Municipal Services Provision: Co-Ordination & Collaboration briefing by Departments of Minerals &Energy, Provincial & Local Gove
NCOP Finance
22 August 2006
Meeting Summary
A summary of this committee meeting is not yet available.
Meeting report
FINANCE AND LOCAL GOVERNMENT AND ADMINISTRATION SELECT COMMITTEES
22 August 2006
MUNICIPAL SERVICES PROVISION: CO-ORDINATION AND COLLABORATION BRIEFING BY
DEPARTMENTS OF MINERALS AND ENERGY, PROVINCIAL AND LOCAL GOVERNMENT, NATIONAL
TREASURY, WATER AFFAIRS AND FORESTRY, DEVELOPMENT BANK OF SOUTHERN AFRICA AND
ESKOM
Co-Chairperson: Mr T Ralane (ANC) [Free State] and Mr S Shiceka (ANC) [Gauteng]
Documents handed out:
DPLG
presentation on Municipal Performance Regulations
DPLG Summary of
Expenditure of MIG Funds as at 30 June 2006
DPLG presentation on Profiles of Municipalities with regard to Finance: Bophirima, Ehlanzeni, Eden and Namakwa
Briefing note by the
Director General of Provincial and Local Government
Treasury
presentation on Co-ordination and Collaboration: Provision of Municipal
Services
DWAF presentation on
Co-ordination and Collaboration: Provision of Municipal Services
Eskom presentation on
Co-ordination and Collaboration: Provision of Municipal Services
DME presentation on
Co-ordination and Collaboration: Provision of Municipal Services
DBSA presentation on Co-ordination and Collaboration: Provision of Municipal
Services
SALGA presentation on
Co-ordination and Collaboration: Provision of Municipal Services (not
presented)
SUMMARY
The Committee was briefed on co-ordination and collaboration pertaining to
provision of municipal services. The Committee had convened the meeting because
it had seen some gaps in what Departments were doing. All the Departments that
appeared before the Committee were responsible for providing certain services
to municipalities. The Committee wanted to look at streamlining services that
were delivered to municipalities such that there was no duplication, bickering
and finger pointing.
DPLG made the point that municipalities were owed a lot of money by some
Departments. This was having a negative effect on service delivery by
municipalities. The amount of time taken by municipalities to collect debts
ranged from 14 to 1045 days. There were lessons that could be learnt from
municipalities that had better collection systems
DWAF had no MECs for Water Affairs and Forestry and had to rely on provincial
departments of Local Government. Extensive collaboration and consultation existed between DWAF and several
other national departments. These include: DPLG, Treasury, Department of
Housing, Department of Health, Department of Education and Department of
Minerals and Energy. Formal and informal relationships existed through which
extensive debate and discussions took place regarding tactics, strategy
development, consultation, briefing and support. There was a need for
better links with National Treasury. DWAF was better placed to identify gaps in
the funding of infrastructure.
There was a need for more collaboration between the
Department of Minerals and Energy and the Department of Housing. There were
problems as a result of the unavailability of houses for electrification.
Planning seemed to be a major challenge. Some of the projects were approved
late by municipalities. In some instances municipalities had committed
themselves to projects which ended up not materialising or getting completed in
the financial year. There were also problems as a result of the prolonged
municipal procurement processes. The sourcing of solar panels for solar home
system had been difficult as a result of international demand.
Members were
disappointed that the presentation by National Treasury had failed to address
the issues of co-ordination, collaboration and assistance to municipalities.
Members complained of the following issues, amongst other:
- Departments owed a lot of money to municipalities and it seemed that there
was no willingness to pay the debts.
- There was no evidence of communication and collaboration amongst departments.
This resulted in unnecessary duplication of structures and programmes.
- Municipalities had the tendency to ask for loans from the Development Bank of
Southern Africa despite having money in their bank accounts and support from
national departments.
- The issue of access to free basic services still had to be addressed. It was
important to fully engage on who was responsible for providing which service to
people.
- Some of the indigent policies of municipalities were not being implemented or
were not working properly. There was a need for further discussion on targeting
and access to free basic electricity.
