1 MUNICIPAL DEMARCATION BOARD REPORT ON ACTIVITIES THE DETERMINATION OF METROPOLITAN AND DISTRICT COUNCIL BOUNDARIES The Municipal Demarcation Board published a Section 26 notice on 10 August 1999 inviting views and representations on the determination of the boundaries of all category A (Metropolitan) municipalities; the boundaries of all category C (District) municipalities; and possible municipal boundaries extending across provincial boundaries. Between 6 and 14 October 1999 the boundaries of Category A and C municipalities and possible cross boundary areas were published in Provincial Gazettes. In addition to its communications with stakeholders, the Board provided, at some 55 selected venues, copies of the maps of the boundaries of District/Metropolitan municipalities. On 15 October 1999 the Constitutional Court found certain sections of the Municipal Structures Act, 1998 to be unconstitutional. In reacting to the court’s judgement, the Board published afresh Section 26 Notices inviting comment from the public at large around the determination of Category A and Category C municipalities. The Board commissioned a specific study into whether or not Port Elizabeth meets the criteria as laid down in the Municipal Structures Act, which study indicated it did meet the criteria. The Board also consulted with its major stakeholders around the decision on which areas should be metropolitan areas. At its meeting on November 18 1999, the Municipal Demarcation Board applied the relevant criteria in Section 2 of the Municipal Structures Act and determined that the following areas would be category A areas: • Greater Johannesburg • Greater Cape Town • Greater Durban • Greater East Rand • Greater Pretoria • Greater Port Elizabeth After having considered all views and representations the Board determined the boundaries of all Category A and C municipalities and the applicable Section 21 notice was published in the provincial Gazettes from 22 - 26 November 1999. Objections were to be submitted by 31 January 2000. THE DETERMINATION OF CATEGORY B BOUNDARIES The section 26 notice for category B municipalities was published on 11 October 1999 with the closing date on the 2 November 1999.
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MUNICIPAL DEMARCATION BOARD
REPORT ON ACTIVITIES THE DETERMINATION OF METROPOLITAN AND DISTRICT COUNCIL BOUNDARIES The Municipal Demarcation Board published a Section 26 notice on 10 August 1999 inviting views and representations on the determination of the boundaries of all category A (Metropolitan) municipalities; the boundaries of all category C (District) municipalities; and possible municipal boundaries extending across provincial boundaries. Between 6 and 14 October 1999 the boundaries of Category A and C municipalities and possible cross boundary areas were published in Provincial Gazettes. In addition to its communications with stakeholders, the Board provided, at some 55 selected venues, copies of the maps of the boundaries of District/Metropolitan municipalities. On 15 October 1999 the Constitutional Court found certain sections of the Municipal Structures Act, 1998 to be unconstitutional. In reacting to the court’s judgement, the Board published afresh Section 26 Notices inviting comment from the public at large around the determination of Category A and Category C municipalities. The Board commissioned a specific study into whether or not Port Elizabeth meets the criteria as laid down in the Municipal Structures Act, which study indicated it did meet the criteria. The Board also consulted with its major stakeholders around the decision on which areas should be metropolitan areas. At its meeting on November 18 1999, the Municipal Demarcation Board applied the relevant criteria in Section 2 of the Municipal Structures Act and determined that the following areas would be category A areas:
• Greater Johannesburg • Greater Cape Town • Greater Durban • Greater East Rand • Greater Pretoria • Greater Port Elizabeth
After having considered all views and representations the Board determined the boundaries of all Category A and C municipalities and the applicable Section 21 notice was published in the provincial Gazettes from 22 - 26 November 1999. Objections were to be submitted by 31 January 2000. THE DETERMINATION OF CATEGORY B BOUNDARIES The section 26 notice for category B municipalities was published on 11 October 1999 with the closing date on the 2 November 1999.
