Amending Municipal Governance Laws: New Rules, New Directions? A focus on the Municipal Systems Amendment Bill

On 29 October 2019, Parliament revived deliberations on the Municipal Systems Amendment Bill (Bill). The Bill had been undergoing stakeholder engagement before it lapsed under the previous Parliament. Its revival therefore meant that deliberations on the Bill would start again. After it was revived, the Bill was allocated to the National Assembly’s Portfolio Committee on Cooperative Governance and Traditional Affairs (COGTA) (Portfolio Committee) which was tasked with facilitating stakeholder engagement. As of 30 October 2020, deliberations on the Bill in the Committee had almost been concluded in readiness for its submission to the National Assembly for Second Reading.

 

This report provides a summary of the discussions held on the Bill as part of a webinar hosted by the Dullah Omar Institute (DOI) and the South African Local Government Association (SALGA) with the support of the Hanns Seidel Foundation. The Webinar was held under the title “Amending Municipal governance laws - new rules, new direction?” and took place on 30 October 2020.

The panel and key questions

The webinar was chaired by Prof Nico Steytler, the SARChI Chair in Multilevel Government, Law and Policy. The panel consisted of: Prof Jaap de Visser (Director, DOI); Councillor (Cllr) Thembisile Nkadimeng (President, SALGA & Executive Mayor, City of Polokwane); Ms Faith Muthambi (Chairperson of the National Assembly’s Portfolio Committee on COGTA) and Dr Louis Scheepers (Acting Municipal Manager, Knysna Local Municipality).

The panel engaged with three key questions with respect to the Municipal Systems Amendment Bill:

  1. What changes does the Bill bring?
  2. What are the Bill’s most important features and which parts require further debate?
  3. Is the Bill likely to improve governance in municipalities? 

Key issues re-introduced under the Amendment Bill and new proposed changes

Prof de Visser started the discussion by giving a brief overview of the contents of the Amendment Bill as well as the changes introduced into the Bill during the deliberations of the Portfolio Committee. He pointed out that the provisions of the Amendment Bill are not new and only seek to reinstate the provisions that were part of the 2011 Amendment Act, which was declared unconstitutional by the Constitutional Court. In this respect, the Bill -

  1. sets out the procedure to be followed by municipalities in appointing senior managers;
  2. empowers the Department to prescribe minimum key competencies, skills and experience for senior managers in regulations;
  3. re-introduces a ban on the holding of political office by senior managers;
  4. requires a municipality to inform the MEC for local government once an appointment of a senior manager has been made and to provide the documentation that went into the appointment for the MEC to assess the legality of the appointment;
  5. sets out a moratorium on the re-employment of staff who had been dismissed for misconduct such as to ensure they are not re-employed for a particular period of time.
  6. outlines rules on how a staff establishment is put together; and
  7. sets out roles on how the national Minister may leapfrog the province if it fails to initiate an investigation in terms of section 106 of the Municipal Systems Act, into allegations of corruption and maladministration.

Three new changes have since been proposed as part of the deliberations of the Portfolio Committee. These include proposals that -

  1. all municipal staff, and not just senior managers, should be banned from holding political office;
  2. all managers that report to the municipal manager (‘section 56 managers’) should be hired on a permanent basis; and
  3. regarding the requirement for municipalities to notify the MEC of new appointments, that the appointments should be deemed to be in compliance with the law where the MEC fails to respond after being notified.

In finalising his comments, Prof de Visser pointed out that the Amendments were really about professionalising senior management in local governance.

The push for the professionalisation of local governance

As a background, Cllr Nkadimeng highlighted that the issue of political interference by party structures in the affairs of municipal councils and administrations had been previously highlighted in two reports, the State of Local Government Report (2009) and the Local Government Turn-Around Strategy (LGTAS) (2010). She stated that a failure to address the issue had led to the internalisation of the interference through senior and middle management employees who have ranks in political parties. Such interference, she argued, undermines the integrity and functioning of municipalities. Therefore, both reports had proposed the professionalisation of local government administration, as a means to addressing the issue. In this regard, the reports recommended minimum qualifications and competencies for senior managers and staff and that senior managers should belong to a professional organization which would be in charge of monitoring their conduct.

Recommendations regarding minimum competencies informed the current practice in local government where persons applying for appointment as senior managers are required to write a competence test. Cllr Nkadimeng, however, pointed out that there was need to determine who has the authority to administer competence tests; whether it is the municipal council or COGTA. This, she argued, will help avoid any confusion occasioned by conflicting results where both COGTA and councils administer a competence test.

Would professional organisations do a better job?

Prof de Visser raised the question as to whether professional organisations would do a better job at guarding and enforcing quality and integrity in municipal management especially seeing as provincial oversight alone had not been quite successful in this.

Dr Scheepers took the view that an element of self-regulation through a professional association of local government management would help in ensuring responsible conduct. In this respect he proposed for the creation of an umbrella professional organisation for professionals working in municipal management.

