COGTA Budget: Committee Report

Meeting report

Report of the Portfolio Committee on Cooperative Governance and Traditional Affairs on the Annual Performance Plan and Budget of the Department of Cooperative Governance and Traditional Affairs

The Chairperson outlined the plan for the meeting which would involve discussion and breakdown of the entire Draft Report, Members’ questions, input and additions.

On the background and introduction, the Chairperson stated the matters were extrapolated from the 2018 Annual Report as it provided a baseline. The overview of performance during the 2017/18 financial year was also captured directly from the Annual Report.

The Chairperson proceeded to take Members through the Draft Report page by page.  

Policy Priorities for 2019/2020

The Chairperson and Members looked at the Back to Basics Pillars. The Chairperson questioned the necessity of adding three additional pillars--disaster management, spatial transformation, and local economic development—when she felt there has not been any encouraging progress on the original five pillars.

The Chairperson cited weak progress in the Status Report, Audit Report, and wondered how the eight will be delivered on when there was already failure in delivering on the five pillars.

Local Government Support and Intervention Management

Mr S August (GOOD) asked a question about water losses in relation to local government support and intervention. He cited R9 million loss of water in municipalities, yet, Water and Sanitation does not have a budget under Section 4.5 of the Report. He wanted to know where in the Report the money was allocated.

The Chairperson clarified that the money for water loss and leaks is allocated in 4.5, under Sub-Programme 5: Municipal Infrastructure Administration, Sub Programme 6: Municipal Infrastructure Grant, and Sub-Programme 7: Municipal Infrastructure Support Agent. She reiterated the R85 billion budget allocated for the Department is distributed to all municipalities.

The Chairperson thanked Mr August for his question and stressed the need for the Committee to work closely with the Departments of Water and Sanitation, Human Settlements, and Environmental Affairs.

Programme 6: Community Work Programme

In relation to disaster management, the Chairperson felt the budget allocation for disaster relief is too reactive when instead it should be proactive.  

Implementation of 2017/2018 Budgetary Review Recommendations

The Chairperson stated the recommendations are the most important matters that need to be followed up upon. She recanted each of the four recommendations and called out COGTA to address its weak levels of assurance.

The Chairperson stated she requested the audit action plan to assess progress of implementation and to see if matters raised in the 2017/2018 Financial Year were addressed. The action plan would only be released on 31 July so the Committee would not know if there has been any progress. Hence the section would refer to “ongoing” in the Committee’s Report.

Looking at Recommendation 5.2, the Chairperson called the Community Work Programme Workers protest march to COGTA headquarters, on 18 June 2019, in which they threatened to shut down all offices if their complaints were not attended to by 5 July 2019, a clear indication that something is not right when it comes to the Community Work programme.  

The Chairperson called upon COGTA to improve oversight upon the Community Work Programme.

On recommendation 5.3: The Portfolio Committee must invite all the municipalities with deposits in the VBS Mutual Bank …

The Chairperson said three provinces, North West, Limpopo and Gauteng, were seriously affected by the VBS matter, and would be called before the Committee soon to speak on the VBS Bank possible liquidation and poor service delivery.

The Chairperson mentioned that the Water Service Authority deposited R300 million into a VBS account, yet, there was no water.

On recommendation 5.4, the Chairperson clarified the purpose of the recommendation was for the Municipal Demarcation Board (MDB) to submit proposed amendments on the Demarcation Act directly to the Portfolio Committee, instead of going through COGTA (Executive Authority), which the MDB felt slowed the process.

Committee Observations

The Chairperson commended progress local government made in terms of electricity delivery and access to road construction, however, the Chairperson echoed the Committee’s view that there seems to be no real positive impact on local communities on the ground.

She said communities still cry out for basic services, especially in Limpopo, where she has seen kids swimming through a river to get to school because there is no road.

The Committee then addressed the other recommendations in the Draft Report. She noted the bulk of the SA Local Government Association (SALGA) budget, 65%, is allocated for personnel compensation, leaving the core mandates without sufficient funding.

The Chairperson railed against the fact that only 18 of 257 municipalities attained a clean audit. She demanded that COGTA improve its performance and attain more clean audits.

The Chairperson reiterated the lack of tangible outputs on the ground despite an increased SALGA budget and felt that municipalities have regressed even though the money is in place. She emphasised some amalgamations have had a negative impact on the financial success of merged municipalities leaving them financially unstable and dysfunctional.

Committee Recommendations

The Chairperson empasised the need to recover municipal funds from unlawful golden handshakes with VBS.  Unrecovered funds negatively affect service delivery, especially in respect to water. She insisted the Portfolio Committee pursue quarterly reports of departments and entities on a regular basis in order to correct problems before the end of the financial year.

The Chairperson spoke to MDB complaints over lack of offices locally and provisionally - there are underutilised offices all over the country including tribal offices that government built. She called upon municipalities to share resources, cooperate, and work together.

Mr B Luthuli (IFP) echoed the Chairperson’s point on facility distribution and for the MDB to improve its regional footprint; offering to give up his tribal offices in KZN if need be.

The Chairperson introduced additional the recommendations as outlined in the email from Ms H Mkhaliphi (EFF).  The Chairperson felt the Committee already covered many of the additional recommendations but encouraged other Members and colleagues to attend meetings even if they are not an appointed Member of the Committee as all opinions are valued and will enhance discussion.

Mr August addressed the Chairperson’s previous remarks about children swimming in the river to get to school. He stressed the importance of communication between departments and portfolios. He highlighted the need for all committees and departments to interact with each other to effectively build bridges and roads for the kids.

Mr H Hoosen (DA) stated that he was overall satisfied with the Committee Report and felt it was a fair reflection of what the Committee discussed in the two days prior.

Mr Hoosen proposed one amendment - regarding the Committee observation that only 18 out of 257 municipalities received clean audits, he motioned to add the following point to Section 7: Recommendations:

“The Department should implement measures to address the increasing number of municipalities with poor audit outcomes…and these municipalities must provide a report to the Portfolio Committee on its action plan”.

The Committee agreed.

Secondly, regarding additional recommendations provided by Ms Mkhaliphi, Mr Hoosen felt the recommendations would be improper unless they were discussed with the Department itself to make sure the recommendations had not already been undertaken.

Ms M Tlou (ANC) broadly stated that the Committee needed to focus and target its attention on the most salient matters and recommended increasing the Disaster Recovery Grant in the fact of climate change.

Ms D Direko (ANC) requested that every Member agree to adopt the Committee Report so that the Committee would start Parliament on a united and cohesive footing.

For the record, Mr Hoosen and Mr C Brink (DA) stated they were happy with the document and commended the team that put it together.  However, due to party caucus mandates, they would have to abstain from the adoption.

Ms Direko moved to adopt the Report.  

Mr Luthuli (IFP) seconded the motion.

The Report of the Portfolio Committee on Cooperative Governance and Traditional Affairs on the Annual Performance Plan and Budget of the Department of Cooperative Governance and Traditional Affairs was adopted with amendments.

The Chairperson thanked the Committee for its cooperation and hard work so far and asked Members to go home and think about the most important matters that need to be addressed before the Committee’s next meeting.

The meeting was adjourned