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A number of workshops were held in which the category B framework and sections 24 and 25 of the Municipal Demarcation Act No 27 of 1998 were applied in the preparation of the boundary options. In addition, cognisance was also taken, in the drafting phase, of the information obtained from the section 26 submissions. One hundred and forty seven hearings were held throughout South Africa. The Municipal Demarcation Board Meeting to consider B-municipal boundaries was held on 15 December 1999. The Section 21 notices appeared in the relevant Provincial Gazettes from 20 – 22 December 1999. The closing date for objections to the boundaries was 31 January 2000. CONSIDERATION OF OBJECTIONS AND REDETERMINATIONS OF CATEGORY A, B AND C BOUNDARIES As at the 15th February 2000 a total of 2353 submissions and objections had been received by the Demarcation Board. After all objections have been duly considered the Board redetermined the boundaries of all category A, B and C municipalities and also published its proposed proposed boundaries for cross boundary municipalities. A number of district management areas were also declared. The final determination resulted in the following number of municipalities per category: Category A 6 Of which 2 are cross boundary metropolitan
municipalities. Category B 232 Of which 8 are cross boundary local municipalities Category C 46 Of which 7 are cross boundary district municipalities DMAs 26 Of which 1 (Kruger Park) falls in two provinces Due to technical and other problems various boundaries had to be republished prior to the 5 December 2000 local elections. CROSS BOUNDARY AREAS After receiving the concurrence of the relevant legislatures and after the Cross-boundary Act, 2000 was promulgated the Board determined the boundaries of 2 cross boundary metropolitan municipalities, 8 cross boundary local municipalities and 7 cross boundary district municipalities. The legal provisions to deal with cross boundary areas are very cumbersome and the Board recommends that they be reviewed. DISTRICT MANAGEMENT AREAS In terms of section 6 of the Municipal Structures Act, 1998 (Act No.117 of 1998) the Municipal Demarcation Board, after having consulted the Minister and the
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MECs responsible for local government in the provinces, declared various areas that must have municipalities of both category C and category B as district management areas. The Boards final declaration was published in Government Gazette 21617 of 29 September 2000. AD-HOC DELIMITATIONS The Board dealt with a number of ad-hoc request for the re-determinations of the boundaries that existed prior to the demarcation for the 5 December 2000 local elections. The long and tedious process required by the Demarcation Act demands an urgent review of the legislation to that such request for minor adjustments can be dealt with expeditiously. DELIMITATION OF WARDS In the interests of transparency, the MDB released a Discussion Document dealing with not only the process to be embarked upon in finalizing ward boundaries, but data on the number of registered voters and existing councillors in each of these municipal areas. These data allowed all stakeholders to debate these issues in anticipation of the formula for the number of councillors. After the Minster published the formula for the number of councillors on 5 April 1999 the MECs responsible for local government published the number of councillors in Provincial Gazettes. All wards were sucessfully delimited priot to the elections. RESULTS OF THE DEMARCATION AND DELIMITATION PROCESSES The 843 municipalities established during 1995/96 have been rationalised to 284 as follows:
• 6 (A Category) Metropolitan areas (Johannesburg, Pretoria, East Rand, Durban, Port Elizabeth and Cape Town)
• 47 (C category) District Municipalities • 231 (B category) Local Municipalities
POWERS AND FUNCTIONS The Board has two major functions pertaining to powers and functions:
• To determine as to whether powers and functions are performed and to make recommendations to MECs regarding authorisations; and
• To determine the capacity of municipalities and to advise MECs as to whether powers and functions should be adjusted.
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DETERMINATION OF CAPACITY PRE DECEMBER 5 2000 ELECTIONS When the Board determined municipal boundaries prior to the local elections on 5 December 2000 category B and C municipalities were classified in the following broad capacity categories: Category C (District) Municipalities: The Municipal Demarcation Board examined the potential administrative and financial capacity of each municipality. The 47 District municipalities divide fairly evenly into the following groups:
• Classification 1 – Highly Capacitated Category C Municipalities (have significant budgets; can easily perform all the Category C functions, can perform category B functions; and have the administrative and financial management capacity and infrastructure to collect revenue and to govern on its own initiative the local affairs of its community)
• Classification 2 – Capacitated Category C Municipalities (have relative large budgets; can perform Category C functions and can perform some Category B functions; and have reasonable administrative and financial management capacity and infrastructure to collect revenue and to govern on its own initiative the local affairs of its community).
• Classification 3 – Fairly to Very Limited Capacitated Category C Municipalities: (have medium to small budgets; can, to some extent, perform Category C functions; can possibly perform minor Category B functions; and have fair to very limited administrative and financial management capacity and infrastructure to collect revenue and to govern on its own initiative the local affairs of its community).
