THE WHITE PAPER ON LOCAL GOVERNMENT

The Ministry for Provincial Affairs and Constitutional Development released the White Paper on Local Government in March this year. Within the framework of the Constitution, this White Paper sets out the vision for a new developmental local government system, which is committed to working with local citizens, groups and communities to improve the quality of life and to meet the social, material and economic needs of communities in a holistic way.

It is the culmination of a three-phased consultative process that was embarked upon eighteen months ago. The first phase of consultations resulted in a Discussion Document published in April 1997. The second phase culminated in the release, in October 1997, of the Green Paper on Local Government. The final phase, whose end product is this White Paper, consisted of hearings organised by the Portfolio Committee, a local government Summit, public submissions and sectoral consultative conferences. The next step now is the preparation of appropriate legislation to enact the policy directions contained in this document.

Geographic, institutional and social segregation pre-dates the introduction of apartheid in 1948. The Group Areas Act, apartheid’s key piece of legislation, not only entrenched in law the systematic segregation of residential areas and the compulsory removal of black people to ‘own group’ areas, but also created the legal framework within which affluent white municipalities could, with impunity, abdicate their financial responsibility towards servicing black disadvantaged areas. Apartheid regulations also barred most retail and industrial developments in black areas. As a result, large black populations were forced into areas which had a very limited tax base, thus depriving municipalities in these areas of the means to meet the needs of local residents, whilst many white municipalities had large concentrations of economic resources to tax and small populations to serve.

Various attempts were made under apartheid to introduce ‘own management’ structures for black residents. By 1982 Black Local Authorities (BLAs) had been established to replace Community Councils. BLAs had no significant tax base, were seen as politically illegitimate, which led to being rejected by the vast majority of black people. Essentially they were set up to reinforce the policies of segregation and to ensure the economic exclusion of black people.

As the political struggles of the mid-eighties gained momentum, civics and other community structures started organising against these anomalies. The BLAs were collapsing, Regional Services Councils (RSCs), and Joint Services Councils (JSCs) were set up to channel funds into black areas, but by and large these interventions came too late. The crisis in local government eventually led to a national debate, culminating in the Local Government Negotiating Forum, alongside the national negotiating process.

The Local Government Negotiating Forum framed the Agreement on Finance and Services writing off arrears to BLAs. It also negotiated the Local Government Transition Act (LGTA) of 1993. The LGTA sketched out a process for change within local government.

3. A New Vision for Developmental Local Government

Although local government will, until 30 March 1999, be guided by the rules and regulations of the Local Government Transition Act (LGTA) of 1993, the Constitution envisages a fundamental transformation of the local government system. The Constitution mandates local government to provide democratic and accountable government, which will ensure the provision of services to communities in a manner that would stimulate sustainable social and economic development. Equally important, to meet these goals, local citizens, community organisations and groups within the communities will have to be involved in all matters of local government.

Four key elements characterise the new vision for developmental local government. These are:

• Maximising social development and economic growth: The powers and functions vested in local government create the conditions for it play a key role in developing economic prosperity at the local level. Municipalities therefore need a clear vision for the local economy and to create the overall economic and social conditions conducive to the creation of employment opportunities. Essential municipal services such as water, sanitation, electricity, roads and street lighting is an important contribution of local government toward building a healthy and socially sustainable society. However, simple changes can also be made to existing procedures such as affirmative procurement policies. By simplifying such policies, opportunities can be created for specific target groups, such as women or emerging black businesses, to establish themselves.

• Integrating and Co-ordinating: Developmental local government must find creative ways of integrating and co-ordinating resources and investments from all key role players, including parastatals, trade unions, community groups and the private sector to meet development targets. To achieve this, municipalities must develop integrated development plans (IDPs), based on the principles of the Development Facilitation Act.

• Democratising development: Municipal Councils play a central role in promoting local democracy. To actively stimulate the participation of marginalised and excluded groups in local government initiatives and community processes, municipalities must adopt inclusive approaches, including strategies aimed at removing obstacles to their participation. Such strategies could include, for example, a standardised, or ‘equitable share’ subsidy for poor households; or financial, technical skills or training support for community organisations. Special attention must be given to the diverse needs of women. Such an appreciation must be reflected in the planning and delivery processes of municipalities, in order to increase their impact on reducing poverty.

• Leading and learning: All communities, irrespective of whether they are located in the cities, towns or rural areas, will have to find within themselves ways of making their settlements more sustainable. To create the social conditions favourable to development, municipalities must, amongst others, build the kind of political leadership that is able to bring together communities of different persuasions, raise awareness of human rights and environmental issues, targeting particularly marginalised groups and the youth.

