1 Welcome… Finance Week 2013 Day 1 Recap

2 Objectives Platform for municipalities to recognize best performing municipalities Forum for municipalities to engage with one another on best practices and challenges Considerations of the 2011/12 audit outcomes Sharing of best practice on capital expenditure and forward planning Exploring various options to reduce the costs of water losses

Premier Speech The governance system in local governance has recently been enhanced by the introduction of the Municipal Public Accounts Committees which must analyze problem areas within municipalities, and propose corrective action and changes where required in relation to the use of finances in municipalities. The existence of MPACs in municipalities and their functions should not be understood as witch hunt machinery aimed at ridiculing everyone who appears before it, but rather as an important wing of Council to achieve the objectives of the whole municipality and that councilors continue to carry the aspirations of the communities they lead through effective oversight. There should be severe consequences for poor performance at all levels No tolerance for under expenditure of budget Promotion of good governance 3

MEC Recommendation Strengthen support needed by the residents accountants when performing their functions. Institutionalize PMS and ensure that all section 56 managers prioritise clean audit as part of their performance plan. Implement forward in all municipalities 4

Key controls

Audit Best Practice Presentation of credibility of information Watertight & sustainable internal controls Improvements in reporting Lobby for development of database of municipal employees Availability of key staff during audit, specifically CFO / acting CFO who is first line of communication Oversight responsibilities All parties should be knowledgeable on current changes to legislation, guidelines, circulars, AG requirements, internal municipal policies, 6

Revenue Enhancement Noting commitments of capacity building offer Current consumer debt stands at R3,3 billion Key areas to focus to improve revenue: Meter Services Customer Care Management Call Center Management Data Cleansing Communication 7

Municipal Support Political Leadership Administrative Leadership The right skills in the right place Municipal High Level Advisory Body Effective provincial monitoring Sharing of results of provincial monitoring and continuous engagement with municipalities Institutionalising provincial support and being relevant to municipal needs Accountability and the right Attitude Collaborative and holistic approach Database of scarce skills, i.e. Finance and Engineering Good Relations and trust amongst provincial and municipal officials Complementing and supplementing municipal gaps Reducing dependency on consultants and effective management of service providers 8

Water Losses The senior management or policy makers must demonstrate a commitment to reducing distribution losses by: Making the reduction of water loss a stated priority Fixing targets and a timescale for achieving them Develop a water loss reduction strategy 9