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23 May 2006

Honourable Speaker and Deputy Speaker,
Honourable Premier, TSP Makwetla,
Honourable members of the Executive Council,
Honourable executive mayors and honourable councillors,
Your excellencies, amakhosi,
Our partners from the private sector
Distinguished guest,
Ladies and gentlemen,

Once again our country has proved contrary to the belief of many analysts and the prophets of doom who criticised our local government system. Our people have shown that our democracy has matured and that they have a deep understanding on how to exercise the power of X. With the unveiling of our new local government system, we have seen men and women who were previously excluded from decision making positions being elected to such positions to improve the lives of our people.

This has been one of the most difficult elections. I am pleased, Madame Speaker, that our province has once again exercised so much tolerance and restraint we had no incidences of violence as it has been the case with some areas in our country incidents which should be condemned in the strongest terms. Many of us have said many nasty things to each other which had a potential of dividing our communities as we were campaigning for the largest number of support for our parties. Now that the elections are behind us, I would like to plead with each and every citizen of this province to ensure that we work together for the benefit of our communities especially those who continue to live in abject poverty.

Let me take this opportunity to thank all our people who despite unfavourable conditions of the weather went out in their millions to cast their vote as we were electing new leaders in the local municipalities and once more for showing confidence in the ruling party. I would also like to acknowledge the councillors who have left office after the local government elections. You have been pioneers who have sought to help give every individual access to water, electricity, sanitation and refuse removal. Your work forms a solid foundation for all our future work.

Honourable Speaker, allow me to congratulate all our elected public officials who will for the next five years represent the aspirations of our people irrespective of their political affiliations. I strongly believe that you will all stand out and provide the much-needed leadership which our people desperately need as they continue to strive for a better life. Our sincere thanks also go to our traditional leaders who have played a major role in ensuring that our rural people participate in these elections, thank you very much.

Let me also take this opportunity, Madame Speaker, to welcome our colleagues from Bushbuck Ridge as they have from 1 March 2006 officially become part of Mpumalanga province. We hope that together we will be able to steer this ship for it to successfully reach its shores.

Madam Speaker, our people have spoken before the election they were very clear on what they expect from our local municipalities. We also have during our campaigns promised in our election manifesto that together. “We have a plan to make local government work better for “ALL.” That plan should continue to deepen and enhance our local democracy and ensure that our people are not just mere recipients but active participants and drivers of transformation and development in their local communities. The time has come to put our people at the centre of development and we must continue to ensure that our policies are in favour of the poor, as well as integrate the marginalised poor communities in all our municipalities.

There is no doubt that despite the challenges facing our municipalities, they have done well:
* More of our people are now having access to clean water and have electricity in their houses.

* Government continues to promote the interest of children, persons with disability, youth, women and older people better than before.

* More of our people have access to housing, land and other social services which they previously did not have access to.

As a Department we have identified key performance areas (KPA) which will drive the strategic direction of our activities during this financial year and there is a general consensus amongst all stakeholders in this regard. These KPAs are a response to all the concerns that have been raised by our people and they will require our hands on support if we are to have well functioning municipalities who are in the cold face of service delivery.

These key challenges are the following:
* induction of elected officials and managers
* institutional capacity and municipal transformation
* basic service delivery and infrastructure
* local economic development
* good governance.

Induction of elected officials and managers

After we constituted our municipal councils formally, we conducted an induction programme for all our new and old elected councillors and managers.

South African Local Government Association (SALGA) assisted by the Department was driving the general induction programme which was completed at the end of April 2006.

Added to that induction programme, each municipality will undergo a strategic planning session. It is our view that this process will serve as an in house induction that will set the new strategic direction of our municipalities whilst at the same time inducting our new elected officials on the current status of their administration. Thereafter they will know of hand what the key socio economic challenges are.

The Department in it budget has put an amount of R1,9 million to assist municipalities with the facilitation of these strategic planning sessions.

