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DISTRICT MUNICIPALITY I UMASIPALA WESITHILI I DISTRIKSMUNISIPALITEIT 


www.gardenroute.gov.za 

www.facebook.com/gardenroutedm 
@GardenRoute_DM #GardenRoute #KleinKaroo 
Head Office: 54 York Street, George, Western Cape, South Africa 


2018/19 
Annual Report 



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2017 - 2022 (Adopted by Council on 29 May 2017) Garden Route 

District Municipality’s 

VISION & MISSION 


Vision 

Garden Route, the leading, enabling and inclusive district, 
characterised by equitable and sustainable development, 
high quality of life and equal opportunities for all. 

Mission 


The Garden Route District Municipality, as a category C local authority, 
strives to deliver on its mandate through: 

■ Unlocking resources for equitable, prosperous and sustainable development. 

■ Provide the platform for coordination of bulk infrastructure planning across the district. 

■ Provide strategic leadership towards inclusive / radical / rigourous socio-economic transformation, to 
address social, economic and spatial injustice. 

■ Redress inequalities, access to ensure inclusive services, information and opportunities for all citizens 
of the district. 

■ Initiate funding mobilisation initiatives / programmes, to ensure financial sustainability. 

■ Coordinate and facilitate social development initiatives. 


2 



2018-2019 Annual Report: Garden Route District Municipality 


2017 - 2022 (Adopted by Council on 29 May 2017) 
Garden Route District Municipality’s 


STRATEGIC 

OBJECTIVES 


Strategic Objective 1 A Skilled Workforce and Communities 
Strategic Objective 2 Bulk Infrastructure Co-ordination 
Strategic Objective 3 Financial Viability. 

Strategic Objective 4 Good Governance. 

Strategic Objective 5 Growing an inclusive district economy. 
Strategic Objective 6 Healthy and socially stable communities 
Strategic Objective 7 Sustainable Environmental Management and 

Public Safety. 


3 



2018-2019 Annual Report: Garden Route District Municipality 


VALUES 




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2018-2019 Annual Report: Garden Route District Municipality 


ABOUT THIS 

ANNUAL REPORT 

Garden Route District Municipality is determined as a Category C-municipality with a 
mayoral executive system. Section 84 of the Municipal Structures Act distinguishes 
between roles and responsibilities of district municipalities and those of B-municipalities. 
According to the Act, the Garden Route District Municipality must perform the 
following functions: 

(a) Integrated development planning for the district municipality as a whole. 

(b) Potable water supply systems. 

(c) Bulk supply of electricity, which includes for the purposes of such supply, the 
transmission, distribution and, where applicable, the generation of electricity. 

(d) Domestic waste-water and sewage disposal systems. 

(e) Solid waste disposal sites, in so far as it relates to - 

(i) the determination of a waste disposal strategy; 

(ii) the regulation of waste disposal; 

(iii) the establishment, operation and control of waste disposal sites, bulk 
waste transfer facilities and waste disposal facilities for more than one local 
municipality in the district. 

(t) Municipal roads which form an integral part of a road transport system for the 
area of the district municipality as a whole. 

(g) Regulation of passenger transport services. 

(h) Municipal airports serving the area of the district municipality as a whole. 

(i) Municipal health services. 

(j) Firefighting services serving the area of the district municipality as a whole, 
which includes- 

(i) planning, co-ordination and regulation of fire services; 

(ii) specialised firefighting services such as mountain, veld and chemical fire 
services; 

(iii) co-ordination of the standardisation of infrastructure, vehicles, equipment 
and procedures; 

(iv) training of fire officers. 

(k) The establishment, conduct and control of fresh produce markets and 
abattoirs serving the area of a major proportion of the municipalities in the 
district. 


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2018-2019 Annual Report: Garden Route District Municipality 


(l) The establishment conduct and control of cemeteries and crematoria serving 
the area of a major proportion of municipalities in the district. 

(m) Promotion of local tourism for the area of the district municipality. 

(n) Municipal public works relating to any of the above functions or any other 
functions assigned to the district municipality. 

(o) The receipt, allocation and, if applicable, the distribution of grants made to the 
district municipality. 

(p) The imposition and collection of taxes, levies and duties as related to the 
above functions or as may be assigned to the district municipality in terms of 
national legislation. 

Garden Route District Municipality acknowledges its enabling role as facilitator, co¬ 
ordinator and capacitator and seeks to achieve integrated, sustainable and 
equitable social and economic development of its area as a whole by ensuring 
integrated development planning and promoting bulk infrastructural development 
and services for the district as a whole, building the capacity of local municipalities in 
its area to perform their functions and exercise their powers where such capacity is 
lacking and promoting equitable distribution of resources between the local 
municipalities in its area to ensure appropriate levels of municipal services within the 
area. 


The Garden Route District encompasses a total area of 23 332km 2 and is constituent of 
seven Category B-Municipalities within its geographic area, namely: Bitou, Knysna, 
George, Mossel Bay, Hessequa, Oudtshoorn and Kannaland. 


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2018-2019 Annual Report: Garden Route District Municipality 

TABLE OF CONTENTS 

EXECUTIVE MAYOR'S FOREWORD. 

MUNICIPAL MANAGER’S OVERVIEW. 

1.1 Municipal Functions, Population and the Environment. 

1.2 Employment and the Economy. 

1.3 Service Delivery Overview. 

1.4 Financial Health Overview. 

1.5 Organisational Development Overview. 

1.6 Auditor General Report. 

1.7 Statutory Annual Report Process. 

CHAPTER 2: POLITICAL AND ADMINISTRATIVE GOVERNANCE. 

2.1 Composition of Council. 

2.2 Administrative Governance. 

2.3 Intergovernmental Relations. 

2.4 IDP Participation & Performance Alignment. 

2.5 Risk Management. 

2.6 Anti-Corruption and Fraud. 

2.7 Supply Chain Management. 

2.8 Municipal Website. 

CHAPTER 3: OVERVIEW OF PERFORMANCE WITHIN THE ORGANISATION. 

3.1 Overview. 

3.2 Performance Management. 

3.3 Service Delivery Performance. 

3.4 Service Provider Strategic Performance. 

3.5 Municipal Functions. 

3.6 Component A: Bulk Infrastructure Planning. 


..15 

...20 

...26 

...30 

...91 

...92 

...94 

...94 

100 

105 

113 

115 

121 

122 

128 

128 

131 

134 

134 

137 

139 

151 

152 

153 


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2018-2019 Annual Report: Garden Route District Municipality 

3.7 Component B: Roads and Transport.161 

3.8 Component C: Planning and Local Economic Development.164 

3.9 Component D: Environmental protection.190 

3.10 Component E: Municipal Health.192 

3.11 Component F: Fire Services and Disaster Management.201 

3.12 Component G: Corporate Policy Offices and Other Services.227 

3.13 Component H: Organisational performance scorecard.256 

CHAPTER 4: ORGANISATIONAL DEVELOPMENT PERFORMANCE.264 

4.1 National KPI’s - Municipal Transformation and Organisational Development.264 

4.2 Introduction to the Municipal Workforce.264 

4.3 Managing the Municipal Workforce.268 

4.4 Capacitating the Municipal Workforce.271 

4.5 The Municipal Workforce Expenditure.275 

CHAPTER 5: FINANCIAL PERFORMANCE.280 

5.1 Financial matters.280 

5.2 Grants.280 

5.3 Asset Management.280 

5.4 Financial ratios based on Key Performance Indicators.282 

5.5 Capital expenditure.286 

5.6 Sources of finance.287 

5.7 Capital Spending on 5 largest projects.287 

5.8 Cash Flow.287 

5.9 Borrowing and Investments.288 

5.10 Public Private Partnerships.288 

5.11 GRAP Compliance.289 

5.12 performance of service providers.290 

Appendices.293 


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2018-2019 Annual Report: Garden Route District Municipality 

VOLUME II: ANNUAL FINANCIAL STATEMENTS.293 

Appendix A: Councillors, Committee allocation and Council attendance.387 

Appendix B: Third Tier Administrative Structure.390 

Appendix C: Functions of Garden Route DM.390 

Appendix D: Municipal Audit and Performance Audit Committee Recommendations ....393 

Appendix E: Long Term Contracts and Public/Private Partnerships.396 

Appendix F: Disclosures of financial interests.396 

Appendix G(i): Revenue Collection Performance by Vote.397 

Appendix G (ii): Revenue Collection Performance by Source.397 

Appendix H: Conditional Grants received excluding MIG.398 

Appendix I: Capital Expenditure - New and upgrade / Renewal Programmes.399 

Appendix J (i): Capital Expenditure - New assets Programme.399 

Appendix J (i): Capital Expenditure - New assets Programme.399 

Appendix J (ii) Capital Expenditure - Upgrade / Renewal Programme.400 

Appendix K: Declaration and Grants made by Garden Route DM.400 

Appendix L : Declaration of loans and grants made by the municipality.401 

Appendix m: Declaration of returns not made in due time under the MFMA S71.401 

Appendix n: Capital Program by Project Year 1.401 

Appendix o: Audit report 2018/2019.407 

Appendix p: Apac report for annual report 2018/2019 .413 


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2018-2019 Annual Report: Garden Route District Municipality 


CHAPTER 1 

EXECUTIVE SUMMARY: 
FOREWORD BY THE EXECUTIVE 
MAYOR AND OVERVIEW BY THE 
MUNICIPAL MANAGER 



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2018-2019 Annual Report: Garden Route District Municipality 



Executive Mayor 
Cllr Memory Booysen 


EXECUTIVE MAYOR’S FOREWORD 


On 12 April 2019, I delivered the first inaugural state of the district address from the 
inauguration of this Council. On 8 May 2019, our country has held its sixth National and 
Provincial democratic elections to usher in, the sixth administration and legislatures at 
National and Provincial level. 

SITUATIONAL ANALYSIS 

Our district has undergone major changes regarding access to basic services, given 
the fact that we are the second largest population non-metro district municipality in 
the Western Cape, our population has grown and is estimated to 679 213 (2024). The 
built environment of our district has changed profoundly, as the result of access to 
basic services as from 2016. 

Our district is confronted by a dependency ratio which has grown to 56.1% with a 
proportion of poor people below poverty lines within the district standing at 40.5%. 

SOCIO ECONOMIC RISKS 

We are also confronted by three (3) socio economic risks; 


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2018-2019 Annual Report: Garden Route District Municipality 


Riskl: Slow Economic growth. 

Risk2: Increase population and demand for services. 

Risk3: Rising unemployment. 

COMMUNITY SAFETY 

On safety we are confronted by three (3) most serious crimes, such as Theft, Assault 
and Drug abuse. We hosted a district anti-crime summit in partnership with SAPS to 
start engaging on the aforementioned crimes. 

INSTITUTIONAL ARRANGEMENT 

We had an institutional strategic planning session from the 12-13 March 2019, one of 
the fundamental purpose was to do an institutional diagnosis, asking ourselves three 
fundamental questions and answer those questions quite frank and honest. 

1. “What do we do” 

2. "For whom do we do it” 

3. “How do we excel” 


In responding to those three questions, we have taken a clear decision to perform all 
powers and functions as mandated by the Local Government:Municipal Structures 
Act, Section 84. We are going to develop a long term vision of our district “VISION 
2040”, it will outline our strategy in enhancing the relevancy of the Garden Route 
district, and how the gains of this district are going to be sustained and advanced. 


MUNICIPAL SUPPORT 

We have committed R500 000 during 2018, to assist Kannaland Municipality for 
drought disaster. This intervention included the donation of 850x2 litres of potable 
water containers to the community of Kannaland, the tankering of water to both the 
Zoar community as well as rural communities in water distress as well as provision of 
5000 litre water tanks to be used during water shedding 


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2018-2019 Annual Report: Garden Route District Municipality 

Council availed the amount of R130 000 to develop a Tourism Strategy for Kannaland 
to aid the Kannaland Municipality and various stakeholders to prioritise and implement 
various tourism projects in order to market and develop Kannaland as a tourism 
destination. 

The aim of the proposed tourism strategy is to ensure positive economic benefits and 
opportunities for all stakeholders. The development of the tourism strategy was 
informed by stakeholders' inputs through various mechanisms including workshops that 
were held. 

JOB CREATION AND PEOPLES DEVELOPMENT 

The financial year 2018/19, marked the beginning of a prosperous year for 
approximately 120 young people from the Knysna and Plettenberg Bay municipal 
areas, as they benefited from the Garden Route Municipal Training Programmes, 
which includes: First Aid Level 3 Training; Driver's License Training and Law 
Enforcement Training. 

These training programmes originated from the Garden Route Rebuild Initiative 
(GRRI), which was established after devastating fires hit the district 
(Knysna/Plettenberg Bay) in June 2017. 

The Training Programmes is funded by the Garden Route District Municipality (GRDM) 
and is managed through the Office of the Executive Mayor, under the Expanded 
Public Works Programme (EPWP). The project's primary focus is youth development 
in the Garden Route district, building capacity among young people; breaking the 
chain of unemployment and ensuring a marketable labour force in the region. 

During 2017/18 we have offered 499 and 2018/19 we have offered 411. We have 
transitioned young men and women to the driving school program which is 
underway currently, we have enrolled 23 young women, with the total of 26 young 
people. 

We are also offering the opportunity for interns to gain experience through a 
Municipal Graduate Internship Programme. 


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2018-2019 Annual Report: Garden Route District Municipality 

We are also giving study bursaries to the youth of our district, through my office. 

Investing in people is the most decisive act of national development. It is through 
education that we can unleash creativity and cultivate the spirit of resilience among 
citizens. 

GOOD GOVERNANACE AND PUBLIC PARTICIPATION 

At the centre of the council vision, it is the will of the people of this district. We are 
trying by all means to MAXIMIZE CITIZEN IMPACT, through stakeholder engagement 
programs and forums. 

In conclusion let me take this opportunity to thank all the Councillor of Garden Route 
District Municipality and the entire administration as led by the Municipal Manager (Mr 
Monde Stratu) 



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2018-2019 Annual Report: Garden Route District Municipality 



MUNICIPAL MANAGER 
Mr Monde Stratu 


MUNICIPAL MANAGER’S OVERVIEW 

I'm pleased to indicate that Garden Route District Municipality is compiling its Annual 
Report for the second time as informed by Circular 63 of the Local government: 
Municipal Finance management Act. 

