ATC190219: Report of the Select Committee on Cooperative Governance and Traditional Affairs Inspection Loco on Notice of Intervention issued in Terms of Section 139 (1) (b) of the Constitution in Kagisano Molopo Local Municipality, dated 19 February 2019

NCOP Cooperative Governance & Traditional Affairs, Water and Sanitation and Human Settlements

Report of the Select Committee on Cooperative Governance and Traditional Affairs Inspection Loco on Notice of Intervention issued in Terms of Section 139 (1) (b) of the Constitution in Kagisano Molopo Local Municipality, dated 19 February 2019
 

1.         Background and Overview

 

1.1        The Select Committee on Co-operative Governance and Traditional Affairs, having considered the request by the National Council of Provinces (NCOP), to consider and report on the intervention notice invoked in Kagisano Molopo Local Municipality in terms of section 139(1)(b) of the Constitution, the Select Committee reports as follows:

 

1.2        In terms of NCOP Rule 101, the Office of the Chairperson of the NCOP referred the notice of intervention by the North West MEC for Cooperative Governance, Human Settlement and Traditional Affairs (CoGTA), to the Select Committee for consideration and reporting. On 30 January 2019, the Select Committee conducted a loco inspection in Kagisano Molopo Local Municipality.

           

2.         Objective of the Loco Inspection in Kagisano Molopo Local Municipality

 

2.1        The main objective was to interact with the internal and external stakeholders of the Municipality in order to solicit their opinions on the constitutional, procedural and substantive matters related to the invocation of section 139(1)(b) of the Constitution.

 

3.         Composition of the Delegation

 

3.1        The Select Committee delegation was composed of the following Members of Parliament and officials: (ANC); Hon T Wana, Eastern Cape (ANC); (ANC); Hon G Oliphant, Northern Cape (ANC); Hon D Ximbi, Western Cape (ANC); Hon E Matame Limpopo (ANC); Mr TM Manele, Committee Secretary (Committee Section), Mr B Mahlangeni, Researcher (Research Unit) and Mr N Mfuku, Content Advisor (Committee Section), Mr P Bongco, Committee Assistant (Committee Section) and Mr M Mbebe, Procedural Officer, NCOP

 

 4.        General Overview of the Loco Inspection at Kagisano Molopo Local Municipality

 

4.1        On 30 January 2019, the delegation of the Select Committee interacted with senior officials of the Department of CoGTA, representatives of the African National Congress (ANC), Democratic Alliance (DA), Economic Freedom Fighters, representative of the South African Local Government Association and forums representing organised labour, youth and traditional leaders.

 

4.2.       The Chief-Director made a presentation on the constitutional, procedural and substantive reasons for the intervention. The representatives of the political parties and Organised Labour, shared their opinions with regard to the intervention as tabled by the MEC for CoGTA.

 

5.      Presentation on the Service Delivery and Administrative instability leading to intervention in terms of section 139 (1) (b) of the Constitution 

 

5.1.    The Head of the Department of Cooperative Governance, Human Settlement and Traditional Affairs briefed the delegation of the Select Committee on constitutional, procedural and substantive matters related to the intervention.  The presentation on the substantive matters related to the invocation of the intervention focused on service delivery administrative instability  

 

6.          Service delivery 

 

6.1        The department reported that the municipality experienced service delivery problems that affected the mayor, the council and municipal manager. The supply chain management unit has been influenced by councillors aligned to the business forum to the point where the supply quotations for supply chain management processes to be done in procurement of services   

 6.2.      The municipality had been unable to spend its MIG allocations as it has not appointed the technical director.

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 6.3.      The equitable share allocations were withheld by the national treasury due to the instability in the municipality and this had a potential to adversely affect the delivery of services and labour instability.      

 

7.          Administrative instability  

 

7.1.       Political and administrative infighting rendering compromising the oversight responsibility of the municipality. Auditor-General indicating in its reports that leadership did not adequately exercise appropriate oversight over financial and compliance monitoring and related internal control.