Local government priorities for 2006 – 2011

Madame Speakers, it is proper that as we usher in the new local councils, we also spell out the local government priorities. It is important that I outline the following challenges observed nationally affecting local government:
1. poor capacity and inadequate accountability mechanisms
2. poor basic service delivery in some municipalities
3. high levels of poverty, unemployment
4. poor communication between councils and communities. Some councils non-functional ward committees.

Given such a background of challenges facing our municipalities, Mpumalanga alongside other provinces adopted the following priorities to guide our program planning for the next five years of local government:

Priority 1: Mainstreaming and ensuring that every sphere of government provides hands on support to local municipalities to improve governance, performance and accountability.

Priority 2: Addressing and structuring governance arrangements of the State in order to better strengthen, support and monitor local government and,

Priority 3: Refining and strengthening the policy, regulatory and fiscal environment for local government and giving greater attention to the enforcement measures.

Madame Speaker, as we ensure the implementation of these priorities in all our programs our outcome goal is a clearer role definition of both national and provincial spheres of government in support of municipalities. Our Premier’s office and sector departments are poised to play a calculated role that will ensure the achievement of integrated service delivery at municipal level.

Institutional capacity and municipal transformation

Most of our municipalities are still grappling with establishing core municipal systems where there are they are grappling with implementation. At the core of these systems is the Performance Management System (PMS). An assessment done to establish the status qou of the PMS in 2005 indicated that less than 40 percent of our municipalities have successfully put in place their PMS. Based on the outcomes of the assessment a programme of intervention has been developed for the municipalities which are below 60 percent in terms of the development and implementation of the PMS namely Dipaleseng, Lekwa, Delmas, Thembisile, Thaba Chweu and Nkomazi local municipalities.

The PMS is a must have for the municipality to function properly and achieve its desired objective. Every municipality in the province will ensure that their PMS is developed and implemented in the next 90 days from today and the Department will provide all the necessary support in assisting the struggling municipalities.

Each municipality will within the next 90 days ensure that all vacant position are advertised and skilled people appointed, especially section 57 managers.

The provincial government has successfully completed its skills audit. This skills audit has indicated that there are some capacity gaps in the provincial administration. It is equally important that municipalities should also undergo the same process. Our Department together with Department of Local Government (DPLG) will develop a competency framework which will be completed by the end of July. We hope that it will provide a regulatory framework on the appointment, performance and evaluation of managers in all our municipalities. Each municipality would then have to budget for a competency audit which will be carried out immediately after the framework has been developed.

In the interim we will have to do a competency test for each manager before they are appointed and we shall use the institutions that have been appointed by the provincial government to assist in this regard. After an appointment of a municipal manager the municipality must make sure that a performance contract is signed. These contracts must have clear measurable key performance areas. Coupled with the appointments we will ensure that the equity plan of government is adhered to. Presently men even in acting capacities manage most of our municipalities. We must ensure that there is a fair representation of women in management positions in all our municipalities.

We are still faced with serious challenges in the area of financial management. Gert Sibande District Municipality has developed modules to address these challenges. In order to avoid duplication the Department with Gert Sibande District Municipality will drive the process of rolling out the programme which must commence in the next two months. Through this programme we will ensure that every municipality submits their financial statements on time to the Auditor-General and making sure that we increase the number of municipalities who receive unqualified reports. Our congratulations go to Gert Sibande, Nkangala District, Delmas, Thembisile, Steve Tshwete, Dr JS Moroka who have for the past three years received unqualified reports from the Auditor-General (AG). If these municipalities can adhere to financial prudence, there is no reason why some of our municipalities cannot conform to basic accounting principles.

It has become obvious that there is poor accountability in most of our municipalities. Some of the officials have total disregard for procedures, they have become a law unto themselves. The Department will strengthen its monitoring capacity by ensuring that the performance of municipalities is monitored and reports are submitted every quarter. I hope that we shall all be man enough or rather woman enough to take action against incompetence.

The Department will within the next three months initiate discussions with the Nkangala District Municipality with a view of establishing an institute to train municipal managers. There is no doubt that the district has shown a lot of management expertise and we need to acknowledge that fact and create a pool of knowledge that could be shared by our province and the rest of the country including our neighbouring countries. We are working hard to position our province as a centre of excellence in local government management.

