Local is not lekker for businesses operating in some municipalities in terms of service delivery.
North West's Ditsobotla municipality whose poor service delivery prompted the uprooting of Africa's biggest cheese making factory by dairy group Clover last year, came up as a class act in the roll call of governance failures in the province yesterday.
An update to Parliament's portfolio committee on Cooperative Governance and Traditional Affairs was presented on an exercise started in 2019 to clean-up rampant corruption, poor governance, unqualified personnel, cronyism, violence, poor service delivery and political instability.
The provincial Treasury Department and the South African Local Government Association (Salga) briefed an incredulous committee about the interventions which seemed to have borne minimal fruit.
The parliamentary committee heard that of the 43 municipalities dissolved and requiring state interventions, 12 were in the North West and included Madibeng, Kgetleng Rivier, Tswaing, Mahikeng, Ditsobotla, Mamusi, Ratlou Ramotshere Moiloa and Naledi Local and Dr Ruth Segomotsi Mompati District municipalities.
The session heard that the Ditsobotla municipality had to be dissolved because of a complete collapse in its systems.
MEC for Cooperative Governance, Human Settlements and Traditional Affairs, Lena Miga, said, "That municipality has always been troublesome since its inauguration. They are not able to meet and agree on compliance and service delivery. There just always have been fights over the appointment of a municipal manager. At some stage they had two municipal managers, two speakers and two mayors.
“We have tried to correct the issues so they are resolved, but they always go back to the council chambers and do the same thing again. An official we had
Last week, the provincial government convened an urgent special meeting on the state of governance, the collapse of administrative systems and institutional dysfunctionality at the Ditsobotla local municipality.
It said over the past months, the municipality had experienced heightened instability in both administration and council operations, which escalated in July when government through Section 216 of the Constitution withheld disbursement of the equitable share to the municipality.
Attempts towards a cooperative approach to give the municipality a chance to resolve internal governance challenges through support from the Department and the Exco Team of MECs, to strengthen the capacity to manage its own affairs and perform its functions, had also failed.
An administrator would be appointed to take over the running of the municipality to ensure continuity of service delivery and consult with the National Treasury to secure the release of the Equitable Share of the Ditsobotla local municipality.
"All these interventions and many others failed to restore stability in the municipality resulting in the total collapse of systems. This resulted in the municipality failing to discharge its constitutional obligation and legislative mandate," Miga said.
There was also a high incidence of "adopting unfunded budgets" wherein municipalities' expenditure was expected to exceed their projected revenue, a violation of the Municipal Finance Management Act, which stipulates that municipalities base their budgets on a reasonable estimate of expected revenue.
Often, however, municipalities overestimated their revenue, resulting ultimately in a financial crisis or their realistically anticipated revenue was insufficient to meet planned spending.
The Ditsobotla municipality has been at pains to distance itself from the dairy group Clover’s claim that it shut down its biggest cheese factory in the country due to water and electricity supply disruptions, as well as poor road infrastructure.
Clover employed about 380 permanent employees and about 40 temporary employees. It further employs about 20 general workers, 20 truck drivers and truck cleaners, with other employment opportunities emanating from enterprise development programmes such as sub-contracting.
Clover's Group Manager: Legal & Secretarial Steven Velthuysen said this week on the sale of the group's City Deep Johannesburg warehouse that the sale was part of centralising operations.
"It is well documented that we are consolidating our operations to bigger plants like Queensburgh, we have had some struggles with municipalities in terms of poor service delivery, we have had engagements but nothing has come of it, its mostly small towns that we face service delivery issues,'' he said.
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