MINUTES
Mr Ralane said that the Committee had convened the meeting because it had
seen some gaps in terms of what Departments were doing. All of the Departments
before the Committee were responsible for providing certain services to
municipalities. The Committee wanted to look at the issue of streamlining the
services that were delivered to municipalities such that there was no
duplication, bickering and finger pointing. He asked Mr Shiceka to preside over
the meeting.
Department of Provincial and Local Government (DPLG) presentation
Ms L Msengana-Ndlela (Director General) made the presentation. (See
document attached). She focussed on the following issues:
- Implementation Plan for the 5-year Local Government Strategic Agenda
(2006-2011).
- Implementation of the Intergovernmental Relations Framework Act
- Municipal Performance Regulations
- Profiles of Municipalities with regard to Finance
- Summary of Expenditure of Municipal Infrastructure Grant (MIG) Funds as at 30
June 2006
The DG said that there were some Departments that owed municipalities a lot of
money. The amount of time taken by municipalities to collect raged from a
minimum of 14 to a maximum of 1045 days. There were lessons that could be
learnt from municipalities that had better collection systems. Municipalities
would often argue that their challenges were not the same.
Department of Water Affairs and Tourism (DWAF) presentation
Mr J Sindane (Director General) said that the DPLG was a very key
Department for DWAF. DWAF had no MECs for Water Affairs and Forestry and had to
rely on provincial departments of Local Government. 72% of the Municipal
Infrastructure Grant (MIG) was for water and sanitation. Extensive collaboration and
consultation existed between DWAF and several other national departments. These
include: DPLG, Treasury, Department of Housing, Department of Health,
Department of Education and Department of Minerals and Energy. Formal and
informal relationships existed through which extensive debate and discussions
took place regarding tactics, strategy development, consultation, briefing and
support.
There was a need for better links with National Treasury. DWAF was better placed
to identify gaps in the funding of infrastructure. Some of the regulations
promoted by Treasury could unintentionally work against or undermine the
Department's work. DWAF and DPLG (and not Treasury) had to report on the
targets. The Departments might observe some behavioural patterns that might
necessitate some kind of intervention. The departments would offend Treasury
should they speak directly with municipalities in relation to the observed
behaviour and offer some assistance. The Division of Revenue Act (DORA) did not
allow this. Someone had to account or report on the failure to meet the
Department of Education's (DOE) target in relation to water and sanitation in
schools. DWAF had a relationship with DOE but DOE was not responsible for the
provision of water and sanitation at schools. This was the responsibility of
provincial departments of education. Municipalities could easily provide the
service provided the money went directly to them. Some kind of restructuring
was needed to ensure better co-ordination and service delivery.
Eskom presentation
Mr I Sokopo (Electrification Stakeholder Manager) and Mr M Ntsokolo
(Distribution Division) attended the meeting. Mr Ntsokolo made the
presentation. (See document attached). He said that Eskom reported to the
Department of Minerals and Energy (DME) and had relationships with various
government departments and parastatals. It interacted with organised customers
and attended provincial Integrated Development Plans and energy forums.
He said that the Integrated National Electrification Plan (INEP) Business
Planing Unit reported to DME. One of its obligations was to make
recommendations on the INEP programme to the National Electricity Advisory
Committee (NEAC). NEAC was composed of various government Departments and
Eskom. The criteria for allocating funds took issues like backlogs, past
performance and government priorities and initiatives into account.
There was a National Task Team
comprising of DPLG, DME, Treasury, Eskom, the National Electricity Regulator,
Department of Public Enterprises and the SA Local Government Association. The
Task Team was responsible for determining one national contract on how the free
basic electricity programme should work in order to avoid individual
negotiations by municipalities. The Team also decided on the national tariff.
Municipalities had to determine their indigent policies in relation to who
qualified for free basic electricity. In the absence of such a policy, people
who had prepaid meters and had meters that were less than 20 amps qualified for
free basic electricity. People who had the conventional meter and had a
consumption of less than 150 units per month also qualified for free basic
electricity. Funds flew directly to the municipalities through the equitable
share. Eskom entered into agreements with municipalities that then issued the
free electricity. Eskom claimed the money for the electricity from the
municipalities as per the national tariff.
