The following speech was delivered in Parliament today by the DA’s Shadow Minister of Cooperative Governance and Traditional Affairs, Kevin Mileham MP, during the Budget Vote on Cooperative Governance and Traditional Affairs.
Chairperson,
It’s rather astounding that 3 years after the “Back to Basics” programme was announced, no assessment has been done to determine whether the situation has improved.
Lest we forget: at its launch, then Minister Pravin Gordhan noted that roughly a third of all of South Africa’s municipalities were dysfunctional, a further third were “at risk”, and the final third were performing well. The last time any assessment was done, in February 2015, 29% of municipalities were considered dysfunctional, 31% at risk, and 40% performing well. This begs the question: just what has COGTA been doing for the past 3 years? No significant improvement and no assessments to determine whether things are getting better or worse.
According to a presentation this week from the Department of Cooperative Governance to the Portfolio Committee, 86 municipalities are not viable. And some 205 municipalities rely on grants from the national fiscus for more than 75% of their revenue according to the section 71 reports they submit quarterly to National Treasury. This is indicative of a system of local government in disarray. Unless municipalities can generate their own revenue, they face financial failure. Coupled with excessive and rapidly growing salary bills, it should be no surprise that many municipalities are unable or unwilling to comply with the National Treasury guidelines regarding the minimum amount to be allocated to maintenance and renewal of infrastructure.
On this latter issue, it is abundantly clear that the Medium Term Strategic Framework (MTSF) is not going to achieve its objectives in relation to municipal bulk infrastructure. Again, information provided by the Department just this week shows that, with 60% of the MTSF timeframe expended: Only 12% of the targeted 2.3 million households have been given access to water through this programme; and
- Only 12% of the targeted 2.3 million households have been given access to water through this programme; and
- Only 17% of the targeted 2.5 million households have been given access to sanitation.
And that is just two of the indicators!
Salary increases that outstrip inflation, in all spheres of government, are making the provision of services unaffordable. It is interesting to note that in the DA-governed Western Cape, salaries comprise just 53.2% of the total provincial budget, according to the latest provincial budget and expenditure report. And this is the lowest percentage of all the provinces, by a clear margin. And the same is true in DA governed municipalities, because where we govern, there are no “jobs for pals!”
We welcome the progress municipalities and National Treasury are making on implementing a standard chart of accounts at municipal level. We are, however, concerned that a number of municipalities are not going to be ready to roll-out the Municipal Standard Chart of Accounts (MSCOA) system on 1 July, as required by National Treasury. The reduction in the Municipal Systems Improvement Grant will have a significant impact on municipalities’ ability to implement this, and may result in further financial instability in our municipalities.
During the 2016 State of the Nation Address, it was emphasized that excessive and wasteful expenditure must be reduced, and that action must be taken to manage unnecessary expenditure. The Municipal Finance Management Act (MFMA) Circular 82 highlighted the following areas of cost containment that should be implemented at local government level, including:
- The curtailment of overseas trips;
- The requirement of a detailed motivation for all travel, whether local or international;
- The discouragement of the use of business class flights;
- Restrictions on the employment of consultants, including the requirement that a “gap analysis” be conducted to determine the need for the consultants and restrictions on the fees charged to equal or less than their industry standards;
- Regulations guiding the use of accommodation when travelling;
- Encouragement of the use of municipal facilities for meetings, rather than offsite workshops, indabas etc.;
- A prohibition on the issuing of municipal credit cards; and
- A curb on spending on conferences, catering, entertainment and social functions.
While we welcome this initiative from former COGTA and Finance Minister Gordhan, it is sadly mostly ignored – as was evidenced in Umgeni Municipality who decided to hold a “Strategic Workshop” at the luxury Edward Hotel in Durban. Interestingly, the entire ANC caucus booked in for an extra night the evening before the conference, to discuss “other business” at ratepayer expense. The bottom line, one that is often repeated by the Auditor-General, is that there is zero accountability and a complete lack of consequence management. But why should we be surprised – the ANC of 2017 has learned well from Number 1, and his able lieutenants, including Minister Des van Rooyen.
We note with extreme concern that political battles continue to play out at a local government level. The dissolution of Nquthu Municipality is one example of how the ANC puts its faction fights ahead of the people of South Africa. But other examples abound. The political hypocrisy evidenced by the ANC in acceding to the AIC’s demand for Matatiele to be reincorporated in KwaZulu-Natal, simply so that they can hold onto power in Ekurhuleni is breathtaking. And then we have Gauteng MEC Paul Mashatile, who has indicated that he wants to withdraw all municipal powers and functions from the DA-controlled Mogale City municipality, and vest them in the ANC-controlled West Rand District Municipality, not because Mogale City is failing to deliver, but because it puts the ANC back in charge of the biggest cash cow in the district.
Chairperson, last year I was thrown out of this house for calling the Minister a two minute noodle. This year, I’ve been racking my brain to figure out what you call a Minister who has accomplished absolutely nothing. Who is more absent than present, but who shows up at any JZ783 event, and pretends to have military veteran credentials.
Maybe that’s why we see him in camo gear so often – he’s hiding from his many failures. So, instead, I’m not going to call him anything. I am, however, going to challenge him.
I challenge him to present a report on the effects of amalgamating municipalities prior to the 2016 Local Government Elections. I challenge him to show leadership on the Vuwani matter. I challenge him to ensure that municipal officials and public representatives are held responsible for any and all misconduct.