Honourable Speaker Honourable Members of the National Assembly Cabinet Colleagues and Deputy Ministers Chairperson of the House of Traditional and Khoi-San Leaders President of the South African Local Government Association Directors-General of DCOG and DTA CEO of MISA Leadership of IMATU & SAMWU Fellow South Africans
Paid tribute to the passing of the former President, the late Mr David Mabuza.

It is an honour to deliver the 2025/26 Budget votes 3 and 15 of the Department of Cooperative Governance and the Department of Traditional Affairs before this House. We meet at a time of grief as just 4 weeks ago, KwaZulu-Natal, Western Cape, and at most the Eastern Cape faced catastrophic flooding, with Nelson Mandela Bay, Chris Hani and OR Tambo districts suffering the most significant devastation.

One hundred and seven (107) lives were lost, thousands were displaced, and critical infrastructure – schools, clinics, roads – was destroyed. We know that many families are still yet to lay to rest their beloved ones. On behalf of the Ministry, we extend our deepest condolences. May the souls of the departed rest in peace. Following the declaration of a national disaster on June 5, 2025, municipalities, provincial, and national departments initiated the process of adjusting their budget allocations to address the disaster that had occurred.

I am partially pleased that on Monday, 07 July 2025, we communicated the release of R1.255 billion to the Eastern Cape, KwaZulu-Natal, Free State, Mpumalanga, Limpopo, and North-West to address the February 2025 disasters. The Eastern Cape will receive R504 million of the R1.255 billion.

In relation to June 2025 disasters, we have received the assessments from all provinces at an estimated cost of R6.3 billion. Our technical team, under MISA, is on the ground conducting verification to initiate recovery. On 5 August 2025, which will be 60 days after the disaster is classified, we will announce the allocations to intervene in June disasters to “build back better”. As we move forward, our disaster response and intervention will be completed within 60 days to release available funds.

CoGTA is leading the G20 Disaster Risk Reduction Working Group. Together with G20 Member States and global experts, we are advancing priority themes such as:
• Nature-Based Disaster Risk Reduction
• Resilient Infrastructure & Recovery
• Early Warning Systems, Inclusive, and Alternative Financing

BUDGET ALLOCATION: INVESTING IN FUNCTIONALITY AND RESILIENCE
The 2025/26 MTEF allocates:
• R410.9 billion to Vote 3: Cooperative Governance, with 96.7% directed to intergovernmental transfers and support to municipalities and entities
• R195.5 million to Vote 15: Traditional Affairs, with R46.9 million earmarked for transfers and subsidies, including support to the CRL Rights Commission
Within Vote 3, allocations fund key programmes over the MTEF period:
• R57 billion for the Municipal Infrastructure Grant (MIG) to fast-track basic services
• R4.1 billion for the Integrated Urban Development Grant (IUDG) to support spatial transformation in targeted cities
• R474.6 million for the Municipal Systems Improvement Grant (MSIG) to strengthen governance systems
• R1.163 billion to support the Municipal Infrastructure Support Agent (MISA) and its deployment of technical capacity
• Funding for disaster management contingency reserves, the District Development Model, and partnership frameworks with SALGA
Within Vote 15, the budget enables:
• Enforcement of the Customary Initiation Act
• Implementation of the Traditional and Khoi-San Leadership Act
• Resources for tools of trade for the Department and the National House of Traditional and Khoi-San leaders, recognition processes, and cultural documentation projects
This is a budget that anchors stability, resilience and deepening of democracy across spheres of governance.

