Department of Cooperative Governance on: Projects implemented in local government (LGTAS, Operation Clean Audit, B2B etc); District Development Model

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Cooperative Governance and Traditional Affairs

01 April 2021
Chairperson: Ms F Muthambi (ANC)
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Meeting Summary

Video: Portfolio Committee on Cooperative Governance and Traditional Affairs, 01 April 2021

The Committee received a briefing from senior officials of the Department of Cooperative Governance and Traditional Affairs (COGTA) in a virtual meeting on the conception and implementation of the District Development Model (DDM). 

Members were told that the DDM consisted of joint and collaborative planning processes undertaken at the local, district/metropolitan and national level. It called on the three spheres of government to coordinate strategic interventions based on current realities and empirical data. This had led to the creation of a strategically focused "One Plan" for each of the 44 districts and eight metropolitan geographic spaces in the country, in which the district was seen as the ‘landing strip,’ or centre of coordination.

The DDM had been premised on the 1998 White Paper on Local Government, which sought to facilitate local government to be capacitated and transformed to play a developmental role. To this end, the Model had four interrelated characteristics that maximised social development and economic growth; integration and coordination; democratisation and development; as well as ethical and strategic leadership, coupled with skills and capacity development.

In order for local government to advance this, the Constitution called on national and provincial governments to support and strengthen the capacity of municipalities to manage their own affairs.

Therefore, the DDM was a practical intergovernmental relations (IGR) mechanism that enabled all three spheres of government to work in tandem with communities and stakeholders, to plan, budget and implement in unison. This also required national and provincial departments to provide implementation plans and budgets that addressed local challenges and developmental opportunities, aligned with skills and capacity training. Three districts -- O.R.Tambo, the Waterberg and Ethekwini -- had been identified as pilot districts for the DDM.

Members questioned the conception and implementation of the DDM, citing several other previous interventions that seemed similar in nature. They agreed that the model appeared to be a repackaged initiative drawn from previous interventions by the Department. They expressed their exasperation at the dire state in which the majority of South Africa's municipalities had found themselves, and therefore wanted assurances that the Model would lead to positive change and improved governance at municipalities.

The meeting was thrown into disarray towards the end of proceedings when a senior Department official confessed he had not followed the discussions as he had been in bed sleeping, but wanted to inform the Committee that the Department had been busy with a legislative process to amend the IGR Act, and this essentially meant that the DDM would not be able to be implemented without a legislative framework.

The official’s disrespect and disregard for Parliamentary decorum drew the ire of the entire Committee, and the Deputy Director General of the Department was instructed to deal with the matter expeditiously.

The Chairperson reminded the meeting that the Minister had said -- and it had been recorded as such -- that the DDM would be implemented under the current legislative framework. The disregard and disrespect shown towards the Committee by a plethora of officials, who seemed to view its meetings as "just by the way things," should be nipped in the bud. 

Meeting report

District Development Model

The Committee was briefed by the Department of Cooperative Governance and Traditional Affairs (COGTA), and was told that the District Development Model (DDM) consisted of joint and collaborative planning processes undertaken at the local, district/metropolitan and national level.

It called on the three spheres of government to coordinate strategic interventions based on current realities and empirical data. This had led to the creation of the strategically focused "One Plan" for each of the 44 districts and eight metropolitan geographic spaces in the country, wherein the district was seen as the ‘landing strip,’ or centre of coordination.

The Model built had been premised on the 1998 White Paper on Local Government, which sought to facilitate that "local government was capacitated and transformed to play a developmental role.” 

To this end, the Model had four interrelated characteristics of that maximised social development, economic growth, integration and coordination, democratisation and development, as well as ethical and strategic leadership, coupled with skills and capacity development.

In order for local government to advance this, the Constitution called on “national and provincial governments to support and strengthen the capacity of municipalities to manage their own affairs.”

Therefore, the Model was a practical intergovernmental relations (IGR) mechanism that enabled all three spheres of government to work in tandem with communities and stakeholders, to plan, budget and implement in unison.

This also required national and provincial Departments to provide implementation plans and budgets that spoke to local challenges and developmental opportunities aligned with skills and capacity training.

The Model also took into account lessons from previous and current Departmental initiatives, such as Project Consolidate, the Integrated Sustainable Rural Development Programme, the Urban Renewal Programme, district level planning and implementation management support centres, the local government turnaround strategy, and “Back to Basics.” All of these sought to improve the quality of life for all through impactful delivery.

The objectives of the Model were to coordinate government response to the challenges of poverty, unemployment and inequality, particularly amongst women, youth and people living with disabilities. It also called for inclusivity by gender budgeting, based on the needs and aspirations of people and communities at the local level. Additionally, the Model fostered a practical IGR mechanism to plan, budget and implement jointly, in order to provide a coherent government that addressed silos, duplication and fragmentation.