In providing the overview for 2018/2019 financial year, its proper that I begin by saying, 
the Council in its institutional strategic planning session held on the 12-13 March 2019, 
has agreed to perform all functions of the district municipality as entailed in Section 84 
of the Local Government: Municipal Structures Act. 

NAME CHANGE 

On 5 December 2017 Council resolved to change its name and on 24 August 2018 the 
name was changed from Eden District Municipality to Garden Route District 
Municipality, after a lengthy process of public participation. 

This decision was not taken lightly as there were various names and brands that were 
used to refer to our region. Names such as Southern Cape, Southern Coast, Eden, 
and Garden Route were used and this created a state of brand delusion. 


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2018-2019 Annual Report: Garden Route District Municipality 


Our district was declared as an international biosphere by UNESCO and was known 
as the Garden Route Biosphere Reserve. We had to leverage this very prestigious 
recognition to ensure economic growth for our region. Further to that the Europeans, 
Chinese, Southern Americans and African markets are already aware of the name 
Garden Route, which makes it easier to continue with a brand that is already known 
by our markets. 

INSTITUTIONAL DEVELOPMENT AND ORGANISATIONAL PERFORMANCE 

The organisational structure was approved by council together with relevant policies 
to ensure smooth and proper running of the organisation. We are trying by all means 
to balance the employment equity, also to attend to labour matters. 

The local labour forum serves as a proper forum to channel labour related issues, to 
ensure cordial working relations between the administration and labour component. 

Skills development is at the centre of the agenda of council. The employment 
assistance program is also doing very well together with occupational health and 
safety. We are in the process to implement individual performance. 

FINANCIAL VIABILITY AND MANAGEMENT 

Garden Route District Municipality is grant dependent and funds are being managed 
under very tight controls however we ensure that, we rise to our legislative mandate. 
The supply chain process are open to everyone and local content is encouraged on 
procurement. The realistic and funded budget is what we advocate for. We strive for 
clean governance and that is evident in the processes in place to improve on our 
audit outcomes. The Municipality received an Unqualified opinion with findings with 
one finding during the 2017/2018 financial audit. For the financial year under review 
we have also received Unqualified Audit report and issues raised by AG on the Annual 
Report have been adjusted as part of the action plan, the Annual Performance 
Report has been aligned with the Annual Report, the strategic objectives contained in 
the APR have also been aligned with the ones' contained in the Annual Report. 


16 



2018-2019 Annual Report: Garden Route District Municipality 
INFRASTRUCTURE AND SERVICE DELIVERY 

We have constructed roads and infrastructure throughout the district, the access to 
basic service delivery has improved and is improving. 

ACCESS TO WATER: households with access to piped water inside the dwelling 

or yard or within 200 meters from yard is 96.9% 

ACCESS TO ELECTRICITY: households with access to electricity as primary source of 

energy for lighting purposes is 96.1% 

ACCESS TO SANITATION: households with access to flush toilet connected to 

sewerage system is 94.3% 

ACCESS TO REFUSE REMOVAL: is 88.8% 

ACCESS TO FORMAL DWELLING: is 85.7% 

These qualitative changes in the lives of the people of Garden Route represent a 
towering monument of progress during the twenty-five years of our democracy. 

COMMUNITY SERVICES AND SAFETY 

Disaster management is being managed properly and the level of water in our dams is 
satisfactorily, although we acknowledge that we are not a water rich district. 

A Regional landfill site will be constructed, which will be a waste management 
resource for the entire region. A firefighting academy is also part of our priorities as 
discussed in our institutional strategic planning session. On safety, we are in the 
process to develop a safety plan of the district and have also in partnership with SAPS 
conducted an anti - crime summit, during the financial year under review. 

LOCAL ECONOMIC DEVELOPMENT 

The Council took another decision to be a Skills Mecca and to ensure that the skills 
needed by the industry are addressed through this process. In February 2018, the 
district held a Skills conference where all stakeholders were invited. The industry, SETAs, 


17 



2018-2019 Annual Report: Garden Route District Municipality 

relevant department including the whole Western Cape Cabinet was invited. This was 
also a successful conference and the implementation of the resolutions of that 
conference is in progress. The Municipality is also a top achiever when it comes to 
creating employment opportunities through the Expanded Public Works Programme 
(EPWP). 

We always create more opportunities than what was planned and this was the case 
with the year under reviewed. The programme created 411 job opportunities in the 
year under review. Tourism strategy is in place, we have also assisted Kannaland Local 
Municipality in developing its Tourism strategy. 

GOOD GOVERANCE AND PUBLIC PARTICIPATION 

During the financial year under review, we have hosted a good governance summit, 
to augment public confidence in local government. We have also revitalised and 
capacitated our governance structures to ensure effective oversight, i.e. Municipal 
Public Accounts Committee (MPAC), Audit and Public Audit Committee (APAC), Risk 
Management Committee (RMC) and section 80 Committees (Municipal Structures 
Act). 

The council has taken a bold decision to perform all its legislative functions, as outline 
in section 84 of the Municipal Structures Act. To achieve that there are various 
approved projects, which include the following: 

■ Establishment of a Fresh Produce Market 

■ Becoming a Water Service Authority 

■ Establishment of Regional Landfill site 

■ Fire Services Function (Discussion with local municipalities in progress, to 
determine the best model for this function) 

The Executive Management team is fully empowered and capacitated to deliver on 
the mandate of this council. We have appointed two new Executives in our Finance 
and Roads departments to further strengthen the current executive management 


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2018-2019 Annual Report: Garden Route District Municipality 

team. I am confident that the Executive team will deliver on the ambitious strategy of 
this council. 

In conclusion, I would like to thank the administration as well as the Council for its 
guidance. 



MONDE STRATU 
MUNICIPAL MANAGER 


19 



2018-2019 Annual Report: Garden Route District Municipality 


1.1 MUNICIPAL FUNCTIONS, POPULATION AND THE 
ENVIRONMENT 


The Garden Route District is the 
third largest district in the Western 
Cape and is well-known for its 
coastal holiday towns and vast 
farmlands. The N2 is a valuable 
transport route for goods and 
tourists alike and connects the 
District to the Overberg District and 
the Cape Metro area in the west 
and the Eastern Cape Province to 
the east, while the N12 and the 
R62 links the District with inland 
areas to the north. 




Legend 


GDPR (R million) 

N 

R0 - R5 000 

R5 001 -R10 000 

A 

|^H >R10 001 + 


The seven local municipalities that make up this District include Kannaland, 
Hessequa, Oudtshoorn, Mossel Bay, George, Knysna and Bitou (Eden District, 
2017). 


1.1.1 POPULATION DYNAMICS 

According to the Department of Social Development's 2018 projections, the 
Garden Route District Municipality currently has a population of 623 800, rendering it 
the second largest district population outside of the metro. This total is estimated to 
increase to 697 213 by 2024 which equates to 1.9 percent average annual growth 
over this period. The growth of Garden Route District for the 2018 to 2024 period is 
just below that of the Province's 2.0 percent. 


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2018-2019 Annual Report: Garden Route District Municipality 
1.1.2 EDUCATION 

The extent of improvement in educational circumstances of households in the 
Garden Route District discussed here using data on learner enrolments. Grade 12 
dropout rates and Matric pass rates. 

Between 2016 and 2017 the Garden Route District recorded increases in learner 
enrolment, an overall decrease in Grade 12 dropout rates and a decrease in the 
average Matric pass rate as indicated in Table 1 

Table 1 

Enrolment, dropout and Matric pass rates in Garden Route District, 2016-2017 


Municipality 

Learner 

enrolment 

(2016) 

Learner 

enrolme 

nt 

% 

Grade 

12 

dropout 

Grade 

12 

dropout 

% 

Matri 
c pass 
rates 

Matric 

pass 

rate 

% 

Bitou 

8 041 

8 041 

0 

44.5 

44.5 

o 

o 

78 

78.0 

0.0 

George 

34 782 

35 441 

1 

26.4 

31.2 

18.2 

83.4 

83.7 

0.4 

Hessequa 

8 566 

8 706 

1 

30.2 

35.6 

17.9 

93.6 

87.4 

-6.6 

Kannaland 

4 651 

4 679 

0 

39.3 

40.2 

2.3 

88.9 

89.2 

0.3 

Knysna 

12 103 

12 326 

1 

32.2 

35.3 

9.6 

77.9 

72.4 

-7.1 

Mossel Bay 

16 401 

16 650 

1 

32.5 

36.5 

12.3 

87.4 

83.5 

-4.5 

Oudtshoorn 

18 588 

18 657 

0 

35.6 

33.6 

-5.6 

93.1 

80.1 

-14.0 


Source: Western Cape Education Department, 2018 


Most of the municipalities within the Garden Route area have high learner 
enrolment numbers which is, however, accompanied by high dropout rates 
exceeding 30 per cent amongst Grade 12 learners in 2016 and 2017. The 
highest dropout rates are reflected in Bitou (44.5 per cent) and Kannaland (40.2 
per cent). The highest matric pass rates in excess of 85 per cent were recorded in 
Hessequa and Kannaland in 2017, indicating positive education outcomes in these 
areas. 



George 

Oudtshoorn 

Bitou 

Knysna 

Education 

Levels 

Number 

% of total 

adult 

population 

Number 

% of total 

adult 

population 

Number 

% of total 

adult 

population 

Number 

% of total 

adult 

population 

No 

13 476 

7.4 

7 046 

7.7 

2 576 

6.1 

4 117 

6.1 


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2018-2019 Annual Report: Garden Route District Municipality 

Schooling j j [ T j [ I 


Some 


primary 

38 931 

21.3 

23 273 

25.3 

8 283 

19.6 

13 931 

20.6 

Complete 

Primary 

11 622 

6.4 

8 129 

8.9 

2 708 

6.4 

3 973 

5.9 

Some 

Secondary 

61 343 

33.6 

31 729 

34.5 

14 769 

34.9 

23 272 

34.5 

Grade 12 

41 692 

22.8 

17 464 

19.0 

9 633 

22.8 

16 001 

23.7 

Higher 

15 681 

8.6 

4 196 

4.6 

4 334 

10.2 

6 231 

9.2 


Education levels of population in the Garden Route District, 2017 


Table A Source:Quantec/Urban-Econ calculation, 2017 



Garden Route 

Kannaland 

Hessequa 

Mosselbay 

Education 

Levels 

Number 

% of total 

adult 

populatio 

n 

Number 

% of total 

adult 

population 

Number 

% of total 

adult 

populatio 

n 

Number 

% of total 

adult 

population 

No 

Schooling 

38 501 

7.1 

2 004 

8.5 

3 874 

7.4 

5 430 

6.4 

Some 

primary 

119 854 

22.0 

6 879 

29.3 

12 561 

24.1 

16 037 

18.8 

Complete 

Primary 

37 956 

7.0 

2 183 

9.3 

4 341 

8.3 

5012 

5.9 

Some 

Secondary 

183 599 

33.7 

8312 

35.4 

17419 

33.5 

26 840 

31.5 

Grade 12 

120 642 

22.1 

3414 

14.5 

9 714 

18.7 

22 753 

26.7 

Higher 

44 287 

8.1 

687 

2.9 

4 105 

7.9 

9 129 

10.7 


Mossel Bay and Bitou have the largest proportion (10.7 per cent and 10.2 per cent 


respectively), of the total adult population with an educational achievement higher 
than Grade 12 as well as the lowest proportion of people without schooling (6.4 
per cent and 6.1 per cent respectively). The largest proportion of people without 
schooling are found at Kannaland (8.5 per cent) and Oudtshoorn (7.7 per cent). 
Primary school education is important as it is a foundation for human development 
and therefore the existence of individuals without any form of schooling is a concern 
to decision-makers at local, provincial and national government. 


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2018-2019 Annual Report: Garden Route District Municipality 


Mossel Bay has the largest proportion of people with a Grade 12 qualification 
(26.7 per cent) followed by Knysna (23.7 per cent). High educational 
achievements indicate the availability of a skilled and qualified workforce which 
augurs well for economic growth. 


1.1.3 ROADS 

The total coverage of roads within the Garden Route district amounts to 6040 
kilometres. Gravelled divisional roads account for 46.63 per cent of all gravelled roads 
in the District, making it the largest proportion of all gravelled roads. Trunk roads 
comprise the largest proportion (41.58%) of surfaced roads across the Garden Route 
district. 


1.1.4 HEALTH DEVELOPMENT WITHIN GARDEN ROUTE DISTRICT 


The health conditions of persons living within the Garden Route region are analysed 
in this section by looking at infant mortality rates, the top 10 causes of death as 
well as the top 10 injuries that cause death. Between 2011 and 2016 life 
expectancy in the Western Cape averaged 64.8 years for males and 70.6 years for 
females according to the mid-year population estimates by Statistics South 
Africa in 2017. For the period between 2016 and 2021 the average life 
expectancy is expected to be higher at 66.2 years for males and 72.1 years for 
females. 

Figure 1. shows a decrease in infant mortality rates in Garden Route District between 
2007 and 2016, indicating an improvement in child health care in the period 
under review. 


23 



2018-2019 Annual Report: Garden Route District Municipality 



Source: Western Cape Health Department, 2018 


1.1.5 HUMAN SETTLEMENTS 

Access to decent formal housing is regarded as a basic human right and an 
important indicator of the level of human development within an economy. Table 
5.10 shows the different types of dwellings for households living within the Garden 
Route region in 2017, of which 27 874 or 15.2 per cent are informal and 154 934 or 
84.8 per cent are formal dwellings. 