Development Bank of Southern Africa presentation
Mr P Baloyi (CEO & MD), Ms J Nhlapo (COO-Development Fund), Mr G
Mantashe (Executive Manager-Strategic Initiatives) and Mr A Tadesse
(Head-Corporate Strategy) attended the meeting. Mr Tadesse made the
presentation. (See document attached)
Department of Minerals and Energy (DME) presentation
Mr Sindane said that there was a need for more
collaboration with the Department of Housing. There were problems as a result
of the unavailability of houses for electrification. Planning seemed to be a
major challenge. Some of the projects were approved late by municipalities. In
some instances municipalities had committed themselves to projects which ended
up not materialising or getting completed in the financial year. There were
also problems as a result of the prolonged municipal procurement processes. The
sourcing of solar panels for solar home system had been difficult as a result
of international demand. This had a negative effect on fast tracking of
electrification from an off-grid perspective. Municipal financial year was not
synchronised with Eskom's financial year. Municipalities started deliberations
on new projects only around June or July and the Councils' resolutions to
implement electrification programmes were normally passed around November.
Supply of funds was outstripped by the demand for projects. There was a need
for more money to deal with the 3, 4 million houses that still had to be
electrified.
He said that the statistics of schools with or without electricity was
unreliable. A school could be recorded as not electrified and one could find
that it was not electrified because it was in a bad state. Some of the schools
were built from mud and others did not have roofs that were suitable for the
installation of grid electricity. Most schools, especially in the Eastern Cape
were of mud, wood and corrugated iron and were regarded as temporary
structures. There was low commitment on ownership and maintenance of the
electrical infrastructure installed in schools. This raised the issue of the
sustainability of the infrastructure. Most schools were prone to vandalism and
theft. There was also the issue of Rehabilitation of infrastructure installed
over 12 years ago. One could imagine the state of such infrastructure. Old
infrastructure was one of the reasons of the frequent blackouts of longer
duration. The quality of supply and network reliability was an issue. One of
the criticisms was that the electricity did not meet the thermal needs of
households. This included space and water heating. There was a need to find
alternative and complementary means of meeting the thermal needs.
National
Treasury presentation
Mr
Malcolm Booysen (Director: Intergovernmental Relations) made the presentation.
(See document attached). He said that it was sad that there was still some
misunderstanding by Department of provisions like section 16 of DORA. He had
thought that the misunderstanding had been addressed during the hearings on the
Division of Revenue Bill. It seemed that the Department were reading the
section out of context or only focusing on certain parts.
Mr Ralane said that Mr Boysen should not deal with section 16 but focus on
collaboration and collaboration with other Departments.
Mr Boysen said that some departments had raised the differences in financial
years as an issue. The differences had some advantages which outweighed the
disadvantages. There were a number of mechanisms to the overcome the
disadvantages. National Department would have to finalise their allocations in
September or October if the financial years were aligned. The publication of
three-year allocations was aimed at facilitating better planning for
municipalities. The allocations were 'guaranteed' provided that municipalities
maintained good spending patterns. Some presentation had raised the issue of
targets and the misunderstanding was that national government alone was
responsible for addressing the targets. Municipalities should also contribute
in meeting the targets.
Mr Ralane said that the Committee was not interested in Treasury's response to
other presentations but wanted its contribution to the topic under discussion.
Mr Boysen said that Treasury played a major role in the budget process by
co-ordinating efforts of departments and municipalities. There were a number of
stages in the budget process in which municipalities and departments were
involved. There was
co-ordination and collaboration in some areas but this could be improved
especially in relation to the MIG and Housing. It should be noted that MIG and
Housing were formula driven whilst other programmes were project driven. It was
important to improve planning and identification of priorities during the
budget process. The tabling of three-year allocations by municipality was aimed
at facilitating improved planning
Discussion
Mr Shiceka said that this was a beginning of a process that would unfold over
time. The Committees would continue to hold bilateral and multilateral
discussions with departments to ensure that they worked in a holistic way. It
was important to have a co-ordinated approach to service delivery. The
Committee still had to call the Department of Transport to appear it because
transport was the veins and arteries of the economy of the country.