Three districts – O R Tambo, the Waterberg and Ethekwini -- had been identified as pilot districts for the DDM. The Department had received a budget appropriation of R50 million that covered the entire cost of conception and implementation. The One Plan had been designed by experts from the Development Bank of South Africa (DBSA).

Discussion

Mr C Brink (DA) said that he had found the presentation on previous attempts by government to improve basic services at the municipal level as important, and indicated that it was important to look at why these previous interventions had failed.

He recalled page 104 of the National Development Plan (NDP) that detailed the tendency by the government to jump from one "fad" to the next. The NDP had issued a scathing analysis of "fads," and blamed the policy uncertainty for the inefficiency, as well the capacity constraints. He advised the government to move away from fancy words and to address the underlying issues that hampered service delivery. He cautioned that all of these haphazard interventions might lead to worsening situations. 

He recalled that in 2004, the then Minister of Provincial and Local Government had announced "Project Consolidate,” which had been geared towards skills transfer through the deployment of skills to municipalities. Similarly, in 2005, the Minister had announced the critical infrastructure (Cl) programme. According to Mr Brink, this programme had a perverse incentive, in that the qualified professionals that had been earmarked to assist municipalities had ended up working full time for the programme as bureaucrats.

In 2006, the Joint Initiative for Priority Skills Acquisition (JIPSA) had been announced, with the sole aim to assist smaller municipalities. This programme had subsequently been succeeded by the municipal financial support programme.

He recalled that the Local Government Leadership Academy had also supposedly been established with the stated aim to enhance skills development, ethics and financial governance at the municipal level. 

He wanted to know what had happened to the Local Government Leadership Academy.

He said that in 2006, the then Provincial and Local Government Department had adopted Agenda 2011, but this had subsequently been halted.

He also recalled the local government change strategy that had been implemented in 2009, as well as the "Back2Basics" (B2B) Programme, which had been aimed at the turnaround of about two-thirds of South Africa's municipalities. The local government change strategy had been earmarked for a two year period, but the B2B had replaced it.

He lamented the failure of these interventions, and said that matters had become worse since 2014. The common thread between all of the programmes had been the sharp focus on skills transfer from the centre to the locality. In most cases, advice had been dispensed from the centre, with little or no skills transfer having taken place. 

He also commented on the DDM's R50 billion overall price tag, and the R4.3 billion that had been earmarked for the pilot districts of Waterberg and O R Tambo. He recalled that these funds had been paid over to the Development Bank of South Africa (DBSA), which had designed the DDM plans for the Department. He indicated as well that the DBSA had conducted extensive research in order to present tangible outcomes for government's consideration.

He said that the Minister had indicated that the Department had used consultants for the DDM design process, and asked whether this had been feasible given the R50 million that had been budgeted. He also wanted to know what the price tag of phase two and three would be, and requested a breakdown from the Department.

He also touched on the district hubs that would serve as shared service centres. The Department had indicated that no budget allocation had been earmarked for these service centres, and that all skills would be sourced in-house. 

Besides the money that had been given to the DBSA, there seemed to be no additional and new revenue streams for the DDM, who would rely solely on volunteers and the private sector. He asked how feasible this would be, given that there no single agreement existed with these entities. He added that the Department had touted the importance of voluntary service, yet it could not provide any evidence that it had embarked on consultations with interested parties. 

He wanted to know what these districts' mandate would be, given the lack of an budget, and asked whether this had been just another "fad" by the Department. 

He asked how the Department would deal with disagreements related to the operating system of the proposed district hubs. He had continuously raised this omission by the Department, and the Deputy Director-General (DDG), Mr Themba  Fosi, had not been forthright. He asked the Department to explain how these district hubs would prevent the duplication of projects. He also wanted to know how the competing interests of national, provincial and local governments would be taken into account, given their diverse interests.

How did the DDM aim to address these anomalies, as well as the silo mentality that existed within the three spheres of government? He cautioned the DDG to refrain from referencing the intergovernmental relations framework (IGR). He also requested a copy of the DDM implementation framework. He theorised that reasonably, the Department should have a dispute resolution mechanism.

He also touched on the lesson learned by the two pilot regions -- Waterberg and O.R

Tambo -- during the pilot period, and wondered aloud whether the Departmental jargon would be understood by ordinary residents of both the Waterberg and O.R. Tambo regions. He asked to be briefed on the skills deficit in the O.R. Tambo region, as well as how the DDM would assist local municipalities to attract the relevant skills such as town planners, engineers and artisans. In the absence of any details, he surmised that no lessons had been learnt.

Mr K Ceza (EFF) recalled that much had been said about previous interventions that had been effected to assist municipalities. He wanted to know whether these interventions had been successful.

