PRESENTATION TO THE SELECT COMMITTEE ON FINANCE BY DEPARTMENT
OF LOCAL AND PROVINCIAL GOVERNMENT
07 MARCH 2002
OUTLINE
·
Context: Supporting Developmental Local Government
·
Overview of DPLG's Conditional Grants
·
Budget Allocations Summary
·
Overview per individual Grant
CONTEXT OF DEVELOPMENTAL LOCAL GOVERNMENT
·
Overall objective of all conditional grants is to support and build
developmental local government
·
Developmental Local Government is centred on working with local
communities to find sustainable ways of meeting their needs and improve the
quality of their lives
OVERVIEW OF SIX CONDITIONAL GRANTS
A. GRANTS TO PROVINCES:
·
Local Government Support Grant: 2001/2 - R160m; 2002/3 -
Rl70m
· Consolidated
Municipal Infrastructure Programme (CMIP): 2001/2 -R98.9m; 2002/3 - R
104,5m
B. GRANTS TO MUNICIPALITIES:
·
Local Government Transition Grant: 2001/2 - R578m;
2002/3 -R200m
·
Municipal Systems Improvements Grant: 2001/2 - R42.8; 200213
–R93.3m
·
Consolidated Municipal Infrastructure Programme (CMIP):
2001/2 -R927m; 2002/3 - R 1654.5m
·
Local Economic Development (LED) Fund: 2001/2 - R99m; 2002/3
–R98.5m
·
Integrated Sustainable Rural Development (ISRDP) Grant:
2001/2 –R33.02m; 2002/3 – R31.98m
GRANTS TO PROVINCES
LOCAL GOVERNMENT SUPPORT GRANT
·
PURPOSE: To assist municipalities experiencing severe
financial problems to restructure their financial positions and organisations
in the medium term.
·
ALLOCATION PRINCIPLES: Allocation to provinces based on
need. Provinces submit business plans and gazette approved allocations.
Municipalities must have management support team.
·
BUDGET PROVISION: 2002/3- R170m, 2003/4- R160m; 2004/5 -
R143.8m
·
PAYMENT SCHEDULE: Funds transferred to provinces in 2 or
more tranches. First tranche is 50% of allocated amount. All funds disbursed by
August 2002.
·
ASSESSMENT OF PERFORMANCE: 170 municipalities put in more
stable financial position. Auditor General and Eskom have seen positive
improvements. Key lessons learnt in the implementation of credit control and
debt collection policies.
·
DPLG CAPACITY: Restructuring in the Department has put
dedicated internal management in place for this Grant
·
PROVINCIAL CAPACITY: Varied. One additional person set aside
by provinces to assist
CONSOLIDATED MUNICIPAL INFRASTRUCTURE PROGRAMME
·
PURPOSE: To provide support to Provinces to manage CMIP
effectively and build capacity within municipalities.
·
ALLOCATION PRINCIPLES: Based on a percentage of total grants
to municipalities and escalated with inflation.
· BUDGET
PROVISION: 2002/3 - R104.5m, 2003/4 - R110.7m; 2004/5 - R117.4m
GRANTS TO MUNICIPALITIES
LOCAL GOVERNMENT TRANSITION GRANT
·
PURPOSE: To assist municipalities with significant off costs
of amalgamating and establishing new structures following the municipal demarcation
process
·
ALLOCATION PRINCIPLES: Based on estimated off and incidental
costs resulting from the demarcation process. Undertook national survey -
determined individual estimated costs. 2001/2 and 2002/3 allocations
unconditional. Incorporated into the Equitable Share in 2003/04.
·
BUDGET PROVISION: 2002/3- R200m, 2003/4- R0m; 2004/5 – R0m
·
PAYMENT SCHEDULE: Funds transferred to municipalities in
four (4) equal tranches.
·
ASSESSMENT OF PERFORMANCE: All municipalities have prepared
Interim IDPs and 90% have prepared Establishment
Plans
·
DPLG CAPACITY: Restructuring in the Department has put
internal management in place to manage this Grant.