Mr Ralane said that the Committee was not interested in the departments'
understanding of section 16 but the outcomes. The departments should go back
and show practical outcomes. DPLG, DME, Treasury and DWAF should do an audit of
challenges in relation to implementing section 16 so that it could be amended
if necessary. SALGA should collaborate in the audit. The Committees did not
want to see unintended outcomes from the legislation. Mr M Robertson (ANC)
[Eastern Cape] said that the Committee had noticed from the Report of the
Auditor General that municipalities were very slack in sending financial
statements. There were 45 outstanding reports and a lot had been submitted
late. The DPLG presentation was excellent. The real issue was not how much
planning was done but whether there were hands-on people to implement
identified projects. The LEDs in the Eastern Cape were totally ineffective.
North West provincial departments owed municipalities R88 million. Part of the
money had since been paid but a lot could be done by the remaining balance.
There was also the Nelson Mandela Metro issue. Bisho owed the metro money for
public works. The municipality was sitting on money from traffic fines than had
to go to Bisho. There was a stand off and nothing was happening. The prolonged
procurement process of municipalities had a serious effect on service delivery.
He said that there were numerous outstanding sewage and sanitation problems.
There was a sewage and sanitation problem that had been outstanding for three
years in Sinqu. Letters had been written to various departments and
municipalities but nothing was done. He asked how water and electricity
backlogs would be address. The departments were running ahead building houses
with the necessary services whilst old houses had no services. The DME had said
that it had a roll over of R70 million that resulted due to the unavailability
of houses. He asked the DME to clarify the issue because the backlog was very
big.
Ms Msengana-Ndlela welcome the interaction with the Committee and other
government departments and institutions. She invited the Committee to work with
government departments and institutions in partnership whilst exercising its
oversight responsibilities. The local government sphere was very new. The
departments were dogged by the stubbornness of poverty and underdevelopment.
DPLG would not lament about the problems of the past but would act in order to
solve them. It would come back to Parliament to report on what was happening on
the ground. She requested Members to take time and look at the approach that
the Department was proposing for the next five years and the way in which it
worked with different partners. The Committee should use this as the basis for
its oversight over the next five years. It was important to look at the issue
of sustainability at all times. She also invited the Committee to join the
Department in its Imbizo programmes. Before 1995 national government
never had the taste and the intensity of working on the ground as it did now.
She said that the Department had analysed the profiles of the different
localities. It looked at the municipalities that had the potential to
contribute towards economic development. There were municipalities that had
grown at a higher level than the national economic growth. There was a need to
improve guidance about the LED. Last week the Department had issued a framework
and a toolkit for LED. Stakeholders were busy commenting on the framework and
the Department intended to finalise it by September. Most people in Sub-Saharan
Africa who wanted to know about LED came to SA. SA had started some approaches
and it was important to be practical and for the approaches to have some
impact. This was one reason why the monitoring and evaluation systems that had
been put in place did not only deal with input indicators but also with impact
indicators. The national government had recognised the need to improve the
performance culture of municipalities.
The programme for local government in the next five years would depend on the
collective responsibilities that communities and government had. It was
important to enforce the accountability measures and to improve leadership.
Co-ordination depended on the functions of leadership.
She said that it was important to look at the issue of collaboration. She
agreed that departments should not talk too much about planning. However, they
should still confirm their planning frameworks. There was a credible Integrated
Development Plan (IDP) process. The act of consolidating infrastructure budgets
for municipalities to MIG was an act of co-ordination in itself. The Department
could now report on MIG but this was not enough. People should recognise every
instance in which there was some progress. It was important to have partnership
when moving forward. There were officials from the Institute of Civil
Engineering and the Institute of Municipal Finance Officer on the ground in the
North West province. This approach was not in place before.
Mr Sindane (DME) replied that the roll over was related to a specific incident.
The 2006/07 DORA allowed for some flexibility in relation to the reallocation
of money. It illustrated the importance of collaboration.
Mr Sindane (DWAF) replied that he would be surprised if the situation was still
the same in Sinqu. He was not saying that everything had been fixed but
somebody from DWAF should have gone there and start engaging with the schools.