South Africa had been confronted by a crisis at the municipal level. These municipalities continued to obtain adverse audit findings.

He decried municipalities' over-reliance on consultants who had failed to champion skills transfer. The Auditor General (AG) had found that this had become common practice, and that the majority of municipalities had failed on service delivery. He decried the stagnation experienced by municipalities and linked the rising poverty levels to municipalities' inability to deliver basic public services to communities.

He recalled that the South African Local Government Association (SALGA) had in 2004 introduced the Municipal Support Intervention Unit with an allocated budget of R43 million that had been spread over five years. The programme had been implemented to curtail the serious financial management issues that had taken root in municipalities. 

He lamented that only 27 out of 250 South African municipalities had received a clean audit from the AG, and asked whether the DDM be sufficient to address these challenges, given the magnitude of the crisis. He also asked for a timeframe by when these changes would be implemented.

He recalled that in 2004, Project Consolidate had been implemented with the stated aim to render assistance to almost half of the then 234 municipalities, who had struggled with sound financial management. He also recalled that the AG had highlighted the continued ill-discipline and financial mismanagement that had continued unabated. 

He decried the lack of consequence management by municipalities and asked how the DDM aimed to facilitate the institutionalisation of consequence management and accountability by municipalities.

He said the presentation had also spoken about the challenges experienced by municipalities and their impact on service delivery. He commended the Department for having highlighted the dire challenges experienced by communities who had experienced a continued lack of service delivery. He wanted to know what would be done to address infrastructure challenges and activities related to economic activities

He questioned why the ANC had not taken any bold initiatives to develop and foster deliberate industrial development in rural areas, without the need to incentivise potential investors. It was important to strengthen the potential of municipalities to harness revenue, in order to generate income through collection.

He asked about the amount that had been spent on the launches of the DDM in the targeted municipalities, and whether the source of this funding had been the DBSA. He commented that it might have been prudent to redirect the funds that had been spent on these events to the DDM itself. He also wanted to know whether the DDM had addressed issues related to the in-sourcing of goods and services by municipalities.

He commented that these municipalities had to be capacitated in order to address the capacity backlogs. The presentation had mentioned that R2 billion had been spent annually on capacity development, yet these investments in skills development were totally missing, unless the DBSA or the Department could say that they had overcome the capacity challenges with the funds that had been spent on capacity and skills development.

He also touched on the billing issues experienced by municipalities, and the AG's comments on this continued challenge, and asked how the DDM would assist municipalities with billing issues.

Ms P Xaba- Ntshaba (ANC) said that between 1994 and 2004, the Department had reported that some successes had been achieved with its various interventions. She requested information and concrete examples of the successes, and whether this performance had been sustained. She also called for more investment in capacity building, and stressed the importance of skills development.

She referred to the urban and rural renewable programmes that the Department had implemented between 2001 and 2011, and said the Department had not addressed whether these programmes had been implemented, or reported on the progress thus far. 

She further asked how the DDM would address political instability and its associated challenges.

Ms H Makhalipi (EFF) said that the Committee had requested the brief with the Department in order to be informed of what the DDM entailed, and its impact on good governance and service delivery by municipalities. However, during a previous Committee meeting she had found herself embarrassed, as the person who had been appointed as a DDM champion had had absolutely no comprehension of what the DDM entailed .

She thanked the DDG for the background on the previous Departmental interventions geared towards good governance at municipalities. This background provided a comprehensive context for the endemic challenges that persisted in municipalities.

She had served as a local councillor when the Masakhane campaign had been announced, and wondered why the Department had then decided to introduce several other new campaigns. She touched on B2B and noted its continued relevance, given the endemic challenges. She was of the opinion that B2B had not been given a chance at success.

She said that it seemed as if the DDG had admitted his Department's failures. She asserted that the DDM should be seen as just another repetition of previous programmes that had also emphasised capacity and skills development.

She decried the fact that after 27 years of democracy, municipalities in South Africa continued to experience serious service delivery woes which had a direct impact on the lives of ordinary South Africans. In some municipalities, people were still waiting on electricity and in other cases, communities experienced continued darkness. 

She wanted to know how the DDM ensured that infrastructure challenges would be attended to. She also asked about the role of the districts as the drivers behind the DDM, and whether these districts had the capacity and resources to perform this function.

She said the EThekwini Municipality operated on a budget of R52 billion annually, and wondered how that particular metro would be enabled to coordinate programmes with other spheres of government to implement services.

She highlighted the fact that the former mayor of EThekwini had been arrested on charges of corruption, and lambasted the Department for what she called its "flip flop" on corruption. She claimed that corruption remained one of the biggest risk factors in municipalities. She wanted to know how the DDM would prevent politicians from stealing public funds. 

