3.1.2 Offices
Offices were secured at I’parioli Block B2, 1166 Park Street, Hatfield, Pretoria 0083. The Postal Address of the Board is: Private Bag X28, Hatfield, Pretoria 0082.

3.1.3 Relationship with the IEC
Discussions were begun to ensure that a co-operative relationship is established between the Demarcation Board and the IEC. Discussions with the IEC include: the use of the existing IEC boundary shapefiles and infrastructure.

3.1.4 Information and data bases
The Municipal Demarcation Board began the process of developing a set of databases which would allow the interrogation and interpretation of the factors and objectives of demarcation as contained in the Municipal Demarcation Act (sections 24 and 25).

Municipalities were again requested to provide the Board with all available data they may have describing the factors and objectives.

3.1.5 Consultants
The Board appointed a set of consultants to assist it in the process of policy formulation as outlined below. Dataworld were appointed as the Board’s lead information and research consultants.

3.2 FRAMEWORK FOR DEMARCATION
In order for municipal elections to be held around 1 November 2000, the Board set a number of target dates for the completion of the work:

· Phase 1: Board focuses on developing policy statements on rationalising municipalities and draft frameworks for demarcation.
· Phase 2: Finalisation of Metropolitan and District boundaries.
· Phase 3: Finalisation of Municipal Boundaries.
· Phase 4: Finalisation of Ward boundaries..
· Phase 5: Finalisation of functional boundaries: health, transport, magisterial districts, etc

3.3 POLICY DEVELOPMENT
The Board undertook research and policy work in the following areas:

· Developing spatial and attribute bases: On the spatial side, the IEC boundary files were verified and then used in the development of the spatial data base to be used in the demarcation process. Additional databases were also integrated into the syatem.
· Identifying areas of traditional rural communities, linked also to land tenure and land restitution/claims process.
· Policy on factors and objectives to be used in determining boundaries.
· Metropolitan boundaries: The Board developed a strategic framework for assessing metropolitan and other urban conurbations in order to provide inputs to the Minister’s process of determining nodal points.
· District Council boundaries: A strategic framework for District Councils was developed which, for the first time, properly places the functions to be performed by District Councils at the centre of the process of determining District Council boundaries.
· Cross boundary areas: The Board prepared a framework for utilisation by national and provincial governments in assessing CBAs and identifying whether or not there should be Cross Boundary District Councils/Metropolitan Councils or Cross Boundary Municipalities.
· Rationalisation of municipalities: A framework outlining the approach of the Board to the process of rationalising municipalities also received attention.

3.4 AD HOC DEMARCATIONS
The Board adopted the following approach to dealing with ad hoc demarcations:

· Ad hoc demarcations would only be considered if they are urgent, are minor, are for developmental reasons and are unlikely to be controversial.
· The following information had to be provided by applicants: a map of the relevant area, a point-to-point description, if a traditional authority/magisterial district is affected details of how it is affected, letters from affected municipalities indicating the concurrence of their councils with the proposed exclusions and/or inclusions and any other information which may be useful.

During the past two financial years some 65 requests for ad-hoc boundary determinations were received of which 30 were approved by the Board. The Board believes the long and tedious process to deal with ad hoc determinations requires an amendment to the Act.

3.5 STAKEHOLDERS AND ROLEPLAYERS
Very productive meetings have been held with the following:

· National Parliamentary Portfolio Committee;
· Minister and officials of DCD;
· MECs;
· SALGA and its affiliates;
· Houses of Traditional Leaders;
· National Departments;
· Political parties in the legislatures;
· Key private sector agencies;
· Key NGOs.

In almost all cases the stakeholders and roleplayers have agreed that they would support the process as detailed by the Board and would not pre-empt the demarcation process through encouraging the development of demarcation options outside the agreed process.

3.6 FUNDING
Due to the delay in appointing the Board it was not possible for the Board to utilise the budget allocated for the 1998/1999 financial year and the Ministers for Finance and Provincial Affairs and Constitutional Development were approached for a roll over to the 1999/2000 financial year in terms of section 36 of the Act. With an amount of some R30 million available for the functions to be performed during 1999/2000 the Board realised that it would have to employ innovative methods to perform its functions within the limited amount allocated. Taking into consideration that the Board replaced nine provincial demarcation boards and that it would be responsible for one of the key mechanisms for transforming local government, sufficient funds would have to be provided to the Board over the next few years.

