annual report 2006/2007 municipal demarcation...

BUDGET REVIEW 2008/2009MUNICIPAL DEMARCATION BOARD

PRESENTATION TO THE SELECT COMMITTEE LOCAL GOVERNMENT AND ADMINISTRATION

24 June 2008

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REPRESENTATION AND DOCUMENTS

● From the Board:Prof NC Steytler – Member: Municipal Demarcation BoardMr RH Monare – Chief Executive OfficerMr N Ligege – Chief Financial Officer.

● Document Tabled:Annual Report 2007 – 2008Strategic Plan 2008 -2012

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OVERVIEW

● The Board (RHM).● Last Briefing – 08 May 2007 (RHM).● Overview on Mandate and Performance.

This part will deal back to back with performance in 2007/08,and the way forward in 2008/09 – 2011/12.

● Budget Review (NL).This part will deal with our finances in 2007/08, and budget programmes going forward (2008/09 – 2011/12)

● Conclusion (RHM).

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THE BOARD

● 9 Members since 1 February 2004.● Chairperson the only full time member of the Board.● CEO in charge of the Board’s Administration.● 4 Operational Clusters.● 27 Staff Positions in the Establishment:

8 Vacant at 31 March 2008;74% Black;47% Female;0% Disabled.

● The Board has approved a proposal to review the structure.

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LAST BRIEFING – 08 May 2007

We took some time in last briefing to remind the select committee of the concerns and reservations that members of the committee have raised in the past, and how we have explained those concerns and reservations to the committee.Because the concerns and reservations remain important, vis a vis the oversight role of this committee, it is worthwhile to keep raising them, and to re-assure the Committee that we remain conscious of them. The concerns and reservations had included:

The Board’s expenditure being possibly excessive, and rising from year to year at too high a rate, with respect to:− Professional Fees;− Office Expenses;− Staff Remuneration;− Board Members Remuneration;− Travel and Accommodation;− Consultants.

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The possibility that the Board may be spending its money on things that are irrelevant in as far as its core mandate is concerned, and thus the financial difficulties it faced;

We explained to the committee that we have in the past provided the Committee with the following details in a memo, giving the Committee all the necessary details to explain the issues and concerns:

A breakdown of all expenses incurred on professional fees and on Office Expenses;A clear indication that expenditure on professional fees was fully justified, and that it was incurred in direct pursuance of the Board’s core mandate, and the fact that taking away the expenditure on professional fees would have seriously compromised the Board’s work;

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A clear demonstration that the annual escalations on office expenses and staff salaries were perfectly normal, and that there was nothing excessive about the escalations.An explanation of how staff salaries at the Board are made up.An explanation of the fact that Board Members’ remuneration are simply what has been determined by the Minister for them, as well as reimbursements of their out-of-pocket expenses while in the course of their duties as Board members. There is therefore nothing excessive about their remuneration.With respect to travel and accommodation, an explanation of the fact that: − Board Members cannot be expected to be largely office-bound if they are going

to be effective.− Board Members, who are all part time except the Chairperson, must travel to

attend Board meetings.

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We also gave the committee an overview of the Board’s mandate and our performance, as well as a full budget review, with respect to historic figures and estimates for the future.

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OUTPUTS AND DEVELOPMENTS 2007/2008

In 2007/08 year that ended 31 March 2008 a number of Strategic Themes identified around the Board’s mandate:

Determination and re-determination of municipal boundaries.Assessments of municipal capacity and recommendations to MEC’s responsible for local government on the allocation and re-allocation of powers and functions between local and district municipalities.Review of District Management Areas with a view to withdraw all DMA declaration, if feasible.Assistance to all government departments who require that assistance, with the alignment of their service delivery boundaries to municipal boundaries.Further enhancement of quality engagements and improved working relations with all stakeholders.Various areas of work to enhance and promote good governanceVarious areas of work to enhance and improve organisational capacity and capability.

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PERFORMANCE IN 2007/08: DETERMINATION AND RE-DETERMINATION OF MUNICIPAL BOUNDARIES

We continued with a programme that would ensure that we finalise 100% of the boundary changes requests during the 2007/2008 and 2008/2009 financial years.The programme was put together with an assumption that:

The next national and provincial elections will take place in April 2009The next local government elections will take place in March 2011.