'Why must people protest?" she asked rhetorically, and said they protested due to having no water and no service delivery, and that remained the real problem. Municipalities simply did not have the requisite skills, and she wondered why South Africa still had nine provinces with their own executives.

The Chairperson referred to the lessons learnt by municipalities, and stressed that the first presentation had emphasised strategic and ethical leadership. The DDG had linked strategic and ethical leadership to the current audit findings, and she asked what robust programmes in terms of the DDM would be put in place to deal with the audits. She also wanted to know how the DDM would assist with the alignment of municipal annual performance plans with those of the national government. 

She touched on rural enterprise development as well, and asked how the DDM would assist municipalities to achieve this task.

COGTA’s response

Mr Fosi replied that he appreciated the questions that had been posed by Members, as they assisted the Department to look at ways of how to facilitate and improve service delivery. He would be assisted by his colleagues in responding to the questions.

On the question posed by Mr Brink, he conceded that the Member had been correct when he had surmised that the common thread between all government interventions in municipalities was centred on capacity and skills development. This undertaking had been championed by various administrations since 1994.

It had been no secret that many municipalities had found themselves distressed, and that the majority needed support in the form of capacity building and skills development. The Department would continue to support these municipalities so that they could execute their mandates.

He said that where programmes had been halted, the Department had obviously conducted a thorough analysis on their viability. Monitoring and evaluation remained an important yardstick that determined the viability of programmess.

What made the DDM different was that the Cabinet had adopted the programme. In the Department's engagement with National Treasury during the adjustment budget process, the latter had been requested to avail funds for the DDM. The first phase would include the matters that had been highlighted by Mr Brink, and that some even went beyond just the One Plan, which contained various facets related to improved governance at municipalities. 

He said the Department had signed a Memorandum of Understanding MoU with the DBSA on project management. The DBSA had assisted COGTA to enhance its capacity to administer the various intervention programmes. The Department's work had been enhanced by the different programme managers who co-ordinated different aspects of the DDM. These programme managers had been appointed on a five-year contract and beside the funding that the Department had provided, the DBSA had also indicated that they would contribute towards remuneration. The allocated budget of R50 million covered the personnel costs of the One Plan programme managers. He was emphatic that expenditure on these programme managers had been justified, as they had conducted extensive research to the benefit of the DDM.

He further explained that the One Plan would have different chapters, such as economic positioning, infrastructure and good governance, amongst others. In all of these areas, extensive research had been done. He added that the DDM had been designed to be an inclusive process and that government had not intended to be the sole driving force behind the process. 

Several role players had been engaged, and the outcome of these engagements had resulted in concrete commitments. These commitments relieved the Department of financial obligations for any services rendered. One of the role players that had been engaged had been Exxaro mining company, with which the Department had signed a Memorandum of Understanding (MoU). The mining company would provide critical expertise to municipalities free of charge. 

A MoU had also been signed with Hollard Insurance, which had indicated their interest in early childhood development. The Council on Geoscience (CGS) had also been engaged in terms of the scientific modulations related to the DDM, as well as various other stakeholders. These stakeholders had indicated that they could provide specialised support services to the DDM.

The district hubs formed the centre of coordination, and would serve as the integration point of all the commitments that had been made by the various partners. This would enable the Department to measure the contributions of each role player in the respective sectors. The DDM had earmarked district hubs to work closely with the local governments under the purview of district municipalities.

On the operations model, and what would happen should there be a disagreement between the respective government spheres, he stated that the operations model had been based on two principles -- specialisation and prioritisation.

Specialisation referred to the insurance that all sectors would contribute, and the rationale provided on what they had done. This meant in essence that these sectors would have to account.

Prioritisation denoted the various engagements that had taken place between the Department and various role players such as other departments, on the need for budget prioritisation.

He added that if an analysis indicated that the local economy had to be revitalised, national government obviously had to contribute to the necessary interventions. If all the parties were engaged in the prioritisation of governmental policy, it should be possible to resolve any disagreements that might arise at an early stage. 

He commented that the conversations that the Department had had on the DDM had been informed by research and empirical data. The data had highlighted the extent of problems in municipalities and the mitigating strategies.

Regarding the lessons learnt, he would not able to pronounce on that, as the pilot phase was still ongoing. He promised that the Department would share the relevant documentation and information once the picture became clearer.

The profiles of Waterberg and O.R Tambo had been characterised by a distressed economic environment, poverty, a lack of educational opportunities and the ever-present capacity and skills deficits.

He said he appreciated Members' impatience for actual results. He reminded them to look at the timeline of when the pilot phase of the DDM had been implemented in August 2020, and said that most of the work on the implementation of the DDM had been concluded.

The Committee would be furnished with the DDM implementation framework and the guidelines that defined the One Plan. 

On the question about how the DDM would facilitate improved audit outcomes and the other perennial issues mentioned, he added that the Department would not be able to provide an analysis of the impact as the DDM was still in the establishment phase.

