Progress report on intervention at Mangaung Metropolitan and Enoch Mgijima Local Municipalities; with Deputy Minister

Meeting report

The Chairperson said the Department of Cooperative Governance and Traditional Affairs (COGTA) had been invited to brief the Committee about the interventions in terms of section 139 (7) at the Mangaung Metropolitan Municipality and Enoch Mgijima Local Municipality. The Committee would like to get a sense of how the interventions were going and the outcome. Members were happy to note that there had been the revocation of Section 135 of the Municipal Finance Management Act (MFMA) 136, as its mandatory interventions in most municipalities had not been doing well throughout. There was an appeal to people who were already implementing it to focus on this so that it would also help to guide the Committee’s oversight. Financial management in municipalities translated into service delivery satisfying ratepayers was a challenge. Any attempts to deal with that issue would be greatly appreciated.

Deputy Minister's opening remarks

Ms Thembisile Nkadimeng, Deputy Minister (DM), COGTA, said that in 2020 the Minister of Finance had tabled a report before Cabinet, and a decision was subsequently taken to place Mangaung Metropolitan Municipality under section 139(7) of the Constitution. Amongst other things, a financial recovery plan was imposed and implemented in line with the MFMA. Cabinet assigned a national representative team to look broadly at financial matters and government’s finances through human resources and service delivery. Mr Maseko led this national representative team, and COGTA deployed Mr Tebogo Motlashuping, a Deputy Director-General (DDG), as the city manager. He was working with a few heads of departments he found at the time, and subsequently, some of the contracts expired. The Departments of Human Settlements, Environment, Transport, and Water and Sanitation, had also seconded senior officials to Mangaung. This first deployment of Section 139 (7) was done in line with the District Development Model (DDM), where not only COGTA and National Treasury, but offices or departments with their expertise were brought in.

In Enoch Mgjima, the Eastern Cape Province had intervened in terms of Section 139, sub-section one and sub-section five of the Constitution. They also mandated a financial recovery plan. Enoch Mgijima was faced with special difficulties. This was the same even with the past council and the subsequent council of November 2021, which ushered in the new administration. There were still challenges, but the Department had been able to appoint and induct the national Cabinet representative in May, who had started in June. It was still at the establishment phase with a lot of difficulties because of the lack of cooperation of the municipalities, but the key to that was the assessment of the state of the municipality which had not yet been finally concluded, and the conclusion of the recovery plan.

Ms Avril Williamson, Director-General (DG), COGTA, commended the cooperation between the Department, National Treasury and other departments trying to restore stability in the Mangaung metro. The Enoch Mgijima municipality was under all kinds of national interventions. The national Cabinet representative team was on the ground to stabilise the municipality.

Mangaung metro Section 139(7) intervention

Mr Motlashuping, Acting City Manager of Mangaung Metro, outlined the key issues and the intervention focus areas. These were:

-Decrease high overtime and “acting” expenditure;

-Fill vacant positions;

-Appoint a Municipal Planning Tribunal and Appeals Authority Tribunal;

-Format the Mangaung Transport Forum to support the development of the City Integrated Transport Plan;

-Re-use of resurfacing material to re-gravel roads in the metro;

-Implement a fleet management system;

-Strengthen business partnerships;

-Put systems and processes in place in all directorates;

-Review the organisational structure;

-Review and implement the current financial recovery plan (FRP).

-Improve revenue collection and management; and

-Implement a job card management system to curb overtime.

Governance and institutional capacity

Referring to its governance and institutional capacity, he said there was instability because the Mangaung Metro was characterised by elements of lack and poor oversight and governance systems, political instability, factionalism in the municipal council, high vacancy rates at the senior management level and lower levels, low staff morale, poor work ethics and professionalism, prolonged disciplinary matters, high litigation including costs, and poor planning for transitional measures. 

Progress to date was that the post of City Manager had been advertised with a closing date of 26 August. The council had resolved and appointed a selection panel for the interview process for the City Manager position. Short-listing for the position was scheduled for 22 September. Due to processes were underway to review the organisational structure. The vacant heads of department positions had not been advertised. 

The metro was currently in the process of developing an individual performance management framework to implement proper consequence management and to aid in capacitating the employees with necessary skills where needed. This document would be circulated to the relevant forums, such as labour representatives and other stakeholders, for input.

The macro structure review process commenced in October 2021, and consultations were held with National Treasury and national CoGTA. A refined and aligned structure was ready for further consultation with the public office bearers, executive management team (EMT), and the local labour forum (LLF). Both macro and public office bearers' organisational structures were to be tabled to the council for approval at the end of September. The micro structure for lower level staff would be reviewed and consulted with the relevant stakeholders.

The municipal public accounts committee (MPAC), Section 79 and Section 80, were sitting regularly.-Whippery meetings were sitting, although the recall of the chief whip had disturbed the rhythm.

Strategic matters

Mr Motlashuping reported on the strategic matters which were being addressed by the metro. These included:

- No document management system (DMS), and impact of this on audit reports and knowledge management.

- Unauthorised, irregular, fruitless and wasteful (UIFW) expenditure investigations and consequence management were very slow, but the MPAC was already seized with the matter.

- The headcount of employees and finalisation of placement of former Naledi Municipality employees had not yet been finalised.

- Lack of and/or poor coordinated corporate calendar for strategic meetings of the municipality, such as Council meetings, committees and the executive management team (EMT).

- A contract management framework and functioning of bid committees and procurements.

- A strategic planning session was planned for mid-October.

- A lack of synergy among political parties and intra-party issues were derailing the achievements that could have been registered.

- There were weak internal controls and poor focus on fighting incidents of fraud and corruption in the institution, which was affecting public confidence in the institution.

- Poor management of capital grants seriously affected the provision of basic service delivery, leading to public protests.

- The governance of CENTLEC, the municipal power distributor, left much to be desired. The majority of the Board members had resigned, so there was no quorum. Currently, the National Credit Regulator (NCR) is monitoring the entity's financial affairs.

Financial management

Mr Motlashuping reported on the progress to date:

- Revenue management strategy had been revised and implemented aggressively.

- Disconnections had commenced within the business sector and were ongoing.

- They were profiling critical vacancies and ensuring that the revenue value chain activities such as billing were streamlined by conducting meter audits.

- Systems were being put in place to coordinate meter replacement and installation between finance and Engineering.

- The tariff was not cost reflective. The next policy review session would review and revise the current policy. As of 31 July, the collection rate was 74.3%.

- The indigent register was now being verified and updated for correctness.

- A circular on cost containment had been issued, and strict adherence was being monitored.

- An audit was undertaken to capacitate the payroll unit and movement to the finance component for complete control.

- There was daily management of cash flow and expenditure control.

- Finance staff had been nominated for National Treasury training to obtain the minimum standards per the Gazette.

- Gross financial misconduct had been detected through duplication of payments and non-compliance with the tariffs on tenders awarded.

- An application for a neighbourhood development grant was submitted to National Treasury for approximately R30 million, of which R26 million was spent. R4.2 million remained unspent, and an application for a rollover had been submitted.

- Arrangements were entered into with creditors where required. Invalid and irregular invoices were submitted to finance.

- All grant-funded expenditures were paid within seven days.

- Repairs were carried out on the fleet to reduce outsourcing.

Service delivery

Human Settlement

The Committee was told that the Social Housing Regulatory Authority (SHRA) had taken over the management of the Free State Social Housing Company (FRESHCO) and placed it under administration. The administrator concluded the process and would present the final report to the Mayoral Committee (MAYCO) and the Council.

