Performance information
Goal 6: Financially and organisationally capacitated municipalities
This goal encapsulates the various policy, strategy and support initiatives that are required to build an enabling fiscal framework and adequate local government capacity to deal with financial management. The ultimate focus of this goal is build long-term financial viability and broader sustainability of municipalities.
SALGA’ s role in achieving this goal is to focus on confronting fiscal regime gaps and challenges that constrained the financial viability of municipalities and compromised them to deliver on their constitutional mandate.
The activities in goal six addressed the following SALGA mandates:
• Lobby, advocate and represent;
• Support and advice;
• Capacity building;
• Strategic profiling; and
• Knowledge and information sharing.
Highlights of performance Fiscal reforms
SALGA participated in the budget forum as representative of organised local government and outlined the costs associated with demarcated municipalities and support that must be provided as well as the cost of free basic services study report to inform the equitable share formula.
The Free State Legislature was supported in its advocacy for the review of the equitable share in the Xhariep District region. Xhariep is losing population due to its rural nature and economic profile and the University of Free State was appointed to conduct detailed research.
The district funding model was reviewed with the intention of making the distribution of the regional service council( RSC) levies and replacement levy more equitable. This intervention is temporary and will be reviewed subsequently through a review of the powers and functions exercise.
SALGA made detailed submissions on changes to the Division of Revenue Bill advocating for a realignment of regulations governing transfer of grants from provinces to municipalities in terms of formal assignments by:
• Verifying province and municipality in question agreeing in advance to the allocations irrespective of whether service level agreement is in place or not. This will protect the municipality financially; and
• Gazetting of amounts for predictability and transparency.
Municipal standard chart of accounts( mSCOA) regulatory reforms
SALGA lobbied and supported municipalities on municipal standard chart of accounts( mSCOA) regulation due to be enforced on 1 July 2017 through the following actions and interactions:
• Taking part in the evaluation of system vendors for the transversal arrangement in the implementation of the regulation;
• Lobbied for support and training on the regulation from National Treasury; and
• Advocated for the extension of timelines based on the status of municipal readiness.
SALGA also made comments on the draft preferential procurement regulations.
SALGA conducted research on section 71 reports and gave targeted recommendations to municipalities. Research also served as early financial distress detector.
Alternative billing
A project roll-out plan on the billing study was developed and costed. The following was explored during the financial year in order to execute the billing study recommendations:
• A collaboration between Department of Co-operative Governance and South African Cities Network was explored to meet the central database of defaulters recommendation; and
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