4. ACTIVITIES DURING THE 1999/2000 FINANCIAL YEAR (1 APRIL 1999 TO 31 MARCH 2000.)

4.1 GENERAL
During the present financial year the Board focussed on the determination of the outer boundaries of category A, B and C municipalities, although some work was done on the alignment of government boundaries.

The Board was involved in numerous activities during this financial year including Board meetings, workshops with MECs, Organised Local Government, Houses of Traditional leaders and various Ministers and Government Departments, more that 140 public meetings on the boundaries of Category B municipalities, more than one hundred specific investigations, public participation through the media and other means of communication.

4.2 NODAL POINTS FOR METROPOLITAN AND DISTRICT AREAS
Extensive research was done to advise the Minister on the declaration of nodal points for metropolitan areas. The public were also invited through advertisements in the media to participate in this process.

4.3 THE DETERMINATION OF METROPOLITAN AND DISTRICT COUNCIL BOUNDARIES
The Municipal Demarcation Board published a Section 26 notice on 10 August 1999 inviting views and representations on the determination of the boundaries of all category A (Metropolitan) municipalities; the boundaries of all category C (District) municipalities; and possible municipal boundaries extending across provincial boundaries.

The Notice followed:

· the Board's issuing of a general Framework on nodal points for District and Metropolitan areas in South Africa and which was published on 28 June 1999; and
· Minister FS Mufamadi declaring on 06 August 1999 that Johannesburg, Cape Town, Durban, Pretoria and East Rand would be metropolitan areas.

By close of business on 1 September 1999, over 350 submissions had been received responding to the Board’s Framework and the Section 26 notice.

In addition, the Board continued to undertake its own investigations into the possible boundaries for Metropolitan and District councils in South Africa.

After discussions in committees of the Board, and confirmed at the Board meeting on 5 September 1999, the Municipal Demarcation Board decided to make available to the public at large draft boundaries for Metropolitan and District council boundaries throughout South Africa. These boundaries and comments received by the Board were investigated over a few weeks by some 25 technical teams.

Parallel to, and a necessary part of this process was the investigation of possible Cross Boundary municipalities. In communications with the Minister, the Board was encouraged to make known its own determinations on possible Cross Boundary areas in order that these could be dealt with through a single piece of legislation and after consultation with the governments concerned.

The Board’s preliminary view was that there were a number of areas which could become Cross Boundary Municipalities.

The board pointed out that the finalisation of Metropolitan and District Council boundaries to a large extent was dependent on a degree of certainty about:

· The revenue base of municipalities
· Staffing
· Future major governmental plans

In this regard, the Board published its views on the financing of municipalities.

Between 6 and 14 October 1999 the boundaries of Category A and C municipalities and possible cross boundary areas were published in Provincial Gazettes.

In addition to its communications with stakeholders, the Board provided, at some 55 selected venues, a copies of the maps of the boundaries of District/Metropolitan municipalities.

4.4 THE CONSTITUTIONAL COURT JUDGEMENT
On 15 October 1999 the Constitutional Court found the following sections of the Municipal Structures Act, 1998 to be unconstitutional:

· Sec.4
· Sec.5
· Sec. 6(2)
· Sec. 13
· Sec. 24(1)

The Constitutional Court judgement clearly stated that, in fulfilling its constitutional obligation to determine the boundaries of the categories of municipalities, the Municipal Demarcation Board must not only apply the criteria for determining municipal boundaries, but it must of necessity, apply the criteria for determining when an area should have a particular category of municipality. Such necessity arises from the fact that the determination of boundaries cannot take place in isolation – it can only occur in relation to the boundaries of a specific category, or categories, of municipality. Without determining the category of municipality, the determination of a boundary becomes a meaningless exercise. The Court argued that the task of applying the criteria when an area should have particular category of municipality naturally falls on the Demarcation Board.

On the question as to whether it is possible to excise amongst others sections 4 and 5 of the Structures Act and as to whether the remaining provisions of the Act give effect to the purpose of the Act the Constitutional Court answered in the affirmative. These two questions relate to the application of the criteria, which, the court found, the Minister has no power under the Constitution to apply. The Court also found that section 2 and 3 of the Structures Act, read with section 25 of the Municipal Demarcation Act provide sufficient criteria to enable the Board to carry out its functions.

4.5 REPETITION OF THE PROCESS TO DETERMINE THE BOUNDARIES OF CATEGORY A AND C MUNICIPALITIES.
In reacting to the court’s judgement, the Board published afresh Section 26 Notices inviting comment from the public at large around the determination of Category A and Category C municipalities.