A mixed development project was underway. The social housing phase had been concluded, but land transfer remained unresolved. The Acting City Manager was engaged by the SHRA and developer on the matter. The land belongs to the municipality.

There were 22 rental schemes belonging to the municipality. The Mangaung Metropolitan Municipality (MMM) had started the process of conducting audits at some of the units. One of the old age homes had been audited. Some tenants had already signed new agreements, which were waiting to be signed by MMM.

The Vista Park 3 developer was still on-site. Internal services were installed at extension 261 which was now ready to construct top structures. The developer was currently installing internal services at extension 263, and was waiting for MMM to confirm housing typologies to be constructed in various extensions, including student accommodation. The land valuation process had been concluded.

There had been electronic submission of plans and TP-link applications. The orbit system was being reviewed, as it did not meet the municipality's needs.

The building control backlog would be finalised by 14 October. Valuers had offered to assist with scanning building plans for ease of scrutinising and valuation.

Refurbishment of the fresh produce market had been budgeted for the current financial year. The municipality had been requested to reinvest profits into developing and maintaining the market.

Q&A Consulting Engineering Services had developed a comprehensive, integrated transport plan. The project was expected to be completed on 14 September, but an extension had been granted until December. It generated the highest revenue in 2021/22, amounting to R5.5 million.

Solid waste

Mr Motsalashuping listed the following progress:

- Status quo analysis completed for waste and fleet management.

- Vehicle replacement and fleet stabilisation strategies had been finalised.

- Clean-up operations in Mangaung municipal business sector, Thaba Nchu and Botshabelo,

- There was continuous engagement between labour unions and senior management.

- The southern landfill site's access road had been partially cleaned, entrances were cleared for public access, and law enforcement was deployed to assist in dealing with illegal dumping. There were continuous efforts to keep the area clean, as well as to increase management oversight.

Water and Sewer Infrastructure

- A water and sewer reticulation network study was conducted.

- A draft water maintenance and rehabilitation report was compiled.

- The refurbishment of the water supply system project was currently addressing pipe bursts through a pipe replacement contract.

- Procurement processes were being fast-tracked, and contractors had been appointed to supply material to attend to burst pipes and leaks emanating from different types of water infrastructure.

- A professional service provider was in the process of revising the ten-year water conservation and demand management plan. One of the sub-projects identified was identifying formal sites with an incomplete/complete water reticulation system, but with no meters installed. This exercise would be done using a geographic information system (GIS), and estimated costs would be determined. The expected completion of the revised plan would be before the end of December.

- A reticulation network study was completed and a rehabilitation report was compiled.

- Critical vacant posts had been identified to be advertised.

- The budget had been prioritised and additional funding sourced through an application to the Department of Water and Sanitation.

- Work was being done on resurfacing roads (29.5km), pothole repairs and the re-gravelling/grading of gravel roads.

- The refurbishment of the water supply systems project and the water conservation demand management plan were implemented.

Integrated public transport network (IPTN)

- A forensic investigation by the Ministry of Transport would be finalised by the end of September.

- Reconfiguration of the ITPN was underway.

- Bus certification of fitness was under way, and would be finalised by 23 September.

Construction of a four-lane 1.2km base and surface layer for Moshoeshoe Road, with curbing and stormwater drainage, started on 22 August. 2022.

- All outstanding issues with the vehicle operating company (VOC) for IPTN trunk route had been finalised.

- The fleet maintenance agreement would be signed by the end of September.

- It was intended that the Hauweng Bus Go-live! would be launched in October.

Social services

Progress on the delivery of social services included:

- A library launch by the Library Information Association of South Africa (LIASA).

- Establishment of the substance abuse committee by the Executive Mayor.

-Establishment of the Heritage Council by the Executive Mayor.

-Resuscitation of the district HIV / Aids Council by the Executive Mayor.

-Sufficient budget to develop a comprehensive risk and vulnerability assessment of the city.

-Transferred existing zoo staff to the natural resource management unit.

Disaster management

- Procurement of a disaster information management system -- a requirement in terms of the Disaster Management Act.

- Participation in multi-disciplinary/integrated operations with other law enforcement agencies.

- Collaboration with the University of the Free State on safety and security matters.

- Sufficient funding enables the sub-directorate to respond to the humanitarian needs of affected households, such as blankets, mattresses and temporary shelter (shacks).

- Immediate replacement of backup batteries for two-way radio repeaters.

- Installation of additional two-way radio repeaters.

- R300 000 worth of fire and emergency equipment was donated by Sanlam this month.

(See attached document for the detailed report).

Enoch Mgijama Section 139(7) intervention

Mr Mpho Mogale, Chief Director, COGTA, provided the Committee with a progress report concerning the Section 139(7) intervention at the Enoch Mgijima Local Municipality (EMLM).

He said the intervention would focus on four objectives:

• To assess the state of the EMLM in terms of operations and finances, as well as the implementation of the FRP.
• To determine the best way forward to change the status of the EMLM from a poor or dilapidated state of finances and operations to a future state of sustainable self-sufficiency.
• To create an environment conducive to economic stimulation and growth that would result in reducing poverty and social dependence.
• Facilitate the development and implementation of a new financial recovery plan.

In pursuit of the above objectives, the NCR team had aligned its activities to National Treasury stipulated deliverables, such as:  

- The "As Is" assessment.

- The status assessment of implementation of the current FRP.

- To update and/or develop a new FRP.

- To monitor and oversee the implementation of the new FRP.

- Periodically to report to Parliament through National Treasury on the progress of the project at the EMLM.

Additionally, the NCR team had engaged relevant stakeholders to foster partnerships and ensure buy-in that would add value to the changing status of the EMLM. Stakeholders engaged included the municipal troika, the MAYCO, Council, the Chris Hani District Municipality, organised business, citizens, ratepayers' association, the provincial and national South African Local Government Association (SALGA), organised labour, ward committees, national and provincial COGTA, and treasuries.

Mr Mogale said the following progress had been registered to date:

- The As Is report was completed and presented to Council on 11 August.

- The new FRP was 90% complete, but the NCR was currently implementing the interim FRP which would be replaced by the new FRP, once approved by National Treasury.

- The Municipal Council was providing full support to the NCR intervention initiatives.

- The NCR had issued directives to the Municipal Manager, but the resistance which had been subtle in the initial months, had come out into the open.

- The NCR enjoyed a working relationship with the internal political arm of the council.

- The NCR introduced several internal control tools to mitigate non-compliance and improve efficiency in the service delivery value chain. However, although these had been acknowledged, they were not implemented fully.

- Some ghost employees had been taken off the payroll, but further investigation into irregular appointments and salary anomalies would be pursued. The NCR team had been defied and offered no assistance accessing such data by the Accounting Officer. This has hindered the NCR from gaining better insights into financial governance failures, and developing a relevant solution.

- Despite the intervention of the Executive Mayor, the top management refused to allow the National Treasury (NT) team access to municipal-owned devices that would enable it to reconstruct the required information.

- Denial of access to essential records would prevent the NCR from clearing non-compliance expenditure from past years, which currently amounted to approximately R1billion.

COGTA support

Mr Mogale said COGTA had undertaken the following activities to support the municipality:

- The provincial COGTA and SALGA supported the NCR team with institutional memory about previous interventions.

- It had mobilised the Municipal Infrastructure Support Agent's (MISA's) participation to support the development of the electricity master plan in 2022/23.