On integrated development plans (IDPs), and their relation to the planning cycles of the various spheres of government, he said that when the integrated development plans had first been introduced, the Department had experienced several challenges during the first year of implementation and institutionalisation. The Department had not reached the intended targets, but since then, it had seen the institutionalisation of IDPs in the system. 

He added that as the DDM was still in the implementation stage, the Department would not be able to demonstrate yet how the DDM aimed to address the underlying challenges.

He reiterated his previous comments that the questions that had been raised by Members would assist the Department to strengthen the implementation of the DDM. He gave an assurance that the Department had grasped the extent of challenges experienced by municipalities and how these had manifested themselves.

On the question on what actions the DDM planned to execute in order to facilitate industrial development and poverty eradication in municipalities, he said the Department had been furnished with specific data from one of the knowledge partners. The detailed information on the poverty levels, skills deficit and unemployment rates that burdened the pilot districts had provided a comprehensive synopsis of the scale and type of interventions needed.

The Department had identified and aligned the budgetary planning processes between the respective spheres of government as the appropriate approach. The priorities of municipalities had to find expression in this alignment.

He said that the O.R Tambo region had many child-headed households, so the Department of Social Development (DSD) had a role within the DDM as well.

He also touched on youth skills development and posed a rhetorical question as to what had been done to respond to youth unemployment and the skills deficit by the relevant departments. 

He added that an analysis of the economic potential of the O.R Tambo region had been conducted. 

This analysis had highlighted the agricultural, tourism and oceans economy sectors as the three main economic areas in the region. The O.R Tambo District Municipality was essentially a rural municipality, to which the agricultural sector contributed only about 2% to the district's economy. This indicated that the region had experienced serious underinvestment in the agricultural sector, which in turn meant that investment to these areas had to be stimulated and facilitated. The skills development and capacity training had to be aligned to the economic sectors that he had previously highlighted.

He said that in the case of Waterberg, youth unemployment remained a serious issue in the mining area. He lamented that none of the mining companies had any skills development initiatives, which essentially meant that these mines would attract skills only from outside the district. The Department had entered into conversations with various mining companies and lobbied them to invest in youth skills development. This would greatly benefit the youths in these mining areas so that they could take up the available positions at these mines.

He emphasised that any intervention had to be evidence based, as it would provide an accurate picture of realities on the ground. Provincial and national governments' priorities and budgets had to be aligned with those of local governments.

The Department had envisaged that the DDM would foster a culture of discipline through the mechanisms that would be introduced through the programme.

He said he did not understand the question that had been posed about the DDM launch events, and asked for clarity from Mr Ceza.

On the allocation of R2 billion for capacity and skills development, he commented that most of the Department's programmes had an allocation that had been earmarked for skills development. The challenges that the Department had identified in relation to these initiatives, had been their fragmented nature. This had been reminiscent of the silo mentality, and highlighted the need for a central point of coordination for all of these various programmes.

COGTA and the South African Local Government Association (SALGA) would continue to deliberate on the capacity and skills development deficits in municipalities. It would be more prudent to centralise these efforts, as this would help to avoid duplication. 

He stressed that that the rationale for the R2 billion that had been earmarked for skills development and capacity training had clearly been established, and that the available resources had to be used in a coordinated manner. An unintended consequence had been that the various COGTA programmes all had their own skills development component, and in some cases duplication had occurred.

On the question about one tax base for all residents, he recalled that in some municipalities the former black administrations had been merged with the so-called former white areas into one tax base. Some municipalities had struggled with the creation of one tax base, and this had prompted intervention by the Department to strengthen financial management. 

He also touched on the impact that the demarcation and amalgamation of municipalities had had on the existing challenges that municipalities experienced. Some of these municipalities had persisted with issues related to their staff establishment, which was but one example.

A question had also been posed about whether any provincial governments had their own interventions geared towards the creation of municipal support structures. He said the DDM would look at how provincial governments' capacity could be strengthened as well. In some cases, certain provinces had the capability to support their municipalities through dedicated structures.

On the question about how the DDM aimed to respond to leadership challenges within municipalities, he pointed out that neither the Minister nor the Deputy Ministers were in attendance, so he would not want to he drawn into a political discussion. That remained the purview of the political principals. However, he agreed with the sentiment that political instability in general remained a serious impediment to these municipalities eventually being able to show improved governance good governance and service delivery.

Apartheid spatial planning persisted, and the majority of South Africans continued to live far from the urban areas where most job opportunities resided. COGTA had entered into spatial integration talks with various role players, and the One Plan addressed spatial planning and related development.

He agreed with the general notion that corruption remained a significant risk factor for municipalities. He emphasised that neither councillors nor politicians should not be involved in the financial administration of municipalities.

