1. The Impact of Leadership Changes on the Municipal Governance Process CIGFARO AUDIT AND RISK INDABA 21 June 2017

2. TABLE OF CONTENT
SALGA MANDATE
KEY CONSIDERATIONS
MFMA DEADLINES
MSCOA IMPLEMENTATIONS
POSSIBLE SERVICE DELIVERY CHALLENGES
CONCLUSIONS

3. SALGA MANDATE

4. SALGA MANDATE cont.

5. KEY CONSIDERATIONS
3rd August elections ushered in a number of personnel changes in municipalities – both administrative and political
New vs returning councillors
SALGA immediate intervention with generic and portfolio induction
Close knowledge and capacity gaps
Speedy settling in and to hit the ground running – no operational gaps
New term, new challenges – service delivery protest, audit outcomes, viability, financial health
Targets for the current administration

6. KEY CONSIDERATIONS SALGA conference in Nov/Dec 2016
New leadership and new strategy/resolutions
Escalation of focus on key issues – debt, equitable share allocations, audit outcomes, delivery performance, IGR
SALGA Centre for Leadership
New cadreship to deal with new and old challenges
Focus on oversight, institutional viability/functionality, consequence management, leadership and governance
Institutional viability focus
Not dependent on personalities
Sort capacity issues earlier at recruitment level
Review unintended consequences of the remuneration framework
Build sector stability – coordinated support and interventions by all stakeholders

7. S57/56 managers Contract expiring VS MFMA requirements
MFMA DEADLINES
S57/56 managers Contract expiring VS MFMA requirements
Municipal Audit Readiness and year End Planning
key Stakeholders in the Combined assurance/ first line of defence
Audit Strategy; Municipal Leadership has a serious role to play in the audit engagement process
Most of which are risk owners and have a great understanding of the processes that unfolded in the entire year.
Audit Outcomes regression, Management attention
Some control measures could be impacted negatively, i.e. delegations

8. MSCOA IMPLEMENTATIONS
Municipal Councillors and Administration must go back and ask the difficult questions about the readiness in their municipalities; is the mSCOA project status on track and in line with National Treasury requirements?
Before mSCOA is planned, the municipality MUST Declare the mSCOA as a project
No extension and no exemption 01 July 2017 remains the deadline;
Administrative instability on its own is a risk

9. MSCOA IMPLEMENTATIONS
Audit General has picked few risks from the mSCOA; one of which is data migration and integrity;
The biggest challenges is when the leadership change happens in the mSCOA Implementation year; just after the LGE we had post demarcation issues to deal with
Possible Audit Regression in 2017/2018 Audits if mSCOA not managed well as a total business process change

10. POSSIBLE SERVICE DELIVERY CHALLENGES
Risk on service delivery disruptions
New leadership shifting focus and priorities
Providing sustainable quality services to the communities (principals)
Impact on SCM Processes; most of the Senior Managers are serving at SCM Bid Committees; this can cause possible delays
Possibility of DORA s18 and s19, due to poor spending on conditional grants or not meet the conditionalities in line with those Grants
Renewal versus new appointment of s57/56 Managers

11. CONCLUSIONS SALGA supports good change
Employing new managers should create challenges, but SALGA calls for an due diligence process to take place, where managers are performing, and achieving why not considering renewing the contract of those particular managers.
The Local Government sector will need to deal with the mSCOA post implementation challenges i.e. otherwise municipality might face regression in Audit Outcome due to non-compliance with mSCOA
SALGA NEC is taken stock of all legislative requirement and will present to parliament on the current challenges; and its impact on municipal service delivery.

12. THANK YOU Office Number: 031 817 000 Website: www.salga.org.za