Category B (Local) Municipalities:
Classification 1 - Aspirant Metropolitan Areas: (At least 5 municipalities): These aspirant metropolitan areas are classified as having the following characteristics: • fulfil some of the criteria to be metropolitan areas as specified in section 2
of the Municipal Structures Act No 117 of 1998; • have significant budgets (without electricity have budgets in excess of
R300 million per year); • have over 40% of the registered voters from the District Council in which
they are located; • presently undertake almost all of the Category B functions, and • could, on an agency basis, undertake for the District Municipalities all of
the Category C functions. Care must be exercised in how these areas are dealt with in the division of functions and powers. Classification 2 – Significant and Large Category B Municipalities (At least 17 municipalities fall into this category) The criteria for the classification 2 municipalities are as follows: • fulfil some but limited number of the criteria to be metropolitan areas,
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• have large budgets (without electricity in excess of R100.1 million – 300 million per annum)
• presently undertake most of the Category B functions, and • have the capacity to assume all Category B functions. Care must be exercised in how these areas are dealt with in the division of functions and powers. In individual cases, where the District Municipality lacks capacity, they be allocated some of the Category C functions and powers. Classification 3 – Significant Category B Municipalities (At least 22 municipalities fall into this category) The criteria for the classification 3 municipalities are as follows: • have fairly large budgets (without electricity in excess of R50.1 million –
100 million per annum) • are mainly an agglomeration of small towns, • presently undertake most of the Category B functions, and • have the capacity to assume most if not all Category B functions. In most of these cases the Category B municipalities should have the capacity to adequately deal with their statutory functions and powers. Classification 4 - Strong Category B Municipalities: (At least 84 municipalities fall into this category) The criteria for the classification 4 municipalities are as follows: • budgets between R10.1- 50 million, and • has a dominant urban centre (may be a small town but with good
infrastructure) with other smaller urban centres. It could be that in some cases the District Municipalities in which these municipalities are located be allocated selected Category B powers and functions. Classification 5 - Weak Category B Municipalities (At least 27 municipalities fall into this category) The criteria for the classification 5 municipalities are as follows: • budgets between R1-10 million, and • has a dominant urban centre with limited infrastructure • limited income base • reliance on grant finance These are areas, which presently do not have much capacity. These Category B municipalities are largely dependent on grants. In these cases, attention must be placed on strengthening the Category C municipalities first. Classification 6 – Very Limited Capacity Category B Municipalities (At least 46 municipalities fall into this category and for a further 30 municipalities there is insufficient information, but they are probably also in this category)
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The criteria for the classification 6 municipalities are as follows: • budgets between R1-10 million, and • has one or no urban centre • heavy reliance on grant finance
These are areas, which presently do not have much capacity and are primarily found in the former homeland areas. These Category B municipalities are largely dependent on grants. In these cases, attention must be placed on strengthening the Category C municipalities first.
While the above was a useful pre election guide, modifications are necessary to ensure the Board legally complies with Municipal Structures Amendment Act. These modifications are detailed in the section below. DETERMINATION OF CAPACITY DURING THE TRANSITION PERIOD (5 DECEMBER 2000 UNTIL 4 DECEMBER 2002) Process The Board has recently conducted investigations at provincial and local level to update its database in order to be well placed to make recommendations for authorizations to the MECs. Part of this process meant the development of a broad conceptual framework for application across all municipalities. This involved classifying all Category B and C municipalities into four categories. The four categories were arrived at in the following way: The Board considered two baseline indices for municipal capacity: (i) a ratio of the number of municipal employees per capita and (ii) municipal income excluding electricity. Each of the indices is ranked accordingly for all category B municipalities: Income excluding electricity: 1 = > 300million per annum 2 = 100.1 – 300 million per annum 3 = 50.1 – 100 million per annum 4 = 15 – 50 million per annum 5 = 5.1 – 15 million per annum 6 = < 5 million Employee per capita ratio 1 = 1 – 299 2 = 300 - 599 3 = 600 – 899 4 = 900 – 1499 5 = >1500 6 = No staff For category C municipalities, each of the following indices were ranked accordingly:
Following this, district and local municipalities were classified as follows:
Classification 1- High capacity Classification 2 – Some capacity Classification 3 – Limited capacity Classification 4 – Very limited
The resultant municipal classifications are attached as Appendix B. Once the rankings or classifications were determined, the legal requirements for each municipal function were then applied. This approach resulted in two matrices, outlined below, to guide the assessment of where a municipal function is best undertaken. Each municipality would fall into a particular category in the matrix and the recommended allocation is provided for that position. The matrices are: Section 84(1) Possibilities – District Functions
CAPACITY Category C High
Category C Some
Category C Limited
Category C Very Limited
Category B High* C level B and C level B level B level Category B Some C level B and C level B level B level
Category B Limited
C level C level C level C level
Category B Very Limited
C level C level C level C level
* Aspirant metro excluded – all functions should remain at the B level Local Municipal Functions Category C
High Category C Some
Category C Limited
Category C Very Limited
Category B High B level B level B level B level Category B Some B level B level B level B level Category B Limited
C level/B level C level/B level Some B and C level
Some B and C level
Category B Very Limited
C level/B level C level/B level Some B and C level
Some B and C level
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This framework has been applied to each municipality, taking due cognizance of each function that is actually performed in that municipality (based on the data base of the Board). In this way a national framework is applied in the context of local conditions in a consistent and even-handed way across the entire country. The recommendations that arise from this process takes cognizance of legal factors such as the MEC being able to issue an authorisation only if:
• The district municipality or the local municipality (as the case may be) cannot or does not perform the function or exercise the power in the relevant area.
