Council tensions threaten turnaround

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Makana insiders have expressed concern that “strong” political interference could scupper acting municipal manager Ted Pillay’s efforts at getting the municipality into shape, with control over funding key to escalating conflict. Meanwhile, public service watchdog PSAM’s warning that accountability and the community are the casualties of deepening divisions within the ANC caucus is backed up by staff at the municipality, who say tensions between top-level administration and the politicians is making it hard to get things done.

Pillay hit the ground running when he arrived at Makana Municipality on 1 February, engaging immediately with businesspeople, activists, politicians and residents to identify priorities and act on the concerns of a disillusioned community. Pillay is the Municipal Manager of the District Municipality and it’s partly for this reason he’s been able to expedite a number of essential, quick-win projects.

Councillors across party divides saw Pillay’s deployment as positive and pledged their support. Speaker Yandiswa Vara in a Council meeting soon after Pillay’s arrival spoke enthusiastically of a new mood that had swept through the municipality – “a breath of fresh air” – as staff began to arrive at work on time and did what they were supposed to.

“You longer find staff loitering at the back of Shoprite during working hours,” Vara said during her opening address at a Council meeting not long after Pillay’s arrival.

The honeymoon was short lived. Signs of disharmony have grown over the past month, and with the 2019 national elections in sight, the gloves were off in Makana’s Council Chamber on 30 May.

The Special Council Meeting was to table the final draft Budget and IDP. Among that set of documents, Pillay submitted several reports that drew sharp criticism from some councillors.

These included the news that Makana had lost R4.5 million of its Municipal Infrastructure Grant (MIG) because of non-spending.

The tender for the Alicedale Roads and Stormwater Project awarded at the end of the 2016/17 financial year was put on hold because of concerns about possible irregularities in the supply chain management processes. Pillay’s report said the non-spending had resulted in R4.5m being deducted from the March 2018 Equitable Share allocation to SBDM.

Local government is entitled to an equitable share of revenue raised nationally to enable it to provide basic services and perform the functions allocated to it In terms of Section 227 of the Constitution. The size of local government’s share of the national revenue is decided through the national budget process. The District Municipality (Sarah Baartman) is the caretaker recipient of Makana’s equitable share.

“This money [the R4.5m shortfall]has to be recovered by SBDM from the MIG funds currently held by them on behalf of Makana Municipality,” Pillay wrote.

Mayor Nomhle Gaga was outraged: “If I was given the opportunity to represent the municipality, this money would not have been taken. The District disserviced us. They didn’t represent us as Makana,” Gaga said.

Poor performer

Dirty linen was aired and tensions flared with discussion of another project, the Alicedale Sewerage Upgrade, which is now finally under way.

In February Pillay reversed a tender for this project. It had been signed shortly before his arrival in favour of a contractor with a poor performance record – the same contractor who failed to complete the Alicedale Roads and Stormwater project in time.

Item S6.3 of the agenda for 30 May’s Special Council Meeting is titled ‘Appointment of WK Construction for the Alicedale Sewerage Upgrade Project’. In it, Pillay alerts Council that the cost of the contract would be more than originally budgeted for. It explains in detail the circumstances and events that led to the contract being withheld from the poorly performing cheaper bidder (R16.2m) and awarded instead to WK Construction (R20.4m).

Problems with the cheaper bidder were a combination of non-compliance to supply chain management (SCM) requirements and high risk (they had performed poorly on Phase 1 of the Alicedale Road and Stormwater project).

In the report, Pillay gives a blow by blow account of a protracted struggle over the multimillion-rand tender. It plays out against the background of pressure of SCM deadlines and requirements, and urgency  to spend MIG funding. Unspent Municipal Infrastructure Grant (MIG) funding reverts to National Treasury unless a rollover is approved, and repeated underexpenditure can results in Cogta withholding MIG funds.

CLICK HERE TO READ: ‘ANATOMY OF A TENDER’ 

Chief Whip Mabhuti Matyumza weighed in on the item, calling for an internal investigation.

“I am not questioning the appointment,” he emphasised. “If the [Municipal Finance Management Act] allows, then the acting MM [i.e. Pillay] as the Accounting Officer has the right to take decisions, even allowing an R8 million difference.