 

7.2.       The local municipality deteriorated from unqualified audit outcome during 2015/2016 financial year to a qualified audit opinion during the 2016/2017 financial year. The current council has suspended the mayor and the chief financial officer, opening for litigation challenges for the municipality.

 

7.3.       The lack of cooperation between the mayor, the municipal manager and the council has led to amongst others, failure to adopt the integrated development plans and budget as prescribed by the legislation 

 

7.4.    The municipality failed to convene statutory council meetings. The council operated through special settings, sometimes council meeting convened by the municipal manager without the knowledge of the Speaker to convene council.                   

 

8.         Terms of the Reference of the Administrator

 

• Stabilise and improve governance and administration within the council and administration

• Facilitate recruitment of senior managers including Municipal Managers where applicable
• Improving the financial controls in the municipality, expenditure management, procurement processes, revenue enhancement and debt collection as well as addressing Auditor General’s reports (MFMA compliance);
• Take corrective action on irregular expenditure incurred; and Improve service delivery through facilitation of new projects, unblocking of old projects, maintenance of infrastructure
• Attend to labour and legal matters, including to investigate and take corrective action on irregular appointment of staff and restore labour stability; outstanding disciplinary cases, if any; labour disputes; functionality of Local Labour Forum; instil culture of work and discipline of workers;
• Investigate all awarded contracts to establish validity and legitimacy thereof, and terminate those that are not legitimate in terms of applicable regulations;
• Improve service delivery prioritisation on water and sanitation services;
• Analyse and implement past and current investigations, commissions of enquiry and forensic audits; and 
• Assumes all powers conferred to in terms of Part 3 of Chapter 10 of the MFMA;
• Assumes all the powers and mandates of the Municipal Manager as contained in section 55 of the Municipal Systems Act, 2000;
• Assumes all the executive obligations in terms of the Constitution or legislation, except legislative obligation as enlisted in section 160(2) of the Constitution;
• Together with an identified section 57 Manager in the municipality, if any, be the main signatory to the bank account of the municipality for the duration of the intervention;
• May delegate certain functions and mandates, as may be deemed fit, to the Municipal Manager to carry out during the implementation of the intervention;
• May deal with any uncooperative and destructive municipal official within the labour relations regulatory frameworks, including suspending such officials from duty, and undertaking disciplinary measures, where appropriate;
• Chair all the Work streams created in the municipality,

 

 

 

 

 

9.       Opinions of Political Parties and Stakeholders of the Municipality  

 

9.1        During loco-inspection, the Select Committee interacted and solicited opinions of the political parties, internal and external stakeholders of the Municipality. Their opinions are tabled below:   

 

10.        Opinion of the African National Congress (ANC)

 

10.1      The representative of the ANC indicated that the municipal council has acknowledged and welcomed the intervention. However, the member of the ANC raised concerns with regard to corruption, political instability.   

 

11.        Opinion of the Democratic Alliance (DA)

 

11.1      The representative of the DA tabled an opinion that was not explicitly clear on supporting or not supporting the intervention. However, concerns were raised with regard to miscommunication on the suspension of the previous mayor and political instability  

 

12.      Opinion of the Economic Freedom Fighters     

 

12.1      The representative of the Economic Freedom Fighters tabled an opinion that supported the intervention, and further raised concerns with matters related lack of service delivery, lack of job creation, political instability and interference in administration

 

13.     Opinion of the Forum for Service Delivery

 

13.1. The representative of the Forum for Service Delivery tabled the opinion that did not support the intervention. Concerns were raised with regard to the failure of the Department of Cooperative Governance, Human Settlement and Traditional Affairs to facilitate consultation and the justification on the invocation of section 139 (1) (b) of the constitution in the local; municipality 

 

 

14.        Opinion of the United Democratic Christian Party

 

14.1.     The representative of the united democratic Christian party tabled the opinion that did not support the invocation of the intervention. Concerns were raised with regard to substantive matters related to intervention. The opinion was that the reasoning for intervention was not clear and convincing. 

 

15.      Opinion of South African Local Government Association

 

15.1.  The representative of the South African Local Government Association tabled opinion that welcomed and supported the invocation of section 13 (1) (b) of the constitution. The representative emphasized with the framework of intergovernmental relation the need to ensure that at both political and technical level, there is a platform for common understanding and approach to the issuing of interventions in the municipalities.