He agreed with Ms Mkhalipi that the B2B programme remained relevant, and stressed that the DDM would not replace that particular campaign. B2B would continue, as it focused on issues such as good governance, infrastructure and sound financial management. These three areas had found expression within the DDM.

The success of the DDM concept depended on functional municipalities, not dysfunctional ones.

He reiterated his previous stance, that municipalities remained the key drivers behind the DDM.

He stressed that the lessons identified by the 25-year review had indicated that the Intergovernmental Relations Framework (IGR) continued to be characterised by a silo mentality, and warned that if the anomalies identified by the review were not addressed, IGR would continue to stifle service delivery.

The NDP had also touched on the inefficiency of the current IGR framework.

He recalled that the Chairperson had asked two questions that pertained to ethical leadership and resilient local government economies, and said that these two areas had been addressed during the DDM planning process. 

On the question about ethical leadership, he explained that ethical leadership required different interventions from the other government departments, and these did not form part of the Department's purview.

He continued that the DDM would not introduce new changes to the system. Instead, it called for aligned planning cycles between the respective spheres of government. Between April and June, the Department would use the opportunity to engage with the various tiers of government on the need for an aligned planning cycle. The rationale behind the prioritisation of aligned budget planning processes was that it would assist in effective coordination, and that the Department would be able to engage with other sector departments.

The One Plan would be finalised in July, and had already been provisioned for in the forthcoming financial year. 

He noted that conversations on aligned planning cycles would have a significant impact on the various other departments finding common ground. COGTA would look at alignment issues and see how an inclusive and integrated approach could be adopted. There were modalities that underpinned the One Plan, such as the content guidelines and how the DDM had been envisaged. He promised to share these documents as well as other draft policies for the Committee's attention.

The Department had taken a conscious decision to invest more in the pilot areas in order to get a proper understanding of what was possible, and to establish if the right interventions, coupled with the necessary resources, had been available. It wanted to utilise the three pilots to assist and strengthen the DDM when it would be launched nationwide.

 A complementary process had been undertaken in other districts on the economic and catalytic impact that Covid-19 had on communities. The Department had also designed a template for the study that had been undertaken on the impact of Covid-19 on local economies.

COGTA had looked at the One Plan as the initiator, and the DDM was at the beginning phase of implementation so that the Department would learn certain lessons as the DDM progressed in the pilot districts.

On enterprise development, one of the processes that had been looked at in conjunction with the DBSA had been a local government economic development framework. This would be a practical approach for economic revitalisation of local government economies.

He added that asset verification at the community level had to be strengthened, and opportunities for small businesses had to be created, as well as dedicated support for small traders. 

He said COGTA had worked closely with the DBSA, as well as the Department of Trade and Industry (dti) on the dti’s district economic model that had been aligned to the DDM. The model looked at the profile of all registered traders, as well as the non-registered ones in a particular district. This gave the Department a sense of the challenges and opportunities that existed in municipalities and enabled it to inform these traders of opportunities at dti agencies such as the Small Enterprise Development Agency (SEDA).

The Department had worked closely with industry leaders, as well as with small traders. The small traders had since informed it that they had already created structures in anticipation of the DDM. 

He said that the questions that had been posed by the Committee would assist in institutionalising the DDM. The DDM might not resolve all the issues in the system, as some required different interventions, but the reprioritisation and correlation of policies and budgets should become easier, as well as the identification of bottlenecks at the local government level.

The structural issues affecting asset management had to be addressed in terms of the viability of certain municipalities and the impact which demarcation and amalgamation had on certain local governments.

The DDM would foster capacity development, as well as an improvement in performance management.

A fundamental facet of proper planning and coordination was related to the continuity of projects, and the DDM would assist in this process as well. This would be particularly relevant if more coalition governments at the local level came into being after the local government elections planned for August or later in 2021.

He noted that certain acts also had to be strengthened in order to give effect to the mandate of the DDM.

Follow-up questions and comments

Mr Brink said many questions remained unanswered, and he was unsure about the role of the district hubs being the central point of coordination. He wanted to know whether these hubs would have their own staff establishment, and if so, where the funds would come from to pay for their salaries.

The Chairperson recalled the comments by the DDG about the Committee's impatience at the slow pace of change and effective service delivery, and said that this stemmed from the reality that positive change had to be ensured for ordinary South Africans on the ground. She wanted to know whether the Department had any plans in place to adopt a more holistic approach that would ensure the success of the DDM.

The presentation had omitted the very important role played by social services professionals, and she wondered whether any allowance had been made to include this critical sector in DDM planning. Social services professionals already found themselves living in these communities and thus had a broad understanding of the challenges that these communities faced.