WHITE PAPER REVIEW: REIMAGINING LOCAL GOVERNMENT FOR A NEW ERA

On 19 May 2025, we officially launched the review of the 1998 White Paper on Local Government.
This review is not a ceremonial exercise. It is a strategic imperative.
The current model, while visionary in its time, has not kept pace with the realities of:
• Urbanisation and spatial inequality
• Climate change and infrastructure fragility
• Youth unemployment and digital transformation
• Revenue shortfalls and governance instability
The review process, now extended to 31 July 2025 to allow broader participation, is guided by the principle that “Every Municipality Must Work”, not just in theory, but in practice.
Key objectives of the review include:
• Restoring public trust through transparency, accountability, and ethical leadership
• Revisiting the funding model, particularly the flawed assumption that municipalities can self-fund 90% of their operations
• Professionalising local government, with minimum qualifications and ethical standards for councillors and officials
• Empowering traditional leaders and rural communities within a constitutional framework
• Embedding smart governance tools, such as real-time performance tracking and open budgeting
• Strengthening intergovernmental coordination,
The WPLG Review is our opportunity to rewrite the rulebook, to build a local government system that is capable, ethical, inclusive, and future-fit.

INTERVENTIONS IN DISTRESSED MUNICIPALITIES
The department continues to implement targeted support for municipalities struggling with institutional dysfunction, poor audit outcomes, and critical infrastructure backlogs.
Honourable Members, we are acting decisively in the face of:
• Systemic governance failures
• Persistent non-compliance with statutory obligations
• Rampant financial misconduct
• Service delivery paralysis
Working together with National Treasury, where need be, we are going to use extra-ordinary means to compel municipalities who adopted 2025/26 unfunded budgets to review and adopt funded budgets. We have concurred with Treasury to compel the payments for water boards and Eskom, and pay pension and medical aid contributions to third parties. Notably, the same principle will have to apply to all government departments who owe municipalities, they must be compelled to pay what is due to municipalities.

To intensify our support for audit action plans, CoGTA Minister together with the 9 provincial MECs have agreed on a 10 X 10 with Auditor General and the 9 AGs provincial heads to address and resolve root causes of negative audit outcomes. We are bringing on board South African Institute of Government Auditors ( SAIGA ) which receives funding from Fasset SETA to provide direct oversight and intervention support to high-risk municipalities especially those who consistently do not submit their AFS, thereby ensuring that accountability mechanisms take root and financial credibility is restored.

STRATEGIC BUDGET INSTRUMENTS FOR LOCAL IMPACT
To ensure public resources translate into visible service delivery improvements, we are deploying strategic, differentiated support to a cohort of 30 priority municipalities facing capacity and financial constraints.
As part of this approach:
• The Municipal Infrastructure Grant (MIG) has been partially reprioritised and shifted to Schedule 6B of the Division of Revenue Act, enabling targeted national interventions by the Department and its implementing agent.
•In support of this shift, the Municipal Infrastructure Support Agent (MISA) has been formally designated as the national implementing agent for qualifying MIG projects. MISA will fast-track infrastructure delivery by providing:
o Technical expertise and procurement support
o Capacity building for municipal officials
o Exploration of alternative infrastructure financing models
o Training in project preparation, management, and contract oversight
These interventions will be accompanied by value-for-money audits to ensure accountability and effectiveness.

WARD DELIMITATION & PARTICIPATORY DEMOCRACY
On 3 April 2025, we officially launched the Ward Delimitation Process in Mbombela, Mpumalanga, a critical milestone in preparing for the 2026 Local Government Elections. This process is not merely technical. It is a transformative opportunity to deepen democracy, promote inclusivity, and enhance service delivery. Municipal wards are the building blocks of local governance. The Municipal Demarcation Board (MDB), supported by CoGTA and the Independent Electoral Commission (IEC), is leading a nationwide public consultation process under the theme: “Redefining Municipal Wards: The Building Blocks for Inclusive and Efficient Local Governance.” Public consultations were held across all provinces from April to June 2025, with the final ward boundaries to be handed over to the IEC by October 2025.

To support this, the Department has introduced the Independent Municipal Demarcation Authority (IMDA) Bill, which will repeal and replace the Municipal Demarcation Act of 1998.

The Board is also working closely with Ward Committees, traditional leaders, and community-based organisations to mobilise participation, especially among youth, rural communities, and historically marginalised groups. The success of this process depends on maximum community involvement. It is through this engagement that we ensure wards are not just lines on a map, but living spaces of representation, accountability, and service delivery.