Table 2 Human dwellings within Garden Route District, 2017 



Garden Route 

Kannaland 

Hessequa 

Mossel Bay 

George 

Oudtshoorn 

Bitou 

Knysna 

Dwelling Type 

Total 

Number 

%of 

Total 

Number 

%of 

Total 

Number 

%of 

Total 

number 

%of 

Total 

Number 

%of 

Total 

Number 

%of 

Total 

Number 

%of 

Total 

Number 

%of 

House or brick 
structure on a 
separate stand or 
yard 

137 361 

75.1 

6897 

94.8 

16255 

89.7 

22912 

72.8 

44929 

75.2 

18283 

78.3 

12645 

67.8 

15440 

64.0 

Traditional 

dwelling/hut/structur e 
made of traditional 
materials 

1358 

0.7 

30 

0.4 

152 

0.8 

197 

0.6 

392 

0.7 

191 

0.8 

201 

1.1 

195 

0.8 


24 















































2018-2019 Annual Report: Garden Route District Municipality 


Flat in a block of 
flats 

4013 

2.2 

47 

0.6 

293 

1.6 

861 

2.7 

1445 

2.4 

463 

2.0 

255 

1.4 

650 

2.7 

Town/cluster/semi¬ 
detached house 

(simplex, duplex or 
triplex) 

6168 

3.4 

34 

0.5 

131 

0.7 

2128 

6.8 

1468 

2.5 

1356 

5.8 

197 

1.1 

853 

3.5 

House/flat/room, in 
backyard 

2672 

1.5 

27 

0.4 

177 

1.0 

385 

1.2 

1184 

2.0 

405 

1.7 

138 

0.7 

357 

1.5 

Informal 

dwelling/shack, in 
backyard 

11066 

6.1 

82 

1.1 

467 

2.6 

1691 

5.4 

4522 

7.6 

1071 

4.6 

1781 

9.5 

1453 

6.0 

Informal 

dwelling/shack, NOT in 
backyard, e.g. in an 
informal/squatter 
settlement 

16808 

9.2 

94 

1.3 

418 

2.3 

2534 

8.0 

4839 

8.1 

1285 

5.5 

2927 

15.7 

4712 

19.5 

Informal dwellings 

27874 

15.2 

176 

2.4 

885 

4.9 

4224 

13.4 

9 361 

15.7 

2 356 

10.1 

4 708 

25.2 

6165 

25.6 

Room/flatlet not in 
backyard but on a 
shared property 

1161 

0.6 

10 

0.1 

71 

0.4 

392 

1.2 

367 

0.6 

109 

0.5 

95 

0.5 

117 

0.5 

Other/unspecified/ 

NA 

2200 

1.2 

52 

0.7 

152 

0.8 

388 

1.2 

640 

1.1 

198 

0.8 

418 

2.2 

351 

1.5 

Total 

182 808 

100 

7273 

100 

18117 

100 

31 487 

100 

59 785 

100 

23 360 

100 

18 657 

100.0 

24128 

100 


Source: Quantec Research, 2018 


George has the largest number of informal dwellings (9 361 households or 15.7 per 
cent) followed by Knysna (6 165 households or 25.6 per cent) and Bitou (4 708 or 
25.2 per cent). Although the Kannaland and Hessequa municipal areas have 
lower numbers of informal dwellings compared to the bigger municipal areas in the 
region, these remain a risk and a concern. The average number of people per 
household within municipal areas in the Garden Route region has remained stable at 
approximately four persons per household over the last decade. 

The number of people having access to basic services including water, electricity, 
sanitation and refuse removal is an indication of the level of human development 
within a municipal area. Figure 5.11 below shows the number of households receiving 
water, electricity, sanitation and waste removal services in the Garden Route District 
between 2014 and 2017. It can be seen from Figure 5.11 that there has been an 
increase in the number of households receiving water, electricity, sanitation and refuse 
removal, with significant increases noted for electricity and refuse removal services 
between 2016 and 2017. In terms of free basic services, it can be seen that a higher 
number of households receive free basic water between 2014 and 2016 but free 
electricity exceeded free basic water in 2017. Furthermore, there have been significant 


25 



























2018-2019 Annual Report: Garden Route District Municipality 

increases in the number of households receiving free basic services between 2014 and 
2015 which declined between 2016 and 2017. 

1.1.5 PROVISION OF BASIC SERVICES TO INDIGENT HOUSEHOLDS 


Figure 2 Access to basic services in Garden Route District, 2014 - 2017 


S 

£ 

m 


* 

j=i 

E 



u 

Wnflef 

Free Bast 

'Mttf 

EJectrim 

Free basis 
eiecricity 

SanitnTon 

Free basic 
sarisiori 

Fiaflisa 

nenoval 

Free bast 

refuse 

rerrwnl 

■ 2014 

130787 

60 333 

145 224 

53 415 

143 912 

45 095 

139 579 

45 544 

■ 2015 

140 C59 

117 706 

148 704 

721C6 

143 4. DC 

46 447 

156 099 

42 750 

■ 2015 

153 307 

1054.16 

151 635 

79 610 

151 027 

55 495 

159 725 

87912 

■ 2017 

15C £22 

90 14.0 

155 913 

102 256 

157 307 

52 603 

141 666 

53 153 


Source: Non-financial Census of MuntcipaSHtes. Stats SA: Quantec Research. 201B 


1.2 EMPLOYMENT AND THE ECONOMY 

1.2.1 EMPLOYMENT 

This section highlights key trends in the labour market within the Garden Route 
District municipal area. The wholesale and retail trade, catering and 
accommodation sector contributed the most jobs in the Garden Route municipal 
area in 2016 (52 954 or 23.9 per cent), followed by the finance, insurance, real 
estate and business services sector (38 3571 or 17.3 per cent); community, social 
and personal services (33 584 or 15.1 per cent); agriculture, forestry and fishing (29 


26 
















2018-2019 Annual Report: Garden Route District Municipality 

192 or 13.1 per cent) and general government (22 767 or 10.3 per cent). 
Combined, these top five sectors contributed 176 854 or 79.7 per cent of the 222 
010 jobs in 2016. 


Garden Route District employment growth per sector 2006 - 2017e 


Contribution 



to 

employment 

(%) 

Number 
of jobs 

Trend 


Employment (net change) 


Sector 

2016 

2016 

2006 -2016 

2013-2017e 

2013 

2014 

2015 

2016 

2017e 

Primary Sector 

13.2 

29 381 

-13 853 

3 656 

1 633 

-1 203 

5 166 

-1 189 

-751 

Agriculture, forestry and 
fishing 

13.1 

29 192 

-13 860 

3 639 

1 633 

-1 207 

5 155 

-1 188 

-754 

Mining and quarrying 

0.1 

189 

7 

17 

0 

4 

11 

-1 

3 

Secondary Sector 

16.2 

35 905 

-569 

2 568 

788 

816 

222 

353 

389 

Manufacturing 

8.9 

19715 

-553 

1 558 

645 

190 

341 

-192 

574 

Electricity, gas and water 

0.4 

875 

279 

105 

7 

20 

25 

35 

18 

Construction 

6.9 

15315 

-295 

905 

136 

606 

-144 

510 

-203 

Tertiary Sector 

70.6 

156 724 

34 929 

18 568 

4 196 

3 857 

5 020 

154 

5 341 

Wholesale and retail 
trade, catering and 
accommodation 

23.9 

52 954 

9 520 

6 835 

977 

615 

2214 

80 

2 949 

Transport, storage and 
communication 

4.1 

9 062 

2 972 

1 121 

574 

270 

607 

-753 

423 

Finance, insurance, real 
estate and business 
services 

17.3 

38 357 

12 948 

7 069 

1 503 

1 436 

1 941 

950 

1 239 

General government 

10.3 

22 767 

4 262 

-415 

-306 

1 019 

-550 

279 

-857 

Community, social and 
personal services 

15.1 

33 584 

5 227 

3 958 

1 448 

517 

808 

-402 

1 587 

Total Garden Route District 

13.2 

222 010 

20 507 

24 792 

6617 

3 470 

10 408 

-682 

4 979 


2018 Socio-economic Profile: Garden Route District Municipality 

Only the agriculture, forestry and fishing, manufacturing and construction 
sectors in the Garden Route District municipal area reported average decreases 
in jobs (-13 860, -553, and -295 respectively) between 2006 and 2016. There were 
also some job losses reported in the agriculture, forestry and fishing sector in 
2016 and 2017 due to the severe drought. This is concerning considering that it 
provides a significant contribution to Garden Route District's employment. The 
sector which reported the largest increase in jobs between 2006 and 2016 was 


27 




























2018-2019 Annual Report: Garden Route District Municipality 

the finance, insurance, real estate and business services (12 948) and wholesale, 
retail and trade (2 658) and community, social and personal services (5 227). 

The majority of workers in the Garden Route labour force in 2016 was dominated by 
semi-skilled workers (41.0 per cent) and 27.5 per cent were skilled. 


Garden Route District trends in labour force skills, 2006 

- 2017 


Formal employment 
by skill 

Skill level contribution 
(%) 

Average growth (%) 

Average growth (%) 

Number of jobs 2016 


2016 

2006 -2016 

2013-2017e 

2016 

2017e 

Skilled 

27.5 

3.4 

3.7 

44 472 

45 114 

Semi-skilled 

41.0 

0.7 

2.0 

66 293 

66 149 

Low skilled 

31.5 

-0.6 

1.9 

50 907 

50 587 

Total Garden Route 
District 

100,0 

0,9 

2,4 

161 672 

161 850 


Source: Quantec Research, 2018 (e denotes estimate) 


The number of skilled workers increased relatively fast over the 2006 - 2016 period, 
while growth was slower for semi-skilled workers; low skilled employment declined 
over this period. An improvement in education and economic performance can 
contribute to further increases in the number of higher skilled workers. 

1.2.2 UNEMPLOYMENT 


Unemployment Rates for the Western Cape (%) 

Area 

2007 

2008 

2009 

2010 

2011 

2012 

2013 

2014 

2015 

2016 

2017e 

City of Cape Town 

16.2 

15.2 

16.5 

17.8 

17.9 

18.1 

18.1 

18.5 

19.1 

20.3 

21.1 

West Coast 

4.7 

6.5 

7.9 

9.3 

9.7 

9.6 

9.2 

10.0 

9.0 

10.1 

11.1 

Cape Winelands 

6.5 

7.2 

8.3 

9.6 

9.8 

9.7 

9.4 

9.9 

9.1 

10.1 

10.7 

Overberg 

6.2 

6.9 

8.3 

9.7 

10.0 

10.0 

9.8 

10.5 

9.8 

11.1 

11.8 

Garden Route 

13.2 

12.7 

13.8 

15.0 

14.9 

15.0 

14.8 

15.1 

15.0 

16.3 

17.0 

Central Karoo 

20.5 

21.0 

22.0 

22.9 

22.6 

22.4 

22.1 

22.6 

21.7 

23.0 

24.0 

Western Cape 

13.3 

12.9 

14.2 

15.5 

15.7 

15.8 

15.7 

16.1 

16.2 

17.4 

18.2 


Source: Quantec Research, 2018 (e denotes estimate) 


Over the last decade, the Garden Route District's unemployment rate has been rising 
steadily; it has increased from 15.0 per cent in 2015 to 16.3 per cent in 2016 


28 


































2018-2019 Annual Report: Garden Route District Municipality 

and an estimated 17.0 per cent in 2017. The Garden Route District's 
unemployment rate in 2017 is slightly lower than that of the Province's 18.2 per cent 


1.2.3 ECONOMIC OUTLOOK 

The local economy of the Garden Route municipal area is dominated by the 
finance, insurance, real estate and business services sector (R10 014.3 million or 24.9 
per cent), followed by the wholesale and retail trade, catering and 
accommodation sector (R7 223.4 million or 17.9 per cent), manufacturing sector 
(R5 853.9 million or 14.5 per cent in 2016), general government (R4 106.2 million 
or 10.2 per cent) and transport, storage and communication (R4 019.8 million or 
10.0 per cent). Combined, these five three sectors contributed R31.2 billion (or 77.5 
per cent) to the Garden Route District municipal economy, which was estimated be 
worth R40.3 billion in 2016. 


Garden Route District GDPR performance per sector, 2006 

- 2017e 






Trend 


Real GDPR growth (%) 


Sector 

to GDPR (%) 
2016 

value 

2016 

2006-2016 

2013- 
2017e 

2013 

2014 

2015 

2016 

2017e 

Primary Sector 

6.1 

2 443.0 

1.4 

0.5 

1.8 

6.4 

-2.7 

-7.3 

4.4 

Agriculture, forestry 
and fishing 

5.7 

2 295.1 

1.5 

0.4 

1.7 

6.4 

-2.9 

-7.7 

4.2 

Mining and 
quarrying 

0.4 

148.0 

0.2 

3.5 

2.7 

6.8 

-0.1 

0.5 

7.7 

Secondary Sector 

24.2 

9 750.3 

1.8 

0.8 

2.0 

1.0 

0.2 

0.9 

-0.2 

Manufacturing 

14.5 

5 853.9 

1.9 

0.9 

1.7 

0.6 

0.3 

1.6 

0.4 

Electricity, gas and 
water 

3.1 

1 244.6 

-1.1 

-1.4 

-0.7 

-1.2 

-2.2 

-2.7 

-0.1 

Construction 

6.6 

2 651.8 

3.2 

1.2 

3.9 

2.9 

0.6 

0.4 

-1.8 

Tertiary Sector 

69.7 

28 077.6 

3.3 

2.4 

3.2 

2.8 

2.4 

2.1 

1.3 

Wholesale and retail 
trade, catering and 
accommodation 

17.9 

7 223.4 

2.5 

1.4 

2.4 

1.5 

1.9 

1.9 

-0.7 

Transport, storage 
and communication 

10.0 

4019.8 

3.4 

2.5 

3.2 

4.0 

1.5 

1.5 

2.4 

Finance, insurance, 
real estate and 
business services 

24.9 

10 014.3 

4.2 

3.4 

3.8 

3.5 

3.9 

3.2 

2.7 

General 

government 

10.2 

4 106.2 

2.7 

1.2 

3.5 

2.6 

0.3 

0.4 

-0.6 


29 


























2018-2019 Annual Report: Garden Route District Municipality 


Community, social 
and personal 

services 

6.7 

2 714.0 

2.1 

1.6 

2.5 

1.8 

1.1 

1.5 

1.2 

Total Garden Route 
District 

100.0 

40 270.9 

2.8 

1.9 

2.9 

2.6 

1.5 

1.2 

1.2 


Source: Quantec Research, 2017 (e denotes estimate) 


The 10-year trend, between 2006 and 2016, shows that the finance, insurance, real 
estate and business services sector registered the highest average growth rate 
(4.2 per cent) in the Garden Route District during this period, followed by the 
transport, storage and communication (3.4 per cent) and construction (3.2 per 
cent) sectors. Growth of the agriculture sector shrunk into negative territory in 2015 
and 2016 due to the severe drought but the estimated growth rate for 2017 is 4.2 per 
cent. 