She suggested that maybe the Department should look at creating job opportunities for unemployed young graduates, and that this should be a central pillar of the DDM as well. She had been of the view that it should conduct a comprehensive study or survey on the human capital in all district municipalities, and suggested that the best approach would be to pilot the survey in one of the provinces, with a particular focus on youth unemployment as well as child-headed households. Intervention programmes led by social services professionals should be seen as integral.

She said that the DDG had to be patient with Members as they interrogated the DDM, especially since they had expressed the view that the programme contained repackaged ideas. When a programme had failed, the Department simply cut that programme or repackaged it as something totally different, as had been asserted by Mr Brink. 

Referring to the political champions that had been deployed to the districts as the driving force behind the DDM, she wanted to know what the impact of these deployed political champions had been, and what requisite skills they had brought with them.

She said the Members' impatience indicated that they simply wanted to have a thorough understanding of the situation. The Committee had always conducted rigorous oversight. She proposed that the Committee should follow up on outstanding matters on a quarterly basis, especially on the issues that had been referred to the Minister.

Mr Ceza also referred to the comment on the Committee’s impatience, and indicated that this was simply due to the nature of South African society and how it had previously been structured. The Committee Members were public representatives and therefore expressed the needs of their constituents who were clamouring for societal changes on the ground.

Department’s response

Mr Fosi assured the Committee that the hubs would have dedicated staff members such as a hub manager, who would be assisted by experts on infrastructure, civil engineering, planning and financial management. These experts would assist with the coordination of the various facets, and their salary costs had been incorporated as part of the R50 million DDM budget appropriation.

As the central point of coordination, the district hubs had to have a database of all the various economic sectors in that particular district, which should also include details of all government agencies. It would be at this point, that the role of social services professionals became important. The hub would also be able to provide precise details on the various infrastructure projects that existed within that particular district, as well as any potential social development projects that might be under way. It was very important that even these interventions should be aligned to the district DDM inputs.

The Department had recently signed a MoU with the United Nations on support to unlock small trader value chains. This would also include the participation of the Thusong service centres. All of these activities had to be coordinated, and the hubs would coordinate the various interventions.

He said the Department had invested significantly more in the pilots, as it wanted to ascertain what would be possible if the districts had all of the necessary support. However, the massive investment in the pilot districts might not necessarily be repeated when the DDM was rolled out nationally. Furthermore, not all hubs would have dedicated staff members, and would thus be manned by a Hub Manager who would work closely on coordination with other sister departments and stakeholders. Other departments had regional offices, and these should also be coordinated as part of the DDM.

He said that COGTA had decided that it would look at the Municipal Systems Support Grant as one mechanism to address the budget shortfalls.

He agreed fully with the point raised by the Chairperson about a skills audit. It was critical to look at cogent programmes. It was also important to get a grasp of the state of readiness at the household level, so the data from Statistics South Africa had been invaluable.

The Department wanted to work with the Committee, to look at the objectives of the DDM and to strengthen the model. The Committee should continue its vigorous oversight role over the Department. The guidelines that had been developed on how government should change its operations should not occur in isolation, but in tandem with the role of Parliament in fostering accountability.

Replying to the comments by Ms Mkhalipi, he said that the DDM was a totally different programme that had drawn from the lessons of previous ones. 

Mr Fosi said that the DDM would be strengthened as the Department gained more insights. The programme stressed the importance of capacity and skills development, as well as the deployment of critical skills to municipalities. COGTA remained committed to the stated goal of building functional institutions at South African municipalities that had the requisite capacity to drive developmental programmes.

The “political champions” had been introduced during the initial phase of the pandemic in 2020, and had been tasked to conduct an assessment of the impact of the government's Covid-19 economic relief measures on districts and their ability to implement programmes. Their second function had been to review processes and to unlock intergovernmental relations processes. 

He cited the example of the Durban port which had experienced severe congestion issues. The DDM had brought together the various role players from government to look at how other opportunities at the port could be addressed. To date, the political champions had undertaken 38 visits to areas where the Department had assisted the municipalities with improved governance and service delivery challenges.

COGTA had decided to appoint designated person to prepare and assist with the visits, as well as the reports by the political champions. Over time, the system would be improved and the terms of reference related to the appointment of the political champions would also be shared with the Committee by the Department.

He said that the One Plan essentially emphasised that interventions should respond to the current challenges on the ground, especially in relation to the current Covid-19 pandemic, unemployment and the rising poverty levels in the country.

The information that had been gathered in support of the DDM would also serve as preparation for the incoming administration after the local government elections scheduled for later in 2021.

Mr Fosi said this concluded his response, and if any of his colleagues would like to respond, they were certainly welcome to do so.

Follow-up discussion

At this stage, an official indicated that he wanted to touch on a few issues that the DDG had raised.

The Chairperson asked the official to put on his camera. The official replied that he had been sleeping and was already in bed.