The Constitution identifies the national, provincial and local spheres of government, all of which are required to observe the principles of co-operative government. Although these three spheres of government are distinctive, interdependent and interrelated, they are required to function as a cohesive whole to develop a multi sectoral perspective, harnessing all public resources behind common goals and within a mutually supportive framework.

A system of intergovernmental relations has the following strategic purposes:

• To promote and facilitate co-operative decision making
• To co-ordinate and align priorities, budgets, policies and activities across interrelated functions and sectors;
• To ensure a smooth flow of information within government, with a view to enhancing the implementation of policy and programmes;
• The prevention and resolution of conflicts and disputes

Section 41(20 of the Constitution requires the development of an Act to set up structures and institutions to promote intergovernmental relations. The Department of Constitutional Affairs is presently drafting a discussion document

4.1.1 Roles and Responsibilities of National Government with respect to Local Government

Though roles and responsibilities for the three spheres of government are still evolving, below is an outline of the basic roles of national government with respect to local government.

• National government is responsible for setting the overall strategic framework for the social and economic development for all spheres of government. It should also ensure that local government operates within an enabling framework and that it has the structural human and resource capacity to promote the development of all.
• Whilst local government is still in transition, as envisaged in the Local Government Transition Act (LGTA), national government is responsible for the co-ordination, management and oversight of this transition.
• National Government must also provide the overall legislative framework for local government, including the establishment of criteria for the demarcation of municipal boundaries, the definition of categories of municipalities and types within the categories.
• Other responsibilities include the provision of a framework for intergovernmental relations; ensuring that provincial legislation with respect to local government is in keeping with the national framework; and ensuring the appropriate division of powers and functions between the categories of municipalities.
• As part of its commitment to capacity building and support for local government, national government must support institutions, such as the Local Government Sector Education and Training Authority and the Local Government Bargaining Council.

4.1.2. Roles and Responsibilities of Provincial Government

Given the disparities in capacity and revenue between and within different provinces, provincial governments must structure their approaches to supporting local government according to the specific conditions within each area.

Some of their main responsibilities will include:

• Developing a vision and framework for integrated economic, social and community development through the Provincial Growth and Development Strategy;
• Ensuring that municipal IDPs form a viable, integrated development framework, which gives priority to the basic needs of the community;
• Establishing forums and processes so that local government can participate fully in decision-making processes;
• Reformulating outdated Provincial Ordinances, affecting local government, and bringing these in line with the Constitution and the vision for a new developmental local government. This process will be facilitated by a nation-wide review of , and the adoption of a common approach to the repeal of Ordinances.
• Promoting the development of local government capacity, through the co-ordination and drawing up of a framework for municipal capacity building. Key role players such as the South African Local Government Association (SALGA) , and individual municipal Councils will have responsibility for staff training, including the training of councillors. All training and capacity building initiatives should be linked to the national legislative and policy framework for skills development drawn up by the Department of Labour.
• Extending the role presently played by Provincial governments in the monitoring the municipalities’ finances, through the Provincial Task Teams of Project Viability. In addition, provincial governments have to build financial management capacity, and if and when necessary, intervene, to ensure local financial viability. Provincial Members of the Executive Council (MECs) for Finance are also represented on the Budget Forum, thus playing a key role in budget allocations for local government.
• Intervening, when necessary, to safeguard the promotion of minimum standards of delivery and democracy; to ensure the financial sustainability of a municipality; and to promote accountability and public trust in local government. Powers of intervention are presently governed by section 10G(2) of the LGTA and will remain in force until 1999, after which Section 139 of the Constitution will come into being. According to the constitutional provisions, provincial government can intervene when a municipality cannot or does not fulfil its executive obligations.

4.2 The role of organised local government

The constitution allows for the formation of municipal associations. A national organisation, the South African Local Government Association (SALGA) and nine provincial associations have been formed. SALGA’s key role is the effective representation of local government in national and provincial legislative processes, and in intergovernmental executive processes. SALGA has representation on the National Council of Provinces (NCOP), the Financial and Fiscal Commission (FFC), the new Budget Forum dealing with intergovernmental transfers, and MINMEC. SALGA must also be closely involved in the drafting of all legislation that affects the status, institutions, powers and functions of municipalities.

As the employer component of local government, SALGA plays a key role in the South African Local Government Bargaining Council. In this context, it will be responsible for building capacity amongst its membership, and maintaining open and constructive relationships with organised labour.