There were various ways in which backlogs could be addressed. The ring-fenced
allocation for bucket allocation covered the period until the 2007/08 financial
year. The Department was expected to meet the target by December 2007. It was
in discussion with Treasury so that the money could be brought forward to
enable the Department to meet the target. The Department might fall short of
meeting the targets should it continue at the current rate and using the same
methods. There might have to be an extra injection of cash and capacity. It was
addressing issues like unemployment and skills shortage in its service delivery
processes. There might also be a need to look at different methods of delivery
and this might come at the expense of some of the things that the Department
was trying to do. The Department might end up having to get a highly
capacitated company or institution to come and wipe off the backlogs and then
address issues like poverty and unemployment differently. The decision would
have to be taken at policy level.
Mr Robertson asked all departments to indicate if their budgets spoke to the implementation
of the strategic plans. Departments were not talking to each other and each one
seemed to be doing its own thing willy-nilly. There was a lot of unnecessary
duplication. The major contribution to lack of delivery was communication
between departments.
Mr Sindane replied that it was not a perfect process but the Department was
trying to ensure that municipalities and the departments spent according to
their plans. He understood the concerns around collaborations and
communication. It was the structure of the country's governance that was
promoting some of the problems. Some of the countries that had similar
structures or systems had done away with them. The structure had lasted for
about one year in Ghana, two years in Kenya and four years in Uganda. People
had felt that the structure was time wasting and had blotted the civil service
and led to unnecessary duplications. Sometimes it looked like the best of the
worst of the structures. The relationships that were between people far
outweighed the laws that they were implementing. Everything hanged on the
communication between people who had to deliver the services. Communication was
one of the most elusive concepts. He could understand the lack of evidence to
support that there was communication.
Ms C September (ANC) said that the Select Committee on Finance was going in the
right direction by arranging a meeting like this. The Portfolio Committee on
Water Affairs and Forestry could give the Select Committee some insight on some
of the issues under discussion. She said that the presentations had given
pictures different from those that the Portfolio Committee had seen during its
oversight. Targets had not been met in some instances and this was a course
for concern. The Constitution had devolved the provision of services to
municipalities but also provided for concurrent powers. The issue was the
extent to which the issue of concurrence was compatible with the
Intergovernmental Relations Act. Provincial departments were singing from their
own hymn sheet as opposed to the five-year plan. Departments had always said
that Treasury had some regulations that provided for the manner in which they
should report. The regulations had some impact on service delivery. She asked
Treasury to comment on this. It was disappointing that Treasury's presentation
had not touched on this issue in relation to collaboration.
Mr E Sogoni (ANC) [Gauteng] said that Ms September had indicated that the
presentations were different from the signals on the ground. The DPLG
presentation had indicated that over 95% of the MIG was spent last year. The
devil was in the details. There were municipalities that had not spent their
grants. One could not really see how things like Project Consolidate were
supporting weaker municipalities that had not spent their grants. Mamusa and
Taung municipalities could not spend their MIG and they were the people who
needed the funds. He wondered what kind of support was given to them. DORA
provided for different kinds of grants. The municipalities within the Bojanala
Platinum District Municipality had indicated their needs to the Committee and
were of the view that the DBSA should assist them. DORA made provisions for
departments to support municipalities but municipalities were asking for support
from the DBSA. Where was the problem? Why did municipalities not go to the
departments that were supposed to help them? He wondered if DPLG was
collaborating with DBSA in relation to capacity building in municipalities.
DBSA and DPLG had similar programmes and this raised the issue of
collaboration.
Mr Baloyi was tempted to defend the DBSA but this was not the purpose of this
forum. The objective was to listen attentively to stakeholders. The key
question was how the Department funded municipalities particularly in instances
where funding had already been provided by government in terms of DORA. He said
that he would prefer to come back to the Committee with a structured response
to the issue. There were mitigation circumstances because the DBSA funding came
with advisory and capacity building services. The reason why there was
confusion around capacity building in municipalities was that there was no
distinction being made between capacity building and capacity deployment. The
Siyenza Manje Initiative dealt with capacity deployment. There were generic
capacity activities in which the DBSA was involved. The Bank had looked at
those activities to ensure that it minimised duplication. The Director General
of the DPLG could attest to some of the joint initiatives in which the DPLG and
DBSA were involved.