LEGISLATIVE REFORM AGENDA: BUILDING A CAPABLE STATE

Our legislative programme focuses on rebuilding state integrity, electoral stability, and service delivery readiness through the following bills:
• Independent Municipal Demarcation Authority (IMDA) Bill.
• Local Government: General Laws Amendment Bill,
• Municipal Structures Amendment Bill (also known as the Coalitions Bill),
• Intergovernmental Monitoring, Support and Interventions (IMSI) Bill,

As the additional instruments: We are:
• Finalising a Professionalisation Framework for senior managers in local government
• Implementing Prototype Staff Establishments to address structural inefficiencies
• Reviewing remuneration and performance incentives to attract ethical and qualified municipal leadership
• Strengthening alignment with the District Development Model (DDM) for coordinated delivery
These legal reforms will reinforce developmental governance, restore citizen trust, and build institutional muscle.

TRADITIONAL AFFAIRS: STRENGTHENING COMMUNITY ROOTS

On customary initiation, since December 2024 to June 2025 we dedicated our time and government resources meeting Kings, Traditional leaders, MECs, and all stakeholders involved in the initiation from national , provincial and local initiation committees.

Hon Speaker, I am sad and angry. This morning, 19 boys who two weeks ago left homes healthy to initiation, today are recorded dead. It cannot be. This must not continue. A line must be drawn which must not be crossed.

Yes, 73 cases opened and 67 arrests made. We will follow-up on these cases to final prosecutions. The only deep pain is that the 19 innocent souls whose right to life has been violated, will not be recovered. I want to make this clarion call to all the lovers of the initiation culture to stand-up to protect the right to life.

As a result, on Sunday 13 July 2025 I am convening the urgent meeting of all MECs, the National and Provincial Initiation Committees to reflect on this unfortunate state of affairs. One thing that is clear in my mind is that, a line must be drawn.

RECOGNISING THE ROLE OF MAJESTIES & QUEENS

Following the establishment of the Forum for South African Majesties, March 2025 saw the creation of the Queens’ Council, a historic platform for women leaders in traditional communities. We are pleased that, for the first time in 30 years, the Minister of Finance announced an allocation toward infrastructure for Royal Palaces. The Deputy Minister is leading engagements with the National Treasury to finalise funding modalities under Section 30(2)(d) of the PFMA.

NATIONAL HOUSE OF TRADITIONAL & KHOI-SAN LEADERS (NHTKL)
The NHTKL continues to shape both national and continental discourse. The House’s Chairperson was recently elected to head a regional platform mobilising rural and traditional leaders against the scourge of substance abuse. In November 2025, the Lenaka Memorial Lecture will honour Kgosi Tota, Kgosi Jantjie, and Kgosi Galeshewe, resistance icons against colonial repression. This is part of a broader effort to restore pride and cohesion through cultural heritage.

The Honourable members know that the Constitutional Court on 30 May 2023 declared the Traditional and Khoi-San Leadership Act as unconstitutional and invalid but suspended the invalidity for 24 months. Seeing that the bill to address the invalidity of the act could not be addressed before 29 May 2025, we approached the ConCourt for the extension. I am glad to announce that the Court has granted Parliament an extension until 29 May 2027, and we are hopeful that Parliament will meet this new timeframe.

COMMISSION FOR KHOI-SAN MATTERS (CKSM)
To date, 220 applications have been received for Khoi-San recognition. The Commission is conducting Applicant Member Investigations (AMIs) to expedite the process. We are committed to supporting the CKSM in operating with fairness, efficiency, and alignment with constitutional principles.

CONCLUSION
Honourable Members, through these votes, we renew our commitment to cooperative governance and heritage stewardship.

In a time of disaster recovery, fiscal strain, and political complexity, we must uphold the values of accountability, service, and inclusion.

I hereby table Budget Votes 3 and 15 for the Department of Cooperative Governance and the Department of Traditional Affairs for the 2025/26 financial year.

Thank you.