Metsimaholo Municipality section 139 intervention: Free State MEC briefing

Meeting report

Opening remarks by the Chairperson

The Chairperson opened the virtual meeting and welcomed the Members, support staff and the delegation from the Free State Department of Cooperative Governance and Traditional Affairs (COGTA), including its MEC to the meeting.

He said that there are two specific items to be discussed in the meeting. The first item relates to the intervention in the Metsimaholo Local Municipality and the second one relates to the adoption of a Committee report. He added that the budget vote for Human Settlements and the Water and Sanitation Departments is scheduled for Friday, 04 June 2021, where there will be a debate in the House. This is why it is important for the Committee to look at the report as the Committee had engaged and discussed on it last week Friday, 28 May 2021, with the aim of adopting it.

He said that between 2018 and 2019, the provincial government of the Free State invoked section 139(1)(b) to the Metsimaholo Local Municipality. The invocation of section 139(1)(b) to a municipality means that the municipality is unable to meet its constitutional obligations. It is not the first time that the Department has invoked section 139(1) (b) in this specific municipality, as the municipality was dissolved in 2017 and a new municipal council had to be established with the by-elections proclaimed by the provincial government of the Free State, facilitated by the Independent Electoral Commission (IEC). There was a discussion of some issues between the Chairperson (acting on behalf of the Select Committee), the provincial government of the Free State (represented by the MEC) as well as the former Deputy Minister of COGTA.

In terms of the deadlines and timeframes stipulated by the law, the Committee’s view was that the submission to Parliament was quite problematic because there were some procedural issues about the tabling of the Notice. The provincial government of the Free State should restart the process and retable the submission properly to the Committee so that the Committee can look at it and decide whether it approves or disapprove the intervention.

He then allowed the MEC to brief the Committee on the intervention.

Briefing by Free State COGTA

Mr Thembeni Nxangisa, MEC: Free State COGTA, presented on the re-tabling of the Section 139 (1) (b) intervention in the Metsimaholo local municipality. His presentation was on the background of the intervention as well as the constitutional and procedural matters of the intervention and the substantive matters.

In terms of the background, constitutional and procedural matters, he said that one of the most pressing issues was that since the election of the Metsimaholo Municipal Council in 2017, it has not appointed senior managers, and the Municipal Manager of the municipality was placed on suspension on 03 July 2018. He said that the municipality has operated for some time with middle managers acting as section 56 managers, Municipal Manager and Accounting Officer. The municipality’s policy on acting appointments bars the appointment of anyone appointed below the level of a senior manager to act as a Municipal Manager.

With regards to the substantive matters, he said that the municipality has been struggling with vacant senior management positions, alleged political interference, regression in audit outcomes and governance oversight as well as a deterioration of systems of internal controls, among other issues.

Discussion

Ms S Shaikh (ANC, Limpopo) wanted to know the actual timeframe of when the section 139(1)(b) intervention will be lifted from the municipality.

Mr I Sileku (DA, Western Cape) said that when the MEC said that the council sits regularly and fulfils its responsibilities, he would have loved to have heard such a statement from the actual members of council that are currently serving in the municipality. He wanted to know why the MEC did not invite councillors from different political parties that can actually attest or confirm what the MEC was saying. He asked who the Municipal Manager that was suspended in July 2018 was and about the upliftment of the suspension on the 08 January 2021, because by virtue of the fact that the suspension was lifted, it means that was not a legal decision. He also wanted to know the cost of that particular suspension and how they are going to recover that amount. He said that the council has a tendency of contesting every decision that is made by the ministry in the province, and he asked the MEC to provide the Committee some confidence in terms of whether the council has not contested any decisions that he has made so far.

He said that in terms of consequence management, he wanted to know the plans to make sure that the money that was lost in the contestations of decisions and court cases is recovered.