- It had seconded Mr Pankie Matomela and Ms Mirriam Chikwanda to support the NCR team.

- COGTA and SALGA supported the NCR to deal with staff cost stabilisation, in particular with an attempt to argue for an exemption to the South African Local Government Bargaining Council.

- The following Departments had been mobilised to support the NCR team: Transport and Roads (filling of potholes); Water and Sanitation (sewage spillages and water provision); Justice (disciplinary cases); Minerals and Energy (electricity), Environmental Affairs (waste management); Public Service and Administration (organogram).

- The municipality was currently under municipal infrastructure grant (MIG) cost reimbursement due to its poor performance on MIG expenditure.

High-level observations

- The Council was very supportive of the intervention.

-There was exogenous political interference in the operations of the municipality.

- A recent special Council meeting which the NCR had requested to present a report on the defiance of the records reconstruction project, had been postponed twice without a convincing rationale.

- The stakeholders had pinned all their hopes on this national intervention, and had pledged support to the NCR team.

- The organisational re-design process would stabilise staff costs once the process was completed.

- There was a significant number of employees, including labour representatives, who were desperate for change and stability.

- Efforts to deal with malfeasance and corruption were underway, despite pushback from management.

- The resistance and defiance, led by the municipal manager and the chief financial officer (CFO), to the records management process revealed a bigger risk to the project.

- Support by all for the implementation of the new FRP would lead to service delivery gains

(See attached document for a detailed report)

Discussion

Mr C Brink (DA) expressed concern that the presentation on Mangaung did not mention the financial recovery plan and yet under section 139(7), read with the relevant sections of the MFMA, the financial recovery plan was the rudder that steered the national government's intervention. It was in the financial recovery plan that one makes very specific interventions, or uses site-based specific interventions that bind the municipality, both the political leadership and the administration. Had such a financial recovery plan been formulated? Had it been shared with the municipal council? Had all the other requirements of such a financial recovery plan been met?

There had been concerns about motions of no confidence or the risk of political instability if, say, the mayor was removed, such as what had happened with the chief whip. Had the intervention team made a concerted effort to keep the council, including the opposition parties, informed of their progress? Had sufficient efforts been made to speak to the opposition councillors? Given that this was not a municipality with a government with a clear majority, there was also a coalition. This was unlike the old days, when there was one party with a super-majority and one needed to be worried about only the councillors of that party. What efforts were being made to inculcate a sense of shared responsibility for the success of this financial recovery plan -- if indeed one was in place? Was there any indication in Mangaung that there was sabotage of the efforts of the intervention team? Was it just the motions of no confidence that concerned the intervention team, or was there resistance from other political players -- for example, the Speaker or any of the senior managers in the administration?

Had the heads of the supply chain management (SCM), revenue management, and the head of human resources been replaced, or were those persons the same as before? There was an indication that the revenue collection rate was at 74.3% -- was this a current collection rate on the debt that was not older than 30 days, or a collection rate that included arrear payments? It was astounding that R1.3 billion was owed to Mangaung by provincial and national government departments and organs of the state. If this could be paid within the next six months, that would be the turnaround Mangaung potentially needed, in combination with the other interventions. There had been reference to a successful meeting with the province where there was an agreement to pay tens of millions of rands, but that was not a success. A successful outcome would be an agreement to pay the entire R1.3 billion. The intervention team should be focused and ensure that the government departments were not given a free pass when water and electricity were cut off, as that presumes those bills were not in dispute.

On the shift system, to replace or remedy the situation of excessive overtime, common sense was that more people needed to be hired to put shifts in place. There was no doubt that one would save on overtime, but to get a shift system in place, one needed to recruit more people.

In Enoch Mgijima, it was concerning that the accounting officer seemed to be actively undermining and opposing the intervention team. It was good, however, that a financial recovery plan was put in place, as opposed to Mangaung. Could the Committee please have a confirmation as to whether the council had steered that financial recovery plan, and that efforts were being made to reach out to all political parties and councillors and the council to support the intervention plan? Were the municipal and senior managers stonewalling Treasury and COGTA there? The financial recovery plan should be of assistance, because the provisions in the MFMA on what could be done with the recovery plan and how it binds the municipal council would ensure that effective and quick disciplinary action could be taken against the stonewalling officials. Did the external political interference mentioned in the presentation refer to the officials or cadres in the factions in the administration? Who were the outsiders who were undermining the intervention?

Ms E Spies (DA) appreciated the exceptional support that the government departments were giving to these municipalities. The problem did not lie with the Department, but within the municipality. The fact that the presenter had used the term "exogenous political interference" rang a bell. Staff being paid based on Grade 6 salary scales, even though it was a Grade 4 municipality, was illegal and unethical and must be acted on. How was it possible that the top management did not want to allow National Treasury access to municipal-owned devices? What was the next step to be followed because this must be dealt with immediately? The political interference, leadership instability, incapacity, and inaction needed to be taken up by the political leaders of the governing party of that municipality, because this was exactly what was at the core of the problem. All these departments could come in and intervene, but if they were not getting the cooperation and collaboration of the political leadership, there would not be any progress. The Committee could sit for days or months, but no progress would be made because the root of the problem was not being addressed.

Ms H Mkhaliphi (EFF) felt that the intervention at Enoch Mgijima would fail because the presentation suggested that the people who were supposed to cooperate were very negative. When the Department implemented some interventions, it concentrated only on some governance issues, yet the root of the problem was political. Was the intervention working or not? There was a municipal manager (MM) in this municipality, and he had been there when the intervention took place, but there had been no consequences for the MM or the accounting officer, which was problematic. Could the Committee get clarification on that?

In slide eight of the presentation on the outcomes of the assessment in Enoch Mgijima, it seemed as if everything was not working -- there was inadequate oversight, a lack of consequence management by both political and administrative governance structures, inadequate public participation, MPAC resolutions not acted upon or implemented, poor records management and so forth. Everything was problematic in this municipality. Was this intervention going to help the municipality or not? What needed to be done politically, because the problem involved political factions? There must also be an explanation for the lack of action by disciplinary board against transgressors, which created the problem in this municipality. Mr Mpho must tell the Committee if he was wasting his time with the team that Cabinet sent as an intervention, or whether he could see any progress. If he did see any progress, what was the time frame?

In Mangaung, the presentation stated that the metro was characterised by a poor oversight and governance system, political instability, and factionalism in the council. The indication was that some of the things that caused the instability were being addressed -- for instance, the hiring of the MM and all other senior managers. Was this going to address the cause of the instability? What was their understanding of the killing of the shop steward last week? Of course, they were not policemen, but they dealt with political instability and factionalism. Before the intervention, there had been some disturbing videos on social media about one faction member chasing after another member inside the council. Please update the Committee on the situation after the intervention that had been implemented.

She said the MMM was looking for funding for screening and competency assessments from the Local Government Sector Education & Training Authority (LGSETA) -- why were they not insisting on those institutions that were owing them to pay up, instead of going to look for money somewhere else? Ghost workers had been one of the headaches engulfing Mangaung when the team arrived there, and there was mention of some measures that had been put in place to resolve that. Had they succeeded in that area? Could they also clarify the issue of reducing committees or departments from nine to seven? The presentation indicated that the Local Labour Forum had also agreed on this -- what impact would the reduction have? If the LLF agreed with them, it meant they did not have a problem, because it was a local labour forum representing the workers.

