2016/2017 oversight...the ethekwini municipality’s annual report for 2016/2017 was tabled at...

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TABLE OF CONTENTS

1. INTRODUCTION ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

2. BACKGROUND ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

3. FUNCTIONS OF THE MUNICIPAL PUBLIC ACCOUNTS COMMITTEE ... . . . . . 5

4. COMPOSITION OF MUNICIPAL PUBLIC ACCOUNTS COMMITTEE ... . . . . . . . . . 6

5. ANNUAL REPORT CHECKLIST ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

6. AUDIT REPORT ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

7. ANNUAL REPORT ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

8. CONCLUSION ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

9. ANNEXURES ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

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1. INTRODUCTION

The Municipal Finance Management Act (MFMA) assigns specific oversight responsibilities to

Council with regard to the Annual Report and the preparation of an Oversight Report.

Given the processes required by Council to effectively undertake its oversight role, the

establishment of MPAC of Council provides the appropriate mechanism through which Council

fulfills its oversight responsibilities.

The MPAC’s primary role is to consider the Annual Report, receive input from the various role

players and to prepare a draft Oversight Report for consideration by Council.

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2. BACKGROUND

The oversight role of Council is an important component of the financial reforms and it is achieved

through the separation of roles and responsibilities between Council, the Executive (Mayor and

Executive Committee) and Administration. Good governance, effective accountability, and

oversight can only be achieved if there is a clear distinction between the functions performed by the

different role players.

Non-executive Councillors are required to maintain oversight on the performance of specific

responsibilities and delegated powers that they have given to the Executive (Mayor/Executive

Committee). In other words, in exchange for the powers in which Council has delegated to the

Executive, Council retains a monitoring and oversight role ensuring that there is accountability for

the performance or non-performance of the municipality.

The Municipal Finance Management Act, No.56 of 2003 (MFMA) vests in Council specific powers

of approval and oversight.

� Approval of budgets;

� Approval of Budget related Policies; and

� Review of the Annual Report and adoption of the Oversight Report.

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3. FUNCTIONS OF THE MUNICIPAL PUBLIC ACCOUNTS COMMITTEE

The functions of the MPAC are to:

� Undertake a review and analysis of the Annual Report.

� Invite, receive, and consider inputs from Councillors and Portfolio Committees, on the Annual

Report.

� Consider written comments received on the Annual Report from the public consultation process.

� Conduct Public Hearing(s) to allow the local community or any organs of state to make

representations on the Annual Report.

� Receive and consider Council’s Audit Committee views and comments on the annual financial

statements and the performance report.

� Preparation of the draft Oversight Report, taking into consideration, the views and inputs of the

public, representative(s) of the Auditor-General, organs of state, Council’s Audit Committee

and Councillors.

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4. COMPOSITION OF MUNICIPAL PUBLIC ACCOUNTS COMMITTEE

4.1 Membership

The Municipal Public Accounts Committee (MPAC) is a committee of Council established under

section 79 of the Municipal Structures Act, 1998. Section 79, allows for the co-option of advisory

members to a Committee of Council, who are not members of the Council.

Due to the separation of roles and responsibilities, between Council and the Executive (Mayor and

Executive Committee) it is not appropriate for members of the Executive Committee to be members

of the MPAC.

The Members of eThekwini Municipality’s MPAC are: -

Councillor TJ (Chairperson)

Councillor P Luthuli (Deputy Chairperson)

Councillor A Beetge

Councillor TP Collins

Councillor CB Dlamini

Councillor NB Iyir

Councillor LC Mnguni

Councillor NE Mnguni

Councillor TM Mthethwa

Councillor MC Shezi

Councillor N Sibiya

Inkosi EB Shozi (Ex-officio)

4.2 Authority & Power

The MPAC is delegated the responsibility to conduct meetings and to hold public hearings to

receive and hear public submissions on the Annual Report, on behalf of Council.

Timely notice of all meetings should be given and all meetings held by the MPAC must be open to

the public and minutes of the meetings must be submitted to Council meetings.

4.3 Meeting Schedule

The eThekwini Municipality’s Annual Report for 2016/2017 was tabled at Council’s meeting on

31st January 2018 as prescribed in terms of the Local Government: Municipal Finance Management

Act 56 of 2003. The Annual Report also included the reports of the municipal entities viz. Inkosi

Albert Luthuli ICC (Pty) Ltd and Durban Marine Theme Park (Pty) Ltd, report of the Auditor-

General on the group financial statements and performance information of eThekwini Municipality.

The Annual Report was referred to MPAC for preparation of the Oversight Report.

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The Annual Report was subsequently made available for public comments as follows:

Advertisements were placed in The Mercury dated 19 February 2018, The Daily News dated 19

February 2018, Isolezwe dated 19 February 2018 and The Ezasegagasini to inform the public of the

availability of the Annual Report for comment/representation. Interested parties were required to

make submissions by the 2nd March 2018 to the Performance Monitoring and Evaluation Unit.

Access to the report was made available as listed hereunder:

• Placed for inspection in the Municipal Libraries, Sizakala Centres and at the City Hall.

• Copies circulated to all Councillors

• Posted on the Municipality’s website

• CDs with the full annual report and presentations made during public engagements were

distributed were placed at City Hall and Rennies Building for collection by the public

Public engagements were held as follows: -

07 February 2018 – Informal Business at City Hall (Mandela Room)

16 February 2018 – Traditional Leaders at Pinetown Civic Centre (Committee Room 1)

20 February 2018 – Civil Society at Durban City Hall (Luthuli Hall)

21 February 2018 – Formal Business & Media Forum (Moses Mabhida Mixed Zone)

Further, presentations of the 2016/2017 annual report was made to the following Portfolio

Committees:

08 February 2018 – Community Services Committee at City Hall

14 February 2018 – Security & Emergency Services Committee at City Hall

15 February 2018 – Economic Development and Planning Committee at City Hall

06 March 2018 – Human Settlements & Infrastructure Committee at City Hall

07 March 2018 – Governance & HR Committee at City Hall

Annual Report supplements were distributed to attendees at these sessions and also distributed as

inserts in The Mercury, The Daily News, Isolezwe, Ezasegagasini, and social media platforms

(Facebook and Twitter).

The Annual Report was submitted to the Auditor-General, National Treasury, Provincial Treasury,

KZN Legislature and the Department of Cooperative Governance and Traditional Affairs on

5th February 2018.

The Public was invited to the tabling of the Annual Report to Council on 31st January 2018, and

approximately 50 members of the public were in attendance.

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Revisions Post Tabling

The following changes were made by the Performance Monitoring and Evaluation Unit:

1. The cover page for 2016/2017 has been changed.

2. On the list of abbreviations and acronyms, the following acronyms were added:

BPESA - Business Process Enable South Africa (on page 4)

CER - Certified Emission Reductions (on page 4)

CIP - Community Infrastructure Projects (on page 5)

COBIT - Control Objectives for Information and related Technology (on page 5)

CTO - Community of Tourism Organisations (on page 5)

DAMCO - Logistics company owned by C.W.H. van Dam & Co (on page 5)

DEC - Durban Exhibition Centre (on page 5)

DIA - Diameter (on page 5)

DIRCO - Department of International Relations and Cooperation (on page 6)

DORA - Division of Revenue Act (on page 6)

GWFAP - Generalized Wagon-Flow Allocation Problem (on page 7)

HACCP - Hazard Analysis and Critical Control Point (on page 7)

ICDG - Integrated City Development Grant (on page 7)

ITB - Ingonyama Trust Board (on page 7)

LUMP - Land Use Management Plan (on page 8)

MERSETA - Manufacturing, Engineering and Related Services Sector Education and Training

Authority (on page 8)

NDPG - Neighbourhood Development Partnership Grant (on page 8)

NIAMM - National Immovable Asset Maintenance Management (on page 9)

NMT - Non-Motorised Transport (on page 9)

PSEDS - Provincial Spatial Economic Development Strategy (on page 9)

PSIR - Policy Strategy Information and Research (on page 9)

SAAMBR - South African Association for Marine Biological Research (on page 9)

SAFA - South African Football Association (on page 9)

SMS - Short Message System (on page 10)

UNFCCC - United Nations Framework Convention for Climate Change (on page 10)

USDG - Urban Settlement Development Grant (on page 10)

3. On page 5, acronym CPTR – Current Public transport Records “t” for transport was changed to “T”.

4. DCCi acronym was changed to DCCI (on page 5).

5. On page 6, acronym EFA was changed to Electricity For All with “F” as a capital letter.

6. On page 7, acronym HD - High-definition was changed to High Definition.

7. On page 8, abbreviation MUT – was rectified to be Mangosuthu instead of Mongosuthu.

8. On page 9, acronym NEPAD - New partnership for Africa’s Development was changed to New

Partnership for Africa’s Development.

9. On page 9, acronym PWD - People with Dissabilities changed to People With Disabilities.

10. On page 9, acronym QOL – Quality of Life was changed to Quality Of Life.

11. On , acronym RFP – was rectified to Request For Make, with “F” as a capital letter.

12. On page 9, acronym ROD – Record of Division was changed to Record Of Division.

13. On page 10, abbreviation SFA – Strategic Focus area “a” for area was changed to “A”.

14. On page 10, abbreviation SOE – was changed to State Of the Environment, with “O” as a capital

letter.

15. On page 12, under the List of Tables, Table 2 “EThekwini” was written as “eThekwini”

16. In the list of figures on page 16, the spacing between figure 29-30 was changed to 1,5 line spacing.

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17. On page 22, paragraph 2, The Council changed to council (lower case).

18. On page 23, line 2, “Ward” was changed to ward (lower case).

19. On page 23, the 3rd line of the 2nd last paragraph “Wards” was changed to ward (lower case).

20. On page 24, in the paragraph 3 “employment will be created….” EPWP abbreviation was added in

brackets.

21. On page 24, under New Wards in eThekwini, on the first and 3rd line “Wards” was changed to “wards”

(lower case).

22. On page 24, under New Wards in eThekwini, the first line in the 2nd paragraph “Wards” was changed

to “wards” (lower case).

23. On page 25, on the 1st and 4th line “Wards” was changed to “wards” (lower case).

24. On page 25, on the 3rd line of the 2nd paragraph “Wards” was changed to “wards” (lower case).

25. On page 25, 2nd paragraph under Radical Economic Transformation, “Wards” was changed to “wards”

(lower case) on the 5th line.