In a rejoinder, Prof de Visser expressed doubt as to whether the national government and the provincial government would be willing to cede their oversight authority in favour of self-regulation by professional associations.

Should all staff be banned from political office in order to professionalize?

Hon. Muthambi pointed out that the extension of the ban on holding political office from senior managers to all staff was informed by the realisation that even relatively junior municipal staff members can wield powerful political interference into the administrative affairs of a municipality. She indicated that all political parties represented in the Portfolio Committee were in agreement that this amendment, though unpopular, was necessary for the professionalisation of local government.

Cllr Nkadimeng pointed out that SALGA had come out strongly in support of the ban as this was central to the professionalisation of local government. She stated that the introduction of the ban in 2011 had been key in securing partial professionalisation of senior management in local government and there was need for complete professionalisation.

Prof de Visser, on his part, hailed this as a positive development as it addresses the issue of junior administrative staff undermining senior managers or even mayors who have lower ranks in party political structures.

Should section 56 managers be appointed on a permanent basis?

Regarding the proposal to appoint section 56 managers on a permanent basis, Prof de Visser pointed out that previously municipalities were free to decide whether to appoint the managers on fixed term contracts or permanently. While this could be interpreted as creating uncertainty and unevenness, it could also be seen as the exercise of discretion by municipalities. Prof de Visser argued that although permanency would be good for stability, it would be particularly bad if the process results in a bad appointment which would then be a lifetime appointment. There is, therefore, need to strike a balance between seeking stability in the administration and having to deal with poorer appointments.

Dr Scheepers argued that the proposal for self-regulation through professional associations and certification of local government practitioners has the potential to provide a solution to the question of wrong appointments in instances of permanent contracts for senior managers.

In addition to that, Dr Scheepers was of the view that the current system of fixed-term contracts makes senior managers susceptible to undue political influence. This is due to the fact that they need the goodwill of the council for renewal of their contracts every five years. He argued that it also fosters ‘short-termism’ in the sense that the managers are concerned about what will happen in the short-term hence losing the long-term focus that municipalities must have. A long-term focus is important given the fact that decisions made (by both political and administrative leadership) at the municipal level have long-term impacts on communities and on municipalities as institutions. He, therefore, supported the proposal.

However, Cllr Nkadimeng termed the proposal as concerning. She pointed out that a survey undertaken by SALGA in July 2020 had revealed an overwhelming preference by municipalities (84%) for fixed term contracts for senior managers over permanent appointments (16%).  The study had also revealed no clear connection between permanent senior management and either clean audits, disclaimer audits or on section 139 interventions. Since the survey did not corroborate the view that municipalities are more stable or perform better if senior managers are appointed permanently, SALGA ,therefore, argues that the discretion over tenure should be left to municipal councils.

Cllr Nkadimeng argued that the proposed amendments pose a threat to the constitutionally guaranteed institutional integrity of local governments in so far as the appointment and determination of the conditions of employment of senior managers is concerned. She therefore urged local governments to protect their autonomy in the legislative processes.

Does the law require concurrence from the MEC or just notification of appointment?

On the proviso that a senior manager appointment is deemed lawful upon failure of the MEC to respond, Prof de Visser expressed reservations as to what this would imply. He argued that, from a legal standpoint, this proposal reinforces an incorrect notion that the MEC’s approval is necessary for the appointment of a senior manager by a municipality. He pointed out that the MEC’s role is not to approve an appointment but to monitor if the appointment was done according to laid down rules and if not to have it rectified through the court process.

Is the Bill likely to improve municipal governance?

The panelists shared the view that the amendments had the potential to improve municipal government. Cllr Nkadimeng, however, urged that this would depend on whether they are properly implemented and respected. Similarly, Hon. Muthambi pointed out that the success of any law lies on how it is interpreted and implemented. She added that many of the failures in municipalities are not as a result of inadequate progressive and developmental laws but as a result of poor capacity or lack of political will to implement.

Negative impact of the declaration of invalidity

To illustrate the negative impact felt as a result of the invalidation of the Amendment Act, Hon. Muthambi recounted cases where MECs had been unable to monitor the appointment of a senior managers in municipalities. She pointed out that this also meant that the Portfolio Committee could not exercise its oversight mandate over these failures by MECs. She therefore urged, that the processing of the Bill be expedited to restore order in local government.

In conclusion, the above amendments are key to ensuring better service delivery by qualified and competent staff as well as municipal administrations whose functioning is devoid of political interference. However, care should be taken to ensure that the institutional integrity of local government, as a sphere of government, is not encroached upon by some of the amendments. Nonetheless, as pointed out above, political goodwill and a commitment to the implementation of the enacted amendments will be key in ensuring municipal governance is positively impacted by amendments contained in the Bill.

 

by Henry Gichana

 

* After the webinar, the Bill was passed by the National Assembly and, at the time of publication of this article (March 2021), it was under consideration by the National Council of Provinces.