Pretoria - Pay us our money! That is what the City of Tshwane is demanding from the Department of Co-operative Governance and Traditional Affairs for R1 billion it incurred in 2011 when failing municipalities to the east of the city were disestablished and incorporated into Tshwane.
If avenues such as mediation fail, the city is willing to go to court to recoup the money, mayoral spokesman Blessing Manale said.
Through the May 2011 local government election, the Metsweding region - that included several small municipalities of Kungwini (Bronkhorstspruit and Ekangala) and Nokeng Tsa Taemane (Cullinan and Rayton) - ceased to exist and was incorporated into the new greater Tshwane metro.
Manale said the city had noted the inability of the inter-governmental relations framework and convention to resolve the issue of compensation for the merger, and was contemplating turning to the courts to force the department, both at provincial and national level, to compensate the city.
It would be a ground-breaking case as it would test the notion that “funds must follow function”. This general principle applies to funding through national budget hearings or when provinces and national government pass laws, regulations or take executive decisions which have financial implications on another tier of government.
While papers are yet to be served, Manale said the council’s legal team was being briefed to prepare for a mediated process or, at worst, such a legal option.
“In the light of the announcement of the Minister of Finance that a fund will be established to address the impact of mergers, a window of opportunity exists for the city to be included in such a dispensation to avoid a legal confrontation.”
“The merger brought more financial responsibility for Tshwane, which was starting to recover from a 2009 cash crunch by cutting discretionary expenditure and improving revenue collection,” he explained.
During Tshwane’s August 2013 monthly council meeting, executive mayor Kgosientso Ramokgopa tabled a report on the R1bn cost of the merger and indicated the city had never been refunded by national or provincial fiscus.
Manale said Tshwane was reiterating its stance that a special restructuring grant from the Treasury was needed to ensure the merger did not result in a financial burden on the city. ANC councillors in Metsweding and Kungwini voted against amalgamation with Tshwane and there was evidence of grumbling in communities and protests against the plan at the time.
The 2013 report reflected that Tshwane had challenges reconciling records from the different municipalities and that they did not have complete records of revenue billed and collected. The merger also resulted in an increase in the salary bill of staff previously employed by the municipalities, adding to the financial burden.
At least 27 informal settlements were added to Tshwane’s 33, which the city now has to develop. However, there are other benefits for the residents, such as the capital budget of around R300 million, a big increase from the less than R60m they were spending. Services such as metro police now contribute to road policing, crime prevention and bylaw enforcement in the old municipal areas, which now also have access to better fire brigade services.
Pretoria News