1.3 SERVICE DELIVERY OVERVIEW 

1.3.1 SERVICE DELIVERY 

The following key service delivery initiatives were rolled out by various departments of 
Garden Route DM during the 2018/19 financial year: 


1.3.1.1 OFFICE OF THE MUNICIPAL MANAGER 


The Office of the Municipal Manager consists of the units as set out on the table below. 
The main functions of these units are to give support to the entire organisation. 


Support Services Objective 


Performance Management Develop, Implement and maintain an effective 

performance management system throughout the 
institution. 

Risk Management Facilitate Risk Management activities throughout the 

organisations to ensure that performance objectives are 
met. 


30 


















2018-2019 Annual Report: Garden Route District Municipality 


Internal Audit 


Political Office 


Communication 


Legal Services 


Provide the accounting officer, management and council 
with reasonable assurance regarding the effectiveness of 
controls environment. 

Providing support to councillors and to manage 
community based projects 

Develop, Implement and maintain and efficient and 
effective system of communication to internal and 
external stakeholders. 

Providing support, legal mechanisms and processes that 
are necessary to enable Garden Route District 
Municipality to fulfil its strategic objective of Good 
Governance as a regional leader in local government. 


We seek to continuously improve and to mature our good governance practices. We 
have undertaken a number of key activities relating to our application of the good 
governance practices. We have revitalised and capacitated our governance 
structures to ensure effective oversight, i.e. Municipal Public Accounts Committee 
(MPAC), Audit and Public Audit Committee (APAC), Risk Management Committee 
(RMC) and section 80 Committees (Municipal Structures Act). 

We have organised and hosted a very successful Good Governance Summit that 
was attended by delegates from the Public Sector, Private Sector, the local 
municipalities within our District and the Office of the Auditor-General. 

The main objectives of the summit were to: 

■ Empower all relevant stakeholders to effectively perform their oversight and 
enhance accountability through the implementation of effective governance 
structures; 

■ Enhance public participation process through effective good governance 
structures and new innovations to eliminate or minimize protests relating to 
service delivery; 

■ Insulate municipalities against interference from external stakeholders; 


31 



2018-2019 Annual Report: Garden Route District Municipality 

■ Encourage and improve ethics and ethical conduct within the municipal 
leadership; and 

■ Address the cost of corruption and poor governance. 


Media Coverage and Highlights 


<- tt Georgeherald.com 


= 

GEORCE 

HERALD 


Select Language ▼ 


TOP DOGS TACKLE TOPIC 
OF CORRUPTION 


Journalist Michelle Pienaar | Thursday, 20 June 2019, 
07:50 



• 'A 

Garden Route Municipal Manager, Monde 
Stratu 


GEORGE NEWS - Corruption was the topic of 
discussion at a Good Governance Summit, 
collaborativelv hosted bv the Garden Route 



We have successfully procured an Intergrated and Automated Governance 
System for the District. The system will be rolled out to five local municipalities 
(George, Mossel Bay, Kannaland, Hessequa and Knysna) to enhance 
governance, the other 2 municipalities within the district have already 
procured the system. 


At year-end the Internal Audit Unit conducted stock counts at selected 
Council stores and fuel depots across the District on behalf of the AG. 


The Communication and Graphic Design Unit, in-house, developed a 
municipal website, brand standards guide and the new municipal logo. Our 


32 





2018-2019 Annual Report: Garden Route District Municipality 

Facebook page is the second most “liked” out of the 44 district municipalities 
in South Africa. 


1.3.1.2 COMMUNITY SERVICES 


MUNICIPAL HEALTH & ENVIRONMENTAL SERVICES INFO CHAPTER 3 
1.3.1.2.1 INTRODUCTION TO MUNICIPAL HEALTH 


According to the Constitution of the Republic of South Africa 1996, the Local 
Government: Municipal Structures Act, 1998 (No.l 17 of 1998) and the National Health 
Act, 2003 (No. 61 of 2003) it is the statutory responsibility of the District Municipality to 
render Municipal Health Services. 

Section 24 of the Constitution of the Republic of South Africa entrenches the right of all 
citizens to live in an environment that is not harmful to their health or well-being. 
Section 1 of the National Health Act (Act 61 of 2003) defines Municipal Health Services 
and clearly stipulates the responsibilities of municipalities in the performance of such 
services. 

Environmental health comprises those aspects of human health, including quality of 
life, that are determined by physical, chemical, biological, social and psycho-social 
factors in the environment. It refers to the theory and practice of assessing, correcting, 
controlling and preventing factors in the environment that can adversely affect the 
health of present and future generations. 

Environmental health services are services that implement environmental health 
policies through monitoring and controlling, which improves environmental 
parameters and encourage the use of environmentally friendly and healthy 
technologies and behaviours. Controlling and monitoring plays a leading role in 
suggesting and developing new policy areas. (These definitions are in line with the 
definitions of the World Health Organization). 


33 






2018-2019 Annual Report: Garden Route District Municipality 


_L3.1.2.2 SERVICES RENDERED 

Residential, business and public premises are regularly monitored to ensure that there 
are no health nuisances. This is done to ensure compliance with the applicable 
legislation, the principles of Agenda 21 and the "Healthy Cities" approach, and the 
minimisation of any detrimental environmental health risk. 

Key Performance Areas: 

■ Chemical safety 

■ Disposal of the dead 

■ Environmental pollution control 

■ Food control 

■ Health surveillance of premises 

■ Surveillance and prevention of communicable diseases 

■ Vector confrol/monitoring 

■ Waste management 

■ Water quality monitoring 

■ Administration - general 


1.3.1.2.3 HEALTH INSPECTION, FOOD AND ABATTOIR LICENSING AND INSPECTION 


To fulfil its constitutional and legal obligations, the District's Municipal Health Services 
unit fulfils its mandate through the knowledge and expertise of our highly qualified and 
skilled Environmental Health Practitioners (EHPs). They provide and facilitate 
comprehensive, pro-active and needs-related services to ensure a safe, healthy and 
clean environment by preventing and eliminating sources of diseases. 

There are functional Municipal Health offices located in all the local municipalities in 
the District. The Municipal Health inspectorate is divided into 4 regions, namely: 

■ Klein-Karoo Region (Oudtshoorn and Kannaland) 

■ George 

■ Lakes Region (Bitou and Knysna) 

■ Langeberg (Mossel Bay and Hessequa) 


34 









2018-2019 Annual Report: Garden Route District Municipality 

Municipal Health services is a personnel driven function because of inspections and 
monitoring, according to the scope of practice of Environmental Health, which forms 
the basis of performing this function. Performing these functions will add value to 
“healthier people in healthier places” as in support of Section 24 of the Constitution 
which states that: “Everyone has a right to a safe environment”. 

Main functions: 

■ Monitoring of water quality 

■ Protection of water sources by enforcement of laws and regulations 

■ Implementation of health and hygiene awareness 

■ Control of food premises by issuing compliance certificates to food premises 

■ Ensure that food is safe and healthy for human consumption by the enforcement of 

■ laws and regulations 

■ The monitoring of the storage, treatment, collection, handling and disposal of the 
various categories of waste 

■ The identification, monitoring and evaluation of health risks, nuisances and hazards 

■ The promotion of health and hygiene aimed at preventing the incidence of 
environmental conditions that will result in contagious diseases 

■ Monitoring, identification, evaluation to ensure the prevention of vectors 

■ The identification, evaluation, monitoring and prevention of the pollution of soil, water 
and air 

■ Monitoring of cemeteries, crematoriums and other facilities for the disposal of corpses 

■ The monitoring, identification, evaluation and prevention of risks relating to chemicals 
hazardous to humans 

In terms of Section 15(2) of the National Environmental Management: Air Quality Act, 
2004, as amended (Act 39 of 2004) each municipality must include in its Integrated 
Development Plan (IDP) contemplated in chapter five of the Municipal Systems Act, 
an air quality management plan (AQMP). 

GRDM's Air Quality Management Plan was compiled in 2007 and revised in 2013. The 
project entailed providing assistance to the seven (7) B-authorities within GRDM's 
borders to ensure that each B-authority have AQMP and is compliant with the 


35 




2018-2019 Annual Report: Garden Route District Municipality 

requirements of the Air Quality Act. Both the 2007 and 2013 AQMP's versions were 
included in GRDM Integrated Development Plan (IDP). 

The following objectives were defined in the AQMP: 

■ Set Air Quality Goals 

■ Set Up Air Quality Management System 

■ Develop / compile emissions database 

■ Develop air quality monitoring network 

■ Dispersion modelling 

■ Reporting 

■ Carry Out Risk Assessments 

■ Assess and Select Control Measures 

■ Implementation of Interventions and Monitoring Effectiveness 

■ Revise Air Quality Goals 

■ Integrate the AQMP into the IDP 

■ Compliance Monitoring, Enforcement and Control 

■ Most of these objectives were totally met during the reporting year. Where a goal 

has been partially met it was due to budgetary constraints 


a) Highlights: Health inspection, food and abattoir licensing and inspections 

The following highlights were achieved during the financial year: 


HIGHLIGHTS 

DESCRIPTION 

MUNICIPAL HEALTH & ENVIRONMENTAL SERVICES 

GARDEN ROUTE: ENTIRE REGION 

Nat Dept of Health - Listeria Investigation: 
Meat Processing Plants 

20 June 2018 

The National Department of Health 
introduced control measures for the food 
industry regarding the Listeriosis outbreak. 
Municipal Health was directly involved in 
the sampling and inspection of this 
programme. 


36 












2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS 

DESCRIPTION 

Informal food trader's project. 

Provide education and awareness sessions 

to informal food traders 

Listeriosis Awareness and Recall 

Awareness, education material on Listeriosis 
was handed out to various outlets, formal, 
informal, and monitoring of recalls of food 
products. 

During Garden Route employee wellness 
day, employees were educated through 
the method of an exhibition 

World Tobacco Day 

To educate the owners / managers of 
restaurants to locate designated smoking 
areas for public. 

RIVERSDALE - OFFICE 

World Environmental Health Day: 25 
September 2018 

Theme: Global Food Safety and 

Sustainability 

Target group: Food Caterers 

Department of Social Development 
Training 

Communicable Disease training - Training 
was provided to all Sectional Heads of the 
region. 

George Agriculture “Landbou Vereniging” 

Raw Milk and Listeriosis: Training session 
provided to Dairy Farmers 

Department of Education 

Environmental Health Training and 
Inspections of Schools: Training with regard 
to 9 Key Performance Areas of Municipal 
Health was provided to School Governing 
Bodies 

Heidelberg and Riversdale Agricultural 
shows 

Successful monitoring of Informal Food 
traders during the event 

MOSSELBAY - OFFICE 

Formal health and hygiene training: 
Informal Food Traders in Asia Park and Kwa- 
Nonqaba. 

All educators received health training in 
waste management. 

Formal health and hygiene training at 4 x 
creches. 

51 participants (personnel) received 
certificates of attendance. 

Door-to-door Barber shop hygiene project 
and education, Kwa-Nonqaba. 

6 educators were trained regarding 
communicable diseases. 

Health and Hygiene training at Admirals 

12 food handlers received training, on 


37 
























2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS DESCRIPTION 


Casino 

health related matters regarding the 
management of food premises. 

Event Planning meetings eg. Buffalo Rallly, 
Whale Rally, Tarka festival, Mossel Bay Sport 
School week, Dias festival, Friemersheim 
Fragrance festial and various other events. 
World Food Day event at Brandwag with 
national Department of Agriculture and 
other role players. 

Meetings were held with Mossel Bay 
Municipality and all role players before any 
event, to pro-actively prevent health 
hazards during events. 

Daily Ploliday season monitoring meetings 
with Mossel Bay Municipality, SAPS, Tourism, 
Neighbourhood Watch, ATKV and other 
role players. 

To coordinate activities, and find solutions 
and give feedback on any matter that 
may cause a health hazard. 

Formal health and hygiene training at De 
Fleus Feeds 

51 participants (personnel) received 
certificates of attendance. 

Formal Hepatitis A training at Protea 
creche. 

6 educators were trained regarding 
communicable diseases. 

Health and Hygiene training at Admirals 
Casino 

12 food handlers received training, on 
health related matters regarding the 
management of food premises. 

Event Planning meetings. 

Meetings were held with Mossel Bay 
Municipality and all role players before any 
event, to pro-actively prevent health 
hazards during events. 

Daily Holiday season monitoring meetings. 

To coordinate activities, and find solutions 
and give feedback on any matter that 
may cause a health hazard. 


GEORGE - REGION 


■ Outreach Project at creches in 


collaboration with Department of 

Presentation and demonstrations on health 
and hygiene practices. 

Health 


■ Health and hygiene awareness 

(Clinics, schools, creches and food 

Public outreach around currently 

experienced diseases ( Listeriosis, Hepatitis 

premises) 

B, Scabies and Enteroviral meningitis) 


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2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS DESCRIPTION 


■ Syferfontein Basic Subsistence 

Door to door sessions to complete the basic 

evaluation 

Subsistence and Evaluation questionnaires. 

■ George Agricultural show 

Health and Hygiene education and 
awareness presentations and 

demonstrations in collaboration with other 

stakeholders. 

■ Operation fiela in collaboration 


with SAPS (Thembalethu, Conville , 

Monitoring food premises and give health 
education 

Uniondale and Lions Den) 


■ Barbershop and Hairdresser 


Awareness (Thembalethu) 

Health and hygiene Awareness 

■ Listeriosis Awareness and education 

Awareness on prevention of Listeriosis as 

(George Farmers Association) 

well as Health and hygiene education. 

■ Clean up Campaign in 


collaboration with George 

Health and hygiene awareness on illegal 

Municipality (Molen River and 

dumping 

Borcherds) 


■ Exhibition at George Civic Centre 

Public Awareness and health education 

■ Health and hygiene inspection at 


the George Old Car Show and 

Health surveillance of premises and food 
monitoring 

CANSA RELAY, Strawberry festival 



KLEIN KAROO REGION 


Klein Karoo National Arts Festival (KKNK) 

The Klein Karoo Municipal Health Office 
received a certificate for the rendering of 
outstanding environmental health services 
during the 2019 KKNK. 


