1 PERFORMANCE AGAINST PREDETERMINED OBJECTIVES - 2017/18 FINANCIAL YEAR - PowerPoint Presentation

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2. PERFORMANCE AGAINST PREDETERMINED OBJECTIVES - 2017/18 FINANCIAL YEAR 2017 TO 2021 STRATEGIC PLAN, 2018/19 ANNUAL PERFORMANCE PLAN & BUDGETBRIEFING TO THE PORTFOLIO COMMITTEE ON COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS 2DELEGATIONMs MJJ ThupanaChairperson: Municipal Demarcation BoardMr AM AdamDeputy Chairperson: Municipal Demarcation BoardMr M SigidiChief Executive OfficerMs T BaadjieChief Financial Officer

3. OUTLINE OF PRESENTATIONPurpose of the presentationInstitutional arrangementsThe Board’s Constitutional mandateLegislative mandateVision, mission and valuesConcerns raised by the Committee during previous briefing – 5 October 2017Update on Capacity Assessment projects2017/18 APP – Changes to planned targetsProgress on achievement of 2017/18 targetsStrategic Plan 2017 to 2021 (Reviewed)Annual Performance Plan for 2018/19Medium Term Expenditure FrameworkBroad process and timeframes within current legal framework 2017 to 2021Update on Municipal boundary re-determination process (2017 to 2019)Concluding remarks3

4. PURPOSE OF THE PRESENTATIONTo present to the Portfolio Committee:Progress on achievement of targets for 2017/18 financial year. MDB Strategic Plan for period 2017 to 2021;The Annual Performance Plan for the 2018/19 financial year;The budget allocation of the institution; andChallenges encountered by the institution.4

5. INSTITUTIONAL ARRANGEMENTSTHE BOARDThe Board is led by the Chairperson, and discharges its duties through the following committees:Governance, Social and Ethics CommitteeHuman Capital CommitteeAudit and Risk CommitteeBoundaries, Powers and Functions CommitteeKnowledge Management and ICT CommitteePublic Participation CommitteeADMINISTRATION The administration is led by the Chief Executive Officer, who is also the Accounting Officer. The Board has four programmes which are:AdministrationDemarcationsResearch and Knowledge ManagementPublic participation, Education and Awareness5

6. THE BOARD’S CONSTITUTIONAL MANDATE6 The Board’s mandate is primarily derived from chapter 7 of the Constitution of the Republic of South Africa, Act 108 of 1996.  Chapter 7 - This chapter deals with matters relating to the status, object of local government, the developmental duties, establishment and powers and functions of municipalities, among others. 

7. LEGISLATIVE MANDATE7

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9. CONCERNS RAISED DURING PREVIOUS BRIEFING - 5 OCTOBER 2017ConcernWhat has been doneThe Portfolio Committee raised a concern that the MDB did not perform Capacity Assessments in the last four financial years. The Portfolio Committee (PC) raised a point that this is one of the core mandates of the MDB.The next slide will provide the current status of the Capacity Assessment projectThe PC also raised an issue about how the Board will achieve the objectives of regionalisation if the National Treasury (NT) will not avail the budget the MDB was seekingThe MDB’s bid for additional financial resources was not approved by NT. NT postponed the consideration thereof to the 2019/20 budget processes. We continue to engage stakeholders to educate and create awareness on demarcation processes despite the limited resources. The Committee also raised the insufficient public participation and engagement with communities/citizens during the determination and re-determination processesThis matter has been addressed during the current technical misalignment processes. In this regard we were able to dedicate a year to the pre-legal consultations with stakeholders and communities affected by technical municipal boundary misalignments. This was done because of the funding received during the adjustment process.

10. UPDATE ON THE CAPACITY ASSESSMENT PROJECTThe MDB received an additional R7 million during the budget adjustment process in October 2017. Half of the budget was to be used to conduct municipal capacity assessments for all municipalities whilst the remaining half was meant for public participation and citizen engagement processes.The Board envisaged to do a desktop study to identify data sources that might be available prior to conducting municipal capacity assessments. This idea was abandoned due to lack of interest shown to our RFP.The terms of reference for the full capacity assessment (all local and district municipalities following receipt of additional budget) was thereafter enriched to ensure that this is done through the main project. The service provider was appointed and the project will be concluded by October 2018. To ensure the quality of the assessments a reference group has been established comprised of institutions such as National Treasury, SALGA, FFC, COGTA etc.10

11. 2017/18 APP – CHANGES TO PLANNED TARGETSPerformance indicator, “Produce and evaluate report on performance of the Board and its sub-committees” deleted, as the performance of the Board and its sub-committees are to be evaluated biennially. The performance of the Board and its sub-committees was conducted in 2016. Performance indicator, “Training programme for Board members developed and implemented” amended to “Produce a report on the training of Board members” and annual target amended to “Report on Board member’s training submitted by end of quarter 4”. Performance indicator, “Public Participation Strategy approved” amended to “Framework on public participation in municipal boundary redetermination and ward delimitation approved”. Corresponding annual target amended to “Framework on public participation in municipal boundary redetermination and ward delimitation approved by end quarter 2”. 11