Basic service delivery and infrastructure

Basic services are a critical necessity in addressing the plight of our poor people.

The country has set itself national targets that we all need to achieve.

We said that:
(a) all communities will have access to clean and decent sanitation by 2010
(b) all houses will have access to electricity by 2012
(c) there is universal provision of free basic services
(d) no community will still be using the bucket system for sanitation by 2007.

In our case, Mpumalanga has set the end of 2006 as the target date.

We all know that our municipalities have serious challenges of capacity, especially on technical skills. Most of our municipalities are not doing well with regard to Municipal Infrastructure Grants (MIG) projects. The Department has engaged Development Bank of South Africa (DBSA) to assist it with a team of technical experts, which will include engineers and project managers. They will intervene and assist our struggling municipalities and commence with the most under spending municipalities. The team will commence on 1 June 2006. The first team will be deployed at Ehlanzeni District Municipality, Albert Luthuli, Thaba Chweu and Govan Mbeki municipalities. We commit ourselves to raising the level of spending to more than 80 percent. R3 million has been set aside for such support.

Each municipality will in the next two months develop a plan to deal with the extension of basic services to our people. Our partners from the DBSA have pledged support in assisting our municipalities in the development of these plans. The assistance will be co-ordinated from the Department.

Water

Madam Speaker, we have in our previous meetings with municipalities and the Premier discussed the implementation of the water blue print. The Department and districts have already started with assisting municipalities in developing business plans in this regard. In speeding up the process each municipality must within the next two months ensure that their plans are in place including strategies to deal with maintenance, water service development plans and plans for water system. Department of Water Affairs (DWAF) is playing a major role in this process which will be co-ordinated at our departmental level.

Our province continues to be plagued by an acute water shortage. We will continue with our programme of providing emergency water by acquisition of water tankers and placing of water tanks (Jojos) in strategic points in the following municipalities Delmas, Nkomazi, Msukaligwa, Thembisile, Steve Tshwete and Mbombela. The Department will spend an estimated amount of R5,2 million for provision of portable water in the above mentioned municipalities.

We stepped in jointly with the Department of Education to support a school that experienced water shortages. The two departments provided portable water to Mbuyane Secondary School in Kabokweni as a short term intervention. As a mid term intervention we will assist the pupils and educators of Mbuyane Secondary School to drill and equip one electric borehole with a chlorination system that would pump water to two ten thousand litre water tanks. This project is going to cost the Department an estimated amount of R260 000,00.

The Department, Madame Speaker, has set aside a budget of R3,161 million to assist the struggling municipalities to augment the provision of clean and safe water.

We are glad to announce that the water pipe line from Cullinan to Bronkhorstspruit that we announced last year has started supplying water to Thembisile Municipality from 18 April 2006. This pipeline is providing 20 mega litres of water per day to the municipality.

Sanitation]

Madame Speaker, the province took the bucket eradication challenge head on. We have done well with this initiative. Our target for 2005/2006 was to eradicate all buckets in our province. An initial figure supplied to province was 22 000 bucket toilets to be eradicated. Upon verification we found that there were 17 000 bucket toilets as the earlier figure hand included pit latrines. I am pleased to say that we have eradicated the bucket toilets in five areas at Gert Sibande District.

We have eradicated more than 16 000 bucket toilets in the formal settlements. The Minister of Water Affairs and Forestry, Buyelwa Sonjica, has commended the province for aggressively eradicating the bucket toilets. This is a clear indication that 2006 will mark the total bucket eradication in the province.

Delmas has been a unique case because of the dolomatic soil in the area where the Mandela informal settlement is located. The municipality has purchased portions two and nine of the Farm Witklip. 360 stands have been allowed on this farm as the rest of the land is unsuitable. Internal services for the 360 stands have been completed. Construction of the toilets has commenced and it is envisaged that it will be complete by the end of July 2006. After this process 360 families will be moved to settle in this area. As this happens 360 bucket toilets will be eliminated. Council intends to purchase portion six of the farm Middelburg 231 IR and Leeuport, to develop a further 1500 stands. The application to purchase this land is currently with the Department of Land Affairs (DLA).