This reply incensed the Chairperson, who said it was totally unacceptable that the official was in a meeting, but was saying he was sleeping in bed.

She then said that other Members wanted to address the official, and a visibly upset Ms Makhalipi charged that the official seemed to be oblivious of the fact that he was in attendance at a Parliamentary meeting.

The Chairperson requested the still unidentified official to proceed with his submission.

He informed the Committee that the relevant legislation that pertained to the IGR Act had been under consideration for amendment, and that the Department wanted to ensure compliance.

A surprised Chairperson commented that the official has just informed the Committee that the Department had been busy with a legislative process to amend the IGR Act, and that this essentially meant that the DDM would not be able to be implemented without a legislative framework.

She asked the official whether the Department had not put the horse before the cart in relation to the DDM. The Committee seemed impatient because it had just been informed that no legislative framework existed that gave effect to the DDM.

She reminded the official that she was a legislator and thus well informed about the legislative process. She seemed aghast at the comments that the official had made. She asked the official what his name and designation was.

He replied that his name was Loyiso Ncoko, and that he was a director in the Department that oversaw the North West province's Section 139 interventions.

The Chairperson said the official had lacked decorum, and labelled him disrespectful.

Ms D Direko (ANC) expressed her concern that the official had, by his own admission, informed the Committee that he had slept during an official parliamentary committee meeting. She hoped that the DDG would give the official an induction on how to approach high-level meetings -- what to expect, and to respect the decorum of the House. His attitude had shown a level of disrespect and she was worried, as the official had indicated that he was the director responsible for the B2B campaign as well. She commented that it was no wonder that problems with the B2B programme persisted. She was of the view that the Committee should not expect the official to deliver on what he had said, as he had slept during a Parliamentary meeting. 

Mr Brink added that he shared the sentiments that had been expressed by his colleagues, and that the Chairperson took the business of the Committee seriously. He cautioned that the Chairperson should not be trifled with. 

He continued that the official had indicated that possible changes to the IGR Act would need to be effected. He had been surprised by this admission, as he thought that DDG Fosi would have led with that information. He had been made to understand by the Minister that the DDM would be implemented under the current legislative framework, and was surprised at the admission of possible legislative changes at this late stage. He requested the DDG to address this.

Ms Makhalipi said that the Committee would simply not allow the official to be disrespectful. She reminded him that the Committee had been involved in very robust engagements, and regarded its oversight role as critical. The meeting had progressed well until the disrespectful incident had occurred. He had boldly spoken about his involvement in North West, a province she regarded as the worst of the worst. Nothing could be learned from that province. 

She said she would like the Department to understand that the Committee did not comprise of children, and that it always conducted rigorous oversight. This behaviour should simply not be tolerated. She asked the DDG to inform the Committee what would be done about this situation

The Chairperson commented that sometimes she allowed Members to speak their minds, otherwise she would again be accused of being harsh, as had happened during a meeting with KZN municipalities. She said that what she and her colleagues had experienced bordered on the ridiculous, and was totally uncalled for. She asked the DDG to respond to this incident as he addressed the follow-up questions.

She reminded the meeting that the Minister had said -- and it had been recorded as such -- that the DDM would be implemented under the current legislative framework. The disregard and disrespect shown towards the Committee by a plethora of officials, who seemed to view its meetings as "just by the way things," should be nipped in the bud. 

A subdued DDG profusely apologised for the disrespect and unbecoming behaviour of his colleague, and the disrespect shown towards the decorum of the House. The Department had always respected the Committee and would thus not tolerate such unacceptable behaviour. The incident provided the Department with the opportunity to reflect on how to deal with what had transpired. He again apologised for the unfortunate conduct of his colleague.

Mr Fosi said he had already covered the most important aspects that had been raised by Members, and said the Department had not initiated any legislative amendment processes in respect of the IGR Act. The Department intended to amend one Section to strengthen the post-implementation of the DDM, but it would be introduced under the current relevant legislation.

He once again apologised for what had happened, and indicated that the Department certainly had not intended for this to happen.

The Chairperson said that the unfortunate incident would be taken up with the Minister, and that she hoped that the incident would be dealt with before written communication to the Minister.

Concluding comments

The Chairperson said that Committee meetings would continue during the Members' constituency period, and that it would continue to conduct rigorous oversight over the Department's work. 

The DDG had also had very positive things to say about the DDM, so the Committee would undertake oversight visits to pilot districts to get a feel of what had been done.

She had been very impressed with the presentation and the discussions that had ensued, only to be thrown into disarray by a disrespectful official who had not paid attention. The Minister needed to come and explain the amendments to the IGR Act so that the Committee could ascertain the true situation.

She said the next meeting of the Committee would take place on 12 April, when the state of readiness for the local government elections would be discussed with the Department and the Independent Electoral Commission.

The meeting was adjourned 

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