Other potential contributions of SALGA include the provision of specialised services to supplement and strengthen the capacity of municipalities, research and information dissemination, human resource development, including the training of councillors.

In addition to membership fees payable by municipalities, national and provincial governments have made a commitment to assisting organised labour financially, on a rand-by-rand basis out of the equitable share of national revenue to which local government is entitled.

In keeping with the principle of devolving functions to local government, the Department of Health has designated municipalities as District Health Authorities (DHAs) where they have the capacity to perform this function. This is borne out by the need to integrate health services, presently being rendered by both provincial and local authorities, and to co-ordinate vertical services, impacting on health, such as water supply, welfare and transport.

The White Paper on Local Government reiterates the Department of Health’s commitment to the District Health System (DHS), and the establishment of District Health Authorities with health district boundaries being aligned with municipal boundaries. In rural areas, where populations are more dispersed and often smaller, it is envisaged that a number of municipalities could be combined to form a DHA. In metropolitan areas, on the other hand, where populations are much denser, a metropolitan government may incorporate a number of DHAs.

This White Paper acknowledges the importance of the DHS to making health more accessible, available and affordable, but points to the following issues which still need to be resolved, namely:

• linking ‘municipal health services’ to primary health care, and the financial implications this would have on local government;
• aligning boundaries to enable the effective delivery of municipal and DHA services; and
• resolving employment conditions for local government and provincial health staff.

Other sectors that will work very closely with local government include the Departments of Transport; Trade and Industry; Arts and Culture; Safety and Security; Mineral and Energy Affairs; Housing; Land Affairs; Public Works; and Water Affairs and Forestry.

 6. How will Co-operative Government work in Practice?

Whilst a host of functions are being devolved from the national and provincial levels to local government, local government is constitutionally obliged to participate in national and provincial development programmes. The potential benefits of such co-operation can significantly enhance the capacity of local government to deliver on its own programmes, whilst at the same time enhancing the effectiveness of joint initiatives. Some of the ways in which this can happen are:

• Working directly with local government: Substantial resources, from the national and provincial levels, could be made available to municipalities, thereby also contributing to the institutional development of local government;

• Integrating programmes into municipal IDPs: To ensure that scarce resources are used for maximum impact, national, provincial and local infrastructure investment plans must be integrated on the basis of IDPs.

• Coordinated decentralisation and the assignment of powers: To ensure the devolution and effective execution of functions, it is important that local government has the financial and administrative capacity to carry out its mandate. Unfunded mandates can put tremendous strain on local government’s limited resources and could compromise the delivery of essential services. To minimise the possibility of such difficulties occurring, the White paper proposes that all legislation dealing with the decentralisation or assignment of powers to local government is referred to the Local Government MINMEC ( a joint sitting between the Minister and Provincial MECs) for discussion and comment. In addition, provincial government is tasked with monitoring the co-ordination of governmental activities and to report to MINMEC in this regard. Other mechanisms, include the stipulation that the delegation of functions to local government can only take place with the approval of cabinet, once provincial and local government have been adequately consulted. Similarly, delegation from the provincial to the local sphere, must be the result of a provincial Executive Council decision, following consultations with local government.

The Constitution establishes three categories of municipalities, namely:

• Category (A): A municipality that has exclusive municipal executive and legislative authority in its area;
• Category (B): A municipality that shares municipal executive and legislative authority in its area with a Category (C) municipality within whose area it falls;
• Category (C): A municipality that has municipal executive and legislative authority in an area that includes more than one municipality.

Section 155 of the Constitution stipulates that national legislation must:

• Define the different types of municipality that may be established within each category;
• Establish criteria for determining when an area should have a single Category (A) municipality or when it should have municipalities of both Category (B) and (C);
• Make provision for an appropriate division of powers and functions between municipalities when an area has municipalities of both Category (B) and (C).

7.1 Factors influencing the choice of municipal institutions

Given South Africa’s specific circumstances, the White Paper proposes that the choice of municipality should be determined by the extent to which these institutions meet the needs of local communities. South Africa’s legacy of racial, spatial and geopolitical separation has created vast distortions in settlement patterns, leading to an uneven distribution of municipal capacity, particularly between urban and rural municipalities. This situation necessitates rapid intervention to arrest and reverse entrenched patterns of inequity, create economic competitiveness and viability and ensure representation of, and sensitivity to those sections of the population who, historically, had been denied participation.

The new developmental local government system envisages the setting up of municipal institutions which would have the capacity to address these historical distortions. Where the required municipal capacity does not exist, a system of district governance would have to ensure the management of integrated development planning so as to speed up service delivery. The new vision also identifies metropolitan governments as an important axis around which the spatial, economic, political and social integration of local communities can be promoted.