Slide 11 referred to a lack of and misplaced capacity and poor commitment. Had they managed to deal with this, because when they were saying that they had advertised the position of MM, it meant that he would soon be leaving this municipality? Was he satisfied with his part as an interventionist and happy with the MM taking the pattern forward?

There were unspent conditional grants -- for example, the Urban Settlements Development Grant (USDG) and the Neighbourhood Development Grant -- that amounted to R508 750 792, yet there were service delivery challenges. Why were there unspent conditional grants while the people needed them on the ground?

There had been a call for CENTLEC to be disbanded. What was the plan? At some point, the CENTLEC item was supposed to have been discussed in a Council meeting, but the current mayor had withdrawn it from the agenda. What was the reason, because it was also surfacing here on their presentation? What was the status of its board, which was said not to be working? Why, then was the matter withdrawn from the agenda of the council? A report of consultants implicated former mayor Olly Mlamleli -- when would it serve at the council? Were they going to leave it like that, without taking through reports to the council?

According to the presentation, some committees were functional, and others had challenges, but they were not big challenges. Why had the committee of infrastructure and development never sat to date while there was a backlog on sewage issues? They had indicated that Mangaung was very clean, which was a good starting point, but what was the plan if the townships were not clean?

The presentation also mentioned that it had been discovered that lawyers were charging a lot of money. Following the Matlho Attorneys report that the council heard on 12 May about ghost workers, it had been recommended that three officials be charged for misconduct, including the head of department (HOD) for corporate services, who had since resigned, even before the report was tabled. How far were they with a report about the HOD who had resigned?

There had been mention of the purchase of land for the graveyard at the Nelsville farm. Why was the land not being utilised, since the graveyards were full and people were being buried on top of each other?

Ms D Direko (ANC) said the Mangaung presentation showed that there had been some positive effects on the administration side, but there were some political challenges in that municipality. How far was the municipality with the placement of the former municipal staff of Naledi and Soutpan? They had been sent to Mangaung after the amalgamation, but during the recent Imbizo of the President in Mangaung, it was asserted that they had never been integrated into the organogram of the municipality. What were the working conditions of the employees in the municipality because there had been some protests? Issues raised included the personal protective equipment (PPE) and allegations of inconsistency in employees’ salaries -- that some general workers were not receiving the same salaries in the municipality.

Was there a placement policy that adopted a realistic organogram for the municipality? Had the municipality come up with a clear organogram that would also cater to their shift system? The system was very good, because it was going to cut outsourcing and save money for the municipality.

She said there was currently a water crisis in Mangaung, especially in Riverside. Was there any plan to address that water challenge? Some areas were still using the bucket system -- was there any plan on the part of the municipality to remove that bucket system? After so many years into democracy,  people should not still have to use the bucket system. Some videos had been making the rounds, mostly on social media, about some of the roads in Mangaung, especially the one along the graveyards in Botshabelo -- was it in their plan to fix that road or not?

Regarding the appointment of the city manager, with the current state of Mangaung, did they need to appoint a city manager or did they need to allow the intervention team to stabilise the municipality? After it was stabilised, they could consider the appointment of the city manager. In most municipalities, where one had a city manager and the administrator, they did not work together to ensure they met their objectives. The city manager would pull in one direction and the administrator in the other. At least in Mangaung, they had the advantage of the administrator in the absence of a city manager, and there was evident progress, so did they need to appoint a city manager?

In those municipalities that were not performing well, the Auditor-General (AG) would always say some of the challenges were due to a lack of political oversight. In Enoch Mgijima, was there any political will to assist the municipality? Did they have a financial recovery plan in place? If so, was it being implemented, and what was the progress?

Mr K Ceza (EFF) commented on the material impairment to the tune of R4.183 million, unauthorised expenditure of R1 billion, irregular expenditure of R1.6 million, the under-spending of the USDG and public transport infrastructure grant by R233 million and R1.3 million respectively, the material losses on the consolidated financial statements, the material water distribution losses and so forth. On service delivery, there had been a Department of Transport project for the integrated transport network in the metro, and the municipality had developed and approved an operational plan for a phase of the network that covered the period from 2016 to 2020. Why was that deadline not met? How much was planned in terms of feasibility studies, and the initial stages of the construction process of the programme? The Moshoeshoe truck road construction commenced on 21 January 2019 and was planned to have been completed by 14 November 2019, but by February 2021, the project was not yet completed. Why was the deadline for completion not met? It also looked like the intervention projects were not being completed as well. At the bottom end of the chain was the end user, who was deprived of the services.

The presentation referred to economic stimulation. What was the nature of that economic stimulation, because the Committee's concern was that in the process of improving municipalities, one had to build economic activities which would give rise to employment and people becoming skilled. What was the nature of economic stimulation? On the landfill site, if they were removing people from an already deplorable site where they resided, had they considered their economic activities there, and had they considered moving them together with their economic activities? Whenever they wanted to deal with people, they tended to be punitive instead of providing the necessary solutions to give the people land for residential purposes. People lived there because those sites would not be in the former white suburban areas. They would come to dump only next to the townships. Had they considered a different approach in dealing with residents there, instead of trying to find out who was local and non-South African? That would give rise to many problems involving xenophobia and other issues. The synergy between contracts, management, supply and end-user would not happen because, by design, that chain did not seek synergy because of its corruptibility.

Mr B Hadebe (ANC) said he did not normally applaud fish for swimming, but it was also his conviction that when one had the desire and commitment to see things being done correctly and in line with good corporate governance, one also had to be comfortable and satisfied when progress was made to towards achieving it. Members were therefore also called upon to apply the same desire and commitment, to give credit where credit was due. The Mangaung presentation gave hope and comfort that things were being done in that municipality, and that the situation would soon improve. It highlighted all the challenges such as issues of sewer spillages, the metro police re-establishment, pothole resurfacing, water, and so forth. The report highlighted everything and did not hide anything. As the DDG was presenting, he was reminded of Amica Cabral when he said: “Hide nothing from the masses of our people. Tell no lies. Expose lies whenever they are told. Mask no difficulties, mistakes, or failures. Claim no easy victories.”

On money owed by government departments to Mangaung, he said there should not be a soft approach when dealing with this. He urged the intervention team to be very decisive in dealing with this matter and demand that the money be paid as soon as yesterday. If it meant disconnecting services, so be it. A very clear and unequivocal message must be sent when dealing with government departments.

Administrative solutions would not resolve the political instability in that municipality. As such, the Deputy Minister would be the relevant person to communicate a sense of comfort on what was being done to address once and for all the political instability and political interference in that municipality. One could not expect an administrative solution to resolve political problems. He quoted the adage that “insanity was doing the same thing over and over again and expecting a different result.” History and experiences had taught them that the premature departure of intervention would lead to the collapse of the good work and the progress that would have been achieved at that point. What measures were in place to ensure that they had long-term sustainable solutions to the good work they had done? Were plans and measures in place? Were they "smart," meaning specific and measurable, and would they achieve sustainable solutions when they left? He was mindful of the fact that the team needed not to overstay its welcome and end up being captured, but the interest of the Committee was first and foremost to ensure that what the intervention team had done was just the beginning. The ultimate prize was to have a sustainable solution in dealing with the issues affecting the municipalities under intervention.

