

MUNICIPAL ESKOM DEBT

Municipal debt demands urgent attention, especially regarding the substantial amounts owed to Eskom and the escalating debt from customers to municipalities. Recent data reveals that South African municipalities collectively owe Eskom R78 billion, a significant increase from R58.5 billion at the end of March 2023, surpassing the projected R68 billion for the end of March 2024. Despite most municipalities participating in Eskom’s Debt Relief Programme, some struggle with its stringent compliance conditions. Furthermore, the growing culture of non-payment among municipal customers severely impacts collection rates, making it increasingly difficult for municipalities to service their Eskom debt due to low revenue generation.

We commend initiatives such as the Distribution Agency Agreement between Maluti-a-Phofung and Eskom in the Free State. This Agreement, the first of its kind in the country, aims to address outstanding debt owed to Eskom and ensure every resident has access to electricity.

Additionally, we have introduced the Smart Meters Grant, administered by the National Treasury, which provides capital and operational subsidies to co-fund smart metering systems for municipalities. The initial focus will be on municipalities currently in the municipal debt relief programme.

Recognizing that current efforts to improve collections and reduce debt have been ineffective, innovative solutions from the new administration are necessary. The CoGTA Results Management Office (RMO), alongside institutions like MISA and SALGA, will work to address this critical issue in the current administration.

DCOG CONTRIBUTION TOWARDS STRENGTHENING ECONOMIC DEVELOPMENT 

In 2018, we released the Local Economic Development (LED) Framework, which aims to create innovative, competitive, sustainable, and inclusive local economies. Since the introduction of the Framework for Local Economic Development (LED), the Department has collaborated with key stakeholders including the UK government’s Foreign, Commonwealth, and Development Office (FCDO), Anglo-American South Africa (AASA), and Sibanye Still Water.

Together, they aim to: Build local government capacity for sustainable economic growth; Assist in national policy implementation for infrastructure enhancement and economic development; Strengthen technical expertise within local governments to ensure inclusive development; Enhance institutional efficiency, improve access to dependable public services, and foster sustainable revenue generation. Furthermore, DCOG, the South African Local Government Association (SALGA), and eThekwini Municipal Learning Institute (MILE) have been conducting masterclasses to build the capabilities in municipalities to undertake LED.  

We will, in this administration, support three secondary cities, namely, the City of Polokwane, City of Mbombela and Rustenburg Municipality with action plans to foster business friendly attitudes and behaviours across all staff levels at the selected municipalities. 

We also plan to finalise the development of a Standard Draft By-laws for Township Economies to provide guidance on how to develop sustainable townships. The Standard Draft By-laws (SDB) for Township Economies is intended to introduce a standardised framework to encourage municipalities to think differently about promoting commercial, and industrial economic activities in townships in line with the principles of spatial justice, spatial sustainability, spatial resilience, efficient and good administration to guide land use governance and promotion of economic development.

COMMUNITY WORK PROGRAMME

The CWP holds a special place in our collective consciousness as it is a government-wide initiative designed to uplift the most vulnerable among us. This programme is our response to the pressing need to address the challenges faced by our poorest and most economically marginalized communities. Since its establishment in 2007, the CWP has served as a guiding light, offering essential assistance and opportunities to individuals facing poverty.

To date, the CWP has provided work opportunities to 243,839 participants. Training has been provided to enhance the useful work that contributes to the development and maintenance of community assets.

Recognizing both successes and challenges, the Department undertook a transformative process to revamp CWP implementation guidelines. This included focusing on artisan and enterprise development to maximize economic growth and empowerment opportunities.

Our initiatives are driven by five (5) focus points, each one brimming with promise and potential for positive change. Firstly, we are committed to creating meaningful job opportunities that foster self-reliance and contribute to community development. Secondly, we aim to align our work with municipal developmental plans to maximize our impact.  Thirdly, our focus is on supporting unemployed youth, women, and people with disabilities, breaking down barriers to employment for these marginalized groups.  Fourthly, we are dedicated to sustainable business models for CWP participants, ensuring long-term economic independence. Lastly, we value partnerships with the private sector to drive economic and skills development through our Skills Revolution Approach.

To enhance the efficacy of CWP implementation, Memoranda of Agreement (MOAs) have been signed with Provinces have been signed. These MOAs outline the roles and responsibilities between DCOG and Provinces, improving drastically the collaborative implementation of CWP as a partnership-based delivery mechanism and working towards the institutionalization of the Programme at the local level. We welcome work undertaken to start and introduce the more than 40 Smart Partners to the Provincial COGTAs with Gauteng and the Eastern Cape being the first.

CONCLUSION

As we table the Vote 3 budget, we wish to commit to this House and all South Africans that we are working to build a local government that our citizens can trust and rely on, to improve their lives and contribute to the growth and development of our great nation.

I thank you.