“I’m not an auditor, but I can tell you that this is going to be a disclaimer item. Not only that, but we are already struggling financially as an institution and this decision disadvantages other projects.”

Referring to the 4.5m lost because of non-spending, Matyumza said, “This demands a detailed report on why we lost that money: there must be consequences for those who put us in this mess.”

Of the Sarah Baartman District Municipality recouping the R4.5m Makana had lost from money they held on behalf of the local municipality, Matyumza said, “For them to take this money from our already budgeted MIG is suicide for us. We must engage the Sarah Baartman accounting officer, who also happens to be the District MM, on this.”

Minutes later, the knives were out.

“Treasury made a decision that Sarah Baartman must assist the municipality – but the District remained a banner, not an implementer,” Matyumza said. “They must not take this money now because the project [Alicedale Roads and Stormwater]  is commencing.”

Minister of Co-operative Governance and Traditional Affairs Dr Zweli Mkhize with Makana Local Municipality’s Executive Mayor Nomhle Gaga on Friday 4 May 2018 at the Monument. Photo: Sue Maclennan

Zweli Mkhize and the R10m roads upgrade

By the time the meeting reached item SC6.9, no one could have doubted what the top three politicians in Council intended to convey about Pillay. It was this item that particularly drew the fury of the third member of the Troika, Speaker Yandiswa Vara.

In it, Pillay details a quick-win R10 million project to repair roads in the Grahamstown CBD ahead of the National Arts Festival.

Cogta Minister Zweli Mkhize greets National Arts Festival CEO Tony Lankester ahead of the 4 May 2018 stakeholder engagement.

He’d met with Cogta officials during Minister Zweli Mkhize’s visit to Grahamstown on 4 May and fast-tracked the process of appointing a consultant at a cost of R1 million, while the Municipal Infrastructure Support Agency (MISA) was to manage the engineering and logistics. The funding was from Cogta and followed a series of stakeholder meetings during which Mkhize heard the concerns of business, education institutions and the National Arts Festival about the difficulty of operating in a city with collapsing infrastructure.

The report to Council was to recommend the condonement of the R1m consultant fee.

CLICK HERE TO READ: THE R10m ROADS UPGRADE PROJECT

The Troika couldn’t contain themselves.

“That business plan was developed last year with MISA,” Gaga said. “This is all part of the master plan. What is new is that the work must be done quickly.”

Of the R1m consultant, Gaga said, “We can’t condone something we don’t know.”

Matyumza said, “The word ‘condone’ is an indication that something was done wrong. We can’t agree to this appointment of a consultant. Did we need a consultant on a R10m project? I don’t think so.”

Speaker Yandiswa Vara, livid, held her fury to the very end of the meeting, using her Speaker’s privilege to conclude the meeting with a barb clearly aimed at Pillay.

“Let me make this very clear. The support we are getting as Makana is based on what we submitted as Makana,” Vara said. “That is the message I want to go out to the community.  I don’t want people claiming victories that are not theirs.”

Makana Council Speaker Yandiswa Vara (red scarf) stands ready to receive a petition from taxi owners outside the city hall on 24 April 2018. She is flanked by Corporate Services Director Nomathandazo Mazwai and Acting MM Ted Pillay. The ANC caucus top three (Vara, Mayor Nomhle Gaga and Chief Whip Mabhuti Matyumza) have been gloves-off with Pillay in Council. Photo: Sue Maclennan

Political interference: communities the casualty

The Public Service Accountability Monitor’s (PSAM’s) warning that deepening factionalism is hampering service delivery to communities is backed up by Makana insiders, who say tensions between the administration and the politicians, particularly at the top level, is making it hard to get things done.

“The ANC caucus is divided – it’s not coherent. Not only that, but there are tensions between the MM, the Mayor and the Speaker. There is no working relationship,” said a Makana staff member who spoke on condition of anonymity.

The staff member said conflicting instructions were often received, with each party insisting theirs was the final word.

“It’s very obvious that the Speaker doesn’t want Pillay there,” said the staff member. “Even though she herself used to be a councillor in Sarah Baartman.

“There is very strong political interference in Ted’s work at the level of both the region and the province by a particular faction. All political appointments, as well as all tender decisions, are done through the ANC’s Regional office. The Region is calling the shots. They have political control.”