26. On page 29, paragraph 3 under the title “transparency” Council changed to lower case.

27. On page 30, 3rd paragraph “Wards” was changed to “wards” (lower case) on the 4th line.

28. On page 30, 3rd paragraph “Council” was changed to “council” (lower case) on the 5th line.

29. On page 30, last paragraph “Ward Committees” was changed to “ward committees” (lower case “w”

and “c”).

30. On page 31, 1st line under 2.2.2 “Committees” was changed to “committees” (lower case).

31. On page 31, 2nd line under 2.2.2 “Constitutional” was changed to “constitutional” (lower case).

32. On page 32, “Council’s land” was rephrased to “council land” in the 2nd line.

33. On page 35, the contract expiry date for CM Sibusiso Sithole was changed from 22 December 2016, to

the 31st of December 2016 and rephrased as contract expiry and not termination.

34. On page 35, paragraph 1, on the second line, Integrated Development Plan (IDP) was changed to

abbreviation IDP.

35. On page 36, paragraph 2, Key Performance Areas abbreviation was added in brackets (KPA).

36. On page 37, 1st line “Council” was changed to “council” (lower case).

37. On page 37, under the eThekwini’s current risk profile, priority 1 sustainability, the sentence was

rephrased to read as “Limited resources to address the growing demand for services which may result

in the municipality not being able to meet the city’s objectives and ultimately threaten sustainability”.

38. On page 39 under Opportunities, “value add” was written as “value-add” in the 2nd line.

39. On page 43 under Newsflash, 2nd line was written as “The Unit produces daily Newsflash” not

Newsflashes.

40. On page 44, last paragraph “Council” was changed to “council” (lower caps c) on the 2nd line under

Challenges and Mitigations.

41. On page 45, 2nd line under Sizakala Customer Services, “One Stop Shops” was written as “One-Stop-

Shops”.

42. On page 46, Figure 5 “statistical distribution by departments pie chart” the navy colour code was

changed to orange.

43. On page 47, 1st line under Mystery Shopper Report, commas were added and the sentence read as “In

terms of eThekwini Municipality’s Customer Care Policy, the Municipality conducts a Mystery

Shopper Programme for eThekwini Municipality, to rate and assess the service provided to

residents and ratepayers”

44. On page 47, 2nd paragraph under Customer Service Integration Project, commas were added and the

sentence read as “A Task Team comprising of Deputy Heads responsible for customer services in

various Service Units, was set up by the Deputy City Manager’s (DCM) Forum to lead this

process. The Municipality envisages a model that is made of three tiers, whereby tiers-1 and 2

will deal with mainly customer related matters as a first line of customer contact, and tier 3 deals

with technical and Unit specific matters”. 45. On page 47, 3rd paragraph under Customer Service Integration Project, “introdction” was rectified to

“introduction” in the 2nd line of the paragraph.

46. On page 47, in the 3rd line of the 1st paragraph under Customer Service Standards and Charter, a

hyphen was added to “Municipal-Wide”.

47. On page 48, the spacing changed in bullet one to read as section 4 (2) in line 2.

48. On page 48, 3rd bullet under Purpose of Existence “Ward” changed to “ward” (lower case).

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49. On page 49, row 1 of Table 5 “Ward Committees” and “Ward Plans” for 2015/16 and 2016/17

respectively were changed to lower case “w”& “c” and “w”& “p” accordingly.

50. On page 49, row 2 of Table 5, the spacing changed under 2014/15 as “(CBP) Train the Trainer:

achieved”.

51. On page 49, row 2 of Table 5 under 2015/16 rephrased to read as “Created platforms for stakeholder

engagement. 50 masakhane road shows held: achieved”.

52. On page 49, row 3 of Table 5 under 20114/15, “Ward” written as “ward” (lower case).

53. On page 49, row 5 of Table 5 under 2014/15 rephrased to read as “Established” instead of “Establish”.

54. On page 50, row 1 of table 5 under 2014/15, “Ward Committees” changed to lower case “w” and “c”.

55. On page 51, bullet 6 “Wards” changed to lower case “w”.

56. On page 51, 8th bullet “Government” changed to lower case “g”.

57. On page 52, 2nd and 3rd bullets “Wards” changed to lower case “w”.

58. On page 52, bullet 12 rephrased to read as “Work closely with the Speaker’s office focusing

initially at the functional ward committees. 59. On page 53, under Future Focus, “Wards” changed to lower case “w” in the 1st and last bullet.

60. On page 56, in the 1st and 2nd bullets under Implementation of SIP, a hyphen was added to

“eThekwini-Wide”.

61. On page 55, abbreviations DIRCO, UN and AU were written in full under bullet 8.

62. On page 58, the paragraph was changed to reflect accurate figures for 2016/2017. It thus reads as “an

analysis of the performance of the Municipality (excluding the Municipal Entities), indicates that the

overall performance of the Municipality has increased from 66.67% to 69.84%. The trend-analysis

below indicates that performance increased from 2013/14 to 2014/15 by 1.79%, 2014/15 to 2015/16

by 0.7%, 2015/16 to 2016/17 by 3.17%”.

63. On page 58, the 2016/2017 achievement rate was changed to 69.84% on figure 8.

64. On page 59, Figure 9 was changed to reflect the accurate percentage of households with access to at

least a basic level of Water as 94.98% for 2016/2017.

65. On page 60, the 2nd line of the first paragraph was changed to read as “the 2016/17 result of 94.98%

translates to 898 457 households in the City with access to a basic level of water.

66. On page 60, Figure 10 on the title Sanitation was changed to lower case “s”.

67. On page 62, Figure 14 was changed to reflect the accurate percentage of estimated indigent

households provided with free basic services: Sanitation as 67.31% for 2016/2017”.

68. On Page 62, the first line below figure 14 was changed to read as “the percentage of households with

access to at least a basic level of sanitation increased from 2015 /16 to 2016/17 by 3.05%”.

69. On page 64, Figure 18 on the title Jobs Created changed to lower case “j” and “c”.

70. On page 67, Figure 23 on debt coverage ratio, was changed to reflect the accurate 2016/2017 figure of

13.77%.

71. On page 69, Plan 1 Owner was rectified to “Phillip Sithole” and not “Philip”.

72. On page 70, the first and second paragraphs under analysis were changed to reflect the changes made

to overall performance. Thus they were reflected as “the table above reflects the performance of the

Municipality and its entities. The overall performance of the Municipality is 69.84%. With reference

to the Municipal Scorecard, Plan 2 (Developing a Prosperous, Diverse Economy and Employment

Creation) is the lowest performing plan with an achievement of 50%. The most successful plan is

Plan 1 (Develop and Sustain our Spatial, Natural and Built Environment) where they have 100%

achievement on their Key Performance Indicators (KPI’s).

73. On page 71, 1st paragraph under Remix Plant, “Inner City” changed to lower case “i” & “c” on the 4th

line and “6.25 Ml/day” changed to 6.25 “ML/day” on the 5th line under the 2nd paragraph.

74. On page 73 first line, “EThekwini” changed to “eThekwini”.

75. On page 73, under title “western aqueduct”, diameter was added on paragraph 2.

76. On page 74, Table 10 colon removed on the table titles (i.e. contract and description).

77. On page 74, Table 10, the date was rectified to April 2018 under row 3 of phase 2 with sub-heading

stage.

78. On page 75, the first paragraph after the “Northern Aqueduct” subheading, the 5th line of the paragraph

states “pressure reducing valves” was changed to “Pressure Reducing Valves”.

79. On page 76, first line, spacing between “require” and “currently” changed.

80. On page 77, title Non-revenue Water changed to Non-Revenue Water with “R” as a capital letter.

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81. On page 78, Table 11 title changed to Non-Revenue Water with “R” as a capital letter.

82. On page 78, Table 12 figures for 2016/17 changed to reflect final audited results.

83. On page 78, Table 13 figures for 2016/17 changed from 640, 858 to 613, 548 for piped water inside

dwelling (standard water connection).

84. On page 79, Table 14 figures for 2016/17 changed to 47, 453 (backlog) and delivery of basic services

to 541, 317

85. On page 80, Table 15 figures for 2016/17 changed from 141, 603 to 141, 645 (backlog) whilst 2014/15

figures also changed from 163,495 to 159,197.

86. On page 81, Table 16 figures changed for all financial years to reflect audited scorecard and final audit

results for 2016/17.

87. On page 82, paragraph 4, on line three sentence “We have worked closely with the Regulator…”,

Regulator changed to lower case “r”.

88. On page 87, the first paragraph under the recycling subheading, “Drop of centres” found on the 5th line

changed to “drop of centres”

89. On page 88, the last paragraph MHIll changed to MHill

90. On page 88, last paragraph, UNFCCC and CER abbreviations were written in full.

91. On page 88, last paragraph, “issurance” on line 3 was changed to “insurance”.

92. On page 90, “firsthand” was changed to “first hand”

93. On page 91, under “We are one Festival, 3rd line”, 24th was changed to 24th

94. On page 91, last paragraph under the title Closure Wyebank Garden Site, the last sentence was

rephrased to read as “East Coast Radio aired the notices which were posted in and around the area

to inform the community”. 95. On page 92, abbreviation for “Cleaning and Solid Waste” included.

96. On page 93, abbreviation for Integrated Waste Management Plan” included.

97. On page 93, second paragraph under the title Integrated Waste management, the spelling for

“enormous” was rectified.

98. On page 93, under bullet 4, the spelling for financial was rectified.

99. On page 94, under title conclusion, the spelling for dependent was rectified in the 3rd line.

100. On page 98, number 2 under challenges sentence rephrased to read “Available funding versus

demand for housing within the City including steep terrain, densification, and retaining walls”.

101. On page 98, USDG abbreviation was written in full under number 1 of title “solutions”.

102. On page 98, ICDG abbreviation was written in full under number 3 of title “solutions”.

103. On page 107, NIAMM abbreviation was written in full under the first paragraph (last line).

104. On page 107, under 3.5.2 the spelling for “Maintenance” was rectified in the last line.

105. On page 108, CIP abbreviation was written in full under the first paragraph (last line).

106. On page 110, Figure 49 line spacing changed to 1.5 line spacing.

107. On page 110, the sentence above Figure 49 a full stop was added.

108. On page 111, paragraph 1, ETafuleni changed to eTafuleni.

109. On page 111, second line under paragraph 1, the spelling for “quantities” and “amongst” was

rectified.