12. PROGRESS ON ACHIEVEMENT OF 2017/18 TARGETS 12

13. PERFORMANCE AGAINST PREDETERMINED OBJECTIVES 2017/18 FINANCIAL YEAR The following main deliverables have been achieved:Job evaluation completed on the approved organisational structure;The following strategies and framework have been adopted: ICT Strategy;Marketing and Branding Strategy;Research Strategy;Public Participation Framework; andRemuneration strategy The IEC, Chief Surveyor General, StatsSA, MinMEC, National House of Traditional Leaders, Provinces and affected municipalities were consulted in the technical municipal boundary alignment process;Spatial boundary descriptions finalised for 85 municipalities;The MDB in partnership with HSRC conducted two research seminars on Categorisation of Metropolitan Municipalities and the other on social cohesion with a case study of Vuwani;The MDB has published section 26 notices on 106 technical municipal boundary redetermination cases. 13

14. PERFORMANCE AGAINST PREDETERMINED OBJECTIVES FOR 2017/18 FINANCIAL YEAR The MDB committed to achieving 47 Annual Performance Plan (APP) targets for the period ending 31 March 2018. 43 (91%) of the annual targets have been achieved 4 (9%) of the annual targets have not been achieved. 14

15. STRATEGIC PLAN FOR THE FISCAL YEARS 2017 TO 2021 (REVIEWED)15

16. STRATEGIC OUTCOME ORIENTED GOALS16

17. STRATEGIC OBJECTIVES17

18. STRATEGIC OBJECTIVES18

19. STRATEGIC OBJECTIVES19

20. STRATEGIC OBJECTIVES20

21. ANNUAL PERFORMANCE PLAN FOR 2018/1921

22. PROGRAMMES SUPPORTING IMPLEMENTATION OF STRATEGYThe implementation of the strategy is supported by four programmes as follows:Programme 1: Administration Corporate Services and Financial Management.Programme 2: Demarcations Municipal outer boundary determination and re-determination and Ward delimitation.Programme 3: Research and Knowledge Management Assessment of the capacity of municipalities, Research and Knowledge management.Programme 4: Public participation, Education and Awareness Public education and awareness and public participation.22

23. MEDIUM TERM PERFORMANCE TARGETS PROGRAMME 1Strategic Objective 1.1Performance indicatorMedium Term Target2018/192019/202020/21Strengthen the corporate governance environmentMaintain the number of reports on the implementation of Board resolutions submitted1.1.1444Maintain the number of reports on monitoring and evaluation of compliance with relevant legislation submitted1.1.2444Number of organisational performance review sessions conducted1.1.3444Number of reports on ICT Governance submitted1.1.4444Host a Dialogue session on Reflections on the 2nd decade of demarcation1.1.5A Dialogue session on Reflections on the 2nd decade of demarcation hostedN/AN/ANumber of media campaigns conducted to increase awareness of demarcation processes1.1.611123

24. MEDIUM TERM PERFORMANCE TARGETS PROGRAMME 1Strategic Objective 1.2Performance indicatorMedium Term Target2018/192019/202020/21Sound Financial ManagementAudit opinion expressed by the AGSA1.2.1Unqualified audit opinionUnqualified audit opinionClean audit opinionPercentage of Audit action plan implemented1.2.2100% Audit action plan implemented before the next audit cycle100% Audit action plan implemented before the next audit cycle 100% Audit action plan implemented before the next audit cycleAnnual Strategic risk register developed by target date1.2.3Develop annual Strategic risk register by end March 2019Develop annual Strategic risk register by end March 2020Develop annual Strategic risk register by end March 2021Organisational input on Estimate of National Expenditure (ENE) submitted to National Treasury by target date1.2.4ENE input submitted to National Treasury by end February 2019ENE input submitted to National Treasury by end February 2020ENE input submitted to National Treasury by end February 202124

25. MEDIUM TERM PERFORMANCE TARGETS PROGRAMME 1Strategic Objective 1.2Performance indicatorMedium Term Target2018/192019/202020/21Sound Financial ManagementNumber of budget monitoring reports submitted1.2.5444Percentage of fully compliant invoices received and paid within 30 days of receipt1.2.6100%100%100%25

26. MEDIUM TERM PERFORMANCE TARGETS PROGRAMME 2Strategic Objective 2.1Performance indicatorMedium Term Target2018/192019/202020/21Conduct determination and re-determination of municipal boundariesLegal notices published in line with resolutions of the Board in terms of Section 21 and 21(5) of the MDA2.1.1Publish section 21 and 21(5) notices in terms of the MDA in line with resolutions of the BoardN/AN/ANumber of municipalities with spatial boundary descriptions finalised by end 2021.2.1.257575826Strategic Objective 2.2Performance indicatorMedium Term Target2018/192019/202020/21Delimit wards for all municipalities that qualify to have wardsPercentage of voting districts analysed to identify fragmentation of communities2.2.1100%N/AN/A