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2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS 

DESCRIPTION 

Health and Hygiene Awareness program at 
Clinics. 

Environmental Health Practitioners of Klein 
Karoo region co-ordinated Environmental 
Health awareness sessions that was held at 
clinics in Zoar, Amalienstein, Calitzdorp, 
Bridgton and De Rust. 

Food safety training in Oudtshoorn 

EHP's provided informal food safety training 
to formal and informal food handlers in 

Oudtshoorn. 

Global handwashing day celebrations in 
Oudtshoorn 

EHP's held an awareness session on the 
importance of handwashing to school 
children. 

Health and Hygiene Awareness Drama 
performed in Hoeko and Dysseldorp. 

EHP's develop a health and hygiene 
awareness drama presented by peer 
educators and it was presented in 
commemoration of World Environmental 
Health Day. 

Environmental Health Norms and Standards 

Information for schools. 

Environmental Health Norms and Standards 
information sessions were presented to 
School Circuit Managers, School Governing 
Body members and School Principals. 

Communicable diseases and diarrhoea 

education and awareness sessions to 
creche principals in Dysselsdorp 

EHP's held an awareness session on 

communicable diseases, diarrhoea and 
importance of hand hygiene to creche 
principals and caregivers. 

BITOU - 

OFFICE 

■ Health and Hygiene Awareness 

■ 

Presentation and demonstrations on health 
and hygiene practices to food managers 
and handlers in terms of R638 

World Food Day Celebrations 

Presentation on safe food handling at 
informal food traders - taxi rank, 

Bossiesgif Soup Kitchen 

Kranshoek Kleuterskool 

Kurland Creche 

Health and Hygiene Awareness program at 
Clinics. 

Environmental Health Practitioners hand out 

Environmental Awareness booklets to 


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2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS DESCRIPTION 



various Clinics 

Global hand washing day 

To promote hygiene practices at Schools 
and Creches 

Kranshoek Kleuterskool 

World Environmental Day 

Environmental Health Practitioners held 
awareness sessions on Health & Hygiene 
Awareness, Waste Management, 

Recycling, and Water Quality to leaners. 

Matric Rage Plettenberg Bay 

Registration and monitoring of food outlets 
were successfully held. 


KNYSNA - OFFICE 


Barbers and hairdressers 

Education awareness sessions were held 

with 5 barbers and hairdressers in Nekkies 

and Damsebos area 

Formal food traders 

Education session was held at Knysna 
correctional services 

Health and hygiene session held with 
foreign nationals from the informal spaza 
shop trading and the distribution of 
pamphlets and posters 

Successful held and monitor oyster festival 

Monitoring food outlets 

Removal of asbestos material 

Successful completion of asbestos removal 
project 

Clean up project 

Partake in Community clean up at 
Kanonkop 

Blitz operation 

Joint blitz operation between Garden 
Route and Knysna SAPS on SPAZA shops. 

Surveillance of premises Karatara fire 

Health surveillance of premises during the 
Karatara fire. 

World Environment day 

Partake in door to door awareness 
regarding waste disposal in Knysna 


ENVIRONMENTAL SERVICES WASTE MANAGEMENT 


Negotiations have been concluded with 
the preferred bidder for the establishment 
of a Regional Waste Management Facility. 

The negotiation process with Interwaste / 
Eden Waste Management was concluded 
and the PPP Agreement will be finalised at 
the end of November 2019. 

Waste Characterisation Studies conducted 
at George and Kannaland Municipalities 

Waste Characterisation Studies were 
conducted and final reports were 


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2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS DESCRIPTION 


and the South African Breweries. 

compiled by GRDM and submitted. 

Home Composting Pilot Project 

implemented in Hessequa, Mossel Bay, 
George and Knysna Municipalities. 

The home composting pilot project was 
concluded in the Hessequa and Mossel Bay 
Municipalities and the data captured and 
analysed. George and Knysna 

Municipalities are still ongoing and data 
recorded on a monthly basis. 


Compilation of a Waste Minimisation Plan 
for South African Breweries 

Following the Waste Characterisation Study 
conducted at SAB, a waste minimisation 
plan was compiled by GRDM for SAB for 
implementation. 

Implementation of a Schools Recycling 
Programme Pilot Project at Percy Mdala 
High School. 

Waste education sessions conducted by 
GRDM to teachers and learners, recycling 
boxes and bags provided by GRDM. 

Schools Education and Awareness 

Education & awareness sessions were held 
at Plettenberg Bay Secondary School, Little 
Lighthouse Preschool, Kings Kingdom 
Preschool, St. Pauls Primary School, Zenzele 
Day care 

Upgrade of Garden Route Waste 
Management Information System 

The WIS was upgraded so that the required 
facilities can register and report directly 
onto the system / collaborator. This is more 
user friendly, time efficient and reduces the 
administrative burdens. 

Recycling Mascot 

Rocky the Recycling Rooster (Mascot) was 
utilised at the George Strawberry Festival, 
Plett Secondary School, Little Lighthouse & 
Kings Kingdom Preschools, St. Pauls Primary, 
World Tobacco Day, Zenzele Day care. The 
Mossel Bay and Knysna Municipality have 
branded their fleet and educational 
material with the mascot, respectively. 

Enforcement of District Waste 

Management By-laws 

Notices served in terms of Section 10 of the 
District Waste Management By-laws PG 
7818 of 01 September 2017. 


AIR QUALITY MANAGEMENT 


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2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS 

DESCRIPTION 

Atmospheric Emission Licencing (AEL) 

All new and renewal AEL application are 
processed via SAAELIP within the legislator/ 
timeframe 

100% NAEIS completion and auditing 

All 30 industries submitted their NAEIS reports 
within the required time-frames. This is due 
to the assistance given to industry in this 
regard. 

Routine inspections 

Compliance and Enforcement inspections 
and administrative enforcement at Listed 

Activities and Controlled emitters within the 

district. 

Complaints dealing 

Supporting B-municipalities with air quality 
complaints and resolving complaints 
concerning Listed Activities and Controlled 
emitters. 

GRDM Air Quality working group meeting 

Held 4 Industrial forums/ Working group 
meetings and thereby capacitated the 
Industry. 

Sampling 

The procurement of a mobile air quality 
monitoring station and the addition of a 
methane cell to monitor landfill sites. 
Particulate Matter sampling, Vehicle 
emission testing, passive sampling and 
weather station operation. 

Air Quality improvements 

Mitigation of air pollution at industrial level 

GRDM Clean Fires Campaign 

GRDM appointed a service provided to 
compile lesson plans aligned to the 
national curriculum (CAPS), as well as 
resources to complement teaching on 
Pollution (Air Pollution) as part of Life Skills 
for grade 3 leaners. These resources 
included A3 posters, games and content 
for use on the interactive whiteboard. 

Ambient Air Quality Monitoring 

Ambient air quality monitoring were 
conducted by means of making use of 
Radiello passive sampling, MiniVol 
Particulate Matter Sampler, portable 


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2018-2019 Annual Report: Garden Route District Municipality 


HIGHLIGHTS 

DESCRIPTION 


Scentinal SL50 and the three stationary 
monitoring stations of the Provincial 
Directorate: Air Quality Management that is 
located in Oudtshoorn, George and in 
Mossel Bay. The purpose of the sampling 
was to obtain baseline information and 
when dealing with air quality relating 
complaints. 

Vehicle emission testing: 

The Garden Route Air Quality unit 
embarked on a project in collaboration 
with the B-municipalities Air Quality and 
Traffic Department during 2018 whereby 
several diesel vehicles were tested for 

excessive smoke emissions. The vehicles first 
went through a visual test. If the visual test 
indicated excessive smoke, that vehicle 
was further tested by means of the vehicle 
smoke test instrument. 


Table F: Health inspection, food and abattoir licensing and inspections 



World Tobacco Day 

Councillors, management and staff of the Garden Route District Municipality (GRDM), 
in collaboration with other stakeholders, on Friday 31 May 2019, launched a World No 
Tobacco Day campaign in front of the GRDM head-office in George. 


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2018-2019 Annual Report: Garden Route District Municipality 



GRDM Schools guided to a greener future 


A pilot Primary School Recycling Programme has been launched at St. Paul's Primary 
School in George on 10 June 2019, by the Executive Mayor of Garden Route District 
Municipality (GRDM), Councillor Memory Booysen, in collaboration with the Waste 
Management Unit of GRDM and their recycling mascot known as ‘Rocky the 
Recycling Rooster'. Through this Programme, learners will be more likely to carry 
recycling habits into their adult years, while sharing it with family and friends. They will 
also be able to become more aware of how their personal actions can affect the 
future of the environment. 



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2018-2019 Annual Report: Garden Route District Municipality 

GRDM Clean Fires Campaign 

Since 2011 the Garden Route District Municipality's District Air Quality Unit embarked 
on air quality awareness relating to clean fires, called the Garden Route Clean Fire 
Campaign. Ongoing projects were identified due to life-threatening air quality 
incidents in especially informal settlements, caused by fires used for household 
purposes, such as cooking and heating. Awareness sessions advanced to a level 
whereby the Department of Education allowed the Air Quality Project to be 
incorporated into the curriculum of Grade 3 learners in the Garden Route. During the 
week of 13 to 17 May 2019, the roll-out of the Clean Fires Programme commenced in 
the Klein Karoo (Oudtshoorn and Kannaland) region, as this is a significant target 
group, since most of these communities use wood for heating purposes during the 
cold winter months. 



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2018-2019 Annual Report: Garden Route District Municipality 


_ FIRE AND RESCUE SERVICES_ 

The Garden Route District Municipality provides a fire service serving the district as a 
whole as described in the Local Government: Municipal Structures, Act 117 of 1998 
which states under section 84.1 (j): 

84. Division of functions and powers between district and local municipalities 
(1) A district municipality has the following functions and powers: 

(j) Fire fighting services serving the area of the district municipality as a whole, which 
includes- 

(i) planning, co-ordination and regulation of fire services; 

(ii) specialised fire fighting services such as mountain, veld and chemical fire services; 

(iii) co-ordination of the standardisation of infrastructure, vehicles, equipment and 
procedures; 

(iv) training of fire officers 


■ This year the GRDM was given a capital budget allocation to procure two fire trucks, an incident command 
vehicle, equipment and uniform. 

■ The Incident Command vehicle was delivered and procured via a formal tender process. 

■ Two(2) firefighting trucks have been ordered and will be delivered before the end of the calendar year and 
was procured vial a formal tender process 

■ New grass fire fighting apparel which meets the required standards for its application was delivered and 
procured via a formal tender. 

■ Station wear was delivered and procured via a formal tender 

■ Fifteen(15) Self-contained breathing apparatus were delivered and procured via 
an informal tender process 

■ Six(6) Level A and 16 level B hazmat suits were delivered and procured via an 
informal tender process. 

■ Four(4) Water nozzles were delivered. 

■ One(l) Member is being trained in the Firefighter 2 and Flazmat Operations 
courses being presented by the WCPG in Mossel Bay 

■ Two(2) Members completed the Advanced Rope Rescue training programme 
being presented by the WCPG in Bredasdorp. 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Two(2) Members are currently on the OETDP training programme being 
presented by the GRDM. 

■ Six(6)Members completed the Radio Telephonic Base Operator training. 

■ Two(2) Members attended the Incident Management training facilitated by the 
WCPG in Bredasdorp. 

■ One(l) Member completed ICS Division Supervisor training 

■ Two(2) Members completed their SAESI Diploma in Fire Technology 

■ Four(4) Members wrote subjects in the SAESI Higher Certificate in Fire 
Technology 

■ One(l) Member is busy with the Diploma in Public Management through 
Damelin. 

■ Public Awareness programmes are conducted with communities to make them 
aware of the dangers of fire and the actions to be taken in the event of fire. 

■ Fire safety compliance, inspections and awareness programmes are 
conducted in Kannaland where all functions of the fire service are provided. 

■ The October/November fires in George and Plessequa initiated a response from 
the provincial department responsible for fire services with operational 
assistance and a grant funding of RIO million. 

■ The October/November fires saw the following departments, municipalities and 
state entities involved in combating the disaster fires: GRDM, George 
Municipality, Mossel Bay Municipality, Plessequa Municipality, Knysna 
Municipality, Bitou Municipality, Overstrand Municipality, Overberg Municipality, 
City of Cape Town, Cape Winelands, West Coast Municipality, Cape Nature, 
SANS Parks, MTO, PG Bison and Working on Fire. 

■ The GRDM assisted with firefighting crews that were dispatched to Overstrand 
Municipality during its disastrous fires of December. 

■ On 5 May 2018, Garden DM Firefighters participated in a Potjiekos competition 
and a Firefighter Team Challenge at Garden Route Mall. Two teams from Eden 
DM excelled during the Team Challenge where 11 teams competed. 


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2018-2019 Annual Report: Garden Route District Municipality 



Firefighter team challenge at Garden Route Mall 

FIREFIGHTING SYMPOSIUM 

On the 3 rd of October 2018 the GRDM in collaboration with the George 
Campus of the Nelson Mandela University (NMU) hosted the 2018 Fire 
Management Symposium. 

The event was well-attended by representatives from forestry companies, 
government departments, including the National Disaster Management 
Centre, municipal authorities, media houses, private and public conservation 
bodies, academic and research institutions, as well as private and public 
landowners and land-managers. 

The first day's event followed by two more days of active participation and a 
gala evening which the Executive Mayor of GRDM, Cllr Memory Booysen, and 
former Principal of the Nelson Mandela University in George, Prof. Quinton 
Johnson, also attended. At the gala evening, these dignitaries addressed the 


49 




2018-2019 Annual Report: Garden Route District Municipality 

audience about the issue of the expropriation of land which left many 
delegates with something important to think about. 



Speakers who addressed the delegates on the first day of the event, are from left: Dr Christo Marais, Chief 
Director at the Department of Environmental Affairs, Mr Roger Godsmark, Operations Director of Forestry 
South Africa, Mr Paul Buchholz, Project Manager of the Garden Route Rebuild Initiative, Dr Jaap 
Steenkamp, Director of Forestry and Allied Manufacturing, Ms Pumeza Nodada, Acting Deputy Director- 
General: Forestry and Natural Resources Management, Mr Malcolm Procter, Deputy Director of Regulation 
and Oversight at DAFF, Mr Leo Long, Senior Practitioner for Training and Skills Development at SAFCOL, Mr 
Axel Jooste, Projects Manager at SAPPI Forestry, Mr John-John Emary from Volunteer Wildfire Services, as 
well as Dr Mmaphaka Tau, Deputy Director-General (Head) of the National Disaster Management Centre. 