Mr G Michalakis (DA, Free State) recounted that there were some glitches with regards to informing the National Council of Provinces (NCOP) and the tabling of the intervention, which was not according to the normal procedure. He said that the initial intervention submitted before the NCOP was irregular, and that is why it has to be tabled again. But if that is the circumstance, he wanted to know who in the provincial department is going to take responsibility for that because an intervention is not something that is invoked lightly. It actually takes the power away from the democratically elected persons on local government level and invests it into the provincial level. He added that the province should know the procedure by now and asked why it was not followed in the first place, to such an extent that a repeat was necessary. He also wanted to know who reappointed the Municipal Manager Molala and why he was suspended. He said that most of the things that the provincial government bases its decision to intervene on have, to some great extent, been addressed. He wanted to know how long the provincial government foresees the intervention to last. “IIs it still necessary for an intervention and if so, for how long do you foresee it will be necessary to have the municipality under administration?”

He said that the MEC of the Free State often invokes section 154 of the Constitution, which is a mandate to him to support the municipality, but it is not an intervention. He asked for the view of the MEC on this matter, specifically on the method of supporting the municipality instead of a full-scale intervention. He asked for a copy of the directive that was issued to the Metsimaholo Municipality prior to invoking the intervention, as it is usually accompanied by a letter before moving onto an intervention.

Mr K Motsamai (EFF, Gauteng) asked whether the Municipal Manager that was suspended was receiving a salary and asked for the reason for his suspension to be revoked.

Ms Z Ncitha (ANC, Eastern Cape) said that one of their critical issues that were raised sharply in the previous meeting with the MEC was the issue of recruitment of senior managers, and in their current report the MEC says that they are at an advanced stage. She said that the MEC needs to be specific with the numbers in terms of how many people were recruited for each senior management position. She also asked for clear details of the audit outcomes of the municipality and the basis of the audit qualification. She also wanted to know whether there were any UIFW (unauthorised, irregular, fruitless and wasteful) expenditures reported and if there were any, how much the costs were.

The Chairperson asked the MEC to take the Select Committee through the sequence of events that took place in the first instance of the invocation of section 139 (1)(b) in the municipality as well as the events that led to the second invocation. This was because the intervention is being re-tabled by the Department. The Chairperson wanted clarity in terms of whether the Department wants the Committee to approve or disapprove the intervention. He said that the letter referred to by the MEC, which the Department sent to the NCOP explaining the intervention on 11 February 2020, is the letter that was contested by the NCOP. The information was distributed by the NCOP to the Deputy Minister at the time, stipulating what had happened and why they contested the intervention. He also wanted to know what has happened in the municipality since the decision to re-invoke the intervention.  

Responses by Free State COGTA

MEC Nxangisa said that on 11 February 2020, when a resolution was made to place the municipality under section 139 (1)(b), a communication was made to the NCOP Minister and the Free State Legislature on the 25 February 2020, which should have been on the 24th. Upon the interaction and advice, COGTA was informed to find a way to correct that mistake with the dates, which is the reason for requesting the Select Committee to approve or disapprove the intervention. “We understand that it is upon you to make a decision; that is why we are making this request”, he added.

The Chairperson asked the MEC to clearly state what decision was taken by the Department on 10 December 2020. He added that it is important to ask these questions clearly because their approval or disapproval of the intervention depends on the explanation they receive from the Department.

MEC Nxangisa said that the Department took the decision to re-table the intervention to the municipality before the NCOP and the Minister. He said that the envisaged ending date of the intervention is October 2021.

On the council members, councillors and workers not invited in the meeting, he said that it should be the Committee that sends the invitation for them to come answer before the Committee. The Municipal Manager was suspended with full pay and the council handled the matter in a shady manner such that the court decided against the council and instructed the council to reinstate the Municipal Manager (MM). The court ruling requested a specific party involved to make payment and in various court rulings, the people who challenged the ministerial decisions, such as the plaintiff, were the ones told by court to pay the cost. The process of recovery is done by through the lawyers of the Department, to hold those people accountable. The reinstatement of the MM is legal because it is an implementation of a court decision. Provincial COGTA is supporting municipalities through section 154.