Mr G Mpumza (ANC) said the presentation on Mgijima showed some indication of positive action in trying to rescue Mangaung from its political and administrative challenges. The Department had let a team led by the former municipal manager of Matlosana into Mangaung -- had it done that because he had experience in local government? There was also an indication in the presentation that the microstructure had been scaled down from nine to seven -- was this intended perhaps towards a process of scaling down a deep-rooted structure? Were the two discarded departments not critically relevant currently?

One of the dominant determinants of the imposition of this intervention, where the financial recovery plan was in the foreground, was because these municipalities had been financially distressed. Their financial management and other systems had collapsed, so had these financial recovery plans been successful wherever they had been imposed? The imposition of this intervention under the recovery plan without a cash injection had not yielded results, particularly in Mgijima. It was the second time that the national government imposed such an intervention in Mgijima after the intervention by the provincial executive, though the financial recovery had failed. What plan did National Treasury have in place to address this and kick-start the financial recovery plan by some form of a cash injection?

It was very worrisome that in Enoch Mgijima, the municipality’s governing system had collapsed to the extent that there was a serious exogenous interference in the administration of the municipality. The MM was also not cooperating with the CFO, to the extent that the national team had to look for other ways to extract data from the municipality because of the non-cooperation of the MM, and the Mayor was condoning that behaviour. Was the oversight structure assisting this intervention team? What other remedial measures was the Mayor bringing to the fore to assist this team in ensuring that the administration of Enoch Mgijima cooperates with the NCR to rescue the municipality from the situation it was in?

Mr A Matumba (EFF) said the challenges in Enoch Mgijima emanated from a lack of political will to lead the municipality properly. Even if the provincial government intervened, politicians would come back and mess up everything again because, without proper political oversight, there would never be proper management. Politicians had started all this mess on the management side, which was why one would get CFOs and municipal managers who thought they were bigger than everyone. It started with the kind of relationship they had with politicians, and that relationship influenced their arrogance in them. That was one thing that needed to be dealt with, because it was something that was raised in every report, yet there was no political accountability -- accountability was always on the management side. For instance, all the issues that were dealt with were either raised by the whistleblowers, the Special Investigating Unit (SIU), the National Prosecuting Authority (NPA), South African Police Service (SAPS), or the Auditor---General. There were no issues brought by the Municipal Public Accounts Committee (MPAC) that was doing oversight. All these issues were picked up by structures outside of the municipality, which showed that there was nothing that politicians were doing. If there was no political will, this intervention team could do whatever it did, but the politicians were going to come and mess up everything.

When Minister Nkosazana Dlamini-Zuma came to Parliament to answer a question on Mangaung, she said the municipality could save more than R10 million if it insourced its security services. How far was the municipality in insourcing the security guards, because it could save them more than R10 million, which could be used to address service delivery issues? How far were they, and what were the timelines for insourcing security services in Mangaung?

Ms S Buthelezi (IFP) asked for an update on the progress of the partnerships Mangaung had with MTN, Interstate and the Central University of Technology (CUT). What did the metro hope to achieve through these partnerships? What stakeholder engagements had they undertaken to mitigate potential taxi or bus violence in the integrated public transport network?

In Enoch Mgijima, according to Section 139 of the Constitution, there was no need for the total collapse of a municipality before an intervention. A non-fulfilment concerning a single identifiable obligation was sufficient for an intervention, so why had the EMLM been allowed to degenerate to the state to which it had degenerated?

COGTA's response

Mr Motlashuping said the team had started in Mangaung at the end of April and had been around the metro for approximately four months, so some issues had occurred before its deployment. He indicated, as a precursor, that the DG had been aware of the difficult environment in which the team was operating. The team was under 24-hour police surveillance and protection because of some of its actions. The team members' lives were in danger, which also applied to other interventions that the national and provincial government had made, because people resisted intervention when certain things and decisions were taken to improve and curb some of the malfeasance committed in those areas. Those were the very difficult conditions the team worked under, and there had been some pushback and resistance from within, especially with the employees because of the decisions made. Fortunately, the Deputy Minister and the DG had experienced some of the reactions that had happened in their presence in Mangaung, where employees wanted to force the municipality to pay them for overtime which amounted to more than 100 to 120 hours per month, whereas the law provided for a maximum of 40 hours per month. The DG and the Deputy Minister had also experienced the onslaught of frequent physical threats to which the team was subjected. This was just to inform the Members that the team did not enjoy staying in Mangaung because of the volatile situation. This could be why a shop steward was fatally shot eight times last week. The police were still investigating the murder, so there could not be speculation on the motivation for the shooting.

The provincial intervention team developed a financial recovery plan, which is now being implemented. National Treasury is in the process now of reviewing this financial recovery plan. As soon as it was finalised, the NCR would put it before the council for adoption and implementation. National Treasury would explain the duration of the review of this financial recovery plan. It was submitted to the council so that it would be implemented. Most of the actions the team took resulted from the response to that financial recovery plan. The NCR had informed the councillors of the progress the team was making, and it had also made a presentation to the MPAC in response to what had been highlighted by the AG. Mr Motlashuping said he had compiled the progress report in the presentation to the MPAC, which was well received. At the last normal council meeting, he reported on the progress made, and all the political parties accepted the report.

Every quarter during council meetings, n the report of the municipal manager was a standing item, and that was where he reported. Apart from that, there was a multiparty whippery where they reported on the progress made, so the parties were involved. There was also an open door policy in the Acting MM's office regarding all political parties, and his phone was full of messages and queries. All the political parties, especially councillors, would then engage with him on some of the queries and reports that they requested from time to time.

Referring to the sabotaging of the intervention, he said there had been pushback from the employees because of NCR's decisions. They saw the team as invading their space and denying them the opportunity of making more money. The other issue for them was the strict control measures that had been put in place to ensure that the team did not rely on service providers, because there were elements in the municipality, especially on the workers’ side, who were conniving with service providers, and vehicles were being sabotaged. For example, a vehicle used for service delivery could not operate because it did not have a battery or permit, so it stayed at the depot. Workers would then inform the MM that they would not work because they would not get into a car that was not roadworthy, and the official responsible for paying for the permit did not give reasons why that was not done. So, the team introduced stricter measures to ensure that everyone did what they were employed to do, which did not go well with them. The NCR team also ensured that people reported to work on time and left on time.

From the outset, councillors could not accept the fact that there was this intervention. It was solely after the Minister had introduced the team and explained the decision of the Cabinet to them that they accepted. Some councillors did not understand the intention of Section 139, but through the team’s engagement with them, there had been understanding. The team’s frequent reporting to them had also created an understanding of why the intervention team was there. There was now collaboration and good working relations between the team and councillors. They did their oversight and, in some instances, became robust in ensuring that the team did certain things, especially considering the challenges of sewer spillages, water leaks, and so forth.

Councillors had asked why the NCR team was in the municipality if it was not seeing to all those things and addressing them. In some instances, the team had been there for only two to three months, trying its best to do things right. It could not be expected to be correcting everything in three months or the six months that Cabinet had deployed it to be there to undo the wrongs that had been done over a period of 15 to 20 years. The issues in Mangaung were embedded to the extent that the wrong things were normalised. They were entrenched so much that when one started doing things differently, people resisted because they were not used to doing things differently. For example, when the team dealt with the overtime issue, it found some employees closed the valves so that people could not get water. The councillors would call them, because they had the keys to the valves, so when they were instructed to go and open the valves, that was when they worked overtime -- because the valves were closed outside of the working hours. That was the kind of sabotage being experienced. The police were asked to escort officials to go and open the valves, only to find out after three hours that they had been closed again, and there was no water in the city. These were just a few examples to show that there was sabotage due to the decisions that the NCR was taking to correct the wrongs that were there.