Ms Nhlapo replied that the Siyenza Manje Initiative was still very new. It was
an element of Project Consolidate based on the principle of hands-on support.
The Bank had learnt some lessons in the last four years in which it was
involved in capacity building. One of the lessons was that to simply give
grants might not be adequate in addressing institutional problems in
municipalities. The Siyenza Manje initiative was conceptualised together with
Treasury and DPLG. The Bank had been tasked with implementing the programme on
behalf of the government. It had used the information that DPLG had put
together in the past two years of Project Consolidate. 136 municipalities had
been identified and the Bank was starting with those as the basis.
She said that the Bank was giving support and extending Project Consolidate by
providing technical support. It had decided to create a niche for Siyenza Manje
and this was to look at infrastructure implementation. The support and
expertise provided to municipalities were meant to unlock the blockages.
Municipalities were facing a lot of challenges in relation to accessing and
spending MIG. It would take three to four years to get the situation under
control. Sinyenza Manje was ensuring that there was collaboration amongst
departments because it involved various departments.
Mr Sindane replied that there were areas that were clear domains of local
municipalities in terms of functions. These included water supply and
sanitation. Municipalities received money directly from Treasury and topped it
up with their own money. The money received by DWAF was targeted to certain
activities like looking after dams and canals and some of it was used for
monitoring and supporting municipalities. Municipalities normally asked for
outside funding when addressing their own areas of capital expenditure. The
DBSA could explain why it gave loans to municipalities.
Mr Z Ntuli (ANC) [KwaZulu-Natal] said that he had recently visited Zululand
municipality in KwaZulu-Natal. People in Abaqhulusi had argued that electricity
was to be supposed delivered by Eskom and others argued that it should supplied
be by local government. People had said that it was the duty of the District
Mayor to supply water in rural areas and that local municipalities should
supply water to urban areas. He asked who decided on who should supply
electricity or water to a certain area. There was a lot of acting municipal
managers and the trend had continued for some time. He asked what were the
reasons for appointing people on acting capacities. This was hindering service
delivery because people did not knowing if they were coming or going. DME had
referred to indigent policies. He wondered which municipalities had indigent
policy. Those that had such policies had not implemented them and those that
had been implemented were not working properly.
Mr Sindane (DME) replied that the distribution issues came from the Electricity
Act of 1987 and this Act predated the Constitution. The new Electricity
Regulation Act took this into account by giving meaning to Schedule 4B issue of
electricity reticulation being a municipal mandate. There was a process in
Parliament to deal with this. All municipalities were licensed in respect of
their distribution business and those that were not licensed were serviced by
Eskom.
Mr M Goeieman (ANC) [Northern Cape] said that municipalities were expected to
perform yet departments were not playing their roles and did not pay for
service rendered by municipalities. He wondered if it was not possible for
departments to send a particular amount of money to municipalities in advance
just to give an assurance that there would be payment for services. The
Committee was informed that departments owed R39 million to municipalities in
North West. This was a lot of money and municipalities that were suffering were
in that area. There houses that had no electricity or toilets somewhere near
Pampierstad. He asked what could be done to ensure that departments paid for their
services.
Ms L Mabe (ANC) was disappointed by Treasury’s presentation. Treasury should
take its responsibility seriously and should do what it had been requested to
do. She had expected the presentation to indicate how Treasury had assisted
co-ordination in municipalities so that service delivery was not hampered. One
could not have all departments involved in capacity building in the absence of
co-ordination because they might end up repeating the same training. Was
capacity building done in consultation with other departments? One could have
officials spending too much of their time out of office attending conferences,
workshops or training on the same topic. DME had indicated that the delays in
procuring solar panels were due to international demand. This was related to
co-ordination and the question was what had DME and the Department of Science
and Technology done to ensure that the challenge was met.
Mr Sindane (DME) replied that there was an immediate problem in relation to
solar panels. There was an initiative to partner with a certain entity in order
to manufacture solar panels locally.