Madame Speaker, as you are aware there was a typhoid outbreak in Delmas last year. I am happy to report that the challenge and outbreak is controlled. Water is safe to drink in Delmas. As part of our turn around strategy we have connected the C field borehole to the main reservoir. Previously the C field borehole was supplying water directly to Delmas West residents from the dosing plant. This did not give the water enough contact time with the chlorine which caused a risk for contamination and increased the risk of stomach ailments. Both the Departments of Local Government and Housing and the Department of Water Affairs each contributed R1,25 million for the connection of the water pipe. We will be officially handing over this project to the community of Delmas before the end of June this year.

As part of the long-term plan and heeding the 1993 report we are looking at the possibility of connecting Delmas to the Rand Water Supply. The important and critical challenge, however, is to raise R100 million needed for this.

I would like to thank the following departments who worked with us during the typhoid outbreak in Delmas; Department of Water Affairs of Forestry, national Department of Health, Department of Provincial and Local Government (DPLG), Department of Agriculture and Land Administration, the provincial Department of Health and Social Services, the Nkangala District Municipality, Council for Geoscience’s, the Premiers Office, Ekurhuleni Municipality, Department of Health in Gauteng, the South African Defence Force (SANDF), Kumba Mine and the media for covering every event of our intervention.

Free basic services

Honourable Speaker, to enhance the delivery of Free Basic Services (FBS) by municipalities to poor households a provincial task team has been established comprising of SALGA, municipalities, Department of Local Government and Housing (DLG&H), DPLG and DWAF. This task team will support municipalities with the provision of Free Basic Water (FBW). Almost all municipalities in the province are currently implementing the FBW policy although only four municipalities are not successfully implementing the policy. These are Albert Luthuli, Nkomazi, Thembisile and Dr JS Moroka municipalities.

The provincial task team on FBW is in the process of assisting the four municipalities that are struggling with the FBW process to identify the challenges and come up with solutions that would make sure that the FBW policy is successfully implemented in the current financial year (2006/07).

The Department is in the process of appointing professional service providers that will conduct an assessment for the provision of free basic services to registered labour tenants in farm areas. The Department’s objective in this regard is to make sure that all municipalities provide services to registered labour tenants. The service provider must do a feasibility study, research and assess if municipalities have adequate capacity to provide services to these people. The Department will then be in a position to come up with a support strategy to assist municipalities in terms of rolling out this program.

Integrated Development Program (IDP)

We are now at the end of the cycle of the previous council IDP process. A lot of experience has been gathered around how best we can develop more credible IDPs. To strengthen the IDP process and the alignment of our planning system, the Department will host a Provincial Integrated Development Planning Summit. This summit seeks to find consensus on how best we can mobilise our resources and address some of our developmental challenges in the province. The IDP summit will take place before the end of August 2006 These IDPs will chart the course of planning for the next five years. All municipalities will by the end of July 2006 have completed their IDPs.

We have already seen how co-operative planning can work well as we were implementing the sanitation programme around the eradication of the bucket system. Our co-ordinated efforts have proved that we can jointly achieve the objectives we set for ourselves.

It has been very clear that our people clearly identified issues around water, sanitation, electricity, roads, housing and job creation as the main areas of concern. We will together with all our social partners seek ways of mobilising resources to address these concerns. We hope that this summit will clarify the main strategic issues facing our province especially our local municipalities. We believe that the process will bring our municipalities more closely to our people and increase trust.

Baseline data

We noticed during the Presidential Imbizo towards the end of last year that there were serious challenges around the accuracy of statistics about resident and households without access to services. To address this challenge the department is organising a stakeholder seminar to try and find a common ground in addressing our baseline data. The main objective of the seminar will be to have an accurate picture of the different service levels that exist across our municipalities. The seminar will take place before September 2006.

Disaster management

The Department has produced a plan for the establishment of a provincial disaster management centre. For the construction of this centre we need an amount of R36 million. We have made a submission to the provincial Treasury in this regard. We are confident that our request will reach a favourable consideration. We will start construction of the centre as soon as the availability of funds is confirmed.