The SCM team had not been replaced -- it was the same team that the NCR had found there because of the decision of the council at its last meeting that the NCR needed to investigate some of the allegations against the supply chain unit. The NCR had started the investigations and had invited anyone with information to help the investigation to come forward. The NCR was also looking into some of the decisions the supply chain unit had taken to see whether there were any other wrongdoings.

Responding to the question on revenue collection, he said it was the percentage on the current and arrear amounts. Yesterday, at the provincial Standing Committee on Public Accounts (SCOPA), the NCR had been requested to separate the percentages concerning revenue collection, current and arrear payments, and he had instructed the finance unit to provide the figures on the two. It would be shared with the Members as soon as it was available.

When he had referred to the meeting with the Premier’s office and the Department of Public Works as a successful meeting, it was because the NCR had been informed that there had never been an engagement to try to resolve the matter in the past. The success did not refer to the R53 million that had already been paid and the R86 million that they were going to pay this week at CENTLEC. The NCR was pushing the provincial department to make payments to the municipality. The fact of the matter was that the NCR had been given reasons why payment could not be made in the past. In the current budget of the provincial department, there was no provision for payment on the arrear account to the municipality. That was the reality -- they did not have the budget to pay it. So in the meeting, they were very clear to the NCR about the situation, indicating that even the R86 million they would pay had to be taken from all the departments. Other provincial departments had to reprioritise some of their targets to ensure they had something to pay on the arrear account. They were paying the current account monthly; the problem was with the arrear account, and the reality was that there was no budget for that at the provincial level. The NCR had indicated that it needed to inform the Minister of Finance and the Minister of COGTA of the intervention in the budgeting process to include this arrear amount owed to Mangaung. Even if one could cut in the other areas, the NCR was told that there was no budget for the arrear amount that needed to be paid. So, his reference to success should be understood in the context that it would be counterproductive to cut now because they could not pay their R2 billion. There needed to be further engagement on the budgeting to allow this arrear account to be dealt with.

Mr Motlashuping agreed that for the shift system to be implemented, more people should be recruited. The team was working on recruiting staff members because there had been a moratorium in place for approximately five years. At the entry-level, especially for the people doing service delivery, the NCR had started requesting all the departments in the municipality to identify critical positions for service delivery, and the critical positions would be advertised soon. They had already given him their lists of the critical positions at that level. A new shift system could not be introduced while there were no people to work those shifts. The NCR was mindful of that situation and was working on it.

He responded to the issue of stability, saying it was about what happened before and after the NCR arrived at the municipality. The council was not sitting regularly because of what had transpired at the time, but the NCR had been mindful of the fact that the MAYCO did not sit. The Section 80 committee did not sit because the previous administration had not made it possible for them to sit -- for example, when they had initiated items to be taken to the council committees and subsequently to the council. When the NCR arrived, it had started identifying compliance matters, for example, where it had drafted items for compliance and taken them to the committees, MAYCO and the council. Committees had then started to sit regularly and propose certain things to be taken to the council, which was done. The NCR’s involvement had made it possible for them to sit regularly, and the team was assisting councillors in putting forward items not necessarily on compliance matters but service delivery matters. Section 80 committees were sitting now. On why the Section 80 committee on infrastructure was not sitting, he said there had been three attempts to make this committee sit. There was a problem with the availability of members of that committee, so the chairperson had instructed and was adamant that it had to sit, and would sit on 27 October. All the committees had sat, and there were many issues that this committee had to deal with because of the challenges that were being faced, and their sitting would be prioritised.

He said the police were still investigating the killing of the shop steward, but the team's officials were under police guard for security reasons. The police had also been involved in risk assessments of some people who had indicated that they suspected that their lives may also be in danger.

The changes that the NCR brought about affected the stability of the municipality. The Speaker and the Deputy Mayor appreciated the kind of work that the NCR was doing and in all their engagement, even with the outside world, they indicated the kind of changes the team was making. That also created some sort of stability administratively, because of the support they were giving the team. At this stage, there was no political interference in the work that the NCR was doing -- maybe it was because the national government and councillors had sent them did not want to get too much into its area work. It would have been difficult or different, maybe if they appointed substantive executives in the municipality. In this instance, they knew that the team was from the national Department brought by the national Cabinet, so there was no attempt to change or interfere in how it operated.

Mr Motlashuping said that the NCR had terminated the ghost workers. These ghost workers had emerged before the November elections. All political parties gave a long list to the administration at the time, which had then appointed these people without even following the process of recruitment and selection, hence they were called ghost workers. Their contracts had since been terminated, and it was also made sure that the offices of political office bearers were manned by only two to three temporary staff per political office bearer until the structure had been reviewed and fully fledged people would be appointed in those positions. Public office bearers did not even have the numbers that they were supposed to have in terms of the regulations of 1 July 2022. The political parties had accepted this decision to terminate the ghost workers and give them skeletal staff to man their offices whilst the NCR was busy with the recruitment process of staff members in their offices per the regulations.

On reducing the departments, the Minister of COGTA developed prototype organograms after a thorough search for different types, categories and sizes of municipalities. This prototype would inform the team that a municipality of the magnitude and size of Mangaung, even if it was a metro, was not a metro like other metros and would have to have a particular organogram. The regulations promulgated recently also guided that a metro of a certain size should have a certain number of departments. The other departments had not been taken away, but had been merged with other departments. A metro such as Mangaung could not have an organogram that was like the City of Johannesburg metro, so the prototype would guide the NCR in determining what should happen, and that had been agreed upon at the LLNF, and was even referred to the sub-committee of the LLNF to deal with it. The NCR also had compliments from the national COGTA and National Treasury that it was not taking this to the council. The NCR was confident that the departments would t respond to the service delivery model of Mangaung as a metro -- not for any other metro, but Mangaung.

Regarding the departure of the NCR, and whether the kind of progress it had made would be sustainable, he said the team's mandate was to be in this municipality for six months. The team members had all been doing this, anticipating it would take six months. This period would come to an end at the end of October. The NCR was trying to put systems in place that would defend them and make sure that whoever came in should not be able to manipulate the system. The NCR was putting systems in all departments to make sure that there was sustainability. However, the principals would decide as to whether there would be an extension of the team’s deployment beyond the October deadline. The team would continue to support this municipality even after the expiry of the six months per Section 54 of the Constitution. It would be proper that the team that had been assigned to Mangaung would continue to give support. Section 54 did not say COGTA -- it said national and provincial -- so all other departments with the people deployed there would have to continue to support this municipality after the expiry of the six months.

The conditional grants were not spent in the past because there was no proper project management. The NCR team in its focal area had decided to put in place a review of procurement plans that would ensure that money was spent. The under-expenditure of the conditional grant was not done during the NCR's four-month stay in Mangaung, but before that. The NCR had re-submitted for this conditional grant to be given back, because it had demonstrated with the review plan that it would have proper project management. The NCR would monitor the strict implementation of the plan that it had developed. He was aware of the issue raised by National Treasury. The Minister of Human Settlements had also accepted the NCR business plan, which detailed how it was going to monitor expenditure. This should ensure that the expenditure would be made on conditional grants during the NCR's era.

