13 June 2008
Comrade Speaker Richard Mdakane;
Comrade Deputy Speaker Auntie Sophie De Bruyn;
Honourable Premier Mbhazima Shilowa;
Members of the Executive Council;
Members of this august house;
Executive Mayors;
Speakers and Chief Whips;
Chief Mahlangu of the Sokhulumi;
Chief Kekana wa Mandebele Alobelo;
Business and Community Leaders
Municipal Managers;
Comrades and friends
INTRODUCTION
I stand here before you with humility and pride that we have contributed towards ensuring that Gauteng municipalities work better for the people of the province. We are presenting this Budget Vote on the eve of celebrating the Youth Day. It was 16th June 1976 when young people declared war against the apartheid regime and refused to cooperate with the oppressive system. Many rights we enjoy today are in part as a result of the active role played by young men and women in bringing apartheid down.
At the time they did not have many opportunities and choices and most of all they were not free.
We must double our efforts to make sure that young people are exposed and given opportunities and information to improve their lives. We have to invest in young people without counting rands and cents.
Since 2004, we have contributed towards building strong and functional municipalities in the province. Municipalities that are financially viable, can withstand change and function effectively beyond the term of office of the current leadership.
We were able to achieve this through strategic partnership with important role players like, South African Local Government Association (SALGA), Local Government SETA, Development Bank of Southern Africa (DBSA), South African Institute of Chartered Accounts (SAICA), South African Institute of Civil Engineers (SAICE), to mention but a few.
Completing the 2004 mandate is the only priority in this financial year. In doing so, we are guided by the intergovernmental priorities:
BUILDING CAPACITY OF THE STATE
The 2006 Manifesto clearly states that an action plan should be developed and implemented to Make Local Government Work Better for the citizens of the province! Key to this plan is provision of hands-on support to municipalities, the acceleration of service delivery to meet Millennium Development Goals of bucket eradication by 2007, provision clean drinking water by 2008, sanitation by 2010 and electricity by 2012.
In order to implement the plan effectively we had to identify problems and possible solutions thereof. The problems that beset municipalities were outstanding consumer debt, which had reached an unprecedented level of around R20 billion, the billing system problems and lack of financial management capacity and skills. Other challenges that we had to respond to include:
Comrade Speaker;
In order to assess the state of municipal finances in Gauteng, we established the Advisory Commission on Municipal Finances. Consequently, we now understand the extent of the financial challenges of municipalities and the nature of the debt. In responding to these challenges, we subsequently held a Municipal Finance Summit which pronounced on the state of municipal finances and developed a programme of action.
We are currently implementing key strategies emanating from the programme of action.
I'm glad to announce that significant progress has been made in this regard. This includes the cleaning of debtor's books and the verification of the Top 300 debtors. Most significantly is that we managed to resolve 95% government debtors and as a result R370 million of unpaid debt was collected from government departments.
In 2004, we made pronouncements that we would like to see all municipalities achieve unqualified audit opinions by 2009/2010 financial year.
I am pleased to inform the House that we have registered significant progress towards attaining this goal.
To date, all 14 municipalities have submitted their 2007/08 Annual Financial Statements on time and the quality of information contained in the statements is far better than before. Six municipalities, City of Johannesburg, Metsweding, Sedibeng, West Rand, Midvaal and Lesedi received unqualified audit opinions. Only West Rand received an unqualified opinion without any matter of emphasis. Four municipalities received qualified opinions and two received disclaimer and one adverse opinion.
Together with the Auditor General's we are engaging municipalities which received disclaimers and adverse audit opinions to detail common issues out of the 2006/07 audit reports with the view of developing plans to ensure they prepare properly for the 2007/08 audits. The deployed accountants will play a leading role in assisting municipalities to prepare thoroughly for these audits.
The same strategy and approach will be used in municipalities which received qualified opinions. Together with AG, we will visit the relevant municipalities to consider plan of action and advise where improvements are required in the plans.