This centre will be fitted with state of the art equipment that will position the Department to strategically be able to deal with any disasters. The centre will also be linked to the national disaster management centre system. As part of the provinces preparations for the 2010 it will be imperative that we have this disaster management centre operational earlier than 2008 enable us to participate in the dry run of 2008.

We are also working with municipalities to strengthen their disaster management capacity. We are all aware that this is where disasters strike and it is important to ensure that they are up to the challenge. As part of strengthening disaster management through out the province we will be holding a provincial disaster management conference before the end of October 2006.

Local economic development

The economic divide between the municipalities that predominantly serviced the white areas and those that are made mostly of the former homeland areas continues to exist. The municipalities that are made up of areas that were previously homeland areas and are characterised by being deep rural continue to be confronted by issues of poverty and unemployment.

The need to strengthen local economic development has become more serious than ever. We all need to look for possible innovations to address economic growth in our communities. In that regard the two districts Gert Sibande and Ehlanzeni district municipalities will in the next three months finalise their local economic development strategies. We will call upon Nkangala District Municipality to support these two districts. The Department has already begun facilitating meetings with the districts to finalise the process.

During the course of this year the Department will establish local economic development (LED) institutions in the form of LED agencies at districts and in some municipalities. The establishment of the LED institutions have been proven as a best practice model in countries such as Germany. These LED institutions will enable the district municipalities to have enough infrastructures which will implement LED programs on behalf of the district municipality. The Department will promote investment on LED initiatives through engagements with stakeholders such as DBSA, IDC, NDA and Harmony Mines.

We are currently involved with the private sector and Small Enterprise Development Agency (SEDA) discussing about how best we can establish business development centres that will closely work with our municipalities to empower and assist our people who are emerging entrepreneurs or have aspirations of entering the economic arena of our country.

We are all excited, Madam Speaker, about the World Cup that is coming to our shores. We must also be equally excited that it will bring economic benefits to our country especially our province. We must as matter of urgency establishes institutions that will jealously ensure that our people benefit from these economic opportunities especially in the areas of accommodation, transport and the upgrading of infrastructure.

The Department together with municipalities will do their best to support the Youth Economic Summit that will be reviewing progress on the Provincial Growth and Development Strategy (PGDS).

Good governance

We have said that we need to put our people at the centre of service delivery. We need to strengthen all our communications points. In this way we shall be deepening democracy in local communities. The Department will during this financial year Implement 10 Multi Purpose Community Centres (MPCCs) in the province. This will strengthen access to services especially in the most rural areas of our provinces. Each municipality will assist the Department in identifying empty underused buildings that could be converted to MPCCs and budget funds to assist in establishing or renovation.

Over and above the initial training offered to new councils, training on code of conduct of councillors, financial management and political oversight will ensure that we increase the level of good governance of our municipalities.

Community participation

As part implementation of the three priorities for the next five years in local government, we want to increase the level of our community participation. On 11 April 2006 our first group of community development workers graduated in the province. 299 community development workers (CDWs) graduated and have been deployed through out the province. The CDWs will strengthen local organs and assist us to ensure that government services reach our people. We will begin a process of recruiting CDWs for Bushbuckridge shortly.

The province has established all 330 ward committees in the three districts. What we need to do now is ensure that all these ward committees are strengthened and made fully functional. The Department together with each municipality will support the administration of these ward committees. The Department has begun rolling out a programme called “Training the Trainer”. This programme focuses on training municipal officials on Community Based Planning (CBD). The officials will then train ward committee members and ensure that ward committees are very successful in their programmes. There will also be a national training programme for members of the national ward committee task team on CBP.

Each councillor will hold at least one public meeting in their ward per quarter. Each mayor will develop a programme to conduct Municipal Izimbizo assisted by the, Municipal Speaker and will interact with every ward committee in his or her municipality.

Cross boundary

We all know that we have now done away with cross boundary municipalities. We are slowly beginning to do away with the myth that the change of provincial boundaries will disrupt the lives of the people who reside in the affected areas. These people will continue to receive their services as they have been doing, irrespective of which province they are in.

