NATIONAL COUNCIL OF PROVINCES
QUESTION FOR WRITTEN REPLY
QUESTION NUMBER 198
DATE OF PUBLICATION: 28 MAY 2010
Mr T D Harris (DA-WC) to ask the Minister of Finance:
Whether he will introduce legislation that will prohibit municipal and
other government officials from entering into contracts with
municipalities; if not, why not; if so, what are the relevant details?
CW259E
REPLY:
The National Treasury has issued the Municipal Supply Chain Management
Regulations, enabled through the Municipal Finance Management Act (Act 56
of 2003), which prohibits municipalities from awarding contracts to persons
who are in the service of the state. Regulation 44 provides that
municipalities may not make any award to a person âwho is in the service of
the state, if that person is not a natural person, of which any director,
manager, principle shareholder or stakeholder is a person in the service of
the state or who is an advisor or consultant contracted with the
municipality or municipal entity.â Â
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'In the service of the state' is defined in the Regulations as a member of
any municipal council, provincial legislature or the National Assembly or
National Council of Provinces; a member of the board of directors of any
municipal entity; an official of any municipality or municipal entity; an
employee of any national or provincial department, national or provincial
public entity or constitutional institution within the meaning of the PFMA;
a member of the accounting authority of any national or provincial public
entity; or an employee of Parliament or a provincial legislature.Â
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Based on the above legal framework, it is clear that municipal and other
government officials are prohibited from doing business with
municipalities; therefore, no further legislation is required.
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