Mr Sindane said that the departments had tried to co-ordinate capacity
building. Capacity building was sometimes sectoral. For instance, DWAF might be
interested in sanitation but it would try and ensure that DPLG was involved in
the process. This ensured that no two structures arrived at same municipalities
to do the same thing. He said that he had met the East Rand Water Care company
(ERWAT) and the company had indicated that it had extra capacity on waste water
treatment plants and training capacity but it was not being used by
municipalities. Sometimes there was a feeling that the resources that were
available for capacity building were more than the capacity building needs.
Mr Nkosi said that there was a need to examine the nature of collaboration. At
what level did the collaboration take place? It did not help for departments to
send junior officials who had no decision-making powers to meetings that were
supposed to take the issues of project implementation forward. The
collaboration should be taken to a higher level so that decisions taken in
meetings could be implemented. Departments should understand that they would
have to delegate some of their powers to some forums once they entered into
collaboration with other departments. The experience was that the forums were
mere forums in which discussions took place. They should have certain powers
for them to be meaningful. People had always raised the problem of having
functions being delegated to them with no money following the functions. This
has to change so that there could be delivery on the delegated functions.
Mr Sindane replied that the sending of junior officials to meetings was a real
problem. A person who dealt with cross cutting issues would like to have all
departments in attendance at the same time. The reality was that people were
wanted in various places at the same time. It was important to ensure that
officials did not spend all their time in the office or in meetings. Some kind
of balance should be struck. It was important to have senior officials in the
meetings but this was not easy to achieve.
Mr Z Kolweni (ANC) [North West] asked what mechanisms were in place to ensure
effective and efficient debt collection by municipalities. He also asked if the
collaboration between DWAF and other departments was working well in the
absence of Waters Affairs and Forestry MECs in the provinces. There were lots
of structures that were active in water affairs and forestry and one wondered
if their activities were in harmony with what provinces were doing.
Ms Msengana-Ndlela replied that the norm in debt collection was 45 days. The
Department was saying that there had been improvements and Namakwa could
collect debts in 19 days. Bophirima could collect debts in 14 days. There were
experts that had been deployed to areas that could not collect debts within a
reasonable period of time.
Mr Sindane replied that that collaboration was working well despite lack of
MECs but there was room for improvement. Most Premiers knew of DWAF not because
they knew the Minister but because they knew the regional officers in their
provinces. Not having an MEC had not been a hindrance but had enabled the
Department to use the existing structures to its advantage.
Ms F Nyanda (ANC) [Mpumalanga] said that Eskom had said that they were
electrifying households. She asked how Eskom monitored illegal connections.
People were connecting free of charge and not paying for the electricity that
they had used. Sometimes employees of Eskom were involved in the illegal
connections.
Mr Ntsokolo replied that illegal connection was a big challenge that Eskom was
confronting everyday. Meter readers were responsible for drawing integrity checks
of the metering and the system and reported back to office. The big challenge
was on the prepaid meters because they were inside the houses. Access to the
houses in order to inspect the meters was the number one problem. People who
had bypassed the meters would normally not give access to their houses. Eskom
did a low consumption report on a monthly basis. This looked at how much
electricity people had purchased and used. Eskom had a very strong disciplinary
approach or measures against staff and members of the public who were involved
in illegal connections.
Ms S Molokoane (Chairperson: Municipal Finance-SALGA) congratulated the DME for
establishing the IDP Engagement Forum. The challenge was for other departments
to lend their hands and participate fully in the process. IDPs were frameworks
for development at local government. The DME presentation had indicated that
there were about two areas where municipalities or beneficiaries could receive
free basic electricity. The DME had referred to funding agreements and
technical targeting. Municipalities were in favour of service level agreements.
The service level agreement was better because it was supported by the
Municipal Finance Management Act and the Municipal Structures Act. She asked if
technical targeting would be reliable given the high level of migration. It
could be assumed that some people were rich and had two or more houses and that
this resulted in less usage of electricity. Such people could still receive
free basic electricity in terms of the formula. Very poor families could be
classified as high consumption families. This could due to the fact that the
grandparent was staying with many grand children. Technically, technical
targeting could not really indicate if the free basic electricity had gone to
the people who were supposed to benefit.