Government will not neglect its responsibility towards the people. A number of municipalities have now been incorporated into either our province or our sister provinces:-
* Metsweding District including an area of Sokhulumi in Thembisile now falls within Gauteng
* all municipalities within Sekhukhune District now fall within Limpopo
* Bohlabela District Municipality has been disestablished, with Bushbuck Ridge now part of Ehlanzeni in Mpumalanga and Maruleng municipality now part of Mopani District in Limpopo.

An interim arrangement has been reached with regards to sharing of assets, staff, liabilities and other matters of Bohlabela District between Mopani and Ehlanzeni district municipalities. We have agreed with my counterpart in Limpopo that all transitional arrangements will be finalized by 31 May 2006.

We will continue to provide our municipalities with the active hands on support that they need. Under project consolidate we will mobilize additional resources both human and material for this purpose.

Traditional leadership and institutions

Madame Speaker, Amakhosi, our traditional leaders are a very important component in our governance structures. We have a history of a good working relationship with them. We are also encouraged by the willingness shown by the traditional leaders to participate in matters of development and we will continue to look at platforms to further engage with them.

This legislature has passed the Mpumalanga traditional leadership, Governance Act, 2005 and the Mpumalanga Provincial House and Local Houses of Traditional Leaders Act, 2005. The Premier has also signed them into law. We will be embarking on workshops to educate and conscientise traditional leaders, councillors, ward committees and community development workers on these acts.

The Department has drafted the Ingoma Bill, 2006. This bill seeks to regulate the traditional practice of holding an ingoma in accordance with applicable customary law and practices within the province. This bill will be submitted to the Executive Council (ExCo) for approval for its publication. We hope it will be promulgated this year.

The Department will assist as part of implementing the provincial as well as the National Act on traditional leaders, to roll out implementation of this Act and finalise the establishment of traditional councils.

Housing

Madame Speaker, housing delivery continues to be one of the major challenges facing the Department. Perhaps because it’s a service that is very close to the hearts of our people, they feel the impact when we fail to deliver this service. As a Department we remain committed to the pledge made by our fellow countrymen 41 years ago when they boldly declared “there shall be housing, security and comfort for all”.

During the 2005/2006 budget debate I stood in this House and informed you of the decision we had taken to complete more than 17 000 houses which formed part of the blocked projects in the province, by March 2006. These projects backdated for more than five years. Another problem that affected these projects is that they were approved at different quanta. When they were unblocked constructors could not complete the projects because the risen cost of building was above the quantum approved. Of course we also had some unscrupulous contractors who abandoned projects given to them.

Madame Speaker, what we had not envisaged were the challenges and practical implications of this decision. Some of the major challenges that we had not reckoned with was the lack of capacity in the Department officials involved in colluding with contractors to defraud government the high vacancy rate in the Department’s technical section and the long time taken to cancel contracts of non-performing contractors and appoint new ones. We were also challenged by the fact that a bulk of our target was to be delivered by our emerging contractors, who are still hindered by lack of access to funding and material supplies. As a result we had delivered only 13 491 by the end of March 2006. I must hasten to add that this is a good achievement for these contractors. We will complete the remaining 3 593 by July 2006. Once again DBSA will assist us in seconding a team of experts to strengthen the Department in this regard.

We will unveil a programme of Rental Stock that will provide housing for those people who do not want to buy but are willing to rent want to be closer to their work places and will ultimately return to their homes, mostly in the rural areas. We will build rental stock housing in Mbombela, Govan Mbeki and Steve Tshwete municipalities. As the Department continues to turn around housing delivery in the province we continue to encounter unscrupulous contractors who will stop at nothing to tarnish the image of the Department and stifle the good work. I must warn these contractors that we will return fire with fire, we will leave no stone unturned in ensuring that the long arm of the law deals with them.

