Hon Chairperson 

Hon Minister 

Hon Deputy Ministers 

Hon Members 

And fellow South African

This year marks the end of administration for local government political administration, and President has since announced that elections will be held on the 4 of November. This is of course a milestone as South Africa celebrates 32 years of democracy.

However, there is still a huge concern over inadequate service delivery, and the number of dysfunctional municipalities still very high. Our challenges are not just lack of funds but capacity to manage those funds effectively and spend the budget for its intended objectives.

The Portfolio Committee expressed concerns about huge budget reductions across the department. This calls for more emphasis on cooperative governance between national and provincial governments to work in synergy for more impact on the ground, in each ward and each municipality as part of the strategy to turn around municipalities despite budget constraints.

The Committee on COGTA exercising oversight has stressed this problem time and time again. The impact of oversight was that it demonstrated a need for intensified supervision of municipalities by national COGTA and Treasury to effectively provide section 154 support.

While this is a challenge for COGTA to solve, the portfolio Committee has extended the challenge for SALGA to relook at its focus on supporting municipalities; especially considering  SALGA audit outcomes  compared to member municipalities.

It has been amply demonstrated that the 9.5 percent of the national revenue that goes to local government, is woefully inadequate. The proposed revision of funding formula for local governments is fully supported.   This review has to go hand in hand with improved inter- spherical coordination to ensure all resources are deployed synergistically at local government level.

Several municipalities are non-viable and the joint oversight committees recommended an immediate and decisive intervention from national ministers as this situation of non-viability can neither be resolved by municipalities on their own nor even with involvement of provincial governments alone.

It raises concern to see that in the current APP, too few municipalities are targeted for support in developing financial recovery plans, management of debt to Eskom and water boards in order to address sustainability and improve good governance

While we await annual audit reports the committee is concerned that there may not yet be an indication of a turnaround in municipalities audit outcomes.

Yet we desperately need improvement in financial systems and controls curb corruption and malfeasance. We need strong of oversight structures and prevention measures

 to curb the ballooning of UIFW.  We also would like to see municipalities embarking on consultant replacement strategies, building internal structures and capacity to enable insourcing of critical tasks.

From our observations, very few provinces have so far utilised the engagement with joint oversight committees to effect changes in leadership ensure accountability and visible consequences management.

We note that National Treasury intends to shift from passive oversight to active, structural intervention, targeting local government stability through legislative governance, and technological reforms. Thus, conditional grants will target specific policy goals, with strict spending conditions to enhance project implementation and address capacity challenges. Direct municipal transfers are projected to grow to support infrastructure, electrification, water services, urban development and public transport. Reforms are essential. Treasury decision on the City of Johannesburg shows the seriousness and forces municipalities to take responsibility.

Municipalities have to urgently address apartheid spatial planning and provide low-income accommodation in city centres and reverse the visible trend of illegal immigration driving out local citizens into informal settlements such as in the city of Johannesburg and Cape Town.  In dealing with issues of illegal immigration, government needs to be proactive to avoid a backlash again that is driven by the tensions when South Africans feel excluded in urban areas.

The committee is of the view that the role of MISA be strengthened, to support weak municipalities in infrastructure development. It is still a challenge that over R1 billion in infrastructure grants was returned to treasury by municipalities because of the lack of capacity to spend.  The Portfolio committee will further monitor the role of MISA in supporting municipalities with regard to the Department Water and Sanitation‘s Green Drop, Blue Drop and No Drop requirements. In view of the water crisis experienced in literally all municipalities hope that national water crisis committee will soon be visible.

The Portfolio Committee remains concerned that the response to disasters needs to be timeous to enable quicker response in case of disaster repairs, as opposed to funding coming several years after disaster hit communities.  Further there is need for strong supervision on the deployment of disaster relief funds to ensure they are spent effectively to the intended areas. The committee is looking forward to engaging with department on the new review of disaster management system hoping it addresses late payments

The Portfolio Committee is currently seized with matter of CRL process of section 22 committee to address concern from religious community regarding their fear of state regulating the religion. Having engaged the Commission, the portfolio committee will soon meet more religious leaders to find a solution. The Committee believes that this tension is unwarranted, and can in fact be resolved; so that this Parliament is able to demonstrate its defence of the Bill of Rights, particularly the freedom of religion and worship as enshrined in the constitution.

Equally the Committee emphasised that the MDB needs to deepen community consultations to address demarcation processes that tend to split a functional community and create a disruption of their normal social activities. This causes a strain accessing service delivery centres.  The concerns of the resource constraints raised by the MDB in reaching many provinces. The high employee related cost at CRL and MDA are a cause for concern.

While the Traditional Khoisan Leadership Bill is being processed, the committee is receiving reports of politicisation of traditional leadership institutions in some provinces. Several cases will soon be referred to Minister for urgent attention from KwaZulu-Natal.

Matters of Khoi and San communities require renewed focus, both traditional leadership structure as well as other diverse issues of languages, land dispossession, agricultural and mineral rights. The NTKL bill will trigger but not resolve all these and a parallel alternative mechanism by the Minister, is recommended.

Customary initiation continues to be source of concern because all deaths and mutilations are preventable. We call for stronger collaborative interdepartmental programme of action targeting zero deaths and accelerated prosecution with strong combination campaigns to build public support.

The budget vote is supported.

ENDS