Based on its earlier research, the Board believed that only the following areas were real contenders as category A (Metropolitan) municipalities:

· Definites: Johannesburg, Cape Town and Durban;
· Probables: Pretoria and East Rand
· Possible: Port Elizabeth.

The Board commissioned a specific study into whether or not Port Elizabeth meets the criteria as laid down in the Municipal Structures Act, which study indicated it did meet the criteria. The Board also consulted with its major stakeholders around the decision on which areas should be metropolitan areas.

At its meeting on November 18 1999, the Municipal Demarcation Board applied the relevant criteria in Section 2 of the Municipal Structures Act and determined that the following areas would be category A areas:

· Greater Johannesburg
· Greater Cape Town
· Greater Durban
· Greater East Rand
· Greater Pretoria
· Greater Port Elizabeth

As at the 15^th November 1999, 827 Category A and C submissions were received by the Demarcation Board. Of these, 525 were nodal or boundary submissions and 302 were submitted as objections.

The number of submissions received varied from province to province. The greatest number of submissions were received from the Western Cape with 35% (279 submissions), followed by Gauteng with 17% (139 submissions), and KwaZulu/ Natal with 13% (110 submissions). The percentage of submissions received drops significantly from here with the Eastern Cape accounting for 9% (78 submissions), Mpumalanga accounting for 7% (62 submissions), the Northern Cape accounting for 6% (49 submissions) and the Free State accounting for 5% (41 submissions). The Northern Province accounted for 4% (35 submissions) and the North West for 4% (31 submissions).

Of the 302 objections, it is important to note that 181 objections were received from Helderberg, 33 from Midrand and 5 from Centurion. Although recorded separately when received by the Board it is significant that most submissions received from these three areas were single line e-mails or single line copies faxed through to the Board with no substantiation of the objection.

After having considered all views and representations the Board determined the boundaries of all Category A and C municipalities and the applicable Section 21 notice was published in the provincial Gazettes from 22 - 26 November 1999. Objections were to be submitted by 31 January 2000.

4.6 THE DETERMINATION OF CATEGORY B BOUNDARIES
A detailed description of each phase for determining the category B boundaries is outlined below.

4.6.1 Phase 1: Policy Formulation
From the outset of the process, a small team of consultants was appointed to examine the legislative guidelines and the implications thereof for the drafting of a framework for determining category B municipalities. The following legislation was examined in detail:

· Constitution of the Republic of South Africa, No 107 of 1996
· Local Government: Municipal Demarcation Act, No 27 of 1998
· Local Government: Municipal Structures Act, No 117 of 1998
· The White Paper on Local Government, March 1998

A document was released on the Internet indicating the Board’s initial thinking with respect to category B municipalities. It highlighted some key considerations namely settlement types, the rationalisation of municipalities, manageable size and the Board’s initial approach to the use of district management areas. This document was refined considerably after a more detailed examination of the legislation, spatial and functional analysis and the broad aspects of financial and administrative capacity. The draft published towards the end of October 1999 contained the following extract of the guiding principles:

4.6.1.1 Rationalisation of Municipalities
The demarcation of Category B municipalities needs to proceed in terms of the factors as described in Section 25 of the Municipal Demarcation Act. Some degree of rationalisation of municipalities is required. It is the Board’s view that, in the light of this, key principles for the rationalisation (and/or amalgamation) of municipalities include the following:

· Geographical contiguity: Because municipal government is so closely tied to local identity and accessibility to local representatives, rationalisation should generally follow ‘nearest-neighbour’ principles – that is, there be geographically coherent consolidated Category B municipalities, and not ‘leap frog’ amalgamations of areas. Not only are geographically fragmented municipalities impractical from a service delivery perspective, but the important function of local government in building a local, developmental identity and sense of common civic purpose, is undermined.

· Capacity development: Another objective of rationalisation / amalgamation should be to develop a minimum ‘critical mass’ of municipal capacity (staff, assets, finances), especially where vulnerable and under capacitated TLCs and TRCs currently exist. Very small municipalities lack the potential to develop the specialised and dedicated capacity that is necessary to effect good town planning, engineering and development management and general service delivery in a country which is undergoing significant modernisation and change in its settlement systems. Moreover, accessing capital markets and the ability to provide ‘higher order’ services (such as libraries) is considerably weakened especially in small town and rural contexts where municipalities are too small.