Not the Messiah

Another source said, “The mantra is things went wrong because we had no permanent municipal manager – but if a new MM walked in tomorrow, they would not be The Messiah. They would still require political support.”

 

The Council insider, who has extensive political and administrative experience, said, “The reason the Council agreed to bring Pillay here was for him to assist them to get money for the Council.”

“The Troika is under pressure,” the insider said. “Politically things need to be seen happening and securing funding is one way the Troika can be seen to be helping the community. Going into the elections, the community wants to see things done.

“Pillay is getting things done and sometimes this means taking shortcuts,” the source said.

“For example, with the water, long ago people knew about the problem with water in Makana. But nothing positive was ever done about it until there was this problem [the high e.coli levels in the municipal water as a result of incorrect chemicals] and Pillay acted on it.”

In the absence of active problem-solving, the source suggested, funding was core.

“It’s the one thing that can show the community the political leadership are doing something.”

There were lots of things not addressed by the municipality, the source said. “Housing in Mayfield tops the list.

“But there are many issues where they’ve papered over the cracks, in a way that has hampered service delivery.”

Not unique to Makana

Public Service Accountability Monitor Director Jay Kruuse says said the casualties of intra party divisions were accountability, and the community.

“Deepening factionalism within the ANC dominated Makana municipal council is symptomatic of widespread failed oversight by councillors who have repeatedly shown blind loyalty to party bosses, and their political survival at the cost of real accountability and the communities that they should serve,” Kruuse said.

This phenomenon was not unique to Makana, though.

“It often evidences in municipalities plagued with mismanagement and allegations that have not been properly investigated and which should ordinarily result in implicated parties being held to account,” Kruuse said.

“In such cases, one would expect provincial government to intervene and take corrective action as required by the Constitution; however, given the extent of factionalism at provincial level as well, this is rarely achieved.”

Kruuse said with opposition parties gaining ground in the most recent local government elections, the ANC was increasingly reluctant to dissolve councils for fear that it could lose more electoral support.

“In this climate, we need more active citizenry to hold public servants and politicians accountable for their responsibilities,” Kruuse said.

Members of the Unemployed People’s Movement lead residents in a protest from Fingo Square to the City Hall, where they handed over a memorandum of demands to acting municipal manager Nomthandazo Mazwai on Thursday 16 November. Photos: Sue Maclennan

 

Acting municipal manager Ted Pillay walks with UPM members to the Masifunde building in Bathurst Street to hear their concerns about employment on the Beaufort Street road repair project. File photo: Sue Maclennan

The trouble with Ted Pillay…

Approachable, efficient and a good listener, the acting municipal manager has engaged with a broad range of community members. That’s the trouble… 

A third inside source was asked if there was a double motive for bringing Pillay to Makana, when there had been a call for a turnaround specialist and under threat of administration. The source said, “The reason the Council agreed to bring him here, among others, was for him to assist them to get money for the Council. That’s why Council agreed to a three-month extension of his term.”

The approach of “presenting yourself to the public as if you are running the municipality alone, because you are the Acting MM”, the insider claimed, was a large part of the councillors’ grudge with Pillay.

In addition, “Makana is not getting the money.”

Rubbing salt in the wound for senior leadership is the perception among the public that Pillay is approachable and engaged.

“Makana has been closed to the public,” said the source. “Pillay opened that door and the politicians are not happy. It’s their job to engage with the community.”

Whereas the public, several councillors and a significant proportion of staff are happy, says the source, some councillors and senior management feel left out of the loop.

“Pillay is conducting all kinds of side meetings. Councillors are not happy that he is willing to engage with some local stakeholders whom they refuse to engage with. They resent that he is making promises in those meetings.”

Pillay’s access to purse strings and national government meant he was able to take shortcuts and execute quick wins.

“The danger with his approach is that he makes a lot of promises to the public before consulting his staff for support,” the source said. “This becomes problematic because a municipality cannot be run by one man: it requires administrative, political, and community support.”

The source said this resentment had resulted in political support for Pillay’s actions being withdrawn by one faction of the ANC caucus – and this was what was playing out in the 30 May meeting.