Panel discussions throughout the events, allowed delegates to pose questions to the 
speakers. The first panel consisted of Mr Gerhard Otto, Manager of Disaster 
Management at Garden Route District Municipality, Ms Pumeza Nodada, Acting 
Deputy Director-General: Forestry and Natural Resources Management, Ms Pumeza 
Nodada, and Deputy Director-General (Head) of the National Disaster Management 
Centre, Dr Mmaphaka Tau. 


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2018-2019 Annual Report: Garden Route District Municipality 


♦ 



Officials from the Garden Route District Municipality who were present at the symposium, were: Executive 
Manager of Community Services, Mr Clive Africa, Acting Speaker, Cllr Barend Groenewald, Manager of 
Disaster Management, Mr Gerhard Otto and the Garden Route DM George Fire Station Officer, Mr Deon 

Stoffels. 

As part of the presentations at the symposium Mr Paul Buchholz, Project Manager of 
the Environmental work stream of the former Garden Route Rebuild Initiative (GRRI), 
elaborated on the activities performed soon after the outbreak of the June 2017 fires in 
the Garden Route and how these activities were maintained. Efforts ensured 
successful outcomes to prevent further damage to affected areas, e.g. one such 
activity was the installation of 34 kilometres of fire sausages (soil erosion prevention 
booms) at the most damaged and affected areas to ensure that sediment does not 
flow down from higher geographical areas. Mr Buchholz acknowledged that this 
could not have been successfully implemented without the assistance of geographic 
information systems (GIS) to analyse the high-risk areas. A drone was also used to spot 
the most affected areas in order to prioritise and guide intervention initiatives. 


51 


2018-2019 Annual Report: Garden Route District Municipality 



Executive Mayor of GRDM, Cllr Memory Booysen (right), and former Principal of the Nelson Mandela 
University in George, Prof. Quinton Johnson (left), addressed the delegates at the gala evening on 4 

October 2018 



Fire Symposium 


DISASTER M ANAG MENT_ 

In terms of the legislative requirements, the Garden Route District has a fully functional 
Disaster Management Centre (DMC).The centre is staffed with the following staff: 

• Head of Centre (HOC), Mr. Gerhard Otto, 

• One Disaster Management Official, Mr. Wouter Jacobs, 


52 














2018-2019 Annual Report: Garden Route District Municipality 

• One Disaster Risk Reduction & Climate Change Adaptation Practitioner, Dr. 
Nina Viljoen, 

• One Call Centre Supervisor, and Me. Stella Bouwer with 4 permanent and two 
contract call centre staff as well as; 

• Two Disaster Management Interns manning the DMC research unit, 

For the 2019/20120 book year the intention would be the appointment and placement 
of at least two disaster management officials to be placed at disaster management 
capacity constrained local municipalities. 

At this point in time local municipalities do not provide any staff or funding towards the 
district DMC, but the following local municipalities have appointed dedicated disaster 
management officials who closely work with the Garden Route Head of Centre: 

• Oudtshoorn LM; 

• George LM; 

The GRDM disaster management centre (DMC) has been equipped with a joint 
operational command and tactical decision areas. In order to stay abreast with 
regional emergency related activities a 24/7 call centre has been established 
adjacent to the DMC. The 24/7 call centre is operated in conjunction with provincial 
Emergency and Medical Services (EMS) and renders an emergency call taking and 
dispatch platform servicing the district as a whole. 

In addition to the EMS call taking staff the Garden Route DM call centre is staffed with 
four permanently employed Operators as well as two call centre reservists. For the 
2019/2020 book year the intention would be to roll out the newly procured disaster 
management information management as well as fire dispatch platform to all local 
municipalities in the region. This platform will ensure standard operational procedures, 
tracking of all resources as well as better coordination during major incidents as well as 
disasters. 

Main activities of the Garden Route Disaster Management center 


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2018-2019 Annual Report: Garden Route District Municipality 

1. Due to the ongoing drought in the Western- as well as the Eastern Cape a 
National drought disaster was declared this year. Although the declaration 
lapsed after three months, the national drought disaster classification 
remained and especially for the Northern, areas of the district special drought 
interventions had to be implemented to prevent towns from running dry. 

2. During the year, the Garden Route Call Centre continued with the upgrading 
of the old analogue based two-way radio communications platform to a 
digital system complete with GPS tracking capability. This system is similar to 
what Provincial EMS, provincial traffic and the South African Police Service 
uses. Sharing a common two-way radio platform enables the District's DMS to 
develop an emergency communications platform over the next couple of 
years. 

3. The Garden Route DMC assisted the Oudtshoorn- and Kannaland local 
authorities during the below normal rainfall periods in the first and second 
quarter of this year. 

These authorities were allocated disaster grant funding to build water security 
capacity. This included the drilling as well as equipping of borehole, the first 
phase in the connection of the deep-water aquifer boreholes at Blossoms to 
Oudtshoorn as well as the Klein Karoo Rural Water Supply Scheme and the 
refurbishment of existing infrastructure to ensure that these town's meet their 
minimum water demand. 

4. In order to assist the Zoar community with rainwater harvesting, the tankering 
of water to water stressed communities as well as during water shedding 
periods council approved that R550 000 from the disaster centre's budget 
could be re-prioritised to be used to assist this authority. 

5. As a pro-active response to the Western Cape Drought disaster all the Water 
Management Plans of local municipalities were updated with a special focus 
on preparedness planning for avoiding “day zero”. 

6. During October and November 2018 the GRDM district experienced a fire 
extending over more than 4 times the area that burnt in last year's Knysna / 
Bitou fire. 10 Lives were lost as a direct consequence to the fires and although 


54 



2018-2019 Annual Report: Garden Route District Municipality 

very few formal sfrucfures bumf fhe fire had a crippling effect on especially 
the forestry industry. For the 2019/2020 book year the focus would be to 
quantify the current knock-on effects of this fire disaster as well as to predict 
the affect this fire would have over the next three to five years. The intention 
of the DMC would be to provide a heads-up to all stakeholders in order to 
collectively develop a “safety net” for those affected as well as to be 
affected by this disaster. 

7. The Garden Route DMC, in collaboration with the PDMC, managed to update 
the Bitou disaster risk assessment the update of the Mossel Bay and Hessequa 
disaster risk assessments is currently work in progress. 

8. In order to ensure the inclusion of Disaster risk reduction and preparedness 
plans as part of local municipal IDP's a special meeting with all the local 
municipal IDP Managers were hosted. Guidelines to assist in the main 
streaming of Disaster risk reduction and preparedness planning were 
developed and provided to local municipalities at this engagement. 

9. Fire, flood and drought awareness campaigns were held in collaboration with 
the PDMC. 

10. The Garden Route DMC, in collaboration with the South African National 
Roads Agency executed two accident simulations on the N2. 

1 l.The Garden Route DMC continued to build capacity at local authority levels, 
facilitating formal and informal training sessions, as well as the development 
of concept plans and guidelines to be used by local authorities. 

12. The Garden Route DMC continued to support the initiatives started by the 
Garden Route Rebuild Initiative with the restoration of not only the dignity of 
communities in the Knysna and Bitou areas who were affected by the June 
2017 inferno, but also to ensure interventions focussing on the environment 
and to build resilience . 

Analysis of the Centre’s outlook on future events, risks and disasters occurring 

Economic perspective 


55 



2018-2019 Annual Report: Garden Route District Municipality 

1. The Garden Route DM is an important economic growth area for the Western 
Cape. It has an expanding population on account of immigration from other 
parts of the country, bringing a dynamic mix of skills and cultures to the district. 
The relatively high percentages of households with no income in areas with 
higher population density, creates several social challenges. The October and 
November 2018 disaster fires as well as the prevailing drought conditions will 
continue to cripple the local economy of the district. 

Basic services and infrastructure 

2. Challenges in terms of the provision of basic services infrastructure are 
experienced at the local municipalities that have seen rapid population 
growth. The natural environment and its resources of the GRDM are sensitive 
and susceptible to overexploitation or inappropriate use. 

Condition of natural “disaster barriers” 

3. The Garden Route has largely intact wetlands which attenuate water; prevent 
erosion and flooding and which naturally purify the water. However, many 
wetlands are being slowly degraded through illegal channelling, the removal of 
reeds, peat and other water flora by transgressors who abstract water, mostly 
for agricultural purpose. 

The Garden Route Annual Fire Commemoration Event :7 June 2019 


On the 7 th of June 2019 the Garden Route Annual Fire Commemoration and Climate 
Change & Adaptation Indaba was hosted by the Garden Route District Municipality 
(GRDM) in collaboration with the South Cape Environmental Forum. The aim of this 
Indaba was to once again remind role-players about the fire disaster fires that 
occurred in June 2017 and October 2018 in the Garden Route District as well as to 
reflect on the aftermaths and tragic losses because of these fires. The Indaba took 
place at the Wilderness Hotel in Wilderness of which approximately 150 delegates 
attended. 


56 



2018-2019 Annual Report: Garden Route District Municipality 



Garden Route District Municipality was well represented at the event. FLTR are: Dr Nina Viljoen, Cllrs Rowen 
Spies, Erica Meyer, Thersia van Rensburg, Joslyn Johnson, Mayor Memory Booysen, Daniel Saayman, Mr 

Gerhard Otto and Deputy Mayor Rosina Ruiters. 



Various role-players from Government Organisations, Training Institutions, Municipalities and members of 
the media attended the event. Front (fltr) GRDM Manager: Disaster Management, Mr Gerhard Otto, 
Executive Mayor, Cllr Memory Booysen and Municipal Manager, Mr Monde Stratu. 


57 


2018-2019 Annual Report: Garden Route District Municipality 

Delegates represented organisations and institutions, such as the National Department 
of Environmental Affairs, the Western Cape Department of Environmental Affairs and 
Development Planning, Stellenbosch University and Nelson Mandela University, as well 
as GRDM and Knysna Municipality were in attendance. 

The main purpose of the Indaba was not to only host the Annual Fire Commemoration 
event, but also to build on the momentum and team effort the region has created in 
their efforts to recover from the fire, but also to host a Climate Change Indaba. The 
main objective being to shape a better prepared, climate- ready and resilient Garden 
Route environment for the communities we serve. 

Dr Nina Viljoen, Manager: Disaster Risk Reduction and Climate Change Adaptation at 
GRDM described the event as crucial in the way the region is planning ahead with a 
challenging environment at play. 

Most of the presentations made at the Indaba, placed emphasis on water security, 
high quality water resources, the living conditions of the communities, sanitation 
facilities as well as the regrowth of alien vegetation. These factors place a high risk on 
the state of health of the residents of the area and the economic growth of the 
Garden Route. 



58 




2018-2019 Annual Report: Garden Route District Municipality 


Dr Nina Viljoen, Manager: Disaster Risk Reduction and Climate Change Adaptation at GRDM 

during, her presentation at the event. 


Dr Jo Barnes, Epidemiologist and Senior Lecturer Emeritus in Community Health at the 
Stellenbosch University's Faculty of Medicine and Health Science, provided insight in 
terms of the harsh realities of the impact of climate change on public health systems. 



IIFF "Culture 
ui l injure 




_ and public Health 

iM , B rpr.pare«"' Mand 

Special emphasis: 

Waterborne (foodborne) diarrhoeal disea 


We are facing a slow di 
pollution of water sourc 
sanitation 


- vs:. 


RONMENTALFORUM 


Dr Jo Barnes, Epidemiologist and Senior Lecturer Emeritus in Community Health at the Stellenbosch 
University, spoke about the harsh realities of the impact of climate change on public health systems in the 

Garden Route. 

Kannaland Drought - Assistance provided 

The residents of Zoar in Kannaland will now be able to store their potable water in 
proper containers, after the Executive Mayor of Garden Route District Municipality 
(GRDM), Cllr Memory Booysen, handed over 850 x 20 litre water containers to 
Kannaland on Friday, 15 March 2019 at the Library Hall in Ladismith. 


59 











2018-2019 Annual Report: Garden Route District Municipality 



Executive Mayor of Garden Route District Municipality, Cllr Memory Booysen, addressing the delegation 
and officials during the handover ceremony. 

The potable containers were handed over to the Executive Mayor of Kannaland, Cllr 
Magdalene Barry, in the presence of the Western Cape Minister of Environmental 
Affairs and Development Planning, Mr Anton Bredell, Western Cape Minister of 
Agriculture, Ms Beverly Shafer, officials from GRDM and Kannaland Municipality, as well 
as farm owners and community members of the area. 



The delegation and officials during the discussions prior to the handover ceremony. 

Before the handover Mr Gerhard Otto, Manager of Disaster Management of Garden 
Route DMC, sketched the dire situation of the dams in Kannaland as well as the 
crippling effect that the drought conditions had in terms of job losses and the adverse 


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2018-2019 Annual Report: Garden Route District Municipality 

affect on food security. Mr Willem Burger from the Western Cape Department of 
Agriculture, delivered a summary of how the Department assisted Kannaland through 
support programmes and projects rolled out in the area during the past years. 



GRDM Manager of Disaster Management, Mr Gerhard Otto, Portfolio Chairperson of Properties and Asset 
Management at GRDM, Cllr Joslyn Johnson, Western Cape Minister of Environmental Affairs and 
Development Planning, Mr Anton Bredell, Western Cape MEC for Agriculture, Minister Beverly Shafers, 
Speaker of Kannaland Municipality, Ms Aletta Theron, Executive Mayor of GRDM, Cllr Memory Booysen, 
Executive Mayor of Kannaland, Cllr Magdalene Barry and GRDM Councillor, Cllr Albertus Rossouw, in front 
of the truck, with three tanks, that delivers water to the Zoar Community. 