In terms of the programme, we stopped receiving all new submissions/requests on 31 March 2008.Changes to municipal boundaries with respect to cases already in process will continue until August 2008, when all boundary changes will be put on hold and we will hand over boundaries to the IEC for them to start delimitation of VD’s.Voting districts can then be determined by the IEC for the national and provincial elections in 2009, followed by the determination of wards for the 2011 local government elections.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 – 2011/12: DETERMINATION AND RE-DETERMINATION OF MUNICIPAL BOUNDARIES

Strategic theme 1 & 2: determination and re-determination of municipal boundaries in accordance with relevant legal provisions, and thedelimitation of wards:

Attend to all outstanding requests for changes to municipal boundaries with a view to complete all changes in 2008/2009 for the 2011 local elections.Ensure that all legal requirements are complied with in preparing for the 2011 local elections.Ensure that the role of the Board is carried out in order to allow the IEC to complete the delineation of voting districts, by 2008/09.

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A number of important developments to date: Re-determination of three secondary cities into category A municipalities: Msunduzi, Mangaung, Buffalo City.Also re-determination of the boundaries of Tshwane, Ekurhuleni, MetswedingDistrict and its two locals Kungwini and Nokeng tsa Taemane, by dividing the Metsweding District area between the two metros.Board attended meetings hosted by MEC’s for local government in KZN and FS, comprising stakeholders from affected districts, locals and other stakeholders.Several re-determinations confirmed, as outlined in Circular 4/2008.Several proposals to create new municipalities turned down.A plea has been made to MEC’s for local government, for them to issue section 23 notices in a number of cases in EC, GT, NW, LIM and WC.

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The following timelines remain relevant:

Phases Timeframe Process

Phase 1 Dec 2007-Aug 2008

Finalise outer boundaries of municipalities –MDB/IEC/MECs

Aug – Sep 2008 Align VD boundaries to municipal boundaries – IEC/MDB

Feb – Aug 2008 Re-categorisation of selected secondary cities and review of some category C municipalities - MDB

Sep 2008 – Mar 2009 Voter registration, certification and division of the national common voters roll into municipal segments – IEC

March 2009 Publish formula for the number of councillors – Minister

March 2009 Publish number of Councillors - MECs

Phase 2 Apr 2009 – Feb 2010 Public consultation process including public hearings, where necessary – MDB

Phase 3 Mar – Aug 2010 Gazette ward boundaries in provincial gazettes for objections, finalise ward boundaries and hand over to the IEC for the 2011 electoral process - MDB

Phase 4 Aug 2010 – Mar 2011 Electoral Process - IEC

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PERFORMANCE IN 2007/08: ASSESSMENT OF MUNICIPAL CAPACITY

As in the past this project was outsourced.Various circulars were sent out to once again keep stakeholders informed of the process.Provinces were requested to assist where possible, often accompanying our data collectors to municipalities.Planning commenced in June 2007. In July 2007 questionnaires were sent out to local and district municipality, followed by field visits in August 2007.Once again 100% return has been achieved.Data capturing, verification and analyses in September and October 2007.46 DC reports covering all 46 DC’s and 231 locals drafted in October/November 2007.Recommendations were sent to MEC’s in December 2007.Provincial overview reports and the National Report finalised in February 2008. For the first time, the National Report was formally launched on 18 March 2008.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 – 2011/12: ASSESSMENT OF MUNICIPAL CAPACITY

Strategic theme 3: collection of relevant information and maintenance and update data sets to render advisory services on capacity and the division of powers and functions.

Deliver Quality annual assessments of Municipal Capacity;Advise and support MEC’s for local government in dealing with the adjustment and re-adjustment of powers and functions between local and district municipalities;Release the results of the assessments in time to allow them to feed into the IDP and budgeting processes of municipalities.

The appointment of the service provider is being finalised.EXCO meeting 25 June 2008 to hear presentations from and to interview the top five bidders, following a bid adjudication process by management.