Mr Sindane (DME) replied that the issue of free basic services and targeting
was a very involved discussion. A study was conducted to look at approaches to
expedient targeting. One was able to identify or target the indigent much
better by looking at the demand patterns. The Department believed that this was
the cheapest way of targeting. The biggest issue was one of leakage and there
could be a lot of leakage if there was no proper targeting. Poor targeting
would lead to everybody getting the free basic electricity. The Department
believed that technical targeting resulted in less leakage.
Mr Ntsokolo replied that Eskom would like to engage with SALGA on the issue of
service level agreements. There was a National Task Team that deliberated on
such issues to ensure that there was one uniform approach across all
municipalities. The Vryheid municipality might have some answers on the issue
of targeting. It was using a very good indigent targeting approach.
Mr Sokopo replied that a high-level universal access plan was on the table.
Eskom was busy stream lining its activities so that it could be able to roll
out when funding became available. There was a need for a guarantee on up front
funding to be able to put infrastructure in place to support the connections.
One of the issues was the need for assurance to be able to gear up the
industry. There was also the question of material to meet the high number of
connections, human capacity and training to undertake a programme of such
magnitude.
Mr D Botha (ANC) [Limpopo] said that Members could sit and identify problems
but nothing would happen if national departments were not playing their part.
There was a problem of co-ordination with district municipalities not informing
local municipalities of what was happening.
Mr Shiceka asked if there was a need for a situation where there would be wall
to wall water boards. Should the inherited distorted situation in relation to
water boards continue? Should the water boards be rationalised so that people
benefited?
Mr Sindane replied that one of the exercises that the Department was busy with
was the reform of the water boards. DWAF was also in the process of
transferring a lot of infrastructure to municipalities. It was looking at the
evolution of the Regional Electricity Distributors from very close quarters to
see if there were any lessons it could learn. The Department was of the view
that water boards should form part of the nucleus of the future regional structures
that would supply bulk water. The process was right at the beginning and there
was still time for people to make some input on how best they thought the new
regional water boards should look like. One approach could be to ground the
structures within district municipalities and tailor them to fit in with
district municipalities. The Department was open to ideas on how to take the
process forward.
Mr Ralane said that it would be useful to look at how the implementation of the
Intergovernmental Framework act was progressing. DBSA, Treasury and DPLG should
improve performance on the MIG especially in the 29 municipalities that had
under performed. DBSA had launched the Sustainable Communities programme and
the question was the extent to which it had interacted with other stakeholders.
The Committee would still have to look at the issue of skills and capacity
given that different departments were involved in these matters. There were
various sources of funding and the issue was how departments harnessed all
those funding in order to deliver services effectively.
He said that there were no reasons why municipalities did not have Chief
Financial Officers given the fact that there was the Municipal Systems
Improvement grant (MSIG). Part of the framework of the grant was to provide for
the employment of properly qualified people. Parts of the MSIG and local
government restructuring dealt with LEDs and this raised the issue of
collaboration. Eskom should align its service delivery with IDP as required in
terms of section 23 of DORA. Eskom should report to Treasury, DME and
municipalities and not to the DPLG. He wondered if there was a gap in DORA that
had to be tightened in relation to reporting. There should be an audit of
delegations that were not followed by funding so that there could an enquiry on
how this had happened.
Mr Shiceka said that there should be follow up on the following issues:
- the Regional Electricity Distributors (REDs) because they affected the
financial situation of municipalities.
- Targets set by DME and whether they would be met. The issue of technical
targeting should be revisited. There should also be engagement on alternative
forms of energy.
- The structures of co-ordination and the allocation of functions between
district and local municipalities in relation to basic services.
- The standard of service delivery on the ground. Rural municipalities often
did not have electricity during windy weather conditions.
- There was the issue of Rand Water service agreements that had not been signed
by municipalities in Gauteng.
- The seniority of officials sent to meetings that were expected to take
decisions was a very serious issue. An organisation should be able to take
decisions quickly in order to be effective. It was not desirable to have
policies gathering dust on the desk of an individual.
The meeting was adjourned.
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