Presentation to President Thabo MbekiWestern Cape Provincial Imbizo 2007

Helen ZilleExecutive Mayor of Cape Town

22 July 2007

Contents1 Background

2 Local Government Responsibilities

3 Organisational Stability

4 Performance Review – Management Efficiency

5 IDP – Infrastructure Led Economic Growth

6 Local Economic Development

7 Housing and Basic Services

8 Key Programmes and Projects

9 2010 Soccer World Cup

10 Good Governance

11 Blockages

12 Conclusion

Background and context of this report

December 2005 Municipal Imbizo

1 March 2006 New Multi-Party Coalition Government

March 2006 to Present Internal Focus on Organisational Stability

IDP Focus on Infrastructure Led Economic Growth

July 2007 Provincial Imbizo

Local Government’s Core Mandate

Local Government Responsibilities

National Province

Local

Constitution

The core functions that Local Government must perform are set out in the following documents:

Chapter 7, ss156 of the Constitution - Powers and Functions of Municipalities

Part B of Schedules 4 and 5 of the Constitution

Local Government Legislation IGR Framework Act

Local Government is also guided by:

White Papers Programmes of Action

1 March 2006New Government Elected

Initial Focus on Organisational StabilityLegacy of 7 municipalities not properly realigned into 1 following formation of Unicity in 2000

City initiated Organisational Realignment Project Executive Management Team aligned with Mayco portfolio structure Placement of 21 500 employees into 1 realigned organisational structure

with basic parity based on benchmark grades, salary scale & conditions of service

Reversing exodus of skills by proactively filling critical vacancies – So far 1800 new appointments made, 1200 to follow in year ahead

Focus for next 3 years to become internally efficient, to improve service delivery and to streamline

transactions with customers (businesses and general public)

Performance Review

Performance Review - OverviewImproved Balance Sheet Recent Credit Rating upgrade: from A+long term / A1 short term to AA-

long term / A1+ short term – the highest in South Africa next to Ekurhuleni

Extensive debt management campaign has reduced outstanding debt owed to the City by R417 million

Improved Operational Management

Improved capital expenditure in 2006/07 highest so far in Unicity ( 77%)

2010 stadium will be substantially complete by end of 2009

Procurement time reduced from 14 weeks to 8 weeks

Improved Services to the Poor

Establishment of Indigent Register (budget for free basic services over R400million)

100% rebates on rates to those registered as indigent and over 100,000 properties valued under R88,000.

R1,5 billion debt written off, mostly to the poor

Improved Perception Rating for Cape Town

Rated No. 1 Long-Haul Conference Destination in UK’s Meetings, Incentives, Conferences and Events international survey

Rated No. 1 City in Middle East/Africa Region and No.10 globally by US Travel & Leisure Magazine

IDP focus: Infrastructure Led Economic Growth

Core objective is to increase public investment in municipal infrastructure and services to lead economic growth and job creation

City implemented above-inflation increase in rates and service charges for new infrastructure and to address service delivery backlogs, especially in sewerage, electricity and transport infrastructure

Sustained under-investment in key infrastructure needs to be corrected

Capital budget therefore increased from R2.5bn (2006/2007) to R4bn (2007/2008)

Operating Budget increased to ensure City has capacity to spend capital budget (especially to fund maintenance and filling of critical vacancies)

Local Economic Development

Improve access to ICT by establishing Municipal Broadband Network (R400m business plan currently under discussion)

Already established 4 Digital Business Centres to extend small business access to IT and Web (Mitchells Plain, Khayelitsha, Gugulethu and Langa)

Improve SMME access to finance through Business Place; joint public/private sector initiative (including Investec, Umsobomvu Youth Fund) with R2,1m loan funding granted in last 12 months

Continued focus on internal efficiency, reducing transaction turnaround time and reducing red tape (guided by WESGRO’s investment constraints review)

Build partnerships in Tourism to create labour intensive economic opportunities

Housing and Basic ServicesHousing backlog in city: housing database currently contains around 400 000 applicants

With limited resources in context of massive scale of need, our focus is on provision of basic services and an incremental approach to housing provision

City accelerated provision of housing opportunities –2003/04 - 1 808 housing opportunities2004/05 - 3 469 housing opportunities2005/06 - 4 585 housing opportunities2006/07 - 7 530 housing opportunities

Informal Settlements Master Plan sets out framework for provision of services & upgrading of all 226 informal settlements around City. Completion of phase 1(essential services) within 2 years.