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PERFORMANCE IN 2007/08: REVIEW OF DISTRICT MANAGEMENT AREAS

Work to review the future of DMA’s continued during the period under review.We engaged provinces to assist us in gathering information regarding DMA’s in their areas.We collected data on the performance of local government functions in DMA’s during the capacity assessment survey.A framework document was developed for a discussion document on the future of DMA’s.The idea was to have a discussion document ready for consultation with stakeholders with a view to finalising such a document during the current financial year (2007/2008).July 2007 DMA report released for comments.Oct 2007 notices published to withdraw declarations.

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PERFORMANCE IN 2007/08: REVIEW OF DISTRICT MANAGEMENT AREAS

As indicated in the Board’s July 2007 DMA report and subsequent circulars, correspondence, press releases and legal notices the Board’s preference was to withdraw declarations of all DMAs.Advantages of the withdrawals are that:− They will result in the full territory of the country being covered by local

municipalities.− A separate electoral system will no longer be required for DMAs. Voters will be

included into existing or new wards in local municipalities.− The confusion around service delivery in DMAs and the division of powers and

functions between district and local municipalities will be rectified.− There will be spatial stability at municipal level which will enhance planning and

service delivery by municipalities.− The confusion around the boundaries of conservation/protected areas vis-à-vis

the boundaries of DMAs will be overcome.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 – 2011/12: REVIEW OF DISTRICT MANAGEMENT AREAS

The Board has now approved the publication of section 21(5) notices with respect to all DMA’s, confirming their new boundaries as part of local municipalities.Section 23 notices still awaited from all local government MEC’s.

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July- Nov 2007 Report sent to all stakeholders and commencement of consultations with affected municipalities, MEC’s, Minister of PLG, SALGA, etc.

Dec 2007 Board decision on future of DMAs.

January 2008 Publication of section 26 notices in terms of the demarcation act, and section 6 of the structures act if necessary.

January-February 2008 Period for submissions, analysis and consideration of views (sections 24 and 25 refer) and representations received in terms of section 26 of the Demarcation Act.

February 2008 Board to consider all the submissions received in the terms of section 26and decide whether to approve the re-determination and publish section 21 notices for objections.

March 2008 Publication of section 21 notices inviting objections.

March – April 2008 Period for submissions, analysis and consideration of all objections (section 24 and 25 refer) and representations received in terms of section 21 of the demarcation act.

April 2008 Board meeting to consider sec 21 objections, approve section 21(5) notices,

May 2008 Finalise outer boundaries of municipalities – section 21(5) notices published before the elections and IEC informed.

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June 2008 IEC publishes all outstanding section 23 notices.

July 2008 MECs publish all outstanding section 23 notices.

July 2008 MECs publish notices in terms of section 12 and/or 17 of the structures act.

August 2008 Municipal boundaries provided to the IEC to start preparations for the elections.

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PERFORMANCE IN 2007/08: SERVICE DELIVERY BOUNDARIES

We continued to work closely with the Department of Justice and CD and the SAPS.We provided technical support during their consultations, with the updating and re-drawing of boundaries.While arrangements were made with both the DOJ & CD and SAPS, tofinalise our involvement in the alignment project with them in 2007/2008, the Department of Justice has made a new request for us to continue supporting them.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 – 2011/12: SERVICE DELIVERY BOUNDARIES

Our involvement in the alignment of service delivery boundaries will now be on a “need to” basis.Development of a comprehensive database of well aligned administrative and functional boundaries, with a view to strengthen the National Spatial data Infrastructure for South Africa.

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PERFORMANCE IN 2007/08: ENHANCE QUALITY ENGAGEMENTS AND IMPROVE WORKING RELATIONS WITH STAKEHOLDERS

We interacted extensively with a number of stakeholders during the period under review, and these interactions have strengthened our relationship with these stakeholders. Among other engagements:− The relationship with the Department of Justice and Constitutional

Development and SAPS was maintained. − Continued working closely with DPLG, DLA and DWAF in the process of

creating a credible TA data set. A process commenced whereby the various provincial data sets were cleaned up and verified by the various stakeholders/departments to ensure that a credible TA Boundary data set exist that could assist with the re-determination of municipal boundaries.

− The Chairperson: MDB adressed SALGA’s strategic planning session, and gave them valuable input.

