Budget Vote Speech to the National Assembly
24 May 2006
Madam Speaker
Local Government MECs
Traditional leaders of our people
Mayors and Councillors present in the gallery
Honourable Members
Introduction
This budget vote comes before the House a little over two months after the
local government elections which took place on the 1st of March 2006. Our
peopleâs participation in those elections was premised on the legitimate
expectation that it would help hasten the dawn of a new age â an age
characterised by:
* the end of the use of the abominable bucket system as a means of
sanitation
* universal access to clean water, decent sanitation, and electricity
* the existence of economic and social infrastructure which is of a quantity
and condition that guarantees sustainable economic development and social
provisioning.
Indeed, together with our people, we understood that critical to the
realisation of these objectives, is a plan to make our municipal system of
government work better.
Diagnostic study
As Honourable Members are aware, in 2004 we carried out a Diagnostic Study
of the local government sphere. This was subsequently followed by a
comprehensive qualitative assessment which was done in 2005. These undertakings
brought to light, two deficiencies which are desperately in need of urgent
attention.
The first is the challenge of weak institutional capacity, and the second,
is the problem of inadequate systems of accountability. National and provincial
governments have gained an even much better feel of the situation as we
interacted through the Presidential and Ministerial Izimbizo Programme of 2005,
with 106 municipalities across all the nine provinces.
Project Consolidate
Madam Speaker, steps were taken to ensure that none of our municipalities
remain stuck in the unpromising corner where poor performance and the attendant
problem of service delivery backlogs are the order of the day. A hands-on
programme of support known as Project Consolidate was rolled-out. As at April
2006, a total of 112 experts, 18 graduates and 80 engineering students had been
mobilised and deployed in a total of 69 Project Consolidate municipalities. The
scale of coverage of the deployment by municipal-type spanned 52 local
municipalities and 17 district municipalities. I will be remiss if I do not
pause here, to thank the following partners for a heart-warming demonstration
of solidarity: the Department of Water Affairs and Forestry, the Local
Government Sector Education and Training Authority (SETA), the Engineering
Council of South Africa, the Afrikaanse Handelsinstituut, National Treasury,
the South African Black Technical Careers Organisation, the South African
Association of Civil Engineers, Department for International Development (UK),
and the Institute of Municipal Finance Officers.
Through the support of Service Delivery Facilitators (SDFs) who came from
these organisations, Project Consolidate proved to be a milestone development
representing an important material sign of what could be achieved through a
co-operative system of governance. Various municipalities can now point to the
positive ways in which the lives of their residents were touched by the
interventions of the Service Delivery Facilitators:
* The Greater Kokstad Municipal Council assisted by deployed SDFs, was able
to electrify 556 households and it remains on course to complete the
electrification of 1 000 households in the Horseshoe informal settlement. The
settlement is in the process of being converted into a formal residential
area.
* Whereas the payment level for services rendered to the community of J.S.
Moroka stood at 11 percent as at July 2005, SDF intervention helped the
municipality to target major debtors, and by January 2006, the payment level
had increased to 45 percent. Similarly, in the municipality of Matjhabeng the
payment level increased from 51 percent in July 2005 to 62 percent by February
2006.
These and other examples too-numerous-to-mention, serve to underscore the
point that Project Consolidate is a prelude to the ushering-in of a season in
which we shall have a local government system which has the requisite capacity
to discharge its mandate.
Madam Speaker and Honourable Members, it is our intention to scale-up and
mainstream the hands-on support that we are currently providing to targeted
municipalities. Within this context of intensified support for local
government, priority attention shall be paid to former cross-boundary
municipalities as well as to the urban and rural nodal municipalities.
As we continue to organise Presidential and Ministerial Izimbizo, follow up
actions shall be undertaken in order to ensure that our entire system of
government is indeed seen to be responsive to the priority needs of the people.
This explains why we are continuing to mobilise our countryâs knowledge base,
and to harness it to the task of improving the functional effectiveness of our
governance system. As we speak, the Development Bank of Southern Africa (DBSA),
through an initiative called Siyenza Manje, is in the process of recruiting 144
experts and 30 young graduates for deployment to priority municipalities over
the next three years. 90 experts and graduates will be placed in the priority
municipalities by December 2006. These experts will provide support in the
areas of engineering, project management, financial management and town
planning. The Department of Provincial and Local Government (DPLG) and the
Department of Public Service and Administration (DPSA) are also finalising the
conceptualisation of a contribution to be made by Project Khaedu towards
enhancing national and provincial governmentsâ support for priority
municipalities.
I must hasten to point out that welcome as this assistance is; it however
carries strong risks of deepening the pathology of local government reliance on
exogenous sources of growth and development. In order to forestall this ghastly
prospect, we are taking steps to help strengthen the political-strategic
capacity of the municipalities themselves. In addition to the councillor
induction programme directed at the over 9 000 newly elected councillors, we
are also looking at the technical side of local governmentâs functional status.
In two days' time, (i.e. on 26 May 2006) the DPLG will publish municipal
Performance Management regulations for public comment. This will enable us to
finalise and issue generic pro forma performance contracts. This will place
municipalities in a position to have performance agreements and contracts with
senior managers that are linked to the political mandate of elected
representatives. Ultimately, this initiative will help us put in place, one of
the crucial elements of sustainability.
Strengthening the financial resource base
The deployment of professionals to targeted municipalities will be
complemented by a range of parallel interventions aimed at augmenting the
fiscal resource base of municipalities. It is for this reason that out of the
R82,9 billion allocated to municipalities over the next three years, the
Regional Services Council (RSC) levy replacement provision to the tune of R24
billion has been made. This replacement provision will compensate district and
metropolitan municipalities for lost revenue as a result of the abolition of
the RSC levies which comes into effect from 1 July 2006.