Rate of housing delivery constrained by: Land shortage for housing: 8,750 hectares required Delays in Housing Accreditation for Cape Town EIA, TIA and other legislative processes – It currently takes between 18 to 24 months to release

land before a housing project can start

Key Programmes & Projects

Presidential Urban Renewal Programme:

- Continued progress on key anchor projects as well as the eight projects being implemented as part of Project Consolidate

- Funding issues with regard to certain projects (e.g. Budgeted funds late or not yet available for Lentegeur Public Transport Interchange & Station Upgrade)

Expanded Public Works Programme (EPWP):

- Well established and mainstreamed, 10 817 jobs created to date- City’s draft policy to guide employment of people from community within EPWP presently

being debated in Committee system of Council - policy became necessary to counter irregularities arising from patronage in selection of workers

2010 Soccer World Cup

2010 stadium will be substantially complete by end of 2009

Critical risk: exposure to excessive price increases from construction industry with serious

capacity problems demanding timelines are being closely managed

2010 Joint Host City Transport Plan in being implemented

As part of World Cup: Green Point common area is being redeveloped into consolidated sports precinct

& urban park 23 public viewing spaces being established (one in each sub-council)

Good GovernanceProvincial Imbizo & IDP Workshops: Various Provincial Imbizo & IDP Public-, Sub-Council- & Ward workshops held for public to identify their local & metropolitan priorities

- Problem: Need for better coordination between City and Province as times/programmes of the Provincial Imbizo process clashed with City’s IDP public participation

Ward Forums: City is implementing ward forums to facilitate participation by local communities. In this regard, the City is exercising its discretion as granted by Section 72 of the Municipal Structures Act

Strengthening of Institutions: CTRU, Wesgro and other agencies to improve governance. Performance review of CTRU showed failure to meet required standards. Engagement between City and CTRU is ongoing.

Critical Challenges

Blockages Housing - biggest constraint is access to well-located land for incremental housing development – will be facilitated by:

Making available state-owned land for affordable housing (e.g. Culemborg, Youngsfield, Ysterplaat)

Provision of funding by Dept of Land Affairs will assist acquisition of land for housing. City has not had response to repeated requests in this regard.

Housing - delay in granting City Phase 1 of housing accreditation is limiting capacity to accelerate housing delivery (backlog of approximately 400 000 grows by 16,000 per year – we must therefore create over 16,000 opportunities per year to reduce backlog)

Housing - Development & investment will be facilitated by reducing ‘red tape’ with respect to planning legislation & EIA / housing subsidy applications

Blockages (continued) Budget - implementation of projects and expenditure of budget can be improved through:

better alignment of planning & budgeting processes of all spheres, including SOEs speedier transfer of funding review of supply chain management regulations Issue of unfunded mandates critical & requires urgent resolution by Provincial &

National Government

Electricity – Problems around electricity provision by ESKOM – delays in electricity provision in Eskom supply areas

Safety and Security – Important that organisational structures set out in National Drug Master Plan adhered to by Province and City so that roles / responsibilities within spheres of government are clearly defined and two spheres can co-ordinate

Conclusion

City made substantial progress to ensure that foundations of service delivery are firmly in place

Focus in terms of 2007/08 IDP & Budget is on infrastructure-led economic growth for job creation

Room for improvement of co-operative governance – in many areas our role as local government would be greatly facilitated through better coordination between spheres of government

City is committed to intergovernmental processes within its constitutional mandate

Enkosi

Thank you

Dankie