In our quest to achieve clean audit opinions, the department will facilitate the establishment, within municipalities, of Audit Project Steering Committees (APSC) which are made up of all key managers and other finance managers. The APSC will monitor the implementation of the detailed Action Plans.
These plans will be integrated into SAICA's own project plans to ensure that the Suitably Qualified Accountants support municipalities in this regard. In further efforts to strengthen municipal internal audit committees, we have signed a Memorandum of Understanding with Institute of Internal Auditors to provide capacity building programme to municipal audit committees during the course of this year.
We are also in a process of establishing a Provincial Revenue Management Entity which will facilitate the collection of debt through investors who will put a negotiated upfront payment. This will serve as an incentive for them to collect the debt on behalf of municipalities. Let me hasten to add that we will ensure that this is done within the scope municipal indigent policies.
Working with the Association of Accounting Technicians (AAT) we trained 200 learners from four municipalities - Emfuleni, Tshwane Metro, Mogale City and Randfontein on basic accounting skills.
This training is meant to build capacity at junior level focusing on daily reconciliation of accounts; receipting and balancing of accounts and accounting.
Another major achievement is the establishment of the Municipal Public Accounts Committees (MPACs). These committees will ensure greater accountability and play an active political oversight role as far as municipal finances are concerned. MPACs will help to improve accountability of mayoral committee's council on prudent financial management.
DEPLOYMENT OF SENIOR ENGINEERS
Since 2006 we have moved tenaciously to support municipal technical capacity by assisting them to establish the Project Management Units (PMUs) in all municipalities and we have provided them with advanced project management training.
Our partnership with South African Institute for Civil Engineers (SAICE) has resulted in 32 senior engineers, 8 graduates and 24 students deployed in municipalities. I am delighted to say that the deployed engineers helped to accelerate the final spending, developed many business plans to ensure that the MIG funds are spent timeously.
So far the deployed engineers have overseen the implementation of infrastructure projects, ranging from roads, water, sanitation, solid waste, electricity to housing projects.
They have also assisted municipalities with the development of infrastructure master plans, maintenance of infrastructure assets and aligning the infrastructure plans to IDPs.
The skills assessment we undertook indicated that the greatest skills shortage was in technical and professional categories. The impact of this was evident in smaller municipalities, where a shortage of engineers had a negative impact on service delivery and infrastructure development. To this, we will be tabling for discussion protocol arrangements between municipalities in terms of recruitment and secondment from one municipality to the other.
We assisted municipalities to fill senior management vacancies and conducted more than 180 competency assessment test for Section 57 posts across all municipalities in the province.
I am pleased to announce that all municipalities have developed their Business Continuity Plans. These plans are meant to assist municipalities to function optimally even after experiencing any form or kind of disaster.
Comrade Speaker;
This year we will spend R25 million on municipal support programme and our focus will include organisational business re-engineering, human resources development strategies and performance management systems.
In continuing with government's hands-on support to municipalities, we have signed a Memorandum of Understanding with DBSA. The partnership forms part of Siyenza Manje programme, and an amount of R134 million has been committed over the next two years. This will involve deployment of accountants and engineers through SAICA and SAICE and a training programme for 150 accounts technicians, mentorship programme for 40 accounting cadets and financial management training to 50 councillors responsible for finance. Comrade Speaker;
The 2007 Community Survey conducted by Statistics SA indicates that significant progress has been made regarding the provision of basic services such as water, sanitation, refuse removal and electricity.
We have committed ourselves to ensuring that Gauteng Province meets the national water targets for 2008. To achieve this, we are assisting municipalities to complete their infrastructure business plans. Provincial Treasury has allocated additional amount of R80 million to the following municipalities: Randfontein, West Rand, Kungwini, Mogale City , Nokeng Tsa Taemane and Emfuleni.
