DUE PROCESS NOT FOLLOWED BY MPAC REGARDING CTICC ANNUAL REPORT
I submit this complaint on behalf of the African Christian Democratic Party (ACDP), for your urgent investigation.
We are aggrieved that due process has not been followed in the City of Cape Town Council adopting the Municipal public Accounts Committee’s (MPAC) Oversight Report on the Cape Town International Convention Centre’s (CTICC) Integrated Annual Report (IAR) for FY 2013/14.
(Agenda item C 48), attached for your reference, at the City of Cape Town’s Council meeting held on 28 January 2015. This was duly supported by Council at what we have referred to as an invalid meeting – please refer to our previous complaint to your office on this matter.
The subject of this complaint, however, relates to the process followed before Council finally approved the report without reservations.
ACDP ALLEGATIONS: The ACDP alleges that, in considering the CTICC IAR and adopting the recommendations from MPAC:
1. Council ignored relevant provisions of the Municipal Systems Act (MSA), Municipal Finance Management Act (MFMA) and its own “System of Delegations” (S.O.D), rendering the oversight process deficient.
2. Council ignored relevant provisions of the MFMA and did not release the CTICC’s Integrated Annual Report to the public for comment.
3. The CTICC Chief Executive Officer (CEO) breached relevant provisions of the MFMA by not being present at the Council meeting of 28 January 2015 to answer questions.
Allegation 1 – Details of alleged Breach:
1. Councils S.O.D is based on Section 59 of the Municipal Systems Act (MSA).
2. The MSA and the S.O.D confirm that Councils delegation of its responsibilities does not divest Council of the power and responsibility to perform the function. IE: If the delegatee does not perform the duty or exercise the power, then Council must.
3. Section 129 of the MFMA confirms that Council must consider the entire Annual Report, not just its Annual Financial Statements. Extract from Section 129 of the MFMA: “129. ( 1 ) The council of a municipality must consider the annual report of the municipality and of any municipal entity under the municipality’s sole or shared control and by no later than two months from the date on which the annual report was tabled in the council in terms of section 127, adopt an oversight report containing the council’s comments on the annual report, which must include a statement whether the council (a) has approved the annual report with or without reservations; (b) Has rejected the annual report; or (c) has referred the annual report back for revision of those components that can be revised.”
4. It does so through the S.O.D. According to the S.O.D. the following delegations exist in terms of the CTICC IAR, apart from the delegations to the Municipal Public Accounts Committee (MPAC): a. The Municipal Manager is to monitor and report on the OPMS (Organisational Performance Management System) of the CTICC in terms of the year under review. b. The CFO is to report on shareholder and contract management of the CTICC for the period under review. c. The Finance Portfolio Committee is to report on shareholder and contract management of the CTICC for the period under review and must exercise oversight over the entity and report accordingly. d. The same applies to the Tourism, Events and Economic Development Portfolio Committee.
5. The decision of Council on 03 December 2014 and the report before Council on 28 January 2015 confirms that Council delegated the entire oversight process relating to the CTICC IAR, to MPAC only – clearly contrary to the MSA and S.O.D.
6. The report before Council on 28 January 2015 confirms that only MPAC fulfilled its delegated role, the other delegatees have not.
7. At its 14 January 2015 meeting, MPAC and the secretariat noted this pending problem and expressed concern that the oversight process was deficient in this regard and therefore highly undesirable. In its draft report before MPAC, the secretariat proposed that this be reported to Council. The undersigned requested an audio copy of this meeting on 29 January 2015 but has not received it before submission of this complaint.
8. MPAC members and the secretariat were also concerned that the tabling of the CTICC IAR at the Council meeting on 03 December 2014 and Councils subsequent decision, was highly premature precisely because it would prevent all other delegatees from exercising oversight, particularly given Councils December recess until 12 January 2015. ie: It was set up to fail. One member of MPAC left the meeting in a vain attempt to belatedly invite the Chair of the Finance Portfolio Committee to attend, and even telephoned him, but was unsuccessful.
9. Simply put, had the Mayoral Committee confirmed to Council on 03 December 2014, that the Finance Portfolio Committee and other delegatees must exercise oversight over the CTICC IAR, in line with the S.O.D and the MFMA, they would have done so, and should have, but didn’t.
10. Yet, in finalising its report to Council that day, MPAC chose to record no reservations relating to either of these concerns, even though the secretariat had originally included such reservations in the draft report that MPAC was asked to finalise. IE: MPAC ignored and overruled the secretariats concerns re the deficient oversight process.
11. In the ACDP’s view, these factors represent breaches of the S.O.D, the MSA and the MFMA.
Allegation 2 – Details of alleged Breach:
1. Section 127(5) of the MFMA instructs that Council must make its own AR and that of its entity(s) public and invite the local community to comment. Extract from Section 127(5) of the MFMA: “(5) Immediately after an annual report is tabled in the council in terms of subsection (2), the accounting officer of the municipality must (a) in accordance with section 21A of the Municipal Systems Act (i) make public the annual report; and (ii) invite the local community to submit representations in connection with the annual report”
2. Both the resolution of Council at its 03 December 2014 meeting, based on the Mayoral Committees recommendation that remained unchanged, and the report before Council on 28 January 2015 are silent on this, confirming that no such invitation to the public was made, and therefore no submissions could have been received. This is a clear breach of the MFMA.
3. We are aware, and so too would the OPP and the City be aware, that there are several members of the public who would be eagerly waiting an invitation to comment on the CTICC’s IAR, but no such invitation was made. The IAR was not forwarded to them for this purpose.
4. In the ACDP’s view, this represents substantial breaches of the S.O.D, the MSA and the MFMA.
Allegation 3 – Details of alleged Breach:
1. Section 129 (2) (a) of the MFMA confirms that the CTICC Accounting Officer (AO), its CEO must be present at the Council meeting on the day it considers the IAR (that being 28 January 2015) to answer questions on the IAR. Extract from Section 129(2) of the MFMA: “(2) The accounting officer must (a) attend council and council committee meetings where the annual report is discussed, for the purpose of responding to questions concerning the report;”
2. Although the AO was present at the MPAC meeting of 14 January 2015, the AO was absent from the Council meeting, confirmed by the attendance register for the Council meeting, thus denying Councillors the opportunity expected in the MFMA. Notwithstanding, and confirming our previous complaint to your office dealing with the validity of the Council meeting of 28 January 2015, it is unlikely the CEO would have been allowed into the meeting when all members of the public and the media had already been illegally excluded from the meeting. The undersigned was present at this meeting and looked for but did not identify the CEO as being present.
3. In relation to the validity of the Council meeting, our previous complaint to your office confirms that members of the public and media were excluded from the “resumed Council meeting” Extract from Section 130(1) of the MFMA: “130. (1) The meetings of a municipal council at which an annual report is to be discussed or at which decisions concerning an annual report are to be taken, must be open to the public and any organs of state, and a reasonable time must be allowed (a) for the discussion of any written submissions received from the local community or any organs of state on the annual report; and (b) for members of the local community or organs of state to address the council.” 4. Whatever the reason for or cause of the CEO’s absence, the point remains that the CEO was not present, thus breaching the MFMA.
Given the clear breaches of legislation outlined above, the ACDP respectfully appeals to the Public Protector to investigate these allegations urgently, and to exercise the powers to the fullest extent, resulting in the CTICC IAR being issued to the other delegatees for oversight, and to members of the public for their comment, and that the CEO is present at the subsequent Council meeting to answer any questions from Councillors before the IAR is finally adopted. We thank you for your attention to this matter.
Caucus Leader and Provincial Chairman For ACDP Western Cape