The Department recently opened criminal and civil cases against four contractors who have fraudulently claimed money from the Department and yet no work or insufficient work had been done. We have also instituted civil action to recover more than R400 000 that was fraudulently claimed by these contractors. We are aware that for any misconduct to happen the perpetrators must get help from within the system. We have found officials in the Department who have colluded with corrupt contractors. Three officials have been expelled and three are on suspension for this unbecoming behaviour. The Department will be establishing a special housing inspection unit. This unit will conduct sporadic spot checks on all housing projects to do the following:

* assess the quality and ensure that it is in line with South African Bureau Standard (SABS) standards
* ensure that work that has been done is in line with money paid
* ensure that before any retention money is paid the work is done satisfactory.

Madam Speaker, we will also continue to monitor closely the quality of the houses. We will not compromise where we find that the houses built are of poor quality those houses will be demolished and rebuilt at the contractors’ expense. On a quarterly basis we will be able to give statistical figures of the houses built and the houses demolished and how we are going to address any shortcomings as far as housing delivery is concerned.

In an attempt to accelerate housing delivery in the province the Department will be visiting and interacting with other stakeholders and housing agencies such as the Gauteng Province and the housing development agency in Botswana. This will help us address problems of housing delivery in terms of the breaking new grounds strategy which will create a middle class by creating habitable human settlements in areas with higher economic development potential in the province. This delivery process will address the needs of the middle-income earners who are not accommodated and catered for by the other housing delivery instruments.

This year we will embark on an extensive programme to upgrade informal settlements in the province. Surveys conducted by the Department indicate that there are 140 informal settlements in the province. We will begin this programme by piloting it in three informal settlements in the following municipalities, Emalahleni, Mkhondo and Mbombela.

We will be signing memorandums of understandings (MoU) with these three municipalities. The MoUs will deal with in situ upgrading of informal settlements. The Department will provide grant funding that will enable the municipalities to fast track the provision of security of tenure, the basic municipal engineering services and the inhabitants to take charge of their own housing development. In terms of the MoU the municipality will amongst others ensure the availability of bulk and connector engineering services provide basic municipal engineering services, provide materials, assistance and support to facilitate the in situ upgrading projects.

During the first and second quarter we will be busy with designing human settlement development plans concept and layout plans and installing infrastructure. From October 2006 we will commence with the construction of 350 houses in Emalahleni, 750 houses in Mkhondo and Mbombela as part of the informal settlement upgrading programme.

Once again this year we will hold our Provincial Housing Indaba. We will use this gathering to look at ways of dealing with the current housing challenges facing the province. We will also use this indaba to sell our new housing plans and strategy for the year, with special emphasis on the breaking new ground strategy. This summit will be held before the end of July 2006.

Madame Speaker, last year we pledged that we would begin the progress of accrediting municipalities with the capacity or potential to implement the housing programme. We have assessed the capacity and potential of some of the municipalities. For 2006/2007 we have identified Emalahleni Municipality to be accredited to perform amplified housing functions. We will continue with the assessment of all the other municipalities and we hope to be able to accredit at least four municipalities.

The housing backlog is continuing to grow. Currently the backlog is 260 000 houses. We will continue to fight to reduce this backlog. For the 2006/07 we will build 12 940 units and we will transfer 5 500 units.

Subsidy quantum

The subsidy quantum has been increased from R31929 to R36 528,00 as from 1 April 2006.

Conclusion

On 5 December 2000 when we started the new democratic local government dispensation, we said we were beginning an un-chartered and unprecedented journey of a transformed back to back system of local government. A journey we were not aware where it would lead us to. This year in March we began a second term of our democratic local government system. This time we are wiser we have learnt a lot of lessons we are well aware of the challenges, sharp curves, pitfalls and dangers that lie ahead. We dare not stumble as we will have no excuses for failing our people.

Madame Speaker, l would like to extend my sincere gratitude to my family for their continued support to the members of the portfolio committee, the Head Department Ms GN Sibeko and her management for their continued support and dedication and the communities of the province for their continued support towards making local government work better.

I now table the budget for the Department of Local government and Housing and accordingly request the House to approve the amount of R625,770,000 including conditional grants.

I thank you!

Issued by: Department of Local Government and Housing, Mpumalanga Provincial Government
23 May 2006