·
PROVINCIAL CAPACITY: Varied. One additional person set aside
by provinces to assist in managing the grant.
MUNICIPAL SYSTEMS IMPROVEMENT GRANT
·
PURPOSE: To support municipalities in implementing the new
systems as provided for in relevant local government legislation, e.g.
development planning, performance management
·
ALLOCATION PRINCIPLES: Municipalities must submit a capacity
development framework~ Must support the establishment of PIMS Centres. Support
to municipalities piloting the performance management system.
·
BUDGET PROVISION: 2002/3 - R93.2m, 2003/4 -R100.4m; 2004/5 -
R132.24m
·
PAYMENT SCHEDULE: Funds transferred directly to
municipalities in 2 tranches.
·
ASSESSMENT OF PERFORMANCE: Contributed directly to
establishing 17 PIMS Centres. PMS pilot municipalities received assistance.
·
DPLG CAPACITY: Restructuring in the Department has ensured
specific internal management. A national PIMS management support is in place.
·
PROVINCIAL CAPACITY: Varied. Provinces are requested to
assist with support and monitoring.
CONSOLIDATED MUNICIPAL INFRASTRUCTURE PROGRAMME
·
PURPOSE: To assist municipalities in ensuring that all South
Africans have access to at least a basic level of municipal services.
·
ALLOCATION PRINCIPLES: Allocations based on a
poverty-weighted formula which takes the following into account: no. of poor
households, unemployment, households without access to basic water.
·
BUDGET PROVISION: 2002/3- R1654.5m; 2003/4-R2096.3m; 2004/5
- R2374m
·
PAYNIENT SCHEDULE: Funds transferred to municipalities in
tranches.
·
ASSESSMENT OF PERFORNIANCE: Over 12m beneficiaries to date.
1406 projects completed. 13m person days of employment opportunities provided.
Minimal rollovers.
·
DPLG CAPACITY: The Department has dedicated management
capacity for CMIP. Assisted by consultants.
·
PROVINCIAL CAPACITY: Varied. All provinces have a programme management
team.
LOCAL ECONOMIC DEVELOPMENT FUND
·
PURPOSE: To assist municipalities in funding innovative
local economic develop initiatives that are aimed at creating jobs, alleviating
poverty and creating sustainable local economies.
·
ALLOCATION PRINCIPLES: Funds are divided between provinces
on a formula basis. Applications are submitted for projects that are part of
the local IDP.
·
BUDGET PROVISION: 2002/3 - R98.5; 2003/4 – R117m; 2004/5 -
nil
·
PAYMENT SCHEDULE: Funds are transferred to directly
municipalities in tranches.
·
ASSESSMENT OF PERFORMANCE: 186 projects supported since
1999/2000, 43 are completed.
·
DPLG CAPACITY: The Department has minimal capacity to manage
the Fund. The merger with CMIP should address the under-capacity here.
·
PROVINCIAL CAPACITY: Varied. Some provinces have LED support
teams in place.
INTEGRATED SUSTAINABLE RURAL DEVELOPMENT PROGRAMME
·
PURPOSE: To support the rural nodal district municipalities
to establish institutional management capacity for planning, project initiation
and implementation of the ISRDP
·
ALLOCATION PRINCIPLES: Available to 13 rural nodes. Focus
will be on project initiation in 2002/3. Grant terminates in 2003/4.
· BUDGET PROVISION: 2002/3 – R32m,
2003/4- nil; 2004/5-nil
·
PAYMENT SCHEDULE: Two payments will be made in 2002/3 (July
2002/January 2003)
·
ASSESSMENT OF PERFORMANCE: PIMS Centres established in all
nodal district municipalities. Focus on building institutional capacity.
·
DPLG CAPACITY: The Department has dedicated capacity for the
ISRDP. The IDT is a support agency to government.
·
PROVINCIAL CAPACITY: All relevant provinces are heavily
involved in the ISRDP. Varied structures in place.