 

16.        Opinion of Organised Labour 

 

16.1.     The representative of South African Municipal Workers Union tabled opinion that did not indicate the union position on intervention. The representative, however, raised concerns with regard to intimidation by senior managers, misuse of municipal cars, mismanagement of funds by the suspended mayor, lack of consultation, and lack of consequence management and lack of clarity on the terms of reference of the administrator.   

 

17.        Opinion External Stakeholders

 

17. 1     The representative of Business Forum tabled the opinion that did not support the invocation of section 139 (1) (b) of the Constitution. However, the Forum representative raised concerns with regard to suspension of the mayor, presentation made by the Department of Cooperative Governance, Human Settlement and Traditional Affairs on the substantive matters related to the intervention.      

 

 

17.2.  The representative of the Youth Forum tabled the opinion that negate the invocation of section 139 (1) (b) of the constitution. Concerns were raised with regard to late notification of the visit of the Select Committee, lack of details in the presentation of the Department of Cooperative Governance, Human Settlement and Traditional Affairs on reasons for intervention.     

 

18.        Select Committee Observations and Opinion

 

18.1      In terms of the constitutional and procedural matters, the Select Committee has observed that the National Minister for CoGTA, the NCOP, the North West Provincial Legislature and the Municipality were notified of the intervention about the substantive matters related to the invocation of section 137 of the Municipal Finance Management Act.

 

18.2      The Select Committee has also noted general concerns raised by stakeholders on matters related to corruption, misuse of municipal cars, lack of consultation on the notice of intervention.

 

18.3.     The Select Committee has noted with concern the absence of Municipal Manager during the oversight visit to the local municipality. noted also with concern is the failure of the Municipal Manager on the 19 February 2019 to provide status report on what the municipality has done during the period of intervention.     

   

18.4.     The Select Committee has noted that on 12 October 2018 the Mayor and Municipal Manager launched an application to the High Court to obtain the orders to nullify the Provincial EXCO’s decision to intervene at Local Municipality in terms of Section 139 of the Constitution of RSA and to nullify the Provincial EXCO’s decision to appoint an administrator for Kagisano Molopo Local municipality

 

18.5.     The Select Committee has further noted that on 26 October 2018 the Judge of the High Court ruled that the application was not urgent, and consequently struck it off the roll with costs. On 26 October 2018, the Municipality through its Attorneys wrote a letter to the State Attorney’s office maintaining that (despite the court outcome) the Sec 139 intervention in Kagisano Molopo LM remains unlawful.  Further that the Municipality will continue to “fulfil its functions”. The municipal leadership remained defiant to cooperate with the Provincial Government nor the Administrator

 

19.        Recommendations of the Select Committee

           

19.1      Having conducted the oversight visit to Kagisano Molopo Local Municipality and interacted with internal and external stakeholders, the Select Committee on Co-operative Governance and Traditional Affairs recommends as follows:   

 

19.1.1   The NCOP approves the intervention in Kagisano Molopo Local Municipality in terms of section 139 (1) (b) of the Constitution  

 

19.1.2   The Administrator should fast-tract the process of implementing the municipal turn-around plan, in accordance with the terms of reference assigned by the North West MEC for CoGTA.

 

19.1.3 The Administrator should provide progress reports on allegation of corruption and misuse of municipal cars and ensure the implementation of proper management consequences.

 

19.1.4 The North West MEC for CoGTA should conduct Forensic Investigation on supply chain management in the municipality and table the report to the National Council of Provinces    

 

19.1.5   The North West MEC for CoGTA should table quarterly progress report to the NCOP on the status of the intervention in the Municipality; including challenges encountered.

 

19.1.6   The Select Committee on Co-operative Governance and Traditional Affairs, in co-operation with the relevant Portfolio Committee in North West Provincial Legislature, should in future conduct a follow-up oversight visit to the Municipality in order to evaluate the progress made in respect of the intervention in the Municipality.

 

Report to be considered.