110. On page 112, Figures 55, 60, 62 and 63 “UMlazi” was changed to “Umlazi”.

111. On page 116, bullet 4 under title challenges and mitigations, spelling for Settlement was rectified.

112. On page 116, bullet 5 under title challenges and mitigations, spelling for contractors was rectified.

113. On page 116, Last bullet under Challenges and Mitigations “Termination” changed to lower case,

“t”.

114. On page 120, paragraph 2 under challenges and mitigations, Project Readiness & Pre-feasibility

capital letters changed to lower case.

115. On page 121, under the title successes and awards, the paragraph was rephrased to read as “The

Architecture Department is recognised by industry leaders as a leading public sector interdisciplinary

department in the built environment with over 40 built environment professionals”.

116. On page 121, paragraph 2 under the title successes and awards, the spelling for positively rectified.

117. On page 123, under title Fews (Flood Early Warning System), the sentence was rephrased as “In

order to gauge the progress of the FEWS project, the Department has divided it into three spheres: a)

Data Management, b) Model Application and c) Configuration”.

118. On page 123, a full stop was added to the last sentence in the last paragraph of the page.

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119. On page 128, the spacing on the first line was changed to read as “3rd of February 2016”.

120. On page 129, a full stop was added to the last sentence in the paragraph above figure 81.

121. On page 130, in the last paragraph an abbreviation was added in brackets - (IAM).

122. On page 134, paragraph 1 under title Stakeholders Workshop, ‘Cleansing and Solid Waste

abbreviation added (CSW) and line 2 “Cleasing” changed to “Cleansing”.

123. On page 141, 2nd line of the second last bullet, the spelling of unroadworthy was rectified.

124. On page 141, last bullet, the spelling of integrated, enforcement, nuisance was rectified.

125. On page 142, under title challenges and mitigations, the spelling of constraints rectified in the 1st

line.

126. On page 143, third line of paragraph 1, the spelling for Recognition was rectified.

127. On page 147, under figure 91 title, the spelling for category was rectified.

128. On page 160, paragraph 1, Foreign Direct Investment abbreviation added (FDI).

129. On page 160, paragraph 2, Durban Investment Promotion Strategy (added).

130. On page 161, paragraph 1, Investment Promotion Agency abbreviation added (IPA).

131. On page 161, 3rd last paragraph, the spelling for focused was rectified.

132. On page 165, last paragraph the spelling for KwaDukuza Municipality was rectified.

133. On page 170, HACCP abbreviation was written in full under bullet 2 of title “the processing

facility”.

134. On page 178, BPESA abbreviation was written in full under second last paragraph.

135. On page 181, paragraph 1, EMA written in full.

136. On page 181, paragraph 2, KZNFC capital letters added.

137. On page 181, paragraph 3, Line reading “The business skills… capital letters changed to lower case.

138. On page 182, paragraph 1, Clothing and Textile Programme …paragraph capital letters changed to

lower case.

139. On page 182, paragraph 4, AGOA written in full African Growth Opportunity Act.

140. On page 182, paragraph 5, reading “the world class…capital letters changed to lower case.

141. On page 182, paragraph 1, KZNCTC written in full “KwaZulu-Natal Clothing and Textile Cluster.

142. On page 183, title Durban Automotive Cluster (DAC) abbreviation added.

143. On Page 183: on the second paragraph the word “recognitition” was changed to “recognition”.

144. On page 183, paragraph 4, “BBBEE was written in full.

145. On page 184, paragraph 3, font changed from bold and capital letters to lower case.

146. On page 184, MERSETA abbreviation was written in full under first paragraph.

147. On page 186, second last paragraph ABSA written in full.

148. On page 186, title “Enterprise Accelerator Workshop” changed to bold.

149. On page 187, title “Entrepreneur Me” Young Engineering Graduates” was changed to bold.

150. On page 187, paragraph 1, BEE written in full.

151. On page 187, title changed to bold “local high schools offering maritime subjects”.

152. On page 187, DAMCO abbreviation was written in full on the fourth paragraph under title “Local

high schools offering maritime subjects”.

153. On page 187, SAAMBR abbreviation was written in full on the second last paragraph under title

“Local high schools offering maritime subjects”.

154. On page 187, DUT abbreviation was written in full on the second last paragraph under title “Local

high schools offering maritime subjects”.

155. On page 188, EMC abbreviation was written in full under second paragraph and “Ethekwini”

changed to “eThekwini”.

156. On page 188, on the title abbreviation (DGC) added.

157. On page 189, second last paragraph, UN written in full United Nations.

158. On page 189: on paragraph four in the sentence reading “The cycle academy is well established at Inanda…….” aManzimtoti changed to Amanzimtoti.

159. On page 190, Caps removed on “responsible tourist” under the title sustainable tourism network.

160. On page 190, paragraph 2, “Tourism Route” capital letters removed.

161. On page 190, paragraph 2, “Green Hub” capital letters removed.

162. On page 190, paragraph 3, Claremont KwaDabeka and Lower Molweni ……. bold removed.

163. On page 190, paragraph 4, South Durban, Amanzimtoti, Mgababa river ……. bold removed.

164. On page 191, paragraph 1: “Hey Durban” …… inverted commas added.

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165. On page 191, paragraph 1 under ‘Hey Durban’, sentence rephrased as “In the current year tourism

attractions will be included and the App will be taken to market”. 166. On page 192, under title ‘Cornubia Green Spaces’ Approval & Academy changed from upper case.

167. On page 192, SAFA abbreviation was written in full under forth bullet.

168. On page 192, NMT abbreviation was written in full under fifth bullet.

169. On page 193, second paragraph (Economic Development and Investment Promotion) was taken out

of brackets.

170. On page 194, first line under title business support, the sentence was rephrased to read as Small

businesses are vital contributors to the health of the economy, and offers diverse opportunities in

our Society”. 171. On page 194, last paragraph Exhibition & Fairs …… “e” and “c” were changed to lower case.

172. On page 195, PSEDS abbreviation was written in full under first paragraph.

173. On page 196, paragraph 3, In the abbreviation ILO…. Organization changed to upper case “O”.

174. On page 197, abbreviation for the title Informal Micro Enterprise Development Programme was

changed to “IMEDP”.

175. On page 197, second last paragraph, EDTEA abbreviation written in full.

176. On page 199, Paragraph 3, capital letters removed.

177. On page 200, All the information in bullets, capital letters changed to lower case.

178. On page 200: under the title Achievements ..in bullet 4 “intervenstions” changed to “interventions”.

Also in bullet 7 “intervenstion” changed to “intervention”.

179. On page 201: paragraph 1 line reading “in re-aligning itself to be at the cutting edge……” the word

“heritage” changed to “heritage”.

180. On page 201, “Tourism development”, destination, official marketing, unit changed to lower case.

181. On page 202, paragraph 3, Nationally and Internationally… “N” and “I” were changed to capital

letters.

182. On page 202, Table 35 People - changed to lower case, “p”.

183. On Page 202: under title “Expansion of the tourism sector” the line reading “and the mission

statement is to market Durban as a ‘must visit’ destination” is removed because it is repeated.

184. On page 203, Table 36 & 37 Capital letters removed from titles.

185. On page 205, Table 40, 41 & 42 Capital letters removed from titles.

186. On page 205, under the title sewing and pattern making programme, the sentence was rephrased to

read as “This is aimed at improving the garment construction and perfecting the finishing of

products, and also introducing these people to designers so that they can be seamstresses and

sample makers”. 187. On page 206, bullet one under challenges “Limitations” changed to lower case “l”.

188. On page 206, last bullet under mitigations “E” on emporiums was changed to lower case.

189. On page 209, bullet one, Launched business forums….. written in lower case.

190. On page 209, bullet one under title “Achievements”, workshops written in lower case.

191. On page 209-210, Table 47 content in the table changed from capital to lower case.

192. On page 210, under empowerment programme / engagements title, sentence rephrased to “Aim:

Information dissemination regarding Transnet and opportunities for black women

193. On page 213, Attendees & Participating changed to lower case “a” and “p”.

194. On page 215, under sub title ‘Functions of the Bulk Market’ DFPM written in full.

195. On page 217, under the second title “Mitigating Measures” bullet 3, DAFF is written in full.

196. On page 217: under the second title “Mitigating Measures” bullet 3 “Fsishing” changed to “Fishing”.

197. On page 218: under title “Development of the distribution centre” first paragraph “fresh poduce”

changed to “fresh produce”. 198. On page 220, second paragraph, spelling of annually rectified on the first line.

199. On page 20, second paragraph, sentence rephrased to read as “…..panel discussions, exhibition

space and the closing nights awards dinner”. 200. On page 222, entire paragraph under title “stained glass productions” was aligned to proper caps.

201. On page 222, paragraph 2 titled stained glass production, third sentence rephrased to read as “The

Durban Film Office together with Stained Glass Productions provided the opportunity from another

six local trainees for UZALO Season. With this training the youth from the disadvantaged

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backgrounds are being equipped with the skills that are most needed in the film and television

sector”.

202. On page 222: under the title “Stained Glass Productions Uzalo Trainee Programme” first paragraph

line reading ‘The training focusses…..” the word focusses changed to focuses.

203. On page 223, paragraph 1 Awareness changed to lower case, “a”.

204. On page 224, ITB abbreviation was written in full in the first paragraph under tourism indaba title.

205. On page 225, Table 57 title caps changed to small caps.

206. On page 226, paragraph 4, TKZN written in full changed to lower case.

207. On page 226, New Delhi Television abbreviation was written in full under sixth bullet.

208. On page 227, under Global Market bullet 1, Call to action was written in lower case.

209. On page 227, second to last bullet Company changed to lower case, “c”.

210. On page 228, first bullet, “Ladysmith Mabuzo” changed to “Ladysmith Mambazo”.

211. On page 228, second bullet, LGA was added as an abbreviation.

212. On page 228, under title “ensuring township development”, EPWP was written in capital letters.

213. On page 230, paragraph 1, NDPW was written in full.

214. On page 230, the last paragraph reading “the risk assessment …., “with” was added in the paragraph.

215. On page 235, paragraph 1, under the title ‘challenges and mitigations’ written “the operations

department is operating …. “Of service” is removed.

216. On page 235, paragraph 2 under the title ‘challenges and mitigations’ “Regards” changed to

“regarding”.

217. On page 235, paragraph 4 under the title ‘challenges and mitigations “faicilitate” was corrected to

“facilitate” and Operational written with lower case, “o”.

218. On page 236, paragraph 1, the line reading “The unit has implemented a pilot…..” the word “to” is

removed.

219. On page 236, paragraph 2 under title successes and awards, spelling for putting was rectified in the

second line.

220. On page 236: under title “Successes and Awards” paragraph 2. Line reading “The staff of eThekwini

Fire & emergency services …” “pUtting” changed to “putting”.

221. On page 237, row 2 under Table 60, “allowances” was written in lower case.

222. On page 238, under title key priority projects, style of writing dates standardised.

223. On page 240: under the title “challenges and Mitigations” bullet 1 the word “enagagement” changed

to “engagement”.

224. On page 241: last paragraph the word “focussing” is removed as it is repeated.

225. On page 241, paragraph 1 DPEM is written in full.

226. On page 242, paragraph 1 SPLUMA moved to end of the abbreviated name as it is an acronym.

227. On page 243, bullet 1 and 2 SDF & BEPP written in abbreviations.

228. On page 244, paragraph 1 line reading “The project was led by the …” (eThekwini municipality)

brackets () removed.

229. On page 244, last paragraph LAP abbreviation added.

230. On page 247, last paragraph DTP. KSIA written at the end of the full name as abbreviations.

231. On Page 248, first paragraph FAP written in full and abbreviated.

232. On page 254, second to last paragraph under title “Current Status” (TOD) added in brackets.

233. On page 257, LUMP abbreviation was written in full under last paragraph.

234. On page 258, paragraph 2, OWTPS written in full.

235. On page 262, GWFAP abbreviation was written in full under second paragraph.

236. On page 266, NDPG abbreviation was written in full under last paragraph.”

237. On page 266, paragraph 1 line reading “The figure above indicate…..”, “an” was added.

238. On page 277, bullet 3 under title other achievement, spelling for decentralisation rectified.

239. On page 278, last paragraph, spelling for antiretroviral was rectified.

240. On page 279, paragraph 4 under title “Successes” brackets removed on (HPRS).

241. On page 281, bullet 3 IDP written in abbreviations.

242. On page 283, under the title “Human Resource Management Information Systems” bullet 1 CV

written in full and bullet 2, LAB is written in full.

243. On page 284, bullet 1 under title “employment equity”, EE was written in full.

244. On page 284, bullet 2 under title “Talent management” KPI written in full.

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245. On page 292, under the title human capital metrics, a full stop was added at the end of the sentence.

246. On page 292, under the title assessment centres, punctuation was added to the paragraph to read as

“Provide a quality psychometric and work sample assessment service to improve the quality of

decision making with regards to selection of job applicants, as per the HR Unit’s Recruitment

and Retention Policy. This policy was developed in accordance with best practice research and

stipulates that, it will be compulsory for all posts from Task 14 and above to undergo

psychometric assessments, as part of the recruitment and selection process. 247. On page 292, row 42 spelling for bodies rectified.

248. On page 304, last paragraph MILE, DUT, MUT abbreviated.

249. On page 306, last paragraph, a full stop was added.

250. On page 307, second to last paragraph, SMME written in abbreviations.

251. On page 312, caps were added to each first letter of “Generally Recognised Accounting Practice”.

252. On page 313, on the subtitle “procurement”.. SCM written in full.

253. On page 315, last paragraph LED written in full.

254. On page 323, paragraph 1, “has” changed to “have”.

255. On page 325, last paragraph “has” changed to “have”.

256. On page 333, figure 155 write-up, the spelling for disputes rectified on the first line: last paragraph.

257. On page 335, figure 157 write-up “RMS” brackets were removed.

258. On page 337, under figure 159 the legend was changed to R billion from R million.

259. On page 347, on the title in 5.13 GRAP is written in full.

260. On page 347, paragraph 3 IGRAPS was moved to the end of the sentence as an abbreviation.

261. On page 349, number 7, the spelling of outcome was rectified.

262. On page 352, spacing between 27 and 28 changed.

263. On page 353, point 34 “City Integrity and Investigation Unit” written in capital C, I & U.

264. On page 356, under title water loss: bullet 4, the first word was written as Installed.

265. On page 437, last paragraph “Senior Management” written with capital S & M.

266. On page 439, paragraph 2, A and O in Accounting Officer written in capital letters.

267. On page 449, Appendix H under Zikhulise Group (Pty) Ltd; the spacing for top structures was

effected.

268. On page 615, a row with 8.13 was added on plan 8 scorecard.

269. On page 724, under note 46 the sentence: “investigations are still in progress regarding 445 cases.

“272” cases were completed during the 2016/2017 financial year”, the number of cases completed

were changed after the audit by the Auditor General to “271”.

270. On page 755, bullet 8 “Anchor ithold” i changed to capital I.

271. On page 755, COBIT abbreviation was written in full under third bullet of title “Ensure legislative

compliance and good governance”.

272. On page 757, paragraph 1, EBITDA abbreviation moved to end of the sentence.

273. On page 758, paragraph 1 under title “challenges and mitigations” Seven written in lower

caps.

274. On page 759, bullet 4 under title “summary of successes and awards” Accommodation Direct

written in lower caps.

275. On page 759, under title “pure marketing” bullet 2, “Gagasi” changed to “IGagasi”.

276. On page 760, SMS abbreviation was written in full under first bullet of “repeat visitor” title.

277. On page 761, bullet 5 Primary level written in lower case “p”.

278. On page 771, Paragraph 1 reading “security management….. “is a member of EXCO” was added.

279. On page 772, last paragraph under the title “guest first approach”, WSP was added as an

abbreviation.

280. On page 841, paragraph 2 “the Durban ICC”, “d” was changed to capital “D”.

281. On page 841, DEC abbreviation was added in the second paragraph.

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5. ANNUAL REPORT CHECKLIST

INF ORM ATION REQU IRE D

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COU NCIL CON SI DERATI ONS AN D QUEST ION S RESPON SES /CO MMENTS

1. Financial Matters – Annual

Financial Statements - Section 121

(3) MFMA

Financial reporting matters to be considered

121 (3)(a)

The annual financial statements

(AFS) for the municipality and, if

applicable, consolidated statements

(with all entities) as submitted to the

Auditor-General.

The AFS are to be in the form as required by the applicable accounting standards.

MFMA Circular 18 with annexures, 23 June 2005, provides guidelines on the

accounting standards for municipalities.

Have the required standards been met?

Yes

Yes

121 (3)(a)

121 (4)

121 (4)(b)

The above applies also to the AFS of municipal entities. Yes

121 (3) (e) An assessment by the

accounting officer on any arrears on

municipal taxes and service charges,

including municipal entities.

Has an adequate assessment been included?

Is there sufficient explanation of the causes of the arrears and of actions to be

taken to remedy the situation?

Is any other action required to be taken?

Yes.

See Note 7, Pages 653-654 of the Annual Report.

There has been strict adherence to the Credit Control & Debt Collection Policy and

the Rates Policy. We note that several debt collection strategies have been

implemented, such as redline letters; consent to judgment; consolidation of accounts;

a team that focuses on the top 20% of debtors which make up 80% of the total debt; a

team that focuses on debtors with 50 or more properties; as well as teams that handle

government, sales-in-execution, deceased estates and liquidations.

Yes. A review of the Credit Control and Debt Collection Policy

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121 (3)(g)

Particulars of any corrective action

taken or to be taken in response to

issues raised in the audit reports.

The conclusions of the annual audit are: -

� an unqualified audit opinion with or without management issues, which

means that the financial statements are acceptable;

� The objective of the municipality should be to achieve an unqualified audit

opinion.

� Taking into account the audit report, audit opinion and the views of the audit

committee, council considered: -

• To what extent does the report indicate serious or minor financial

issues?

• To what extent are the same issues repeated from previous audits?

• Is the action proposed considered to be adequate to effectively address

the issues raised in the audit report?

• Has a schedule of action to be taken been included in the annual report,

with appropriate due dates?

The Municipality achieved an unqualified audit with management issues.

There were some significant internal control deficiencies which resulted in findings on

compliance with legislation. Management was found to have not effectively monitored

compliance with SCM regulations.

In certain instances, matters reported in previous audits were not fully and

satisfactorily addressed which resulted in repeat findings being reported.

Yes

The Action Plan is attached as Annexure “B”

Note that actions taken on audit issues are to be reported to the provincial

legislature, the MEC for Cooperative Government & Traditional Affairs to report

on any omissions by municipalities in addressing issues. Council should confirm

that the audit report has been forwarded to the MEC.

The Audit Report was submitted to COGTA on 5th February 2018.

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121 (3)(f)

An assessment by the municipality’s

accounting officer of the

municipality’s performance against

measurable performance objectives

for revenue collection from each

revenue source and for each vote in

the approved budget.

The budget of the municipality must contain measurable performance objectives

for revenue from each source and for each vote in the budget, taking into account

the IDP (MFMA s17(3)(b)). The accounting officer must include these objectives

in the annual report and report on performance accordingly.

Has the performance met the expectations of council and the community?

Have the objectives been met?

What explanations have been provided for any non-achievement?

What was the impact on the service delivery and expenditure objectives in the

budget?

Yes

See Appendix K(i), Page 461; Appendix K(ii), Page 462; Appendix B(i), Page 743 and

Appendix B(ii), Page 744 of the Annual Report

Yes

Yes

Despite the slowdown in the economy, the Municipality still maintained an excellent

collection rate of 97% (total receipts for services over total billings for services) The

total revenue grew by 3% year on year. The major sources were electricity (36%),

property rates (20%), grants & subsidies (17%) and water (9%).

Total expenditure grew by 12%. The total capital spend was 90%. The main reason

for the under-spend were delays due to environmental issues, land ownership issues,

delays in plant and equipment being delivered from overseas.

121 (3)(i)(k) Any information as

determined by the

municipality, the entity or

its parent municipality.

Review any other information that has been included in regard to the AFS.

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1. Financial Matters – Annual

Financial Statements - Section 121

(3) MFMA

Financial reporting matters to be considered

121 (3)(j) and 121 (4)(g)

Recommendations of the audit

committee in relation to the AFS and

audit reports of the municipality and

its entities.

Have the recommendations of the audit committee in regard to the AFS and audit

reports been adequately addressed by the municipality and/or the entity?

What actions need to be taken in terms of these recommendations?

The Audit Committee was satisfied with the significant improvement in the quality of

the unaudited financial statement. There were however concerns regarding the

effectiveness of Internal Controls.

i. Continued implementation of water and electricity revenue loss strategy and

mitigation action plan with emphasis on illegal connections and water

infrastructure development and management.

ii. Swift and consistent consequence management for wilful supply chain

management regulation non-compliance which results in irregular expenditure.

iii. Final determination on the continued escalation in post-retirement medical aid

benefits and increasing financial obligation for the Municipality.

iv. Improvements in the accuracy and reliability of the Revenue Management System

with regard to customer invoicing, efficiency of revenue collection and customer

debt management.

v. Increased effort in the consolidation, integration and implementation of the ICT

Governance strategy, framework, policies, procedures and internal Controls

across the Municipality under the leadership of the Chief Information Officer.

vi. Monitoring and assessment of the impact of reported legal claims against the

municipality.

vii. Stringent financial management controls to recover the increasing doubtful debts.

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2. Disclosures - Allocations received

and made - Section 123-125

MFMA

Considerations

123 (1)(a)

Allocations received by and made to

the municipality.

The report should disclose:

� Details of allocations received from another organ of state in the national or

provincial sphere.

� Details of allocations received from a municipal, entity or another

municipality

� Details of allocations made to any other organ of state, another municipality,

or a municipal entity.

� Any other allocation made to the municipality under Section 214(1) (c) of

the Constitution.

Have these allocations been received and made?

Does the audit report confirm the correctness of the allocations received in terms

of DORA and provincial budgets?

Does the audit report or the audit committee recommend any action?

Yes. See Appendix L, Pages 463-465; Note 28, Pages 688-694 and

Appendix C, Page 744 of the Annual Report.

Yes. See Appendix R, Pages 524-540 of the Annual Report and Note 34, Page

700

Yes.

Yes.

No.

125 (1)

Information in relation to outstanding

debtors and creditors of the

municipality and entities.

Municipalities and entities are reminded of the requirement to include, in their

annual financial statements, amounts owed to them and persistently delayed

beyond 30 days, by national or provincial departments and public entities.

It is also a requirement to report on whether the municipality or entity has met its

statutory commitments, including the payment of taxes, audit fees, and

See Note 7, Pages 653-654 of the Annual Report

Yes.


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contributions for pension and medical aid funds.

Council should be satisfied that –

� the information has been properly disclosed;

� conditions of allocations have been met; and

� that any explanations provided are acceptable.

See Note 42, Page 713 of the Annual Report

Yes.

Some conditions are still to be met and remain liabilities.

Yes. See Note 28, Pages 688-694

2. Disclosures - Allocations received

and made - Section 123-125

MFMA

Considerations

123 (1)(c)

Information in relation to the use of

allocations received.

Section 123 of the MFMA and MFMA guidance circular 11, require that the

municipality provide information per allocation received per vote and include:-

� The current year and details of spending on all previous conditional grants,

for the previous two financial years. Information is to be provided per vote.

(For example, municipalities must report on all transfers received from

provincial housing departments for housing subsidy grants for three financial

years, and indicate how such funds were spent, and for what projects.

Information stating whether the municipality has complied with the

conditions of the grants, allocations in terms of section 214(1)(c) of the

Constitution and allocations received from other than another organ of state.

Where there is non-compliance, details of the reasons for non-compliance

are to be provided.

� Information on whether allocations under the DORA were delayed or

withheld and the reasons advanced for this.



R10,697,000 of the Neighbourhood Development Partnership Grant allocation was

withheld due to the non-submission of monthly web progress reports and the actual

spend of the grant not being reported regularly; as 80% spend of transferred funds is

required to release the next tranche of funding.

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3. Disclosures in notes to AFS Considerations relating to section 124

Information relating to benefits paid

by municipality and entity to

Councillors, directors and officials.

Information on the following items is to be included in the notes to the annual

report and AFS: -

� salaries, allowances and benefits of political office bearers, Councillors and

boards of directors, whether financial or in kind;

� any arrears owed by individual Councillors to the municipality or entity for

rates and services, which at any time were outstanding for more than 90

days, including the names of Councillors;

� salaries allowances and benefits of the municipal manager, CEO of a

municipal entity, CFO and every senior manager;

� contributions for pensions and medical aid;

� travel, motor car, accommodation, subsistence and other allowances;

� housing benefits and allowances;

� overtime payments;

� loans and advances, and;

� any other type of benefit or allowance related to staff.

Council should be satisfied that –

� the information has been properly disclosed;

� conditions of allocations have been met; and

� that any explanations provided are acceptable.

Yes.


Yes.


Yes.




Yes

Yes

Yes

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4. Municipal Performance Considerations

The annual performance reports of

the municipality and entities.

Section 46, MSA requires municipalities to submit a performance report

reflecting the performance of the municipality and each service provider, a

comparison of the performance with targets set for the previous year and

measures taken to improve performance. The report must form part of the annual

report. Questions that may be considered are –

� Has the performance report been included in the annual report?

� Have all the performance targets set in the budgets, SDBIP, service

agreements etc, been included in the report?

� Does the performance evaluation in the annual report compare actual

performance with targets expressed in the budgets and SDBIP approved for

the financial year?

In terms of key functions or services, how has each performed? E.g. have

backlogs for water, sanitation, and electricity been reduced? What are the refuse

collection volumes, library usage statistics etc?

� To what extent has performance achieved targets set by council?

� Is the council satisfied with the performance levels achieved?

Yes

Yes

Yes

Unit No. of Reportable KPIs in

Q4

Total KPI’s Achieved %

Electricity 6 1 16.17

Water and Sanitation 7 6 85.71

Durban Solid waste 3 2 66.67

Human Settlements 9 6 66.67

Engineering 5 4 80.00

Transport (ETA) 5 1 20.00

57.14% of the key performance indicators for basic service delivery were achieved.

No.

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� Is the community satisfied with performance? Has a customer satisfaction

survey been undertaken and, if so, how do the results align with the annual

report contents? What were the outcomes of public consultation and public

hearings?

� What actions have been taken and planned to improve performance?

� Is the council satisfied with actions to improve performance?

� Did the targets set in the budgets, SDBIP agree with the targets set in the

performance contracts of the municipal manager and each senior manager?

� Does the report evaluate the efficiency of mechanisms applied to deliver the

performance outcomes?

� Taking into account the audit report and opinion and the views of the audit

committee, is performance considered to be efficient and effective?

� To what extent have actions planned for the previous year been carried over

to the financial year reported upon?

� Have any actions planned in the reported year been carried over to the

current or future years? If so are any explanations been provided by the

A customer satisfaction survey was undertaken.

On average, respondents were satisfied with their basic household services, which

included their satisfaction with toilets, water, refuse removal and electricity supply.

However, we feel this is not a true reflection of the views of most community

members. The formula used was not adequate as only 1200 interviews were carried

out in only 40 sample areas. In terms of the sample size, more researchers are

required, questions should be increased and the variations should also be increased.

Questions were too general and people who were unhappy with housing or billing

were not reflected. Ideally, separate surveys are required for rural, peri-urban and

urban areas. The necessary resources should be provided in order to obtain a true

reflection of community views.

See Annexure “B” for the outcome of the public consultation and public hearings.

Various measures and undertakings have been made to improve performance.

Yes

Yes

No

To a large extent yes. But there are areas for improvement.

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municipal manager and are these satisfactory?

Audit reports on performance. Section 45, MSA requires that the Auditor-General must audit the results of

performance measurements, as part of the internal auditing processes and

annually.

Have the recommendations of internal audit been acted on during the financial

year?

Have recommendations by internal audit and/or the auditor-general been included

in action plans to improve performance in the following year?

Not all recommendations were acted on for various reasons.

Yes

Performance of municipal entities and

municipal service providers.

The annual report of the municipality should provide an assessment of the

performance of the municipal entities and all contracted service providers.

This is in addition to the separate annual reports of the entities. The report should

evaluate the effectiveness of these services and whether alternative mechanisms

should be considered.

Is the council satisfied with the evaluation and conclusions of the municipality?

What other actions are considered necessary to be taken by the accounting

officer?

The assessment of contracted service providers is included in the annual report. See

Appendix I; Pages 453-455 of the Annual Report

No

The accuracy, quality and completeness of the assessments requires improvement.

5. General information The following general information is required to be disclosed in the annual report.

Relevant information on municipal

entities.

The municipality should disclose all information relating to the municipal entities

under the sole or effective control of the municipality. Information to be

disclosed includes names and types of entities, members of the board, addresses,

and contact details for entities, the purpose of the entity, the functions, and

Yes

Ushaka Marine Theme Park. See Pages 746-834 of the Annual Report

Inkosi Albert Luthuli International Convention Centre See Pages 835-962

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services provided the type and term of service level agreements with the entities.

The use of any donor funding

support.

What donor funding has the municipality received?

� Have the purposes and the management agreements for the funding been

properly agreed upon?

� Have the funds been used in accordance with agreements?

� Have the objectives been achieved?

� Has the use of funds been effective in improving services to the community?

� What actions need to be taken to improve utilisation of the funds?

Various. See Note 28, Pages 688-694 of the Annual Report

Yes

Yes

Yes

Yes

None

Agreements, contracts and projects

under Private-Public-Partnerships.

Information similar to the details of municipal entities should be provided.

Council should ensure that all details have been supplied.

No public private partnerships were entered into during the year.

See Appendix H; Page 452 of the Annual Report

Service delivery performance on key

services provided.

This may be a high level summary, in addition to detailed information on

performance, which sets out overall performance under the strategic objectives of

the municipality. Overall results on the strategic functions and services should be

summarised. This should cover all services whether provided by the municipality,

entities or external mechanisms.

See Appendix U: Scorecard Report on Pages 543-612 of the Annual Report

See Appendix Q: Services delivery backlogs where another sphere of government is

responsible for service provision; Pages 516-524

Information on long-term contracts. Details of all long-term contracts including levels of liability to the municipality

should be included.

See Appendix H; Pages 448-451 of the Annual Report

Information technology and systems

purchases and the effectiveness of

these systems in the delivery of

services and for ensuring compliance

with statutory obligations.

Details of significant IT activities should be outlined indicating the effectiveness

of the IT projects and the quality of IT services.

Council should consider how effectively the IT services support and facilitate

performance of the municipality and whether value for money has been obtained.

Details of any future IT proposals should be summarised. Council should

comment and draw conclusions on the information provided.

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Capital plan for addressing

infrastructure backlogs

A summary of the long-term capital plans and how these address the backlogs of

services in the municipality should be provided.

This should include details of types and scale of backlogs, projected cost

implications, strategies to address the backlogs and plans proposed and/or

approved. The summary here should cross reference to the performance reports in

the annual report and also will be highlighted in the coming budgets.

Council should consider whether the plans appropriately address the backlogs and

are consistent with the strategic policy directions of council and needs of the

community.

See Annexure C

6. Other considerations recommended

Timing of reports. Was the report tabled in the time prescribed? Yes.

Oversight committee or other

mechanism.

What mechanisms have been put in place to prepare the oversight report? The Municipal Public Accounts Committee was delegated the responsibility of

preparing the oversight report.

Payment of performance bonuses to

municipal officials.

Refer to Section 57 MSA as amended. Bonuses based on performance may be

awarded to a municipal manager or a manager directly accountable to the

municipal manager after the end of the financial year and only after an evaluation

of performance and approval of such evaluation by the municipal council.

Preferably such evaluation should be considered along with the annual report.

The basis upon which performance is evaluated for payment of bonuses should be

reconciled with the municipal performance reported in the annual report.

Have bonuses been paid based on achievements of agreed outputs and after

Performance bonuses for the year under review have not yet been paid to any Section

57 Manager.

Performance will be assessed based on achievements of agreed outputs and will only

of 38


TO BE IN CLUDE D

IN AN NU AL

REPORTS


consideration of the annual report by council? be paid after the adoption of the Oversight Report where applicable.

Public Consultative meetings:

Organisations identified, consulted

and feedback documented

Needs to be noted and should be included in the annual report

Feedback

The following stakeholders were engaged: -

• Informal Traders at Durban City Hall

• Traditional Leaders at the Pinetown Civic Centre

• Civil Society at Durban City Hall

• Formal Business at Moses Mabhida Stadium

A number of issues were raised during the public participation process.

See Annexure A for feedback received

Annual report distribution points

documented and feedback

documented

Distribution points.

Feedback

The Annual Report was placed for inspection at Municipal Libraries, Sizakala

Centres, at the City Hall and Rennie House. In addition, a copy was posted on the

Municipality’s website and copies were circulated to all Councillors.

Submissions were received via email, telephone and from Support Committees.

See Annexure A for the feedback received.

of 38

6. AUDIT REPORT

1. IRREGULAR EXPENDITURE

We have noted the Auditor General’s finding that effective steps were not taken to prevent

irregular expenditure amounting to R514,8 million as disclosed in note 46 to the annual

financial statements, as required by section 62(1)(d) of the MFMA. The majority of the

irregular expenditure R385 million was caused by the municipality not complying with

supply chain management regulation 29(1).

The Audit Committee encouraged management to undertake swift and consistent

consequence management with regard to willful supply chain management policy non-

compliance which results in irregular expenditure in order to ensure effective

accountability and ensure implementation of demand management plans, budget cash low

and proper document and contract management.

We have further noted management’s response that substantial progress has been made to

proactively reduce irregular expenditure and the actions proposed to further reduce the

irregular expenditure.

Therefore,

COMMITTEE RECOMMENDS:

That the City Manager ensures the implementation of the following measures proposed to

reduce instances of irregular expenditure:

i. A zero tolerance approach to irregular expenditure by ensuring appropriate

disciplinary action arising from investigations are taken against employees or

Councillors that transacted with the Municipality and/or. Have breached SCM

processes;

ii. Appropriate disciplinary action against officials who cause the municipality to

incur irregular expenditure will be taken;

iii. The SCM checklist will be revised to ensure that all compliance requirements are

adequately covered in line with SCM regulations and policy;

iv. A disciplinary board in terms of MFMA Regulations will be established in line

with a Council resolution already taken and the work of the board will be

monitored to ensure compliance with regulations; and

v. Implementation of e-procurement and Vendor Portal Database.

2. CONSEQUENCE MANAGEMENT

We have noted with concern that the audit outcome in the current year is due to slow

response by management and leadership in effectively dealing with consequence

management for transgressions of the prescribed supply chain management (SCM)

regulation and policies. These transgressions have resulted in repeat audit findings on

SCM non-compliance for circumventing the competitive bidding process and the related

increase in irregular expenditure identified during the year.

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We were reminded by the Auditor-General that the MFMA and its regulations clearly

stipulate that matters such as incurring unauthorised, irregular and fruitless and wasteful

expenditure; the possible abuse of the SCM system (including fraud and improper

conduct); and allegations of financial misconduct should be investigated. Disciplinary

steps should be taken based on the results of the investigations.

Having undertaken an assessment of the municipality’s management of consequences. The

AG made the following significant findings:

Measures to manage consequences

Measures were not implemented to ensure that the environment was conducive to effective

consequence management. It was found that there was lack of proper record keeping to

ensure that complete, relevant and accurate information is accessible and available to

support the processes followed for financial misconduct/transgressions committed by

officials and suppliers of the municipality including evidence of any disciplinary action

taken.

Ongoing investigations

A total of 16 investigations which the AG deemed to be significant were ongoing at year-

end on allegations relating to financial misconduct, fraud or improper conduct in SCM.

Some of these investigations have been ongoing for a long time. The Municipal

Regulations on Financial Misconduct, Procedures and Criminal Proceedings and the

Disciplinary Regulations for Senior Managers require that each investigation must be

completed within 30 days from the date of appointing the investigator.

Recommendations not implemented for completed investigations

The Municipal Regulations on Financial Misconduct, Procedures and Criminal

Proceedings and the Disciplinary Regulations for Senior Managers require that at

completion of an investigation, the investigation report must be tabled to the council. The

AG highlighted completed investigations for which there was no evidence provided that

the necessary recommendations in terms of appropriate disciplinary action have been

implemented.

Transgressions reported to management for investigation

During the previous year’s audit, the AG reported findings relating to transgressions by

officials or other role players, for management to investigate. During the current year

audit, the AG performed follow-up tests to determine whether the matters reported were

dealt with by management. It was found that some matters had still not been attended to. A

summary of the transgressions reported in the previous year and the year under review that

must be investigated and disciplinary steps taken based on the results of the investigations

were highlighted by the AG.

The Auditor-General further advised that irregular expenditure disclosed in note 48 to the

financial statements must be investigated to determine whether any official is liable for

losses incurred as a result of this expenditure. Disciplinary steps must be taken against

officials who caused or permitted the irregular expenditure and losses incurred must be

recovered from the person liable.

of 38

The issue of the lack of consequence management is not only concerning to the Auditor-

General, we and the Audit Committee also share the same sentiments. It is our belief that

failure to take appropriate action against officials will prevent the municipality from

achieving its goals of good governance and clean audit outcomes.

Therefore,


2.1 That the City Integrity & Investigations Unit be appropriately capacitated to timeously

undertake, conclude and report on investigations as this will enable effective consequence

management.

2.2 That the City Manager ensure that effective record keeping by all Units to enable the

provision of the required evidence at disciplinary hearings and proof of disciplinary action.

2.3 That the City Manager ensure timeous response by management to effectively deal with

consequence management for cases finalised.

3. BAD DEBT PROVISION

As disclosed in note 7 to the financial statements, the municipality made a provision for

bad debts of R3,31 billion (2016: R3,01 billion) on consumer debtors, as the recoverability

of these amounts was doubtful. An amount of R904,1 million that related to the 2016

provision was written off as irrecoverable during the year.

We have noted the Auditor General’s concern regarding the adoption of a general approach

for bad debt provision which, it is felt, may not address the specific risks relevant to the

different streams of income/debtors. The Auditor General is of the view that the

methodology used to account for impairments is not completely aligned to the GRAP

standards and the accounting policy.

During our engagement with Management in this regard, the seriousness of the finding was

acknowledged and an undertaking was made to develop a methodology to address the

concerns raised by the Auditor General. We noted that the guidance of National Treasury

has been sought as well as benchmarking with other municipalities.

It is our belief that the implementation of the Revenue Management System impacted

negatively on the municipality’s ability to recover debt due to the inaccuracies and

discrepancies in the bills generated by the system.

We are concerned about the magnitude of the debt that was written off due to it being

deemed to be irrecoverable.

Furthermore, we share the Audit Committee’s view that stringent financial management

controls should be exercised to recover the increasing doubtful debts.

Accordingly,


of 38

3.1 That the Deputy City Manager: Treasury ensures bad debt provision is undertaken in a

manner that ensures the mitigation of risks specific to the different streams of

income/debtors.

3.2 That the Credit Control and Debt Collection Policy be reviewed to include additional

measures that will enable the Municipality to recover debt incurred by consumers and

ratepayers.

3.3 That the Head: Electricity be provided with the necessary resources to enable the reading

of electricity meters on a monthly basis.

3.4 That the City Manager ensure the accuracy and reliability of the Revenue Management

System in assisting the municipality to manage billing, revenue collection and debt

management.

4. MATERIAL WATER LOSSES

As disclosed in note 45 to the consolidated and separate financial statements, material

water losses of 108,83 million kilolitres (2016: 132,51 million kilolitres) resulted in

revenue losses of R645,90 million (2016: R710,90 million), as a result of illegal

connections and deteriorating infrastructure. The amount of water losses in excess of 30%

amounts to R 100 million (2016: R186,9 million).

We are informed that water loss is caused by deteriorating and aging infrastructure as well

as illegal connections. The Water & Sanitation Unit is implementing the following

measures to reduce water losses:-

• Installation of pressure recuing valves

• Installation of meters in informal settlements

• Installation of community ablution blocks

• Continuous servicing and maintenance of previously installed pressure reducing

valves

The Audit Committee recommends the continued implementation of the water revenue

loss strategy and mitigation action plan with emphasis on illegal connections and water

infrastructure development and maintenance master plan until the prescribed National

Treasury level of 30% water loss is achieved and maintained.

Whilst there is a slight reduction in the water losses, we are still concerned about the extent

of losses and therefore


That the City Manager should continue to ensure the implementation of measures to

address the high water losses; with quarterly progress reports being submitted to the

Human Settlements & Infrastructure Committee to monitor the effectiveness of such

measures.

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5. FINANCIAL MANAGEMENT

During the audit of revenue from service charges the Auditor General noted that incorrect

tariffs had been applied in the calculation of some charges. On inspection of the eThekwini

approved 2016/2017 tariff tables, it was identified that the tariff applied on the consumer

bill related to the approved tariffs for the 2015/2016 financial year. The Auditor General

recommended that management perform proper review checks to ensure that all approved

tariffs are loaded on to the revenue management system accurately for each financial year.

Management has acknowledged that an incorrect tariff was applied. It was indicated that

all tariffs were reviewed and this was found to be an isolated case. We have noted that

going forward line management will be required to provide written confirmation of the

accuracy of tariffs captured on the revenue management systems; with final uploading of

tariffs only being approved upon receipt of the written confirmation.

Therefore,


That the Deputy City Manager: Finance ensures that the correct tariffs are uploaded onto

the revenue management system following their approval by Council.

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7. ANNUAL REPORT

1. REVIEW OF EXTERNAL SERVICE PROVIDER PERFORMANCE MONITORING

BY UNITS WITHIN THE MUNICIPALITY

Of the 385 contracts that were due for assessment (those valued at R10 Million and above),

only 315 (82%) were assessed as required by legislation. Some of the assessments that

were not fully compliant in that they were not signed by both the reporting officer and the

external service provider. The quality of some was questionable. Assessment outcomes did

not match the achievement of key performance indicators; i.e. performance was said to be

acceptable despite service providers failing to achieve key performance indicators. In other

instances, incomplete forms were submitted; with no comment being provided on the

achievement of key performance indicators. The cooperation of all Unit Heads is required

to ensure full compliance and meaningful assessment of the performance of service

providers; which will result in improved service delivery. In our engagement with management; we were informed that performance was monitored

by Units with warning letters being issued in instances of poor performance. Should the

performance not improve termination and blacklisting was then considered.

We are concerned that the majority of the companies which are blacklisted are black-

owned companies which defeats the Municipality’s goal of Radical Economic

Transformation.

Of further concern is the issue of poor performance of service providers across the

municipality; many of whom are awarded numerous contracts. The issue of Business

Forums should be viewed in a serious light as we are informed it also contributes to poor

performance.

Accordingly,


1.1 That the manner in which awards are made to service providers be reviewed as it appeared

that the multiple award of contracts to service providers impacted negatively on their cash

flow and ability to perform effectively; which eventually resulted in termination of

contracts and blacklisting of the said companies.

1.2. That capacity building and support programmes be developed for emerging contractors

that are awarded contracts by the municipality to enable them to perform effectively and

deliver as expected.

1.3 That the City Manager ensure the effective implementation of the Preferential Procurement

Regulations of 2017 as this will go a long way in addressing the concerns of the various

business forums and interest groups.

2. ANNUAL REPORT PUBLIC PARTICIPATION PROCESS

Whilst we value and appreciate the level of public participation on the annual report, it is

our view that there is great room for improvement. Provision, was made for the

engagement of communities through one central hearing; which was unfortunately poorly

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attended. We believe that if the hearings were taken closer to communities more

meaningful engagement of communities would be realised.

It is also our view that the Annual Report Public Participation Process should be led by the

Municipal Public Accounts Committee; with Committee being privy to all arrangements in

this regard.

Accordingly,


That the required financial and human resources be provided to the Municipal Public

Accounts Committee to enable the engagement of communities on the Annual Report at a

ward level; in future.

3. SUPPLY CHAIN MANAGEMENT

Following numerous engagements with Units, we have come to the conclusion that the

municipality’s SCM system has weaknesses and deficiencies which are negatively

impacting the ability of Units to effectively deliver services to communities.

Some of the weaknesses are:

• in the crafting of tender specifications and evaluation of tenders which results in

awards being challenged;

• the length of time taken to conclude a tender process;

• insufficient vetting of service providers (particularly emerging contractors) to

determine whether they have the capacity to deliver on contracts prior to award; and

• SCM processes being undertaken by officials who lack the requisite knowledge of

such processes.

In addition, we were previously informed that a database of vetted sub-contractors per

ward would be compiled and used by main contractors for the purpose of implementing the

Preferential Procurement Regulations. We are of the view that this would go a long way in

addressing the concerns raised by business forums and other interest groups.

Therefore


A comprehensive evaluation of the municipality’s Supply Chain Management system

(structure, policy and processes) be undertaken to determine its ability to effectively

support service delivery; with measures being undertaken to correct any deficiencies in this

regard.

4. CHALLENGES

We encountered a number of challenges during our interrogation of this year’s annual

report. Our work and role was greatly undermined by some officials who failed to appear

before us despite numerous requests in this regard. In addition, they failed to submit

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reports as required and instances where reports were submitted; the quality of the said

reports was questionable due to incomplete and/or incorrect information being provided.

The non-cooperation by officials impacted on our ability to undertake our duties

effectively and to fulfill our mandate. We were unable to deliberate on all matters in the

annual report and report such matters to Council.

It is our view that the lack of consequence management is the root cause of the continued

undermining and disrespect of MPAC by Officials.

Therefore,


That the City Manager take the requisite action against the officials who have hampered

the work of the Municipal Public Accounts Committee during the 2016/2017 Annual

Report process.

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8. CONCLUSION

The MPAC commends Council, the Municipal Manager, the Senior Managers and all staff at

eThekwini Municipality on the strides made towards good governance.

However, there is great room for improvement with regard to:

� Improvement of internal controls to ensure that issues raised by both internal and external

auditors are addressed effectively.

� Improvement of key controls to ensure effective:

� Financial Management

� Contract and Procurement Management

� Compliance Management

� HR Management

� IT Management

� Monitoring and review of the creditor payment period; as delays in the payment of service

providers results in cash flow challenges which impact on their sustainability and ability to

deliver services effectively.

Having performed the following tasks:

� Reviewed and analysed of the Annual Report;

� Invited, received, and considered inputs from Councillors and Portfolio Committees, on the

Annual Report;

� Considered the written comments received on the Annual Report from the public consultation

process;

� Conducted Public Hearings to allow the local community or any organs of state to make

representations on the Annual Report;

� Received and considered Council’s Audit Committee views and comments on the annual

financial statements and the performance report; and

� Prepared the Oversight Report, taking into consideration, the views and inputs of the public,

representatives of the Auditor-General, organs of state, Council’s Audit Committee and

Councillors.

The MPAC has pleasure in presenting the Oversight Report to Council to consider one of the

following resolutions and then to be forwarded to the relevant Departments and Provincial

Legislature:


1. That Council having fully considered the Annual Report of the eThekwini Municipality for

the 2016/2017 Financial Year, adopts the Oversight Report for the 2016/2017 Financial

Year, a copy of which is attached to the signed minutes of this meeting.

2. That Council approves the Annual Report of the eThekwini Municipality for the

2016/2017 Financial Year without reservations.

3. That the Oversight Report be made public in accordance with Section 129(3) of the

Municipal Finance Management Act 56 of 2003.

4. That the Oversight Report be submitted to the Provincial Legislature in accordance with

Section 132(2) of the Municipal Finance Management Act 56 of 2003.

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9. ANNEXURES

Annexure A Report on 2016/17 Annual Report Public Participation Process

Annexure B 2016/17 Action Plan for Auditor General Findings

Annexure C Capital Plan for Addressing Infrastructure Backlogs

Annexure B: 2016/17 Action Plan for Auditor General FindingsNo. Audit finding Internal Control Deficiency Recommendation Management Response Repeat

Finding

YES/NO

Action Plan Responsibility Date Status as at

31 January

2018

1 Reasonable steps to prevent irregular

expenditure

Section 62 (1) (d) of the MFMA, requires the

accounting officer to take reasonable steps to

prevent irregular expenditure.

Despite the commitments provided by senior

and executive leadership to improve the supply

chain management (SCM) control environment,

there has been a slow response by management

in ensuring that there are adequate controls to

prevent and detect irregular expenditure.

Coupled to this is a slow response by

management to effectively deal with employees

who have transgressed the relevant SCM

polices and processes. This is evident from the

repeat findings on irregular expenditure and

consequence management that were identified

during the current year.

· Inadequate controls over contract

management and monitoring within the

electricity unit resulting in contract

extensions and payments after expiry.

• Inadequate controls over demand

management resulting in contracts and

awards procured without inviting

competitive bids, and the deviations

were approved even though it was

practical to invite competitive bids.

• Inadequate monitoring controls over

bid documentation and compliance

checklist to ensure all required

documentation as required by SCM

regulations has been reviewed for each

prospective bidder before an award can

be made.

Management is urged to review the

adequacy of their initiatives as per

the audit action plan to effectively

prevent and detect irregular

expenditure. The review should also

include the adequacy of consequence

management for line departments

with repeat findings. Management is

also advised to review the control

environment over the quotation

procurement process in view of the

high volume and value of

transactions that are procured in this

category and the number of repeat

findings.

We note the finding above. We

will improve our processes going

forward. The SCM checklist will

be revised to ensure that that all

compliance requirements are

adequately covered in line with

SCM regulations and policy. In

addition, with the

implementation of e-procurement

and Vendor Portal Database, the

deficiencies regarding quotations

and supplier declarations should

be addressed.

Yes We will improve our

processes going forward. The

SCM checklist will be revised

to ensure that that all

compliance requirements are

adequately covered in line

with SCM regulations and

policy. In addition, with the

implementation of e-

procurement and Vendor

Portal Database, the

deficiencies regarding

quotations and supplier

declarations should be

addressed.

Andre Petersen

Head: SCM

In progress

2 Provision for bad debts

In terms of Section 62 (c) of the MFMA states

that the accounting officer of a municipality is

responsible for managing the financial

administration of the municipality, and must for

this purpose take all reasonable steps to ensure

that the municipality has and maintains

effective, efficient and transparent systems -

(i) of financial and risk management and

internal control; and

(ii) of internal audit operating in accordance

with any prescribed norms and standards;

The calculation for the provision for bad debts

excludes credit authorities. When performing

the subsequent receipts test on the credit

authorities balance the total extrapolated error

for debtors whose debts had not been received

after year end amounted to R56 400 796.27.

Management has not ensured that the

above information has been taken into

account when assessing the provision

for impairment of the consumer

debtors.

Management should ensure that all

pertinent information is taken into

account when assessing the provision

for impairment of the consumer

debtors.

Management response

outstanding.

No Comparisons with other

Metros in relation to the

calculation will be performed

and the calculation will be

corrected if necessary.