We are in the process of developing the Sanitation Strategy to ensure that we meet the 2010 MDG target for sanitation. In developing this strategy we have started collecting data on the sanitation backlog, that is, pit latrines and any other form of sanitation. This will assist us to know the extent of the backlog and it will inform our strategy. Comrade Speaker;
We recruited, trained and deployed CDWs as public servants into wards where they live. We set a target of ensuring that every ward in the province will have, at least, one (1) CDW and I can proudly say that that target has been achieved. We now have 481 CDWs deployed across Gauteng.
CDWs are playing a major role in ensuring that communities are informed of government programmes across the three spheres of government.
CDWs are also working with municipalities and government departments in identifying and addressing service delivery challenges.
CDWs are clearly becoming agents for change in all our communities by ensuring that people have access to information and resources for their own development and empowerment.
The CDW Programme in Gauteng is also setting the trend with a new reporting and referral system using an electronic device to send reports and refer community issues to government departments as per the Exco Lekgotla in 2007.
We will spend R70 million on the CDW programme in this financial year. Our focus will be on enhancing the effectiveness of CDWs, including the implementation of an early-warning system that will assist government to respond to community service delivery concerns. The electronic hand-held devices given to all CDWs will be used as a tool for recording, referring and tracking community referrals.
PUBLIC PARTICIPATION
This year we will implement a Framework on Public Participation to further give expression to participatory democracy. As part of the framework, we focus on the following:
Gauteng Province has two traditional authorities led by Chief Mahlangu and Chief Kekana. I have given an undertaking in this House that we will give Izinkosi all the necessary support to ensure that they become functional and sustainable institutions of governance in our province.
I am pleased to report that we have developed the Traditional Leaders Framework and Bill that is seeking innovative ways in respect of defining the relationship between Local Government structures, traditional and communities in these areas. We have also facilitated inputs into the Bill in consultation with the Traditional leaders in the province. For this programme we have committed R4.6 million in the 2008/09 financial year.
Comrade Speaker; Now that we have established the Provincial Disaster Management Centre, our focus should turn towards ensuring that the centre functions to its full capacity. The recent violent attacks on foreign nationals put the centre to test. However tragic, this has presented us with an opportunity to improve certain things and to relook at how effective can we coordinate with municipalities. In this financial year we have allocated R22 million to put in place effective disaster and risk reduction and management strategies for the World Cup and Gautrain. The key project is to acquire a Disaster Management Mobile Unit by the end of this financial year. GLOBAL CITY REGION
Although the smallest in geographic size, Gauteng is the economic powerhouse of South Africa, accounting for over 40% of total GDP and a population of over 10,4 million ( Community Survey 2007). Over 95% of the population resides in urban Gauteng. However, the province also has a disproportionately high proportion of urban poverty indicating that challenges remain in terms of ensuring that growth is shared, broad-based, inclusive and equitable.
It is within this broad context that the province launched Gauteng Global City Region initiative in 2007. The rationale behind the GCR perspective is a growing recognition that while macroeconomic considerations are important, development processes are ultimately strongly shaped by processes on the ground in specific regions. Gauteng success therefore has wider benefits in terms of the national and international competitiveness of the country as a whole and achieving the national targets of halving poverty and unemployment.
However, regions don't achieve success automatically and overnight. It takes a long time for a region to develop along a particular path or development trajectory. Therefore we need long-term perspectives & policies to put the GCR on a higher, sustainable and more equitable path of development.
Developing such a long-term perspective and polices, demands that all of us (local, provincial and national) share a common approach in how we deal with the urgent and complex choices needed to build an economically efficient, socially equitable and environmentally sustainable city-region.
I have always held the view that to realize a shared vision for Gauteng, including transforming our province into a global city region, we should strengthen our inter-governmental relation (IGR), especially in planning. IGR is about intergovernmental priority setting, resource allocation and implementation. Hence we pioneered the IDP Roadmap which was approved at the Premier's Coordinating Forum (PCF). We are starting to realise the impact of sequencing of planning cycles and having a joint input to into the municipal IDPs.