Regarding CENTLEC, the NCR had initiated issues at the committee level. It had then prepared this item for the council, which was then taken to the Section 80 committee where it was debated and then referred to MAYCO. MAYCO had also agreed and accepted the recommendations from Section 80 on the disbandment of this board because it was dysfunctional. The item was withdrawn from the council for unknown reasons. This question was also raised at SCOPA yesterday, so the executive may answer that at the next Council meeting, as this item would be put before the council. The NCR had done all that was necessary to ensure that this item went through the processes for it to be debated at the council level.

He said he had not been privy to the consultants' report that implicated the former mayor. He had requested that the report be placed before him so that the recommendations in the report were implemented.

Not only Bloemfontein was being cleaned -- the townships as well. There was an agreement, and it was in the programme that had been presented, that in partnership with business, all areas should be cleaned at all times. It had already started with the townships around Bloemfontein, and had made it clear that even if the NCR was working towards eradicating overtime, overtime would have to be worked in this case. Staff members were already being given overtime for two weekends to go and firstly remove the illegal dumping sites and work on the backlog so that when the normal refuse removal and cleaning was done, the backlog would be out of the way. Even during the weekends, municipal workers were working and removing those things. The NCR was concentrating not only on Bloemfontein, but had also been in the other seven towns in Mangaung to physically see what was happening in those areas. The situation was not all that good regarding cleanliness, but the NCR was working on addressing it.

The Matlho Attorneys report resulted from the disciplinary action that had to be taken against the HOD of Corporate Services. The NCR had received the report, and had given effect to the recommendations of the report. It had initiated the charges against the officials implicated in the report. It requested SALGA, through the advice of the DG, to provide the entity with officials who would preside over the disciplinary hearings, and SALGA cooperated. As per the recommendation of Matlho Attorneys, the NCR had also opened a criminal case against the alleged implicated official. Thus, there had been action following the report.

The NCR was awaiting the report on the UIFW, and as soon as it was received, investigations would be initiated and action would be taken against the implicated officials. It would also be taken to MPAC, which had not been operational before the team arrived. It had only sat for the first time when the NCR presented before it. It had sat for the second time when it was adopting the report that was moved to MPAC, and was subsequently moved to the council. There would be consequences and action taken once the report was shared by the attorneys that were doing the investigations.

In response to the question on purchasing land for graveyards, he said they were waiting for the permit they had applied for, and once it was given, the graveyard would be developed. The graveyard needed to be funded by the Urban Settlements Development Grant. There had been a meeting with the Minister of Human Settlements on the USDG grant, who had told the NCR to set its priorities right. There was R450 million from the USDG and the NCR had to prioritise between fencing the graveyard and dealing with sewage spillages. Sewage spillages would take priority, not meaning that the fencing of the graveyard was not important. The team had to get its priorities right, considering sewage was spilling all over Mangaung.

Mr Motlashuping said the NCR had not completed the placement of the former municipal staff of Naledi and Soutpan. It had not been done since Mangaung became a metro, so the team was correcting it now, but would not be able to finalise it within the short period it had been in Mangaung. However, as stated earlier, the NCR would continue to give support even after it had left, and would continue finalising this process because it had started it.

The disparity in salaries resulted from the mismatching of the small municipalities amalgamated into Mangaung. No one had been prepared to deal with this matter until the NCR arrived in April. Because of this process that the NCR was undertaking, it had been indicated that there was an agreement in the past that to deal with the disparity, all employees had to be given R40 000. The NCR had refused to do that because it was not sustainable and unrealistic that all employees should be given R40,000. The placement would continue even after the organogram had been completed.

 He said the NCR was dealing with the water crisis. It was aware of the other areas where there was no water and had agreed with Bloem Water and Coca-Cola that it would use its tankers in the meantime to provide water to areas where they could not get water. The NCR was upgrading the water treatment plant in areas like Hamilton, which would also address the water crisis for the surrounding areas.

He said it was unfortunate that there was a metro that still had the bucket system -- not only the bucket system, but there were also ventilated improved pit (VIP) toilets in Botshabelo and Thaba Nchu in this time and age, because there was the eradication of the bucket system by the government in the past. Money should be set aside to eradicate this, as it was a non-negotiable matter. He added that the Botshabelo road was also being fixed currently.

On whether the process of appointment of the municipal manager should continue, he said the mandate of the NCR and part of his performance contract was that he must finalise the appointment of the MM, so he would leave it to the principals to decide.

Regarding the material impairment, he had been served with a notice by the office of the AG about this matter to explain the action he had taken since his arrival, as this had been done before his arrival. He could face a jail term if he did not respond to this, so he responded and informed the AG of what his team intended to do and handed over the matter to the law enforcement officers because there was a lot of money that had been misused. Last week he had been sent a reminder by the AG's office to report on what his team was doing on the matter. On wasteful and irregular expenditure, the entity had hired the Thoabala Attorneys to do some forensic investigation into the matter. Once the report was available, the matter would be taken to MPAC for recommendations which would be implemented. 

On the material losses of water, the NCR was working with Bloem Water to deal with non-revenue water or water losses. At the national level, COGTA had a dedicated project dealing with non-revenue water and non-revenue electricity, so the team would be getting support from COGTA to deal with this issue of non-revenue water or to successfully eliminate the escalation of water losses.

The Integrated Public Transport System (IPTN), which was started between 2016 and 2017, was supposed to have been completed. The intervention was being finalised and the team had set a target that by October the Minister would have to introduce it, including the Moshoeshoe road, which would be completed by the end of this month.

There would be an investment summit on economic stimulation to deal with how Mangaung could be brought back to being the province's economic hub. Firstly, the Tempe Airport should be turned into a cargo airport. Secondly, an economic hub would be created around the Tempe and Bram Fischer airports. Transport Minister Fikile Mbalula had been informed about this ambitious project that would stimulate the economy, create employment and resuscitate the rail infrastructure. He had authorised the team to think along those lines and provide proper information and direction on the resuscitation of rail. There had also been a meeting with Coca-Cola, which had indicated that it had set aside R500 million for injection into small and medium enterprises (SMEs), but it did not want to fund tuck shops -- wanted sustainable businesses.

The people in shacks on top of the landfill site were not supposed to be there, regardless of where they came from. The law said they must be moved to an alternative place where there were services, and that was what would be done. As for moving them with their economic activities, the team would take advantage of the refuse dump to promote SMEs involved in recycling. That was what those people had been doing, so that process and economic activity would be continued. They would not be moved just anyhow and put out on the streets -- that was not the intention.

In response to the question about his local government experience, he reminded Mr Mpumza that they had been together in Sweden, where he did a project management course, which was now coming in handy in this position in Mangaung.

On the question of the debt owed by government, he said they were in constant discussions with the Office of the Premier. The team was also engaging the Ministers to assist.

They had discussions with the unions and civic organisations that matched the offices of the companies doing security insourcing. The HOD of police had already received a report from the Private Security Industry Regulatory Authority (PSIRA) that deals with security guards. They gave the NCR two options -- outsourcing with the figures, or insourcing with the figures. This would be taken to the Section 80 committee, and subsequently to the council to decide.

The NCR's partnership with Interstate, MTN, Vodacom and Coca-Cola was very strategic in ensuring the town's cleanliness and allowing SMEs to use these companies to grow. They had agreed that they would train people and give them business opportunities, but they would also concentrate on beautifying the municipality, including all the other neighbouring towns. Interstate had agreed to provide a yellow fleet (heavy equipment) before the rainy season to facilitate the recreation and re-gravelling of the roads, especially in the lifeline areas where there were farms and plots. This was the kind of support the team was getting from these companies. They said in the past, they had not been allowed to participate in all these projects because the municipality wanted money to be donated to it. He had told them the NCR did not want money, and that they should donate their resources and partner with it. Mr Maseko was engaging with all stakeholders, including civic organisations, to ensure that they understood the kind of work the team was doing.