Makana’s institutional organogram (as set out in the Project Management Unit business plan) is as follows:

According to this representation, Pillay as acting MM accounts to Council. via the Mayor and the Speaker.

Pillay has undertaken to get the city back on track, with service delivery and systems his two main focus points. But his bosses in Makana maintain that his chief mandate is to facilitate the appointment of the new Municipal Manager. The process was delayed for two years after former councillor Paul Notyawa took his claim to the post to the courts.

Support

But, says the second insider, it’s not a given that a new municipal manager will be have any more support than Pillay is getting.

“If the politicians don’t like the new MM they are going to do the same thing [that they are doing to Pillay],” the source said.

“They will block him because they feel he claims all the victories.”

Grocott’s Mail asked the third insider to comment on the criticism by some that, in engaging with the public to the extent that he does, Pillay is acting like a politician.

The source said, “The MEC for Cogta allowed Pillay to come and rescue Makana: that alone is political. It means he has the upper hand when it comes to communicating with the ANC’s Provincial leadership and that will not go down well with the Troika: if Pillay can communicate with the PEC, he can air Makana’s dirty linen to them.

“For example, the Alicedale issue: That was not handled well and the Troika knows it.”

Pillay was a politician in the sense that he was politically deployed here, the source said. “The ANC is not happy with what’s happening in this municipality.”

The source supported the view that the appointment of a permanent municipal manager was not necessarily going to wash away Makana’s troubles.

“The mantra is things went wrong because we had no permanent municipal manager – but if a new MM walked in tomorrow, they would not be The Messiah. They would still require political support,” said the source.

Mayor Nomhle Gaga inspects the freedom of the City parade in Grahamstown recently, accompanied by Ted Pillay, members of 6SAI and GOC of the South African Infantry Formation, General Rudzani Maphwanya. Photo: Steven Lang

How did Ted Pillay get here?

Pressure to deliver on services, the ever-present threat of administration, divisions in Makana’s ANC caucus, the fact that Makana has lost direct control of some of its biggest annual grant funding, along with alleged political interference are some of the reasons for open conflict during recent Council meetings, say insiders.

The results are destructive, with one casualty being the support all parties pledged for acting municipal manager Ted Pillay when he was appointed earlier this year to put the embattled local administration back on track.

As Makana plunged toward complete financial and administrative collapse at the end of 2017, Cogta MEC Fikile Xasa sent formal notice of his intention to put Makana under administration under Section 139(1)a. Xasa cited Makana’s failure to appoint a municipal manager (Systems Act 54A(1)) and its failure to manage its debt (“Non compliance with Section 65(2)e of the Municipal Finance Management Act in relation to expenditure management”).

According to Council documents, on 22 November Makana owed just under R68 million, with the biggest amounts owed to Eskom, Amatola Water, the Department of Water and Sanitation and the Auditor General. Over several months, starting in July, an alliance of civic organisations under the banner of the Concerned Citizens Committee to Save Makana (CCCSM) first called for Makana to be put under full administration (Section 139 (5) https://grahamstownresidentsassociation.co.za/wp-content/uploads/2016/04/CCCSM-Press-Release-080817.pdf, then suspended the call on the basis of the promise of a turnaround specialist for Makana.

In a surprise move in the last Council meeting of the year, Chief Whip Mabhuti Matyumza announced the plan to call the Sarah Baartman District Municipality (SBDM) to deploy their Municipal Manager Ted Pillay to Makana for three months in an acting MM role. With a reputation for efficiency and action, there was support across party divides for his proposed appointment. The District Municipality frequently achieves clean audits (consecutive unqualified audit opinions 2006/7-2010/11 and again 2014/15-2015/16. The others have been Financially Unqualified).

It also took the carpet from under the CCCSM’s feet.

The moves took place in the wake of the disrupted ‘Festival of Chairs’ July elective conference in which the ANC in the Eastern Cape elected Oscar Mabuyane to replace Premier Phumulo Masualle as provincial chair. Fallout continued as Masualle failed in his court bid to have the outcome  overturned.

Deep divisions between the two factions continued through to the December elective conference that saw Cyril Ramaphosa replace Jacob Zuma as ANC President. It is these divisions, insiders say, that are playing out in the Makana Council.

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