DATE: 28/01/2005

REPORT OF THE M.E.C. FOR HOUSING, LOCAL GOVERNMENT AND TRADITIONAL AFFAIRS TO THE NATIONAL COUNCIL OF PROVINCES FOR THE PERIOD 15 OCTOBER 2004 TO 14 JANUARY 2005 ON ELUNDINI INTERVENTION IN TERMS OF SECTION 139 OF THE CONSTITUTION OF THE REPUBLIC OF SOUTH AFRICA, ACT NO.108 OF 1996 AS AMENDED.

INTRODUCTION

I have pleasure in submitting my progress report for the period ending 14 January 2005 on my intervention into the affairs of Elundini Local Municipality in terms of section 139 of the constitution of the Republic of South Africa.

CONSTRAINTS AND CHALLENGES

Institutional /Administration

· Council meetings not held for lengthy periods-in contravention of Section 18(2) of the Structures Act

· Overlapping of duties of the Speaker and the Executive Mayor leading to conflict Interference in administration by Councillors has been identified as the main cause of mal-administration and mismanagement

· Failure to adopt by-laws.

· Lack of understanding of the role and functions of the Speaker.

· Executive Committee of the Council is not fully performing the functions it should perform in terms of Section 44 of the Structures Act.

· WP not compliant with regulations.

LEGAL

The Department of Housing, Local Government and Traditional Affairs

Instituted an investigation that revealed a number of irregularities, inter alia:

· Members of the executive committee overpaid by R184 494.40

· Councillors owe Municipality R21 049.08 in arrear cell phone charges

· Cell phone allowances to councillors are not in accordance with applicable legislation.

· The upper limit of the contribution to be made by the council to the medical aid scheme of which a councillor is a member is being exceeded in certain instances.

· Interest free loans and advances are granted to councillors and staff.

· Irregular purchase of Mayoral vehicle. Normal tender procedures not adhered to.

· Both councillors and staff are in arrears with their rates and service accounts contrary to their respective Codes of Conduct.

· Expenditure controls inadequate;

· Legal fees exceed budget;

· Councillors and officials receive monthly travel allowances whilst being paid travelling expenses for certain trips

· Arrear rentals of officials receiving housing allowances

· Unauthorised expenditure in respect of trip to China

· 2003-2004 Budget was never adopted by council

· Budget is running on a deficit due to the outstanding valuation of properties. The team therefore proposes an interim valuation

· Credit control and debt collection policies were developed by the Department but were never adopted by the council due to political instability.

BROAD PARAMETERS OF THE INTERVENTION

CORPORATE SERVICES

Develop a turnaround strategy for Elundini Local Municipality that will incorporate an action plan which will focus on the following broad parameters:

· Reviewal of organogram;

· Assist with rationalisation of policies and by-laws focusing on critical HR policies as short term measure;

· Address major infrastructural backlogs that characterise both urban and rural communities of Elundini Local Municipality with specific focus on water and sanitation;

· Creation of clean and healthy environment through the improvement of refuse removal services;

· Meaningful promotion of Batho Pele principles with a clear communication strategy which will endeavour to lessen the number of petitions, promote the voice of the wards through issues such as the demarcation processes, delimitation of wards, elections, etc;

· Assist in the eradication of the bucket system in concert with Ukhahlamba District Municipality.

FINANCIAL MANAGEMENT

· Ensure that statutory timelines for the submission of Annual Financial Statements are met;

· Ensure that council responds to the reports of the Auditor-General;

· Presentation of the financial position of the Municipality to communities;

· Ensure that budget, organogram, powers and functions are linked to the DP;

· Ensure that indigent policy and the free basic services are in place and properly monitored;

· Ensure that internal controls are in place;

· Ensure that funds are available for valuation of properties to be conducted in all three Administrative Units of the Municipality;

· Ensure that there is an updated Asset Register;

TRIPARTITE TASK TEAM

The department established the above mentioned task team comprising of Municipal Manager, Corporate Services and Finance Managers from Ukhahlamba D.M., Elundini Municipality and DHLG & TA. The Departmental management is led by the Acting Head of Department who has been appointed as an Administrator until a service provider is appointed.

The task team started developing a Turn Around Strategy. The strategy was presented to the staff in all three Administrative Units of the Municipality, namely: Mount Fletcher, Ugie and Maclear on 08 December 2004.

It is regrettable to report that, when the Turn-around Strategy was presented to the Maclear Unit by the departmental team, it was scornfully rejected by the officials. However the same report was accepted by the other Administrative Units, namely: Ugie and Mount Fletcher.

The Tripartite Task Team further established an operational team from the department as well as from Ukhahlamba District Municipality arid Elundini Municipality.

This operational team was mandated to develop Action Plan based on the terms of reference of the intervention.

The Turn around Strategy was to be presented to the council for adoption on 13 December 2004. The task team had also agreed to introduce members of the operational team to the same meeting. it is with regret to inform your good office that the said meeting became chaotic as the Speaker unilaterally rejected the strategy on the grounds that, it was not signed by the MEC but rather signed by the Administrator (HOD).

Without indicating that he was signing on behalf of the MEC. Amid calls from members of the council to read the contents of the strategy, the Speaker ruled against such calls and further adjourned the meeting.

The joint operational team started on 13 Dec 2004. it resumed its duties on 10 January 2005.

 

PROGRESS TO DATE

Legal

Case against Mr Kolwana, Acting Corporate Services Manager, in progress. However, this needs political buy-in.

Finance

Backlog on Annual Financial Statements (AFS) dating back to 1999, has been addressed and AFS have been complied and awaiting Council approval at the next Council meeting.

Budget

Discussions have been held on the alignment of budget-to the Integrated Development Plan (IDP).

Generic Policies

Advertised for a Service Provider to amend and localise generic policies and by-laws

HR Policies

Currently, Elundini Local Municipality has no HR Policies. However, Ukhahlamba DM has provided the Local Municipality with its HR Policies. The policies will be localised to suit the requirements of Elundini.

Performance Management Systems (PMS)

A Service Provider has been appointed by Ukhahlamba DM to assist Elundini Local Municipality to develop Performance Contracts and Performance Management Systems (PMS).

Council meetings

A schedule for council meetings has been drawn up and will be submitted to council at the first meeting for consideration.

Rules and Standing Orders

The process has started to find a suitable person to facilitate a workshop on Rules and Standing Orders of Council.

Integrated Development Plan (IDP)

Discussions on the reviewal of the IDP have been held and the process win be accelerated.

Communication Policy

Initial discussions held with the Office of the Premier for the development or the Policy.

REASONS FOR REQUESTING EXTENSION OF THE INTERVENTION IN TERMS OF SECTION 139 OF THE CONSTITUTION

The reason why so little has been achieved in the first three months of the intervention can be attributed to the following:

· Lack of buy-in by officials because they have not. discussed the issues with their unions'

· Reluctance by officials to participate in turning around the situation, citing political instability in the council and the fact that councillors were involved in a political strife

· Councillors showed very little interest in municipal affairs

REQUEST

· That, for the effective achievement of the broad parameters, further extension of the section 139 intervention should be granted in Elundini local municipality

· That the intervention be extended for a further three months to 30 April 2005

G.E. NKWINTI

M.E.C. for Housing, Local Government and Traditional Affairs