An additional component to the Local Government Equitable Share (LGES) for
2006/07 relates to the new Framework for the Remuneration of Councillors. This
effectively means that subsidised funding is being made available from the
national fiscus. An amount of R584 million will be transferred to support
councillor remuneration over the Medium Term Expenditure Framework (MTEF)
period. Furthermore, additional funding to the amount of R550 million will be
made available to district municipalities in order to assist them to carry out
the Municipal Health Service functions.
The Municipal Property Rates Act will be implemented in a phased manner. By
the end of 2005, at least 17 municipalities considered themselves ready to
comply with the requirement of implementing the Act from 1 July 2006. We are
currently finalising the crafting of the relevant regulations and these will
soon be gazetted. The implementation of the Act will immensely strengthen the
financial and resource base of our municipalities.
Infrastructure investment
One of our strategic areas of focus in the next five years will be to
improve our capacity to plan, manage and monitor infrastructure investment and
the provision of municipal services. In 2005/06, government set aside R5,4
billion for the Municipal Infrastructure Grant (MIG). By the end of March 2006,
the entire amount had been transferred to municipalities, but actual
expenditure stood at R3,9 billion. In other words, the rate of spending on
municipal infrastructure already stands at 72 percent.
Increased spending levels in this regard had enabled us, by the end of
December 2005, to provide 179 000 households with access to sanitation, and to
provide to over 412 000 households, with access to portable water.
Even with respect to MIG expenditure, our approach to monitoring is one
which conceives of progress as an outcome of joint efforts. It is a partnership
which transcends the âMonitorâ and the âMonitoredâ distinction. It is only in
this way that we have been able to get better insights into the impediments
which impair the capacity of municipalities to effectively manage projects.
We are now better placed to manage blockages in the MIG projects
registration process, strengthen existing and establish additional Project
Management Units in municipalities, and to develop national infrastructure
master sector plans to guide infrastructure planning and implementation at
local level. We are therefore confident that the R21,4 billion allocated to MIG
over the next three years will yield an optimal return.
Integrated Development Plans (IDPs): Engagement process
Madam Speaker, whereas the Integrated Development Plans of municipalities
were originally conceived of as strategic plans specific to the municipalities
concerned, we have come to regard the IDP as a potential fulcrum for raising
issues to be attended to by all the three spheres of government. Clearly
therefore, all the three stages of the IDP process starting from
conceptualisation through to formulation and ultimately to execution, require
joint and co-ordinated inputs.
We are happy to report that by March 2006, 80 percent of all municipalities
in the country had draft IDPs, which benefited from intergovernmental
collaboration and support.
We are on course to ensure that by the end of June 2006, national and
provincial government will have convened intensive interactive sessions in each
province in order to assess the quality of every single draft IDP in the
country. This means that for the first time in the history of our country, by
July 2006 we shall see a generation of municipal development plans that is
reflective of all the key priorities of national, provincial and local
government. It is through this process that we are beginning to forge a better
alignment between the National Spatial Development Perspective, the Provincial
Growth and Development Strategies and the Municipal IDPs.
Implementation of the Intergovernmental Relations (IGR) legislation
In addition to institutionalising governmentâs commitment to discharge its
obligations to the people via IDPs, attention shall also be paid to the task of
strengthening the intergovernmental co-ordination and implementation mechanism.
In this regard, the efficient operation of our Intergovernmental Relations
system is essential for sustainable development and service provision.
At national level, the Presidentâs Co-ordinating Council is fully
operational, and all provinces have established province-wide intergovernmental
structures, as set out in the legislation. The process of establishing district
intergovernmental structures is also continuing apace throughout all 46
district municipalities in the country. Within the next three months we will
finalise a Practitionersâ Guide on Intergovernmental Relations. This will be an
important resource for practitioners across our three spheres of government. It
will go a long way towards forging complementarities regarding resources and
capabilities of each sphere of government.
Partnerships
Madam Speaker, continuing attention is also being paid to the task of
strengthening Ward Committees. These Ward Committees represent a new
relationship between civil society and the re-articulated South African State.
Participation in these, coupled with the invaluable contribution of Community
Development Workers (CDWs) gives civil society the possibility to influence the
direction of state practice in a manner that changes the lives of our people
for the better.
Through the 2005 Imbizo Programme, we had a more structured interaction with
Ward Committee members. We have since launched a Handbook for Ward Committees
and the Ward Committee Resource Book. This was done on 10 February 2006. In
addition to this, we are working on a national framework on Public
Participation in Local Government and we are also finalising a submission to
the South African Qualifications Authority (SAQA) for an accredited training
course for Ward Committees.
We are also determined to ensure that all the necessary development-oriented
partnerships are forged, especially at local level. To that end, Growth and
Development Summits will be convened in all metropolitan and district
municipalities. These summits will provide the opportunity to further confirm
and refine the priorities identified in the IDPs. They will also help
facilitate the process of stakeholder mobilisation.
Conclusion
Madam Speaker, we have set our sights firmly on the goal of ensuring that
come the end of local governmentâs current term, our peopleâs best hope for a
better life shall not be disappointed. Success in this regard will depend
especially on the skilful performance of our duties as public representatives
in the legislative bodies and executive structures of the state at national,
provincial and local level. I want to assure this House that we in the Ministry
and Department of Provincial and Local Government are determined to work
untiringly for the realisation of this goal. With your co-operation, success is
certain.
I thank you.
Issued by: Department of Provincial and Local Government
24 May 2006