Metropolitan areas are large urban settlements with dense populations, complex and diversified economies and a high degree of co-ordination between different services, sectors or departments. Social, political and economic activity usually occurs across a larger geographic area than the normal jurisdiction of a municipality. For example, metropolitan residents may live in one locality, work in another, and use recreational facilities in yet another.

Metropolitan governments are governments whose area of jurisdiction covers the whole metropolitan area. Where there is no metropolitan government, the metropolitan area is divided into many municipal jurisdictions.

The White Paper presents the following rationale for the establishment of metropolitan government:

• Establishing the basis for equitable and socially just metropolitan governance: Apartheid created a legal framework which excluded the largely black urban poor and ensured that high-ratable commercial development fell within the jurisdiction of white municipalities. Although the consumer and labour power of township residents contributed to the tax base of white municipalities, services in the townships were not funded from this tax base. Metropolitan government, as envisaged in the White Paper, provides a mechanism for addressing this inequity, and ensures that everyone who contributes to the tax base benefits from it. Studies have shown that the greater the degree of equity between the constituent parts of the metropolitan area, the greater the prospect of overall economic prosperity.
• Metropolitan government promotes strategic land-use planning, and co-ordinated public investment : At present, municipalities exercise their planning powers and functions within their particular areas of jurisdiction. However, economic and social activities are often carried out beyond the boundaries of any given municipality. This situation frequently gives rise to poor planning of land-use, investment in infrastructure and transport systems, often leading to irrational use of public funds. It is envisaged that metropolitan government will facilitate more integrated development planning, thereby reducing negative effects.

It is envisaged that Metropolitan Councils will have the following key roles:

• The promotion of spatial integration and the social development of all;
• The promotion of equity, social justice and economic prosperity;
• The promotion of local democracy; and
• The provision of affordable and efficient services

8.1 Metropolitan Government Systems

Two types of metropolitan government are proposed, namely:

Metropolitan government with Ward Committees: These are Category (A) municipalities consisting of a Metropolitan Council and Ward Committees. The powers and functions of the Ward Committees must be delegated from the Metropolitan Council. The central role of Ward Committees is to facilitate local community participation in local government matters.

Metropolitan government with Metropolitan Substructures: These are municipalities that consist of a Metropolitan Council and Metropolitan Substructures, whose powers and functions are devolved from the Metropolitan Council. Metropolitan Substructures will have advisory, supervisory and decision-making powers. Their main function is to facilitate political and administrative decentralisation in a structured manner.

The White Paper proposes a system of district government to address the needs of those areas that fall outside the metropolitan areas, and that had historically been deprived of adequate services..

The key roles of district government will be:

• To facilitate integrated development planning, including land-use, economic, development and transport planning;
• The provision of bulk-services, and to act as agents for infra structural development through the retention of Regional Services Council levies; and
• Systematic capacity building to municipalities, especially Category (B) municipalities.

10. Category (B) Municipal Institutions

Three options for Category (B) municipalities in areas with District governments are proposed:

Urban Municipalities: these are best suited to larger towns and cities, and will have the full range of municipal powers and functions. Although it is envisaged that their boundaries will not incorporate rural hinterlands, it might mean that the boundaries of some Transitional Local Councils will have to be altered.

Amalgamated Urban-Rural Municipalities: They can be established through the amalgamation of existing urban-rural municipalities, or by an urban municipality extending its boundaries into a rural hinterland. Such municipalities are more appropriate for small and medium sized towns that have clear social and economic links between urban and rural settlements. It is envisaged that such amalgamated municipalities would, amongst others, broaden the tax base of new municipalities; facilitate access to services by rural communities and ensure that rural residents who contribute to the urban tax base would share the benefits derived from that tax base.

Rural Municipalities will be allocated a minimum of executive and legislative powers, but as their administrative and financial capacity improve, they will be able to ‘draw down’ powers from the district government.

The White Paper acknowledges that not all rural municipalities will be able to assume the full range of municipal powers and functions, and that where the establishment of Category (B) municipalities are unviable, the district government may assume direct responsibility for the delivery of all municipal functions in the area.

Finally, this document also deals with municipal political systems, administrative systems and municipal finances. It concludes with an approach to municipal transformation, stressing that the extent of transformation ultimately rests with each municipality. Municipalities are therefore encouraged to tackle the matter creatively, and to develop their own strategies, in consultation with local citizenry, for meeting the needs of local communities.

PHILA

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