Government now regard the IDPs as a potential fulcrum for raising issues to be attended to by all the three spheres of government.
Working with the Provincial Treasury, we have facilitated innovative ways and we are now in a position to provide municipalities with a provincial budget input on the capital programme.
While we have made progress, there is still a need to improve on the participation of communities in the development and review of IDP's. In this regard, we need to institutionalise practices that will assist municipalities to formulate IDP's that are informed by and reflect the aspiration of communities. Alignment of MIDP's and SDBIP remains a challenge. As a result, holding senior officials accountable in terms of their performance contracts, still poses a challenge.
ENERGY
Comrade Speaker;
In responding to the energy challenges, the province and all municipalities working with private sector committed to the 10% energy saving target set by national government. A plan was developed focusing in three key areas of Security of Supply, Alternative Energy Sources and Energy Savings. All municipalities and the provincial government developed implementation plans in line with these key focus areas. The department is coordinating and monitoring the implementation of these plans and is accountable to a political task team comprising of Mayors, MMC responsible for energy and the province.
In the medium term, we will roll-out of solar geysers, solar powered traffic lights, replacing high mast lights with street lights, installing energy efficient lighting in government buildings and oversee, once promulgated, the implementation of the electricity efficiency regulations. We are working with the Central Energy Fund to develop a provincial master plan to introduce new technology to ensure that street and traffic lights that are powered with solar, battery and the usage of lights emitting diodes (LED). The master plan will ensure that all traffic lights are synchronised.
In the long term, we will all have to change our overall behaviour patterns with regards our usage of natural resources, which are dwindling at a rapid rate. This will require a sustained energy efficiency campaign at a grassroots level. The impact of climate change, which is, in the view of many world leaders, the number one priority, requires nothing less than policy shift to green technology and clear implementation plans by all of us.
The department is in the process of developing a Provincial Integrated Energy Strategy which will build on the work done by the three Metros, Industry, Business as well as international German School. Each department must develop energy savings plans and to conduct ongoing energy awareness programmes. I am also advocating that each department should appoint energy champions who will lead the energy saving campaigns. Government must lead by example and we should demonstrate, by the end of the financial year that we have indeed saved more than the required 10%.
The strategy will consolidate the wide variety of initiatives by various sectors, underway in the province, to save energy. It will also identify the best options for renewable energy for the province. The development of this strategy will entail extensive engagements with each sector of society in this province, as the solution to the crisis requires that each home, factory, building and sports field makes a concerted effort to save energy.
Comrade Speaker;
Last week we hosted a three day Provincial Energy Efficiency Product and Information Exhibition (ENERGEX) at the Nasrec Expo Centre. The Expo provided Gauteng citizens and businesses an opportunity to view and learn about a range of products that households, business, institutions and the general public can use in order to contribute to the national energy saving campaigns. What this expo demonstrated is that there is a growing industry out there that requires some focus by agencies such as the Gauteng Economic Development Agency (GEDA) and other institutions because of their potential to create new jobs and developing new capacity in the province to produce CLF's and solar products.
The Executive Council Lekgotla resolved that all municipalities should fast-track the implementation of the Regional Electricity Distribution (Reds). We have to ensure that there is no municipality in the province that opt out and I can confirm that this principle is shared by all municipalities. Despite these challenges, we are on course towards the implementation of the (Reds) 2, 4 and 6 respectively anchored by the three metros.
Based on the 2004 data, the distribution asset maintenance, refurbishment and network strengthening requirement was calculated at R5.408 billion. The figure, based on the latest assessment, indicates a funding requirement of R7.5 billion to address the distribution asset maintenance, refurbishment and strengthening. It is important to note that these figures reflect the total of the electricity distribution related assets in the Gauteng Province. Furthermore, it is important to note that addressing these challenges will require a holistic approach to asset management and it will call for focused attention and dedicated resources.