During the event. Minister Bredell, also announced his plans and what his Department 
had in store for the community of Kannaland. He indicated that the only solution to 
address poverty is job creation. In terms of this he committed to the roll-out of the 
following projects nl: the resealing of the road between Calitzdorp and Oudtshoorn, as 
well as the building of a new clinic- these projects amount to R 38 million. To address 
the drought in the area, two new boreholes to the value of R3.4 million will be 
commissioned and the waste water treatment plant would be rehabilitated with a 
project to the value of R195 000. The Zoar waste water treatment works (R745 000) and 
also the Calitzdorp waste water treatment works (R1.5 million) were added to his 
Department's priority list. 


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2018-2019 Annual Report: Garden Route District Municipality 

1.3.1.3 ROADS SERVICES 

Phase two of the Friemersheim multi-year project has been completed, phase three 
are on schedule for completion in September 2019. The department has managed to 
spend 103% of its R178 million budget for the upgrade and maintenance of roads in 
the district. 




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2018-2019 Annual Report: Garden Route District Municipality 


1.3.1.4 CORPORATE SERVICES 


_HUMAN_ RESOURCES_ 

The Human Resources Section consists of the following disciplines: 

■ Human Resource Management 

■ Employment Equity 

■ Recruitment and Selection 

■ Human Resources Administration & Conditions of Service 

■ Regional Task Administration 

■ Training and Development 

■ Labour Relations 

■ Occupational Health and Safety 

■ Wellness and Employee Assistance 

Human Resource role is vital in ensuring optimally, adequate, qualified and skilled staff 
in the organization for meeting the diverse needs of planning, in line with 
the organization's strategic goals. HR provides guidance and direction in shaping the 
size and skill-levels of the personnel so that the organization is staffed with efficient and 
compact strength of manpower. The training needs of the staff in the organization is 
also addressed, the growth plan for the employees, objective performance 
evaluation, staff retention / incentives and other associated issues, without 
compromising and in coherence with the above objectives. 

The demand for HR services continues to grow. Organizational challenges must be 
addressed that have management, workforce and development, technological, and 
especially financial sustainability for the Garden Route District Municipality. How we 
respond to these challenges will impact our ability to position the Garden Route as an 
employer of choice that maximizes organizational and individual potential. These 
trends and challenges include: 

1. Reduced Financial Resources - Identifying efficiencies and innovations to 
address the structural budget deficit. As GRDM takes steps to reduce costs, 
there will be increased stress on departments and their employees. Although 


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2018-2019 Annual Report: Garden Route District Municipality 

the GRDM's workforce may decrease, customer needs for HR support services 
are expected to grow, requiring increased productivity gains through 
technology, as well as the adoption of other innovative solutions to meet 
demand. 

o Changing Workforce/Strategic Talent Management - Designing and 
implementing succession and performance management programs to 
increase organizational capacity and respond to a changing workforce. 

Preparing for this change will require the delivery of targeted training 
programs, including the use of e-learning solutions where possible. 

o Demographic shifts within our geographic area, as well as within our 
existing workforce, will require appropriate marketing and 
communication strategies to attract qualified and diverse candidate 
pools. We plan to continue the implementation of our current succession 
planning activities. 

o Stabilizing Labour and Benefits Costs - Identifying efficiencies / budget 
reduction strategies to maintain/reduce labour costs. The HR Section, in 
partnership with our stakeholders, will continue to negotiate with labour 
organizations to implement structural budget changes that are aligned 
with our current and anticipated economic conditions and operational 
needs. We will also continue to promote wellness programs and 
employee incentive options as a cost-effective health and productivity 
management strategy for the Garden Route that will also yield important 
benefits to our individual workers and their families. 

o Expanding Strategic Partnerships - Identifying and enhancing 
opportunities to collaborate with customers to increase organizational 
effectiveness. The HR Section will continue to broaden its service focus to 
include a consultative approach to human resource management, and 


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2018-2019 Annual Report: Garden Route District Municipality 

not just an administrative approach. There is a notable increase in 
management and supervisory skills across many departments as a result 
of Garden Route's ongoing investment in training and development. This 
additional capacity, along with the increased use of self-service 
information technology, has allowed our staff to more personally adds 
value and help departments carry out their strategic plans using their 
human capital. 

o Managing Complex Employment Laws and Issues— identifying and 
addressing legal trends and employer-employee changes to determine 
impact to the organization. We expect that anticipated changes to laws 
that expand employee rights will require the Section to respond to an 
increase in employee relations cases. 

We will continue to be proactive in addressing employment issues by 
offering regular training and consultations with employees, supervisors, 
and managers. Changes in labour organization leadership will require 
the Section to expand outreach efforts to ensure that the 
communication between all stakeholders remains open and 
constructive. 

o HR Technology - Maximizing technology to streamline HR transactional 
activities. The HR Section is committed to streamlining our business 
processes in order to decrease costs and improve service. We plan to 
fully leverage our information technology resources to offer flexible, user- 
friendly and integrated systems, 

including the expanded use of employee self-service. This will allow our 
Section to move beyond just transaction processors to become more 
consultative partners with our customers. 

AUXI LI ARY SERVI CES 

In terms of the approved organizational structure of Council, the Section Auxiliary 
Services comprises of: 


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2018-2019 Annual Report: Garden Route District Municipality 


■ Records Management 

■ Fleet Services 

■ Reproduction services 

■ Access Control 

■ Switchboard Services 

■ Office cleaning and Messenger services. 

Garden Route District Municipality has, as all other organizations, essential 
administrative and other support functions that are not necessarily statutory 
prescribed but that are necessary in order for organizations to function. 

These functions are referred to as Auxiliary Services. A new position for the Supervisor 
Records was created and was filled on 2 May 2019. 

A new sub-section namely Fleet Management was added to the section's structure 
in January 2019. 

In terms of section 9(2) (c) of the Provincial Archives and Records Service of the 
Western Cape Act, 2005 (Act 3 of 2005), the Manager Records must ensure that the 
legislative requirements with regards to records management practices in the 
Municipality are adhered to. The following compliance activities took place and was 
approved in the last financial year namely: 

1. The Records Control Schedule is a statutory guideline which indicates 
when official records/ documentation may be destructed and or 
transferred to the repository in Cape Town, and was approved by the 
Western Cape Archives and Records Service on 4 October 2018. 

2. Each municipality must in terms of the Provincial Archives Act (Act 3 of 
2005) do regular disposal procedures, destroy and transfer of records 
that includes financial as well as other records. 


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2018-2019 Annual Report: Garden Route District Municipality 

3. Annual Disposal program- 2 unemployed young people were 
appointed for 3 months from 17 September 2018-14 December 2018. 

According to archival legislation all records of the municipality must be filed and 
stored on steel shelving. The steel shelving was part of the Capital Projects for the 
section for 2018/2019 and it was successfully completed on 30 October 2018. 

A Strategic Plan for the centralisation of records was developed and tabled at the 
Management Committee on 31 January 2019. The objective is to create sustainable 
records management awareness in the municipality. 

Attendance of quarterly Records Management Forum meetings took place on 7 
September 2018, 16 November 2018, 3 February 2019 and 2 June 2019. The objective 
of the said forum meetings is: 

■ To create a platform for records managers in the Western Cape Province 
to discuss strategic matters experienced in the records management 
environment 

■ To unify Records Managers of the province to ensure a cohesive forum, 
where consistent records management practices are addressed 

■ To encourage that records management matters experienced by 
governmental bodies are brought to the attention of the Forum to enable 
them to address it 

■ To ensure that management of records is part of the strategies and 
strategic development plans of governmental bodies. 

I C T 

The Garden Route ICT function is currently serving 350 (ICT-related) users with 
computer and network services within the Garden Route District Municipality. 

Our coverage area consists of Garden Route DM Plead Office, Roads, Health 
Environment, Fire stations in George, Disaster Management, Remote Offices, 
Calitzdorp Spa, De Ploek Resort, Swartvlei, Kraaibosch, and we are also directly 


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2018-2019 Annual Report: Garden Route District Municipality 


involved with the B Municipalities in our region with regards to strengthening 
Intergovernmental relations (Shared Services). 

The ICT component are active members of the following forums: 

■ Western Cape ICT Managers forum 

■ Garden Route regional ICT Forum 

■ Garden Route ICT Steering Committee 

■ GISSA, SAGI, SAGC 

■ Western Cape GIS forum and 

■ Garden Route regional GIS discussion groups 


Governance 

With reference to, the implementation of the approved ICT Governance Policy 
Framework, the ICT Strategic Plan is in its final phase and the following policies were 
revised and approved by Council. 

■ Municipal Corporate Governance of ICT Policy; 

■ ICT Governance Charter; 

■ Risk Management Policy that included the management of Municipal- 
related ICT risks; 

■ Internal Audit Plan that includes ICT audits; 

■ ICT Management Framework; 

■ ICT Disaster Recovery Plan informed by Municipal Continuity Plan and 
Strategy. 

■ Data Backup and Recovery policy. 

■ ICT Service Level Agreement Management policy. 

■ ICT User Access Management policy. 

■ ICT Security Controls policy. 

■ ICT Operating System Security Controls policy. 

GIS 


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2018-2019 Annual Report: Garden Route District Municipality 
Spatial data services: 

With regards to Council Properties the following was done with great success; 

■ Provision of electronic and hardcopy maps for property section of Garden 
Route DM 

■ Calculation of property sizes and provision of Surveyor General - diagrams 

■ Provide onsite assistance with the alien vegetation projects of council 

■ Prepare maps and reports as per requirement of property section. 

■ Locality Maps 

■ Provision of route maps for Garden Route DM employees travelling to 
meetings outside of the Garden Route DM region. 

■ Provision of locality maps for meetings scheduled for provincial and 
national departments attending meetings within the Garden Route DM 
boundaries. 

■ Provide spatial data assistance to B-Municipalities within the Garden Route 
DM region. 


GISc Web-Service development 

■ Development of spatial data/intelligence web-services for user departments 
based on user requirements. 

■ The GISc section of Garden Route DM with the assistance of Esri South Africa 
initiated a project to development web-services for the spatial data 
management within Garden Route DM. 

■ Mapping of spatially related projects in the Garden Route DM region was a 
core component of the project. 

1.3.1.5 FINANCIAL SERVICES 

■ Unqualified audit opinion 2013/14 - 2015/16. 

■ Unqualified with findings 2016/2017 and 2017/18 

■ Improvement of cash and financial position. 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Improvement in cash reserve ratio balances. 

■ Implementation of mSCOA 1 July 2017 

■ Implementation of new financial system 1 July 2017 due to mSCOA 
implementation and previous financial system ceased system developments 
April 2017 for mSCOA 

■ Cash funded budget approved by council 

■ Restructuring of finance departments, from two sections to three sections. 

SUPPLY CHAIN MANAGEM ENT 

Overhaul of the Supply Chain Management Committees with co-opting of specific 
specialised skills specifically in addition to a competent SCM staff; 

■ Appointment of an advocate for ensuring adherence to compliance logical 
legal flow leading proper contract management, 

■ appointment of a Risk Manager for ensuring life cycle risk assessment of 
contracts from the initial phase of procurement 

■ appointment of an Engineer specialising in project management to ensure 
methodical structured specifications 

Over and above SCM Staff meeting the Minimum Municipal Competency 
requirements, there has been various additional training initiatives through Western 
Cape Provincial Government. 

1. Treasury facilitated University of Stellenbosch specifically dealing with Contract 
Management, Demand Management, Asset Management and so forth in 
ensuring continuous growth and development of staff. Council approved the 
Preferential Procurement Policy that seeks to address use of procurement as an 
economic empowerment tool in the region 

2. Closer alignment between Supply Chain Management Unit with Local 
Economic Development Unit 

3. Partnership with PGWC(PT) in staging two Supplier Open Day activities in 
Hessequa and Kannaland Municipality 


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2018-2019 Annual Report: Garden Route District Municipality 

4. Increased maturity levels in the institutionalisation of Supply Change 
Management within the organisation, first formal adoption of Procurement 
Plans resulting from alignment of Demand management with Budgeting 
process took place. 

K. Compliance to use of National Treasury's Central Supplier Database and Electronic 
tender 


1.3.1.6 PLANNING AND ECONOMIC DEVELOPMENT SERVICES 


EPWP 


Garden Route District Municipality signed Protocol Agreement with National 
Department of Public Work in 2014 - 2019 and the Council committed to institutionalise 
EPWP within the Municipality. EPWP Section under the Department of Planning and 
Economic Development Services manage to achieve the below targets for 2018/19 
Financial year; 

■ Garden Route District Municipality managed to chair the EPWP District 
Municipal Forum as per the requirement of the EPWP National Protocol 
Agreement. 

■ Garden Route District Municipality EPWP Section have engage with the 
local Municipality and agreed that GRDM EPWP to attend their Internal 
Steering Committee 

■ GRDM strive to achieve the objectives of the 3 rd phase EPWP and 
institutionalising EPWP within the organisation by enforcing the approved 
GRDM EPWP Policy. Therefore, the EPWP Section play a vital role by 
supporting other Departments in particular to implement EPWP and 
promote the National EPWP recruitment and Selection guide. 

■ GRDM submitted EPWP Business Plan to National Department of Public 
Works for grant funding and signed the Incentive Grant Agreement as per 


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2018-2019 Annual Report: Garden Route District Municipality 

Division of Revenue Act . This funding was spend 100% on the Work 
Opportunities that were created through various funding. 

■ GRDM implemented 17 EPWP projects with a total of 411 Work 
Opportunities that were created through the EPWP Integrated Grant, 
GRDM own funding, GRDM Roads Department and other stakeholders 

■ All EPWP participants received formal and informal training. The core focus 
on training was to minimised the risk towards the Council and this training 
was funded by Human Resources Training Section. GRDM applied for 
training (Financial Sector Conduct Authority) on 14 May 2019 at National 
Department of Public Works and it was approved to capacitate 27 
participants. 

■ The objectives of the training will forms part of the EPWP long term strategy 
which will assist the beneficiaries with access to the labour market and to 
pave plans for exit strategy from EPWP programme 

■ GRDM EPWP Section apply for funding at the Provincial Department of 
Public Works for Labour Intensive training, 46 was capacitated in this 
regards and the GRDM EPWP Section coordinated this training whereby, it 
was hosted in this towns; Knysna, Mossel Bay and Oudtshoorn. 