• For any reason, it is necessary to ensure the continued performance of the function or the exercise of the power in that areas.
• The Demarcation Board has recommended the authorisation. Consequently, the Board has considered at least the following key questions, which are built into the conceptual framework: • Are all the municipal functions being performed within each district area? • Is the function being performed at a category B or C level? • Where should the function be performed in terms of section 84? • If the performance is currently not compliant with section 84, why not? • What can be done to move toward compliance with the legislation? • What are the consequences of compliance – for example some Category B
municipalities rely on Category C functions for resources and a narrowly focussed reassignment of these functions and powers might lead to a collapse of functioning category B municipalities.
Approach taken by the Board: In applying the conceptual framework and while tempering it with submissions received from municipalities and provincial governments, the Board developed the following principles to be used in arriving at its recommendations:
• Principle 1: That there should no longer be any geographic split of functions ie if a category B performs a functions - it should be for the entire area. This adjustment needs to be made because of the confusion presently where a Category B municipality is responsible for a particular function only in the former TLC areas of the Category B municipality. This creates problems in that a Category B municipality might only have jurisdiction over part of a ward. The Board’s view is that where a Category B municipality is able to perform a function it should perform that function for the whole geographic area of the municipality.
• Principle 2: That if a Category C municipality has some capacity it may perform a function for only some of the category Bs in an area but not necessarily all.
• Principle 3: That some functions might need to be split with some aspects indicated for partial adjustments - the nature of the adjustment will still need to be decided.
• Principle 4: That where a function is not performed at all in a District municipality or local municipality it must be assigned to one or more municipalities.
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The Board is in a process of eliciting comments from MECs and municipalities. The consequences of sec 18 authorisations in the short term also needs to be assessed. How will the Board's recommendations affect viability, service delivery and the transformation process? Based on comments received, the Board will formally make its recommendations to MECs by early April 2001. 3. DETERMINATION OF CAPACITY DURING THE FINAL PHASE (POST 4 DECEMBER 2002) The Board has recognised that a more focused approach is required for the post-election phase. The Structures Act defines capacity in relation to a municipality to include the administrative and financial management capacity and infrastructure that enables a municipality to collect revenue and to govern on its own initiative the local government affairs of its community. The definition specifies certain indicators that should be included in assessing the capacity of a municipality to perform a function. However, it does not exclude the development of other indicators. With the exception of perhaps the percentage of the population within a municipal area benefiting from the performance of a certain function, the criteria to be used to determine whether a municipality has the capacity to perform a function, will probably have to differ from function to function. The capacity to perform a function is also directly linked to the standard or level at which a service is to be provided. Experts on the different municipal functions have been approached to advise the Board on possible criteria to be applied to determine as to whether sufficient capacity is available to perform a function in a municipal area. A sound division of powers and functions is key to planning and stability. It directly influence staff establishments, budgets, planning (IDPs) and viability. No certainty about powers and functions is possible without clarity on definitions. Although all functions are important, clarity on definitions and devolution of the 4 "national" functions are important for the transformation process. It is therefore imperative that a team consisting of MDB, DPLG. DWAF, Health and M&E work together and reach consensus on this matter. Devolusion of other national and provincial functions to municipalities should also be co-ordinated to ensure consistency and to protect local resources. Furthermore adjustments should be made with great circumspection so as to ensure that some municipalities are not totally disempowered. It appears that legislation and/or policy need to be revisited. There are clear contradictions between the White Paper and the Structures Act.
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Clarity on the Constitutional future of the country and especially the future role of provinces could also contribute to the debate as to whether South Africa should have a strong or a weak district council system. WORK IN PROCESS The Board is attending to various other project with a view to enhance the transformation process including: • Assistance to departments to align their functional service delivery boundaries
with municipal boundaries; • Information dissemination through the Board's web-site and SA Explorer; • Update of its GIS and data sets; • Assistance to various departments such as Local Government (NP), DPLG,
DTI, Justice and Health. RECOMMENDATIONS It is recommended that: • The authorisation process be completed as soon as possible so as to
create a measure of stability and an environment conducive for transformation, planning and budgeting;
• A team be appointed from all relevant departments to clarify the definitions of municipal powers and functions and to determine the consequances of the division in terms of the existing provisions of the Structures Act;
• The Demarcation Act be amended so as to deal expiditously with requests for changes to boundaries
• The Structures Act be amended to, amongst others, create a more flexible system for the division of powers and functions and to make it possible to transform "aspirant metros" into fully fledged metropolitan municipalities prior to the next local elections
• Provinces provide the MDB with the sec 12 names of the new municipalities and details of all the notices they have published in terms of the Structures Act so that a national database can be compiled and distributed to local government stakeholders.