He said that they have been sending officials from the Provincial COGTA to support municipalities on various functions of fields in terms of skills and other programmes. In terms of the section 56 managers, he indicated that there were six vacancies in the municipality, of which four have been concluded, with two of them in the process of conclusion. There are matters raised by the Auditor-General relating to UIFW expenditure and in some instances, matters of corruption that have been referred to agencies of the state to attend. He added that the communication to the NCOP and the Minister was sent on 23 December 2020.

The Committee Chairperson said that it is safe to declare the first intervention of 11 February 2020 as nullified because it was not invoked according to the Constitution. He added that if there indeed was a communication to the NCOP and the Ministry of the re-tabling on 23 December 2020, it means that it is up to the NCOP to decide whether they approve or disapprove the intervention.

Follow-up questions

Mr Michalakis said that he agrees with the Chairperson that the first intervention from February 2020 is null and void. He said that under those circumstances, an Administrator was appointed in that period and decisions were made. So, if the intervention is nullified, then obviously the actions in the decisions from the Administrator would also not be valid. He added that an Administrator was paid to be an Administrator whilst the Department did not follow the procedure. Surely there should be some form of consequences for that.

He said that he is not completely convinced and comfortable with the intentions of the Department to intervene in the municipality. The reason for this is that between the Department and the municipality there is a bit of a rough relationship, which is evident in them taking each other to court and contesting decisions between them. The second reason is that all the issues that were pointed out as the cause for the municipality being placed under administration have now been addressed, according to the MEC’s presentation. He expressed that unless it is for a political reason, he cannot see any specific reason why this intervention should continue.

The Chairperson reminded Mr Michalakis that the Committee will decide on its own whether they approve of the intervention or not and that the opportunity was given for follow up questions.

Ms N Nkosi (ANC, Mpumalanga) wanted to understand whether the intervention is already implemented or not.

The Chairperson said that it has been implemented, as the decision was made on 10 December 2020 and communication was sent to the NCOP and the Ministry on 23 December 2020.

Responses by the Free State COGTA

Mr Mokete Duma, HOD, Free State COGTA, said that the initial contestation on the first intervention was on the legal date of the commencement of the section 139 (1)(b).

The Chairperson said that there is no need for the timeline to be repeated, as it had been explained by the MEC. He said that the questions that need to be answered relate to the costs incurred by the municipality in terms of the UIFW expenditure as well as the court cases.

Mr Duma said that currently the issues that need to be finalised include the full appointment of the component of the senior managers, which is part of the intervention. He said that they have achieved between 98% and 99% of the targets that they have set but need to finalise these issues. The Executive Council had instructed the Department to request approval until October for the local government elections.

MEC Nxangisa said that the intervention is not for any political reasons and added that COGTA does not enjoy invoking section 139. He said that it is a painful decision to make because to a large extent it accounts to the support and the functionality that they give to municipalities. He asked the Committee to allow them to provide a full report on the intervention this far so that the Committee can make its own decision and added that the Department is pleased with the progress this far. The Administrator was not paid by the municipality in this instance and that it was paid by the Department because they took note that as part of the intervention and support, they must relieve financial burdens to municipalities. The matter will definitely receive attention.

The Chairperson said that the Committee will deliberate further on the intervention and will make a decision by the following Thursday. He allowed the MEC and the delegation from Free State COGTA to leave the meeting and thanked them for taking their time to attend.

The Committee continued with the remainder of the meeting.

Report of the Select Committee on Cooperative Governance, Traditional Affairs, Water, Sanitation and Human Settlement on 2021/2022 Annual Performance Plan and Budget Vote 33 of the Department of Human Settlements

Ms Ncitha said that the issue of the fast-tracking of accreditation of metros by the Department should be added into the report.

The Chairperson agreed and added that the report on the breakdown of the metros, in terms of the municipalities that were not spending appropriately, will be added. He said that the Department will consider facilitation of the Mangaung Development Precinct as presented in the Committee. He also added that there will be an investigation of the Mining Revitalisation Project in the city of Matlosana.

Ms Ncitha moved for the adoption of the report and was seconded by Ms M Bartlett (ANC, Northern Cape).

Mr Sileku said that the DA abstains from the adoption of the report.

The meeting was adjourned.