27. MEDIUM TERM PERFORMANCE TARGETS PROGRAMME 3Strategic Objective 3.1Performance indicatorMedium Term Target2018/192019/202020/21Conduct assessment of municipal capacityNumber of reports compiled on minimum norms and standards for municipal capacity to perform its powers & functions3.1.116N/AN/A27Strategic Objective 3.2Performance indicatorMedium Term Target2018/192019/202020/21Conduct research and render advisory and knowledge management servicesNumber of research papers produced3.2.1222Maintain the number of research seminars conducted3.2.2222Produce a book on Reflections on the 2nd decade of demarcation3.2.3Book on Reflections on the 2nd decade of demarcation producedN/AN/A

28. MEDIUM TERM PERFORMANCE TARGETS PROGRAMME 4Strategic Objective 4.1Performance indicatorMedium Term Target2018/192019/202020/21Enhance public participation, education and awarenessMaintain the number of partnerships established to enhance public education and awareness4.1.1222Maintain the number of outreach programmes to strengthen public awareness and education of demarcation processes4.1.2454Maintain the number of outreach programmes to strengthen stakeholder awareness and education of demarcation processes4.1.3454Number of promotional materials developed to strengthen public awareness and education of demarcation processes4.1.444428

29. MEDIUM TERM EXPENDITURE FRAMEWORK29

30. OVERVIEW OF 2018/19 BUDGET AND MTEF ESTIMATES30Budgeted expenditure by economic classificationAudited outcomesRevised estimateMedium term Expenditure EstimatesR thousand2014/152015/162016/172017/182018/192019/202020/21REVENUE       Transfers - Appropriated funds44 23045 79348 22050 63153 56856 56859 679Additional allocation--10 0007 000-  Other income9424951 830500720730740Total revenue45 17246 28860 050 58 13154 28857 29860 419        OPERATING EXPENDITURE       Total Expenditure52 42464 73750 03158 13154 28857 29860 419Current payments48 74664 03347 87056 96353 24455 72459 160Compensation of employees20 08220 87722 668 28 53630 77433 28835 740Goods and services, of which: 28 66443 15625 20228 42722 47022 43623 420Operating lease3 6623 8303 8423 4863 9364 3724 372Publications and notices23613 07283610999980997Communication1 006803724704772847929Auditors1 0757501 5601 1951 2501 3161 382Travel cost4 4512 3571 1932 2651 2721 2631 419Other operating expenses18 23422 34417 80018 98914 24113 65814 321Capex3 6787042 1611 1681 0441 5741 259Surplus/Deficit-7 252-18 4499 984----

31. RELATING EXPENDITURE TO STRATEGIC OUTCOME ORIENTED GOALSThe budget allocation does not have any additional funding over the medium term. The following new strategies that are top priority have not been provided for:Increase organisational capacity for regionalisation.Establishment of a demarcation knowledge hub.MDB has been engaging with COGTA and National Treasury to identify sources of funding.Additional once off funding of R7 million has been granted to conduct full assessment of municipal capacity and for public participation. The MDB will not have sufficient funds for the forthcoming ward delimitation process. 31

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33. UPDATE ON THE MUNICIPAL BOUNDARY RE-DETERMINATION PROCESS (2017 TO 2018)1. The Board is close to concluding the municipal boundary redetermination (technical alignments) process and by way of enhancing public participation has engaged in the following processes between February 2017 and March 2018:Consulted with primary stakeholders such as MinMEC, PECs, NHTL, StatsSA, IEC and Chief Surveyor General; Had working sessions with affected municipalities on possible options to fix the misalignments; Consulted with affected communities to obtain their inputs, share and engage with them on alternative options to resolve the misalignments.Published section 26 notices inviting members of the public to submit written representations and views.2. Within the legal process that will run from April to July 2018 the MDB will:a. Hold additional public meetings where necessary; Publish section 21(3) notices to invite objections;Finalise the re-determinations in July and hand over boundaries in August as already agreed with the IEC. 33

34. CONCLUDING REMARKSThe challenges highlighted during our previous engagements remain: Resources that are incompatible with organisational strategy and mandate;Lack of regional footprint, which creates a disconnect with the public;Weaknesses in the demarcation legislation e.g. perpetual cycles of demarcation that compromise the planning and service delivery by municipalities and issues of public participation; Perpetual debate on the local government architecture, including the two-tier system and future of intermediate cities. 2. The Board appreciates the progress COGTA is making regarding review of demarcation legislation and hope that the draft Bill on the imminent amendments of the Municipal Demarcation Act will be processed through parliament in time for the ward delimitation process due to start in 2019. 34

35. 35Thank you