Councillor Remuneration Presentation (Sept CFO Forum)

Councillor Remuneration: Determination
of Upper Limits
6 September 2013
Table of Content
• Purpose, Background, Objective
• Current process followed when assessing applications for
councilor remuneration
• Concerns raised by stakeholders(
Managers, Cfo’s, Salga etc.)
• Suggested process going forward,
• Conclusion
Purpose , Objective and Background
• To outline the process followed when assessing applications for
councillor remuneration increases,
• To emphasise the fact that the 2012/13 councillor remuneration process
has been officially closed,
• To outline the suggested process to be followed going forward.
• To ensure that the remuneration increases are within upper limits,
budgeted for and are affordable.
• The Remuneration of Public Office Bearers Act, 1998 (Act No. 20 of 1998)
vests the powers to determine the upper limits of the salaries,
allowances and benefits of the different members of municipal councils
to the Minister for Cooperative Governance and Traditional Affairs.
Process followed when assessing applications
Sequence of events to assess conformance (DLG and PT Process)
Assess AG reports for the two previous financial years
Compliance with legislative prescripts
Status of Audit committees versus Internal Audit reports
Status of Vacancies for the section 56/7 employees
Process Followed continued
Sequence of events to assess performance (PT process)
Assess reports submitted to NT/PT either on an
annual, monthly, and or quarterly basis (IYM
Annual Budgets, SDBIP’s)
Assess findings of LGMTEC 3 and Final Budget
Analyse operating revenue and expenditure,
debtors and creditors as at 31 December of the
current financial year and compare to the same
of the previous period (Year-on-year comparison)
Status of cash position as the December of the
current year (If the municipality has got inherent
cash challenges also do a detailed cash analysis)
Concerns raised by Stakeholders
• Framework not made available to municipalities and relevant
stakeholders for their input on time,
• Inconsistencies identified with the assessment process,
• Role played by Provincial Treasury during the assessment process not
within legislation,
• Assessment must not be used as a tool to punish municipalities
unfairly but must be used objectively and informed by legislation,
• Councilors from other municipalities resigned because of upper limits
not being approved.
Suggested Process Going Forward
• Review and update framework for assessment of “applications for
councillor remuneration increases”, to incorporate and address all
concerns raised by relevant stakeholders,
• After finalisation issue the framework to all of the relevant forums
(PCF,MM,CFO etc.) for input and review,
• Roles for Municipalities, Provincial Treasury, Salga and Department of
Local Government to be clearly defined,
• Agreed upon framework to be majorly informed by section 7 (1) of the
Remuneration of Public Office Bearers Act 20 of 1998,
• Municipalities with inherent cash flow challenges, detailed cash flow
analysis must be done.
• Councillor remuneration process for the 2012/13 financial year
has been officially closed,
• Municipalities which have implemented upper limits upon being
advised otherwise to face consequences,
• Legal cases/issues raised by Municipalities out the assessment
process are being handled by Department of Local Government
and feedback will be provided.
Thank You

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