− We worked with DPLG, SALGA, Stats SA on some projects and initiatives.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 –2011/12: ENHANCE QUALITY ENGAGEMENTS AND IMPROVE WORKING RELATIONS WITH STAKEHOLDERS

Strategic theme 6: strengthening of relations and interaction with key stakeholders.

To build and manage relationships with our stakeholders that breed understanding and mutual respect.To review our stakeholders requirements in relation to the Board’s support and services.To facilitate co-ordination between all stakeholders.To be actively engaged in community organisations and issues as far as resources and time allow.To ensure a work environment that is safe, that encourages growth and development and inspires pride.

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PERFORMANCE IN 2007/08: ENHANCE AND PROMOTE GOOD GOVERNANCE

We engaged in a number of projects to:Improve administrative processes and systems.Ensure effective Risk Management at the Board.Improve the financial and procurement practices to ensure effective and efficient internal operations at the Board.Ensure effective internal controls.Ensure effective budget control.Improve cash flow management at the Board.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 – 2011/12: ENHANCE AND PROMOTE GOOD GOVERNANCE

Strategic theme 8: ensuring good governanceComplying with legal frameworksImproving the efficiency and effectiveness of administrative processes and systems Improving the quality and usage of management information Planning and executing activities within budget Managing risks effectively Effective leadership, management and decision-making.

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PERFORMANCE IN 2007/08: ENHANCE AND IMPROVE ORGANISATIONAL CAPACITY AND CAPABILITY

We engaged in a number of projects to:Pursue achievement of annual strategic milestones across the organisation.Provide employees with the necessary support for them to be capable of delivering against targets.Improve the performance management system.Increase skills levels.Promote an orientation towards performance and accountability for results in the organisation.To find effective ways of appropriately recognising and rewarding innovation and dedication to one’s work.To develop a reliable, robust and responsive corporate system.To enhance smooth running of the organisation.

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STRATEGIC DIRECTION – MEDIUM TERM STRATEGY 2008/09 – 2011/12: ENHANCE AND IMPROVE ORGANISATIONAL CAPACITY AND CAPABILITY

Strategic theme 7: strengthening of the board’s organisational capacity and capability.

Develop and nurture capability at all levels within the Board.Create an enabling environment at the Board that allow for the acquisition of competencies and skills among serving employees which are relevant and appropriate to ensure operational efficiencies, and thus more effective ways of achieving the Board’s mandate.Build a culture of high performance in all employees, and provide training, mentoring and guidance to staff requiring such support;

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DEVELOPMENTS GOING FORWARD:ELECTIONS TIMETABLE

Dec 2007 Board approve last sec 26 notices.

Jan 2008 Last section 26 notices published before the local elections in 2011

March 2008 Last section 21 notices published before the local elections

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Key performance area:Hand over of outer boundaries to IEC, and ensure that formula and the number of councillors are gazetted

April 2008 Closing date for sec 21 objections

May 2008 Last section 21(5) notices published before the elections and IEC informed

June 2008 IEC publishes all outstanding sec 23 notices

July 2008 MECs publish all outstanding section 23 notices

Aug 2008 Municipal boundaries provided to IEC

Aug/Sept 2008 IEC align VD boundaries to municipal boundaries

Sept/Oct/Nov 2008?

Registration of voters for national and provincial elections

Feb 2009? Certify national common voters roll and gazette it

Feb 2009? Divide national common voters roll into municipal segments

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Key performance area:Ward delimitation and public consultation

March 2009 Publish formula for the number of councillors (1999 problem area)

March 2009 MECs determine and publish number of councillors for each municipality (1999 problem area)

March 2009 MDB determines the number of wards and the norm for ward delimitation

Apr 2009? National and Provincial elections

Apr 2009 Formal consultation between MDB and IEC as required by Structures Act

Apr-Jun 2009 MDB prepares first set of draft ward boundaries

Jul/Aug 2009 Public consultation process commences (circular/media ads)

31 Aug 2009 Closing date for public comments

Sept/Oct 2009 Consider public comments and prepare map set 2 for public hearings

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Key performance area:Consider public objections and publish final ward boundaries

Nov/Dec2009 Maps and notices distributed and logistics finalised for public hearings