· Resource sharing: Wherever possible, current TLC’s, TRC’s and/or other areas should be combined with a view to realising fiscally sustainable units, with ‘weaker’ areas being paired with ‘stronger’ areas so as to achieve a sharing of existing or potential resources. Unless this is done, there is every possibility that many of the smaller or weaker authorities will collapse; or islands of exclusive development may emerge up against which under-serviced and unplanned settlements are likely to emerge. Neither the likely waste of the infrastructure of collapsed local authority areas nor the preservation of islands of privilege abutted by under-serviced areas will contribute towards a rational settlement landscape and use of scarce national development resources.

4.6.1.2 Manageable Size
A statistically derived indicator of 3 500km² and 80 000 persons was suggested as the probable norm for Category B municipalities. However, deviations from such a norm are possible given the uneven geographical distribution of population and economic activity throughout the country. Illustratively, there are some cities / large town, which need to be treated as functional units with populations in excess of 1 million. At the other end of the scale, there are sparsely settled rural/small town areas where a population of 80 000 would require undesirably extensive geographical areas. The Board’s empirical research suggests that population of less than 20 000 are generally undesirable for Category B municipalities given the objectives of realising economies of agglomeration and scale in municipalities. On the other hand, given the need for geographical coherence and local identity, areas greater than 10 000 km² are also desirable.

It should however also be recognised that there will often be an inverse relationship between the geographical size and population size of Category B municipalities. Sparsely settled areas of the country will have Category Bs of relatively large geographical area, but relatively small population size. Densely settles areas (eg cities) will be relatively small in geographical size but will have large populations. This is a logical result of the uneven pattern of population distribution and settlement size that occurs throughout the world.

4.6.1.3 Functionality
Category B municipalities should be aggregates of places with significant internal linkages. Such linkages are evident in shopping and work travel patterns. Patterns of social interaction, economic interdependencies, and shared transportation networks amongst other considerations. However, functional linkages are never entirely discrete and there will always be some degree of functional linkage across Category B municipal boundaries. The idea is to maximise the internal linkage whilst minimising the external linkages.

It is recognised that in any alignment of wall-to-wall (or near wall-to-wall) boundaries for Category B municipalities, tradeoffs must arise as to whether some ‘X’ might be allocated to adjacent municipal areas ‘Y’ or ‘Z’. In such circumstances, a most important consideration is the functional links between places – that is to say, whether such a place ‘X’ is interdependent or whether it interacts more with the places in areas ‘Y’ or ‘Z’.

To some extent, functional interdependence is a result of geographical proximity (or distance), but not always. Illustratively, the alignment of transportation routes and physical features (such as a coast) can alter patterns of functional interdependence of some places into a more linear than a circular pattern. In yet other cases, places which may be close together ‘as the crow files’ are divided by an impassable mountain range. As a result they interact very little. Maximising the internal functional linkages between places can therefore mean a different matter than simple distance between places.

For this reason, the ‘jig-saw puzzle’ of boundaries which make up the logical Category B pattern will not necessary be geometrically similar from District council to District Council and from Province to Province. But having said this, functionally is usually an additional qualifying factor to, or an elaboration upon, the principle of geographical coherence as described above.

The above mentioned framework was developed with due regard to the provisions of sections 24 and 25 of the Municipal Demarcation Act and provided the Board with a means to evaluate broad areas for demarcation purposes. However, in the evaluation of submissions in terms of section 26 of the Act the Board specifically took into account the factors provided for in section 25 of the Act.

The above framework was presented at a Stakeholder meeting on the 4 November 1999. In addition, the document was released on the Internet.

4.6.2 Phase 2: Legal Process – Section 26 Notice
In terms of section 26 (1) of the Local Government Municipal Demarcation act No 27 of 1998, before the Board considers any determination of a municipal boundary in terms of section 21 of the Act, it must publish a notice in a newspaper circulating in the area concerned. The notice must state the Boards’ intention to consider boundaries and inviting written representations and views from the public. The stipulated period for such responses may not be less than 21 days. The section 26 notice for category B municipalities was published accordingly on the 11 October 1999 with the closing date on the 2 November 1999.

The Board received two hundred and nineteen submissions with the majority emanating from the larger provinces of the Western Cape, Eastern Cape and Kwa Zulu Natal. A poor response was received from the provinces of the North West, Mpumalanga and the Northern Province. The table outlined below provides more detail with respect to the number of submissions received per province: