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OVERSIGHT REPORT ON THE ANNUAL REPORT 2013/14This Oversight Report is based on the Annual Report 2013/14 and is drafted and submitted in accordance with the Local Government: Municipal Finance Management Act (Act 56 of 2003).

HANTAM MUNICIPALITY

TABLE OF CONTENTS

Contents

1. INTRODUCTION AND BACKGROUND _________________________________________________________________1

2. LEGAL REQUIREMENTS_______________________________________________________________________________1

3. ADOPTION______________________________________________________________________________________________2

4. MUNICIPAL PUBLIC ACCOUNTS COMMITTEE (MPAC)_____________________________________________2

5. COMPONENTS OF THE ANNUAL REPORT____________________________________________________________2

6. PUBLIC CONSULTATION PROCESS__________________________________________________________________2-3

7. MINUTES OF THE MPAC MEETING_________________________________________________________________3-5

8. ANNUAL REPORT CHECKLIST 6-14

9. CONCLUSION 14

10. RECOMMENDED RESOLUTION FOR ADOPTION 14-15

11. ADDENDUM: RESERVATIONS TO THE ANNUAL REPORT 16-21

1

HANTAM MUNICIPALITY OVERSIGHT REPORT 2013/14

1. INTRODUCTION AND BACKGROUND

The Council of Hantam Municipality is vested with the responsibility to oversee the performance of the municipality, as required by the Constitution, the Municipal Finance Management Act (MFMA) and the Municipal Systems Act (MSA). The 1st Draft Annual Report 2013/14 was tabled in council with the Annual Financial Statements on August 2014 and the final draft on January 2015 as prescribed by Section 127 (2) of the Local Government: Municipal Finance Management Act (Act 56 of 2003).

The Oversight Report is the final major step in the annual reporting process of a municipality. The Draft 2013/14 Annual Report of Hantam Municipality was considered by Council and referred to the Municipal Public Accounts Committee for review and for the drafting of the Oversight Report. The Municipal Public Accounts Committee (MPAC) of Hantam Municipality fulfils the oversight role of council. The meeting of the Municipal Public Accounts Committee (MPAC) on the Annual Report of 2013/14 was held on 30TH March 2015.

2. LEGAL REQUIREMENTS

In terms of Section 129 of the MFMA, the council must adopt an Oversight Report containing the council’s comments on the Annual Report which must include a statement whether the council:-

(a) Has approved the annual report with or without reservations;(b) Has rejected the annual report; or(c) Has referred the annual report back for revision of those components that can be

revised.

In terms of the MFMA Circular Number 32, in order to approve the Annual Report without reservations, council should be able to agree that the information contained in the report is a fair and reasonable record of the performance of the municipality in the financial year reported upon.

Approved by Council 28/05/2015 by Council Resolution SR9/05-15


3. ADOPTION

The statutory authority to adopt an Oversight Report in respect of the Annual Report 2013/14 rest with the municipal council.

4. MUNICIPAL PUBLIC ACCOUNTS COMMITTEE (MPAC)

In terms of council resolution, a Municipal Public Accounts Committee (MPAC) was established in terms of Section 79 of the Structures Act, 1998. The Terms of Reference tasks the MPAC with the responsibility to perform an oversight role over the process of preparing the Annual Report of council and to produce an Oversight Report based on the Annual Report.

MPAC currently consists of the following members:-

1. Cllr J. Swarts (Chairperson)2. Cllr M. Esau (member)3. Cllr A. Claassen (member)

5. COMPONENTS OF THE ANNUAL REPORT

The format of the Annual Report 2013/14 is based on the annual report template issued by National Treasury in MFMA circular 63 of 2012. MFMA Circular 63 of 2012 comprises six (6) chapters and attempts to cover all the aspects that needs to be reported on as derived from the MFMA and the Local Government: Municipal Systems Act (Act 32 of 2000).

6. PUBLIC CONSULTATION PROCESS

The draft Annual Report 2013/14 was made public in the local newspaper. Members of the community and other stakeholders were invited to submit written comments/inputs. In addition the draft Annual Report 2013/14 was also made available at all municipal libraries and service points. The Annual Report 2013/14 was furthermore submitted in terms of Section 127(5)(b) to the Auditor General, Provincial Treasury and Coghsta



Provincial Office. In addition Provincial Treasury attended the MPAC meeting on the Annual Report that was held March 2015.

7. MINUTES OF THE MPAC MEETING 30 MARCH 2015

NOTULE VAN ‘N “MUNICIPAL PUBLIC ACCOUNTS COMMITTEE (MPAC) GEHOU OP MAANDAG 30 MAART 2015 IN DIE RAADSAAL, KOMMANDO KANTORE DORPSTRAAT CALVINIA OM 11:00

MPAC lede teenwoordig: Raadslid J. Swarts (Voorsitter)

Raadslid Adam J.E. Claasen

Raadslid Magaret S. Esau

Raadslid Hermina C. Steenkamp

Raadslid G. Opperman

In diens: Mnr N.I. van Stade (Munisipale Bestuurder)

Me. C.F. van Niekerk (Direkteur Korporatiewe Dienste)

Me. S. Coetzee (Direkteur Finansies)

Me. G.M.J. Lock (Sekretariaat)

Provinsiale Tesourie: Matlhogonolo Molaaphene

Reginald Alefeketo

1. OPENING EN VERWELKOMING/OPENING AND WELCOME



Raadslid M. Esau open die vergadering met gebed waarna die voorsitter Rdl. J. Swarts die verwelkom die lede, amptenare asook amptenare van Provinsiale Tesourie by die vergadering.

Die Voorsitter deel die vergadering mee dat dit die eerste vergadering hierdie kwartaal is. Probleme was ondervind om ‘n geskikte datum te kry. Daar word verder kennis geneem dat die Raad tentatiewe datums vir die hou van MPAC vergaderings goedgekeur het en dat daar gehou sal word by die vasgestelde datums.

2. VERSKONINGS/APOLOGIES Rdl. A.F. Fritz (Siek)

Mnr. J.H. Langner

3. BEKRAGTIGING VAN NOTULE

Daar word

BESLUIT

Dat die MPAC notule van 24 Julie 2014 bekragtig word.

Voorgestel: Rdl. A.J.E. Claasen Sekondant: Raadslid G. Opperman

4. OUDITVERSLAG/AUDIT REPORT

Me. S. Coetzee, Direkteur Finansies, hou die ouditverslag aan die vergadering/Provinsiale Tesourie voor.

Daar word

BESLUIT

Dat kennis geneem word van die ouditverslag asook van die voorlegging van die Direkteur Finansies oor die ouditverslag.

5. JAARVERSLAG/ANNUAL REPORT



Me. C.F. van Niekerk hou die Jaarverslag aan die komitee voor.

Daar word

BESLUIT

1. Dat die Jaarverslag deur die komitee goedgekeur word.2. Dat die aanbevelings/wysings/toevoegings soos uitgewys deur Provinsiale

Tesourie aangespreek word en by die volgende Raadsvergadering voorgelê word.

INSETTE DEUR PROVINSIALE TESOURIE/INPUTS – PROVINCIAL TREASURY

1. Dat die dokumente op die Munisipale Webblad geplaas word soos deur die Wet vereis.

2. Delegasies as werksdokument in plek moet kom. (Reeds deur die Raad goedgekeur).

3. Die Burgemeester en Munisipale Bestuurder se voorwoord reeds voorberei is en ingevoeg sal word.

4. Nodige aanpassings aangebring word in terme van Chapter 4 (15); Appendices G (28); J (31); Q (38); R (39) and T (41).



8. ANNUAL REPORT CHECKLIST

ANNUAL REPORT CHECKLIST

The oversight report is the final major step in the annual reporting process of a municipality. Section 129 of the MFMA requires the council to consider the annual report of the municipality and adopt an oversight report. The oversight report must include a statement whether the council:

Has approved the annual report, with or without reservations Has rejected the annual report Has referred the annual report back for revision of those components that can be

revised

No Question Yes No Comments1. Was the annual report

submitted to the Auditor-General, together with the annual financial statements by, the 31st August?

YesElectronically submitted and hard copy to National Treasury and COGHSTA on 2/09/2014Waybill Nr. F820508-8

CHAPTER 12. Does Chapter 1 of the

annual report include: The

Mayor's/Executive mayor's foreword,

The municipal manager's foreword,

Municipal overview?

No

No

Yes

Mayor’s and Municipal Managers overview not included.

Refer to pages 10-26


annual report include the Governance Structures, both Political and Administrative?

Yes Refer to pages 30-36



4. Does Chapter 2 of the annual report include details of Intergovernmental relations?


5. Does Chapter 2 on Governance in the annual report include details on all public accountability and public participation meetings and the IDP participation & alignment?

YesRefer to pages 39-41

6. Does Chapter 2 on Governance in the annual report address risk management issues?

Yes Refer to page 42 and 46

7. Does Chapter 2 of the annual report address anti-corruption and fraud?

YesAnti-corruption and fraud is being address partially through internal audit, the risk management policy, the audit committee and the MPAC committee. This is being addressed through follow-up audits and an audit action plan. Also through our disciplinary procedures. (page 42 & 46)

8. Does Chapter 2 on Governance in the annual report address supply chain management issues?

Yes Refer to Page 42-43

9, Does Chapter 2 on Governance in the annual report address By-laws?


10. Does Chapter 2 on Governance in the annual report address the website(s) where information is available?

Yes Refer to pages 45



11. Does Chapter 2 on Governance in the annual report share information on public satisfaction on municipal services?

Yes Refer to page 47-48

12. Does Chapter 2 in the annual report address the municipal oversight committees?

Yes Refer to page 33 , page 38 and page 40

CHAPTER 313. Does Chapter 3 in the

annual report demonstrate what service delivery has been achieved and what is outstanding?

Yes Being address in chapter 3 as a whole

14. In Chapter 3 of the annual report, are the service delivery issues structured, captured and reflected under each priority as contained in the IDP to allow for easy comparisons on achievements against budget and SDBIP?

YesBeing addressed in chapter 3 as a whole


annual report provide information pertaining to the implementation of an effective performance management system, organizational development and performance of the municipality?

YesThis is being addressed partially in chapter 3 pages 50 to 52 and in chapter 4 page 137

16. Does Chapter 4 of the annual report provide Yes,

This chapter includes Employment Equity, Occupational levels;



information on planning, service delivery, organization, job evaluation, remuneration, benefits, personnel expenditure, affirmative action, recruitment, promotions, termination of services, performance management, skills development, injury on duty, labor relations, leave and discharge due to ill-health?

Employee totals, turnover and vacancies; municipal workforce; policies ;injuries, sickness and suspensions, sick leave, disciplinary cases, performance rewards; skills development and training, Financial Competency development; Employee expenditure ; *job evaluation ; Expenditure – training.

17. Does Chapter 4 of the annual report provide information to identify skills gaps and plans for the development of such skills?

Yes Refer to pages 147 to149

CHAPTER 518. Has Chapter 5 of the

annual report on financial performance include information divided into the following framework:a) Statement of

financial performance

b) Spending against Capital budget

c) Cash flow management and investment

d) Other financial matters?

Yes

Refer to pages 152 - 172


annual report include the Auditor-General’s Report

Yes Refer to Addendum



as submitted by the Auditor-General?

20. Does Chapter 6 of the annual report include details on issues raised during the previous financial year by the Auditor-General?

Yes Refer to page 174

21. Does Chapter 6 of the annual report include remedial action taken to address issues raised during the previous financial year by the Auditor-General and preventative measures?

Yes Refer to page 174

APPENDICES22. Is an Appendix A on

Councilors; Committee allocation and council attendance included?

YesBeing incorporated in Chapter 2 page 32

23. Is an Appendix B on Committee and Committee purpose included, listing all committees of the council, the purpose of each committee and the names of councilors serving on them and the attendance of each councilor?

YesBeing included in Chapter 2 page 33 and 38.

24. Is an Appendix C include an organogram of the administrative structure?

Yes Being incorporated in Chapter 2 page 35-36 (drawing structure).

25. Is an Appendix D included on what constitutes a municipal function and the applicable functions of

Yes This is being included in Chapter 3 page 53 of the annual report.



the municipality?

26. Is an Appendix E on Ward reporting included with information on the functions of ward committees, the sector of community representation, reports submitted by each of these committees’ challenges experienced and measures taken to address them?

Yes This is being included in Chapter 2 page 40 of the annual report.

27. Is an Appendix F on Ward information included outlining the name/number of the ward, listing the seven largest projects in each ward with start & end dates, their total value, progress and information on the top four delivery priorities per ward?

No

28. Is an Appendix G included on recommendations of the audit committee, those adopted, those that were not adopted and the meetings held?

Yes Refer to report of the Audit Committee of which is included in the Annual Report.

29. Is an Appendix H included on information related to the largest projects, agreements and contracts and any Public, Private Partnerships?

Yes Refer to page 170 of Chapter 5



30. Is an Appendix I include service provider performance schedule from the top four priority indicators in the IDP?

YesRefer to page 128-130 strategic performance of service providers.

31. Is an Appendix J included with senior managers’ disclosures of financial interest?

No

32. Is an Appendix K included on Revenue collection by votes and by source based on prior year and current year actual collections?

Yes

33. Is an Appendix L included on Conditional Grants received (excluding MIG) received during the year indicating adjustments budget and the actual, showing percentage variances and any major conditions applied by donors on each grant?

YesIncluded in Chapter 5 page 158

34. Is an Appendix M included on capital expenditure:a) On new assets

programme, b) On upgrade/renewal

programmesShowing the actual of the prior year, the adjusted budget and actual expenditure in the current year?

Yes Refer to Chapter 5 pages 166

35. Is an Appendix N on all capital projects in the Yes



current financial year, indicating the adjusted budget, actual in the current year and the variance?

36. Is an Appendix O included on all capital projects per ward in the current financial year and if the work was completed or not?

Yes Refer to page 160 of Chapter 5

37. Is an Appendix P included on service connection backlogs at schools and clinics with their names and location?

N/A Not applicable to municipality

38. Is an Appendix Q included with all service backlogs experienced by the community where another sphere of government is responsible for providing the service?

N/A Not applicable to municipality

39. Is an Appendix R included listing all organisations or person in receipt of loans and grants; from the municipality stating the nature of the projects funded, conditions attached and the rand value?

No

40. Is an Appendix S included listing all monthly MFMA S71 budget statements not submitted in time?

N/A N/A

41. Is an Appendix T



included for powers and functions not covered in other sections of the annual report?

No Not applicable to functions of the municipality.

VOLUME 242. Have all components of

the audited financial statements, as signed by the auditor-General, been included in the annual report in Volume 2?

Yes Refer to addendum.

9. CONCLUSION

As Chairperson of the MPAC I would like to thank the MPAC Committee Members, The Mayor and Municipal Manager for their diligence and constructive commitment during the oversight period.

The MPAC is satisfied with the Annual Report 2013/14 and recommends that the Annual Report 2013/14 be adopted with the following reservations:-

1) The Mayor’s and Municipal Manager’s forward address.2) Completion of Annexures

10 RECOMMENDED RESOLUTION FOR ADOPTION 1) That Council fully considered the Oversight Report 2013/14 on the Annual

Report 2013/14 for adoption;2) That Council fully considered the Annual Report 2013/14 with reservations for

adoption;3) That the Oversight Report 2013/14 be made public in accordance with Section

129(3) of the MFMA;



4) That the Oversight Report on the Annual Report be submitted to the Provincial Legislature in accordance with Section 132(2) of the MFMA.

ADDENDUM: AMMENDMENTS TO THE ANNUAL REPORT

MAYOR’S FORWARD



Hantam Municipality delivers services that are essential for the welfare and development of its residents. During the year under review, the municipality manages to provide excellent basic services with the limited available financial and other resources. The municipality set a number of key priorities in terms of improving service delivery such as:-

The Refurbishment of Sewerage infrastructure;Calvinia Waste Water Treatment Works;Upgrading of roads;New Bulk water pipeline;Provides electricity to 207 RDP houses.

The focus on infrastructure upgrade will remain a focus point in the year ahead.Numerous special programmes were rolled out focussing on the youth, women and the elderly.We are proud to have obtained an unqualified audit report from the Auditor General for the first time in 4 years, whilst also spending 100% of our MIG. We remained steadfast in ensuring that everybody from the most vulnerable members of our society has, as far as possible, have access to the most basic services. We thus, managed by the manner in which we set our tariffs and the provision of free basic water and electricity services. During the year under review, the municipality also incurred some challenges. The outstanding debtor days are an indication that the municipality is not recouping their service fees quickly enough. This will be addressed in the next financial period. The Loeriesfontein water crisis also put an enormous strain on the financial resources of the municipality, since it was not budgeted for.The administrative and political stability in the municipality allows for effective planning, administrative efficiency and overall effective service delivery.



As Mayor I am aware of the responsibilities bestowed on the Council to bring about fundamental changes to the people in our municipal area.Finally, I would like to express my sincere gratitude to all councillors, officials, the community of Hantam Municipality and stakeholders for their dedication, support and co-operation, which enabled the institution to record service delivery progress during the year under review.

_______________________A.F. FRITZMAYOR

COMPONENT B: EXECUTIVE SUMMARY

MUNICIPAL MANAGER’S OVERVIEW

MUNICIPAL MANAGER’S OVERVIEWThe financial year under review was quite challenging for a number of reasons.

In the 2013/2014 financial year the municipality obtained an unqualified audit report from the Auditor General for the first time in 4 years. This shows how much work have been poured into the administration by the municipality to get the correct controls in place, put the correct processes in place during the year and constantly focus on doing things according to legislation.

Hantam Municipality has sound financial affairs and this can be attributed to the fact that municipal accounts are paid in a satisfactory manner and that defined fiscal policies are in place. We are cognizant of the fact that given the current reality around poverty in our municipal area, that we



have utilized the indigent grant in a sustainable manner for those who qualified for the grants.

We spent 88% of our capital budget of which 100% was spent on the Municipal Infrastructure Grant (MIG). The upgrading of our infrastructure and the maintenance of our roads will remain a focus point in the year ahead.Empowering our workforce remains a key focus area and therefore training opportunities was rolled out.

Among our achievements were several large scale projects for the provision of water, electricity, sanitation and housing as well as smaller achievements that ultimately improved the lives of local communities.

This year the Hantam Municipality performed remarkably well by achieving good scores in its green and blue drop statuses. This demonstrates that the municipality’s ability to implement and maintain excellent service level standards to the benefit of its community. Electricity losses decrease with 1,5% as opposed to the previous year.

One of the biggest challenges facing our municipality is the water crisis in Loeriesfontein which puts tremendous strain on our finance. The funding from the Provincial Government for the services of the 260 plots is still awaiting. This put a strain on the housing backlog in Calvinia.The post of the Head: Corporate services was filled in March 2014 and the post of Head Technical Services remain vacant due to the municipality not finding a suitable candidate.

I wish to express my sincere appreciation to all residents and staff members who contributed to our successes during the year.______________________N.I. VAN STADEMUNCIPAL MANAGERReservations on the Annual ReportAppendix G

Recommendations of the Municipal Audit Committee 2013/14



Municipal Audit Committee RecommendationsDate of Committee Recommendations Recommendations

adopted/not adopted15/08/2013 The audit committee concurs with and accept the

Auditor-General of South Africa’s report and are of the opinion that the audited annual financial statements should be accepted and read together with the report of the AG of South Africa.

Yes, adopted.

Appendix Q

Service Backlogs experienced by the Community where another sphere of government is responsible for service provision

Services and Locations

Scale of backlog Impact of backlog

Clinics Not a municipal function Not a municipal functionHousing 1192 Increase in housing backlog and

housing needs.Licencing and Testing Centre

0 Lost in revenue. To take more licencing and testing applications to enhance revenue.

Reservoirs 3 (Loeriesfontein; Brandvlei and Middelpos)

Insufficient funds. Water crisis in Loeriesfontein

Schools Not a municipal function Not a municipal functionSports Fields 3 (Loeriesfontein;Brandvlei and

Middelpos)Insufficient funds to upgrade sportfields.

Appendix R

Declaration of Loan and Grants made by the Municipality.

No Loans and Grants made by the Municipality.

Appendix TPresidential outcome for Local Government

Outcome/Output Progress to date Number/percentage Achieved



Output: Improving access to basic services

Water, sanitation and waste removal is delivered 100%. The bucket system has been eradicated.

100%

Output: Implementation of the Community Work Programme

EPWP programme delivered and expenditure on programme 100%

100% spent.

Output: Deepen democracy through a refined Ward Committee model.

5 wards of which 3 is dysfunctional and must be re-elected. This is being set for September 2014.

40% (2)

Output: Administrative and financial capability.

In terms of the outcomes of the AG the municipality received an unqualified audit report.

Move from qualified to unqualified audit.



Contact Information

Hantam Municipality

Hoopstreet Calvinia

Tel 0273418500

Fax 0273418501

www.hantam.gov,za


Documents

oversight report on the annual report · Web viewProbleme was ondervind om ‘n geskikte datum te kry. Daar word verder kennis geneem dat die Raad tentatiewe datums vir die hou van