Jan/Feb 2010 Public hearings

March 2010 Finalise map set 3 and gazette ward maps in Provincial gazettes for objections

1 April 2010 Closing date for objections

Apr/May 2010 Consider public objections

Jun 2010 Final ward boundaries handed to IEC

Jun/July 2010 Alignment of VD boundaries to ward boundaries

Aug 2010 Gazette final ward boundaries

Aug 2010 Election date gazetted

Aug – Nov 2010 Registration of voters

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Key performance area:Consider public objections and publish final ward boundaries

Nov 2010 – Feb 2011

Preparations for elections

March 2011? Local elections

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OTHER DEVELOPMENTS GOING FORWARD

The terms of the current Board expires on 31 January 2009.A process must start soon to select and appoint a new Board, to come into office on 1 February 2009.Ideal to have some interaction between the incoming and outgoing Board.Thus the DPLG would need to have the advert out by September 2008 at the latest.

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RECEIPTS FOR THE YEAR 2007/2008

Original MTEF allocation R 20,664,000

Other income R 349,000

TOTAL INCOME AT OUR DISPOSAL 2007/08 R 21,013,000

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EXPENDITURE FOR THE YEAR 2007/08

Expense item 2 008 % 2 007Administrative expenses (679) 4% (2 738)Staff costs (6 800) 43% (6 995)Audit Fees (932) 6% (1 012)Project expenses (4 093) 26% (4 020)Local and foreign aid assistance paid 0 0% (2 650)Other operating expenses (2 587) 16% (2 434)Depreciation and Amortisation (548) 3% (642)Finance costs (139) 1% (89)TOTAL EXPENDITURE (15 778) (20 580)

SURPLUS / (DEFICIT) FOR THE PERIOD 5 235 (873)

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BREAKDOWN OF EXPENDITURE

ADMINISTRATIVE EXPENSES 679- Insurance 176- Members allowances 412- Internal audit fees 242- Conferences and seminars

- Venue and facilities- Training and staff development

11458

- General and administrative expenses- Advertisements- Publications, etc.- Telephone- Legal fees- Stationery and printing- Bank charges

996115

(1,797)191

811612

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STAFF COSTS 6,800

- Staff salaries and wages 5,849

- Board members’ emoluments 765

- Employer’s contributions to UIF and other salary related costs

186

PROJECT EXPENSES 4,093

- Capacity assessment 3,926

- Consulting fees 167

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OTHER OPERATING EXPENSES 2,587

- Licence renewals 215

- Travel and subsistence 1,298

- Courier and delivery charges 50

- Maintenance, repairs and running costs- Machinery and equipment

028

- Rentals in respect of operating leases- Buildings- Plant, machinery and equipment

92967

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SURPLUS RECONCILIATION

Description R'000

Reported expenditure 15,778

Prior year provisions 2,420

Subtotal 18,198Commitments 2,014

Expenditure for the year 20,212

Total MTEF allocation 20,664Surplus 452Expenditure % 98%

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BUDGET PROGRAMMESPROGRAMME MEDIUM TERM EXPENDITURE ESTIMATES

2008/09 2009/10 2010/11Administration and Human Resources Management

4,037,801 4,767,247 5,065,911

Finance and Procurement Control

4.463.578 4,757,954 5,291,370

GIS and IT Support 5,161,649 7,616,294 6,667,076Research and Investigations

7,988,601 32,502,492 16,581,780

CEO and Board 3,767,371 4,168,335 4,541,441TOTAL 25,419,000 53,812,322 38,147,578MTEF Allocation 25,419,000 34,801,000 37,563,000Surplus / (Deficit) 0 (19,011,322) (584,578)

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IN CONCLUSION

We have been overwhelmingly successful with respect to achieving a number of our pre-determined objectives.We have once again carried out our mandate without fail.The Board will stop receiving new submissions on 31 March 2008. The Board’s work on boundary re-determinations, review of DMAs, and alignment of service delivery boundaries plays a significant role in ensuring that the country will be ready for national and provincial elections in 2009, and local government elections in 2011.Efforts are to be pursued to align the white paper process timeframes with the elections preparations timeframes.

annual report 2006/2007 municipal demarcation...

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