Ms Williamson commented on Section 139(7) in Mangaung, saying the Department's advantage was that it was able to secure persons from the MM level into the intervention. This was something that the Department wanted to look at more closely to see how Mangaung could be used as a blueprint when similar interventions might be required going forward.

 On the success in ensuring that collections were indeed made even at a national level from the departments that were owing, the Department had impressed upon them to pay, and the DG had also personally reached out to them to ensure that they came to the party and began to make payments. She personally went to Mangaung every three weeks or so to ensure that the plan was indeed being operationalised. It was inclusive not only of boardroom meetings she had with the team, but also inclusive of actual physical and outside visits to ensure that what was being reported by the team was indeed being undertaken in practice. From the relationship perspective with Eskom, not much has been said, but that could be expanded in the next report. The security of the team remained a concern, but necessary measures had been undertaken to secure the safety of the staff.

Ms Kavitha Ruplal, Head: Municipal Financial Recovery Service, National Treasury, commented on whether an FRP for Mangaung was formulated, whether it had been shared with the council, and if the requirements of the FRP were being met. When the province invoked the mandatory 139 (5) intervention, National Treasury and not the provincial intervention team had prepared that financial recovery plan, and the MEC approved it for Finance in about June 2020, so it has been in implementation since then. The issue was that when the municipality was implementing the plan itself with the previous set of HODs, it had been very difficult to make progress because many of the key issues that Treasury had identified were not dealt with. There was a lack of willingness to deal with them. This applied in particular to the overtime and the bloated organisational structure. Now that they had converted to a national intervention, the FRP was still in the implementation stage and what was being done now was to revise the status quo assessment. Once that status quo assessment was updated and the NCR team was happy with that process, that input would be used to update the financial recovery plan and get it approved by the Minister of Finance. However, there would not be too much of a variation between the current financial recovery plan and the one that would be revised because the issues were the same. Maybe some of the issues had deteriorated, but the NCR team and the resources deployed had arrested many of the immediate issues raised in the financial recovery plan itself. The implementation of the financial recovery plan, whether it was in Mangaung or Enoch Mgijima municipality, required the support of the council and the municipal administration.

On the issue of the administrator, in both these municipalities, there was no administrator, and an administrator could be appointed only, as stated in the Constitution, if there was no council. Therefore, because there were municipal councils in both municipalities, the Department was not allowed to appoint an administrator, so they were referred to as the national Cabinet representative and the support team. It was important to mention that since a council was in place, the current legislative framework did not give many powers to the national Cabinet representative team. Therefore, successfully implementing the financial recovery plan required cooperation from the council and the administration.

Thus, in the case of Enoch Mgijima, there was an issue with getting that cooperation from the administration, and the NCR had recommended that the municipal manager, the accounting officer, and the chief financial officer be put on a precautionary suspension because they were failing to cooperate with the processes of the intervention. They also failed to cooperate with the processes put in place to recover much of the documentation. The municipal building had been burned down earlier this year, and much of the documentation was destroyed. If the Department wanted to implement consequence management or confirm what had been done wrongly in the municipality, it would require those documents. As indicated, the Minister was there yesterday. The accounting officer and the chief financial officer had been instructed to cooperate and to hand over their laptops, iPads, and other devices. The precautionary suspension had been put on hold temporarily, but should they fail to cooperate, the Department would support the NCR team by putting them on suspension. The NCR had reported that two council meetings they had convened where the MM was supposed to come and explain the situation and get the council to decide or to act on how to deal with the administration, had been cancelled at short notice. The justification for the cancellation had not been appropriate.

She reiterated that in both municipalities, the FRP was in place, and in Enoch Mgijima, the Department was at an advanced stage of revising its financial recovery plan. It had been taken to the council, business forum, and a range of stakeholders. In the Mangaung metro, it was in the process of updating the status quo assessment and based on that, the Department would revise the financial recovery plan.

Mr Mogale responded to the question of whether the intervention would work, and said that by just comparing the two municipalities, one could see that at Enoch Mgijima, there was an interim impasse that had to be dislodged. With the support of all stakeholders, that impasse had to be dislodged immediately. When it was done, there would be progress because the Department and the NCR had the resolve for the intervention to work. All that was required was just the space. There was also encouraging political support this time around which had been lacking in the previous administration, when there was also poor oversight.

This current leadership was very committed. All that was needed was to deal with the management. At the next meeting, the Department would give a comprehensive report on the progress that had been made, even though documents had been destroyed and the situation had to be reconstructed from scratch. What was important right now was to stop the wrongdoings of the past and start on a clean slate. There was great oversight, as seen in Mangaung, and the DG was going to the metro every three weeks supported by the Deputy Minister and, in some cases, the Minister came through. The same had been done for Enoch Mgijima municipality. The priority was to make the interventions a success.

On the cash injection in this intervention, Treasury had its position about this that was known and had been accepted, but some things had just happened, and money had been lost in the municipality. There must be consequences, and the leakages that had been there must be closed. When there was confidence and a good threshold of accountability, and reporting of the expenditure incurred in the municipality was restored to a particular level, investment in the municipality would follow.

Deputy Minister Nkadimeng said she would not say much because she had missed quite a lot of the responses because of network challenges, but Mr Mogale had already stated the Department’s commitment.

She responded to Ms Mkhaliphi, saying she could not say how many times the Department's leadership had gone to Mangaung to begin to scratch the surface, and the same level of energy and commitment was needed in Enoch Mgijima. Hopefully, they would get it right. She assured the Committee that where COGTA was facing difficulties, it would be honest with the Members. Those difficulties would be described to the Committee to find solutions together and attempt to implement them. She thanked the Committee for the opportunity to update the Members on the two municipalities and to express the Department's commitment to the municipalities.

Ms Mkhaliphi wanted to know if there had been a response to her two questions on CENTLEC, the dysfunctional board, and the consultants. She would be happy to receive a written report or responses on those two issues.

Mr Motlashuping said he had indicated earlier that the CENTLEC matter was being dealt with at Section 80, and would be discussed at the council. Section 80 and the MAYCO had proposed that CENTLEC should be disbanded and should start the process of advertising for a new board to be appointed by the council. As per the rules, the council was the body that appointed the board of CENTLEC, and there were only two members left there.

On the report about the implication of the mayor, he had already said he had not seen the report, but he had requested it because even yesterday, at the provincial SCOPA meeting, it had been an issue. He would update the Committee as soon as he had the report.

The Chairperson said he hoped that the commitment made by the Department that it would not fail in these two interventions would be met. Failure would affect the people, and the intervention was meant to save the people from a failure involving the three spheres of government. It would not only fail the people, but the country as a whole, because this was the last hope and the last line of defence for the people. This was because the decision was taken by Cabinet, which was the national government, and everybody must be educated to know what this meant. Therefore uncooperative people must not be allowed to distract the team from what the government was supposed to do, as expected by the people. The non-cooperation at Enoch Mgijima was the biggest test of government, because that was what people were exposed to daily, so if one needed an example to demonstrate the capacity of government to deal with wrongdoing, this was an opportunity. Surely everybody was not keen to miss that opportunity.

The meeting was adjourned.