Against this background it is critical that we get the full cooperation of Eskom and the municipalities in the province, to effectively address this challenge and for this, an integrated plan for the management of the electricity distribution assets must be developed. To this end, EDI Holdings is putting a process in place to assist in addressing this challenge.
Comrade Speaker;
The ANC adopted a policy of 50/50 gender representation in political positions. We deemed it important to ensure that we also empower women councillors to address the challenges they face as leaders. Last year we launched the Women Councillors Mentorship Programme aimed at addressing gender imbalances and removing the structural blockages impeding development of women as elected councillors. One of the objectives of this programme is to assist women councillors to become better leaders to advocate for issues affecting their communities.
Women councillors have been paired with mentors who are assisting and supporting them in their working environment and helping them to deal with the challenges they face while conducting their work and fulfilling their roles as councillors. For the 2008/09 financial years, we have budgeted R1.5 million towards this great and noble initiative.
In 2004, we conceived the Women in Local Government Awards. Since its inception, the awards have grown in stature. These annual awards, held in August during Women's Month, are aimed at honouring and celebrating the sterling work done by women in local government in bringing services to communities. They also serve as a platform for all women in municipalities to share their best practices and to motivate more women to go an extra mile in the work that they do.
Comrade Speaker;
Last year we developed HIV and AIDS Guidelines for municipalities during the Indaba. In implementing these guidelines we will transfer R10.9 million to municipalities based on the business plans for their HIV ad AIDS programmes.
We are working with Gauteng Youth Commission to conduct a study on the impact of local government programmes on young people in the province. Once the study is completed, we will host a summit to discuss the outcomes and develop a plan of action by the end of September 2008.
As I conclude, I would like to say that we have laid a solid foundation and what remains is to complete the process towards fully functional and sustainable institutions.
As we look ahead, we must deal with the twin challenge of urbanisation and migration. Failure to act decisively will result in poor planning and as a consequence we shall falter in the allocation of resources and delivery of services. The Global City Region Perspective has created a wonderful opportunity for us to put this matter firmly on the agenda. The 2007 Community Survey gives us hope that we are on course towards realising our goal of a better life for all, but we have to increase the tempo to a higher gear. A better Gauteng that is intergrated, where services are seamless between the two spheres of government is indeed possible in the not too distant future.
I want to leave you with a quote from Joseph Stiglitz book: Making Globalisation work "Markets, government, and individuals are three of the pillars of successful development strategy. A fourth pillar is communities, people working together, often with help from government and nongovernmental organisations. In many developing countries, much important collective action is at the local level. In Bali, as in much of Asia, irrigation for agriculture is provided by a network of canals. These are maintained by the community which ensures that the water is shared fairly among the villagers".
CONCLUSION
I would like to thank the Premier for his guidance and leadership; Members of the Executive Council for their support. Members of the Provincial Legislature; Members of Portfolio Committee under the leadership of Ms. Refiloe Letwaba for keeping us on track at all times.
Executive Mayors and all councillors as well as municipal officials; EDI Holdings CEO Phindi Nzimande and Chairman Dolly Mokgatle; SAICA president Mr Ignatius Sehoole; Ms Alison Lawless CEO of SAICE, DBSA CEO Mr Paul Baloyi and Chairman Mr Jay Naidoo without their cooperation and understanding we will not be where we are.
I would like to thank the HOD, Mr. Oupa Seabi for leading the department with honesty, understanding, patience and integrity.
I also wish to thank all officials of the department, including those who are field workers - without you, the department will be an empty shell.
May I also thank the staff in the office of the MEC for their patience, understanding and unconditional support. Finally, I would like to express my gratitude to my kids Bongiwe and Nkululeko; my mother and my partner Johnny whose support has been a great source of inspiration and motivation.
I thank you all!