Logan Pillay

Manager - SIE

and Legal

Processes

30-Jun-18 In progress

No. Audit finding Internal Control Deficiency Recommendation Management Response Repeat

Finding

YES/NO

Action Plan Responsibility Date Status as at

31 January

2018

3 Water Loss

The municipality disclosed estimated water

losses to a value of R 645,90 million, which

represents a loss of 108 825 996 kilolitres. The

water loss in the current year compared to the

prior year has reduced by 5.2% in terms of

quantity.

The water losses in excess of the 30% norm

amounted to R 100 million (2016: R186,9

million).

The estimate above does not account for issues

identified relating to the overstatement of the

sale of water.

Water loss is due to deteriorating

and aging infrastructure and

illegal connections

The Water & Sanitatio has the

following plan in place and is

currently in progress to reduce

Water Losses:

- Installation of Pressure

Reducing Valves within

eThekwini which is already in

progress

- Installation of meters in

Informal settlements

- Installation of meters at

Community Ablution Blocks

- installed at previously

unmetered Housing Projects

- Continuous servicing and

Yes

- Installation of Pressure

Reducing Valves

- Installation of meters in

Informal settlements

- Installation of meters at

Community Ablution Blocks

- Continuous servicing and

maintenance of previously

installed Pressure Reducing

Valves

Ednick Msweli

Head: Water &

Sanitation

In progress

CAPITAL PLAN FOR ADDRESSING INFRASTRUCTURE BACKLOGS Annexure C

UNIT/

DEPARTMENT

TYPES OF

BACKLOGS

SCALE OF

BACKLOGS

THE

STRATEGIES TO

ADDRESS THE

BACKLOGS

THE PLANS

THAT HAVE

BEEN

PROPOSED

AND/OR

APPROVED

DO THE PLANS

APPROPRIATELY

ADDRESS THE

BACKLOGS?

ARE THE PLANS

CONSISTENT

WITH THE

STRATEGIC

POLICY

DIRECTIONS OF

COUNCIL?

DO THE PLANS

ADDRESS THE

NEEDS OF

COMMUNITIES?

WHAT IS THE

RELEVANT

SECTION OF THE

PERFORMANCE

REPORTS IN THE

2016/17 ANNUAL

REPORT?

WHAT IS THE

RELEVANT

SECTION IN THE

COMING

2018/19/2019/20

CAPITAL

BUDGETS?

eThekwini

Transport

Authority

Taxi Ranks 26 Taxi Ranks

in total.

At a projected

cost of roughly

R7m each.

Eliminating the

backlog will

require about

R182 million

Two Taxi Ranks

will be built per

year

The next two

years

programme is

listed in the

City’s Budgets

for 2018/19

and 2019/20

Yes.

All identified

ranks can be built.

Yes.

IDP Programme

3.10.

Yes IDP

Section 3.6

Page 132

Reflected under

“eThekwini

Transport

Authority”

Coastal,

Stormwater

and

Catchment

Management

Stormwater

Control and

Drainage

Systems

Management

553 known

problems on the

network.

About

R1 Billion will

be required for

the 553 projects

Department

receives

complaints,

analyses and

prioritises the

problems, funds

and addresses

the most

impactful

problems

Projects are

listed in the

City’s

2018/19 and

2019/20

Budgets

Yes.

But the

stormwater water

backlog is very

dynamic and can

change

substantially with

each bad weather

event.

Yes.

Programme 3.9

“Address

Infrastructure

Backlogs -

Engineering”

Yes Section 3.5.6

Coastal

Stormwater and

Catchment

Management

See projects listed

under

“Engineering”

Roads

Provision

Gravel to

Surface

Roads

(High traffic

volume) in

proclaimed

township

areas

256km

Total cost to

eliminate

backlog =

256km x

R7.5M/km =

R1.920 Billion

Approximately

15 years to

eliminate the

backlog

Roads Provision

upgrades 15 to

20km of gravel

roads per

annum. These

are high traffic

volume roads on

the formal road

network in

proclaimed

township areas

The currently

approved

projects are

listed in the

3- year

Medium Term

Expenditure

and Revenue

Framework

Yes.

The backlog can

be eradicated, but

the rate at which

it is eliminated is

budget dependant

Yes Yes Plan 3 See projects listed

under

“Engineering”

UNIT/

DEPARTMENT

TYPES OF

BACKLOGS

SCALE OF

BACKLOGS

THE

STRATEGIES TO

ADDRESS THE

BACKLOGS

THE PLANS

THAT HAVE

BEEN

PROPOSED

AND/OR

APPROVED

DO THE PLANS

APPROPRIATELY

ADDRESS THE

BACKLOGS?

ARE THE PLANS

CONSISTENT

WITH THE

STRATEGIC

POLICY

DIRECTIONS OF

COUNCIL?

DO THE PLANS

ADDRESS THE

NEEDS OF

COMMUNITIES?

WHAT IS THE

RELEVANT

SECTION OF THE

PERFORMANCE

REPORTS IN THE

2016/17 ANNUAL

REPORT?

WHAT IS THE

RELEVANT

SECTION IN THE

COMING

2018/19/2019/20

CAPITAL

BUDGETS?

Road

Maintenance

The

upgrading of

lower traffic

volume

gravel roads

to tarmac

surface

1460km of

gravel roads

with sufficient

traffic to justify

upgrading

R2.3M/km, the

total cost to

eradicate the

backlog is

R3358m.

(R3.4 billion)

Roads are

identified at

least 12 months

in advance of

construction.

Ward

Councillors are

consulted during

the process and

the final list of

roads to be

constructed are

approved by the

Executive

Committee.

Projects are

listed in the

City’s

2018/19 and

2019/20

Budgets

Yes.

The current

backlog can be

eradicated in

about 30 years.

Yes.

IDP Section 3.9,

Page 341

Yes Annual Report

Section 3.5.1

Roads on Page 99

Projects are

itemised under the

“Engineering”

section of the

budget.

Human

Settlements

Informal

Settlements

239,000 units

At R300,000 per

unit, the total

cost to eradicate

the backlog is

R71,7B over

49-years

Informal

settlements are

upgraded on

site, with some

decanting of

households,

which cannot be

accommodated

on site, to

formal housing

schemes

Reflected in

the future

project lists on

the 2018/19

and 2019/20

Budgets

Yes.

However, the

eradication of the

backlog is

unlikely. Human

Settlements is a

complex service

Yes.

IDP Section 3.1:

New Integrated

Housing

Development

Yes Annual Report

Section 3.4

Human

Settlements on

Page 92

Projects are

itemised under the

heading

“Housing”

Human

Settlements

Backyard

Shacks

47,000 units

At R300,000 per

unit, total cost

to eradicate the

backlog is

R14,1 B over

59-years

Reflected in

the future

project lists on

the 2018/19

and 2019/20

Budgets

Yes.

However, the

eradication of the

backlog is

unlikely. Human

Settlements is a

complex service

Yes.

IDP Section 3.1:

New Integrated

Housing

Development

Yes Annual Report

Section 3.4

Human

Settlements on

Page 92

Projects are

itemised under the

heading

“Housing”

UNIT/

DEPARTMENT

TYPES OF

BACKLOGS

SCALE OF

BACKLOGS

THE

STRATEGIES TO

ADDRESS THE

BACKLOGS

THE PLANS

THAT HAVE

BEEN

PROPOSED

AND/OR

APPROVED

DO THE PLANS

APPROPRIATELY

ADDRESS THE

BACKLOGS?

ARE THE PLANS

CONSISTENT

WITH THE

STRATEGIC

POLICY

DIRECTIONS OF

COUNCIL?

DO THE PLANS

ADDRESS THE

NEEDS OF

COMMUNITIES?

WHAT IS THE

RELEVANT

SECTION OF THE

PERFORMANCE

REPORTS IN THE

2016/17 ANNUAL

REPORT?

WHAT IS THE

RELEVANT

SECTION IN THE

COMING

2018/19/2019/20

CAPITAL

BUDGETS?

Human

Settlements

Traditional

Dwellings

99,000 units

At R170,000 per

unit, total cost

to eradicate the

backlog is

R16,8 B

Traditional

dwellings are

provided with

services and

upgraded on

site.

Reflected in

the future

project lists on

the 2018/19

and 2019/20

Budgets

Yes.

However, the

eradication of the

backlog is

unlikely. Human

Settlements is a

complex service

Yes.

IDP Section 3.1:

New Integrated

Housing

Development

Yes Annual Report

Section 3.4

Human

Settlements on

Page 92

Projects are

itemised under the

heading

“Housing”

1. SOCIAL IMPLICATIONS

1.1 The provision of Taxi Ranks will improve the taxi service to the 26 areas identified, providing waiting

space for vehicles not yet en-route, providing sheltered space and facilities for passengers and a site

for taxi associations to manage the route. Small businesses will also be advantaged by high foot traffic

at these sites.

1.2 The provision of surfaced roads, where previously there were only gravel roads will reduce road

maintenance costs, will improve commuting travel times and road safety, will improve travellers

comfort and will prolong the life of vehicles and their tyres, thus reducing costs. The work will also

improve the stormwater drainage systems associated with roads which can reduce flooding.

1.3 The provision of formal housing, or provision of improved incremental services to informal

settlements, backyard shacks and traditional homesteads (umuzi) will greatly improve the quality of

life of the recipients in a number of ways.

1.4 The provision of stormwater services and the management of water catchments in this environment,

where storm rainfall can create dangerous conditions, contributes to the safety of the community by

preventing flooding, wash-aways and fatalities.

2. OTHER PARTIES INVOLVED

2.1 The construction work in addressing service delivery backlogs is performed largely by external

contractors, who are contracted to the municipality through the normal Supply Chain Management

channels.

2.2 Work on community facilities is typically triggered by community requests, preceded by community

consultations or, especially in stormwater work, is undertaken rapidly to address hazards and

emergency situations.

2.3 Work on human settlements and public transport is largely funded by, and undertaken in consultation

with, provincial and national departments.

3. OTHER IMPLICATIONS

3.1 Legal Implications

3.1.1 The upgrading of roads, provision of formal housing and incremental services, taxi ranks and storm

water services is undertaken in terms of various relevant legal frameworks.

3.2 Human Resource Implications

3.2.1 Management of the cluster operations uses existing staff resources. This report is a status and

information update. It does not propose any change to the Human Resource allocations of the Units.

3.4 Financial Implications

3.4.1 The work performed is undertaken using funds provided on the 3-year revenue and expenditure

framework.

2016/2017 oversight...the ethekwini municipality’s annual report for 2016/2017 was tabled at...

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