■ GRDM EPWP achieved high targets with regards to the designated group 
(People with Disability) in the Garden Route Region 

■ EPWP of the Garden Route District Municipality managed to be the highest 
remunerating (Paying) municipality for the beneficiaries in the region for 
2018/19 financial year 

IDP, IGR& PP 

■ The IDP, IGR & PP section hosted a District Alignment working session on 25 
& 26 July 2019 with all the IDP Mangers in the district and performance 
managers 

■ On 14 March 2019 an IDP/Budget and PMS Representative Forum Meeting 
was held in preparation of the 2019/2020 IDP reviews. At this meeting 
Mayors presented the status of their respectively municipalities in relation 


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2018-2019 Annual Report: Garden Route District Municipality 

to IDP/Budget and PMS and Sector Departments presented on their 
various projects and programmes for the 2019/2020 financial year. 

■ An IDP Indaba was held on 22 May 2019, in the George Banquet Hall. The 
objective of the IDP Indaba was to share the Province's final 2019/20 
planned programmes and projects to be implemented in the municipal 
space for inclusion in the IDPs 

■ Furthermore, the district hosted IDP Budget Processes as per the relevant 
IDP legislative framework Managers Forums in order to assess the readiness 
of the Municipalities in terms of the various IDP and 

■ A strong working relationships between IDP/Budget and Performance is 
important hence regular Steering committee meetings is held to ensure 
that proper planning and implementation takes place for alignment of 
IDP/Budget and PMS purposes. 

_ PROPE RTY, MAI NTENANCEAN D RESO RTS ~ 

1. Calitzdorp Spa 

a. Only emergency repairs done as and when needed 

b. New electric security gates installed 

c. New security cameras installed 

d. Preventative maintenance did not take place 

e. Life Savers were appointed for the 2018/2019 festive season 

f. Additional security services procured for the 2018/2019 festive season 

2. De Hoek Mountain Resort 

a. Only emergency repairs done as and when needed 

b. New electric security gates installed 

c. New security cameras installed 

d. Preventative maintenance did not take place 

e. Life Savers were appointed for the 2018/2019 festive season 

f. Additional security services procured for the 2018/2019 festive season 

3. Swartvlei Caravan Park 

a. Emergency as well as preventative maintenance carried out 


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2018-2019 Annual Report: Garden Route District Municipality 

b. Additional security services procured for the 2018/2019 festive season 


4. Victoria Bay Caravan Park 

a. Emergency as well as preventative maintenance carried out 

b. Additional security services procured for the 2018/2019 festive season 

c. Additional sewer removal services procured for the 2018/209 festive 
season as Knysna Municipality could not service the increased demand 

5. General projects applicable to all resorts 

a. Applicable leases managed as required 

b. Accommodation rates increased in line with similar Resort rates 


_ PROPERT IES_ 

■ Existing leases increased by 10 % 

■ New leases annual increase set at 10 % 

■ Two long term lease agreements entered into on Regional Landfill Site: 

a. Moemakoe (Pty) Ltd: Construction of a petroleum storage facility 

b. Ikusasa Processing Engineering Consultants (Pty) Ltd: Construction of a 
chemical manufacturing plant, storage and distribution hub 

■ The following leases will be levied monthly from 1 June 2019 to 31 May 2020. 

Table G 




Lease Renewals Uune 2019 












Debtor 

Number 

Lessee 

Property 

Extent 

Monthly 

Levy 

lJune 2018 

to 

31 May 2019 

Incl. VAT 

Monthly 

Levy 

lJune 2019 

to 

31 May 2020 

Incl. VAT 

Expiry Date 








38000501 

Pumpcor 

Erf 2027 Riversdale 

1 700 m 2 

R 5 778.00 

R 6 355.80 

31-May-20 

38100176 

JH Stander 

Portion 1/64 Farm 233 Moerasrivier 

11.4 ha 

R 2 658.97 

R 2 924.87 

31-May-20 

38200067 

Sunny Herbs 

Portions 4/64 + 5/64 Farm 233 Moerasrivier 

9.5 ha 

R 3 246.00 

R 3 570.60 

31-May-20 

38200066 

JAJ Coleman 

Portions 2/64 + 3/64 Farm 233 Moerasrivier 

12.5 ha 

R 6 412.22 

R 7 053.44 

31-May-20 

84000139 

J Pistorius 

Erf 884 Heidelberg 

1.03 ha 

R 3 638.26 

R 4 002.09 

31-May-20 



Total 


R 21733.45 

R 23 906.80 

















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2018-2019 Annual Report: Garden Route District Municipality 


DISTRICT ECONOMIC DEVELOPMENT 


Garden Route Smart Cities Summit 

The concept of Smart Cities is gaining momentum in the South Cape. The forward- 
thinking municipalities of this region are working on defining what this means for them, 
and on how best to maximise the benefits of smart thinking. 

To that end, the Garden Route District Municipality, together with the South Cape 
Economic Partnership (SCEP) and the Western Cape Economic Development 
Partnership (EDP), convened a workshop on 3 October 2018 in Plettenberg Bay, 
focused on: 

■ Clarifying the meaning of Smart Cities in the context of the South Cape 

■ Sharing best practice in smart thinking from local and international experts 

■ Exploring how District collaboration can multiply Smart City initiatives. 

Attendees at this workshop included representatives of all municipalities in our region, 
with the emphasis on Local Economic Development, Infrastructure, Strategic Services, 
Planning and ICT. Private sector attendees included Town Planning experts and local 
tourism representatives. 

Summary of prioritised action points 
Smart living action points 

■ Pilot project in one community in the region to demonstrate all the 7 principles 
of “Smart Living” 

■ Increase housing density and accessible public transport and make the region 
cycle friendly 

■ Develop a network of small-scale organic agriculture to supply local restaurants 
and retailers 

■ Facilitate integrated efforts for safety and security by the police, 
neighbourhood watches and private security companies 

■ Invite business to provide innovative solutions through existing forums to current 
smart living challenges 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Encourage spatial development for poor communities which will allow activities 
like gardening, etc. 

Smart Waste action points: 

■ Regional programme for sensitizing residents and incentives for recycling 

■ Continue with the integrated approach between municipalities for alternative 
technologies 

■ Waste-to-energy initiatives 

Smart Technology action points: 

■ An audit needs to be done on what exists that could be expanded or 
developed further; 

■ Way leave and trenching policies to be put in place; 

■ Coordination in terms of free Wi-Fi to be coordinated by die District and local 
municipalities; 

Smart Green action points 

■ Lack of Skills within municipalities to interrogate green solutions. Will be 
addressed through Green Cape municipal capacity building initiatives 

■ Interrogate current policy to create more conducive/enabling environment 

■ Inter-governmental approach to green solutions 

Smart Tourism action points 

■ Wi-fi hotspots 

■ Regional public transport e.g. Uber 

■ Data collection and analytics for smart tourism 

■ Smart training for hospitality and tourism industry 

Smart Design action points 

■ Ensuring values, visions and policies that underpin smart city design are in place 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Increase the focus on GIS skills and resources for smart cities 

■ Integration of data collection and maintenance processes and systems 

■ Data access protocols that enables access across municipalities 

Next steps 

The output of this workshop will be used to feed into specific working groups, each 
focused on one of the Smart areas identified above. While the prioritised action points 
will be the initial objectives of these groups, the more detailed opportunities and 
proposals listed in this report will form the basis of the longer-term Smart Cities initiatives 
in the Garden Route. 




Garden Route Film Office 

The film office has been established and registered as a Non-profit company and the 
official Board of Directors have been elected and have been doing intense work for 
the promotion of the Garden Route film industry. 


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2018-2019 Annual Report: Garden Route District Municipality 


In the 2018/19 financial year council contributed R190 000 towards the establishment 
of the Garden Route Film Office for the promotion of the Garden Route district as a 
preferred film destination with which they have already implemented various initiatives 
as entailed in the enclosed report. The Mossel Bay Municipality has also contributed 
towards this initiative and has made office space and an intern available for this 
purpose. 

The role of the Film Office is to: 

■ Regulate standards in the local industry 

■ Create a comprehensive database 

■ Create a professional administrative and regulatory support structure, i.e. permits, 
by-laws & auxiliary services 

■ Uplift and develop skills to underpin a sustainable industry 
Strategic Interventions: 

■ Formation of a GR&KK Film Office 

■ Locations catalogue 

■ Location support and permitting 

■ Skills database 

■ Training, skills development and talent management 

■ Enterprise development and support 

■ Coordinated marketing efforts 

Business Model: 

■ To make money by hosting film events/festivals and award ceremonies and 
sponsorships 

■ Their go-to-market strategy is to attend film festivals and form strategic partnerships 
with investors, government, other media players 

■ Will reach customers by upgrading website, comprehensive database, social 
media and a planned media blitz 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Channels to market are Wesgro, Tourism offices. International and Regional film 
festivals, internet and social media 

■ Current traction is from Cape Town overflow alternative, over 100km radius a variety 
of diverse locations and limited traffic, saving time and money 

■ Will build momentum by offering a professional service, being efficient and 
informative, offering slick auxiliary services, offering filming potential, as yet 
untapped 

Benefits of co-funding the Garden Route Film Office 

■ Exposure to a new, untapped audience 

■ Placing the Garden Route and Klein Karoo on the map as a pristine tourist and film 
destination 

■ Film credit/endorsement 

■ Past film successes and growth in the region 

■ Skills creation and community upliftment 

iKASI MEDIA ACCREDITED FILM AND MEDIA ORIENTATION PROGRAMME CERTIFICATE 
CEREMONY 

22 Students from the Garden Route and Klein Karoo completed the iKasi Media 
Accredited Orientation to Film and Television programme presented by iKasi Media. 
The National Youth Development Agency also provided entrepreneurship training to 
the group. Short films were produced by these learners of which 4 were selected to be 
entered into the 48 Flour Film Festival. The Garden Route District Municipality has 
supported the iKasi Media programme up until when they were accredited. 



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2018-2019 Annual Report: Garden Route District Municipality 


EXPORT DEVELOPMENT PROGRAMME 

The District Economic Development unit embarked on an informal tender process for 
the appointment of a service provider to conduct an Export Advancement: Gap 
Analysis and Mentorship programme for a total of 20 participants (SMME's), in order to 
build the competitive capacity, improve the trade potential and expand the export 
markets of the business. The project entailed assessment of the business identifying 
gaps and challenges for each of the participating businesses. Tradewize International 
was the successful bidder and appointed as service provider to conduct one-on-one, 
on-site assessments of small businesses across the district. 

PROGRAMME BENEFITS 

The general benefits from the ‘Export Advancement’ programme include the 
following: 

■ Knowledge and skills transfer 

■ New market penetration and expansion 

■ Higher exports 

■ Improved productivity 

■ Opportunities to innovate, upgrade and increase competitiveness 

■ Growth in employment creation 
The programme covered the following: 

ONE - ON - ONE MENTORSHIP - OUTCOMES 

■ Business Export Gap Analysis 

■ Export specific mentorship per business implemented based on findings of the 
export gap analysis. 

■ Specific goals to be set linked to a timeframe. 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Exporters to be provided with practical guidance in order to implement the set 
goals. 

■ Addressing specific business needs as per exporter's business requirements 

■ Mentor to work with the exporters, advising on developing certain business areas 

■ Skills transferred should be tailored to the exporter's requirements 

■ A ‘‘Ready to export checklist”; 

■ Market information/research and match making resources to enable the 
compilation of a marketing plan; 

■ Advise on technical material requirement for exporting; 

■ A list of funding sources for product development and export marketing e.g. export 
marketing platform attendance 

CRITERIA FOR EXPORT PROGRAMME PARTICIPANTS 

■ Product/Service should have a niche or competitive edge; 

■ Company should be registered with registrar of companies CIPC; 

■ Be in possession of a valid Tax Clearance Certificate; 

■ Enterprise should have conquered the local market to an extent; 

■ Enterprise must be committed to developing an export market; 

■ Enterprise should have or have access to finance; 

■ Enterprise should have operational capacity to service additional markets; 

The Small Enterprise Development Agency (SEDA) has agreed to become a partner 
and assist in addressing the gaps and challenges identified during these assessments 
and will compile a detailed intervention plan with actions for each of the participating 
businesses that will be directly linked to their export development programme. 

GARDEN ROUTE AIRLIFT STEERING COMMITTEE 

The Garden Route District Municipality in collaboration with the Airports Company of 
South Africa (ACSA) and the George Municipality has initiated a Regional Airlift project 
for which a steering committee was established. 

Project committees are also in the process of being established in order to more 
effectively coordinate the system of transporting cargo and passengers by aircraft. 


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2018-2019 Annual Report: Garden Route District Municipality 


REGIONAL SPECIAL ECONOMIC ZONE 

The District Municipality is driving a process in collaboration with the Mossel Bay 
Municipality by which an application will be submitted to the Department of Trade 
and Industry for the establishment of a Regional Special Economic Zone to further 
enhance the district's appeal for investment and increase the export potential of 
products and access to markets. 

TOURISM 


KANNALAND TOURISM STRATEGY DEVELOPMENT 

The Garden Route District Municipality allocated funds through the 2018/2019 budget 
for the development of a Tourism strategy for Kannaland Municipal area. 

In 2017, Garden Route District Municipality conducted an Investment readiness 
roadshow throughout the District and one concern specifically from the Mayor of 
Kannaland was that there was no strategy for Tourism in Kannaland. The area has 
enormous potential for Tourism as well as investment opportunities, but required a 
document that could streamline all the opportunities and activities. 

A service provider was appointed through the Supply Chain Management tender 
process to review, evaluate and conceptualise a tourism strategy document that will 
aid the Kannaland Municipality and various stakeholders to prioritise and implement 
various tourism projects in order to market and develop Kannaland as a tourism 
destination. 

The aim of the proposed tourism strategy is to ensure positive economic benefits and 
opportunities for all stakeholders. The development of the tourism strategy was 
informed by stakeholders' inputs through various mechanisms including workshops that 
were held. 


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2018-2019 Annual Report: Garden Route District Municipality 



GARDEN ROUTE CATER CARE PROJECT 

The Garden Route District Municipality made the amount of R300 000 available to train 
15 previously disadvantaged individuals in the tourism and hospitality sector. Interviews 
with applicants for Cater Care course 2018/19 were held on 21 and 22 February 2019 
at the Francois Ferreira Academy in George. 

A total of 37 candidates were listed to be interviewed over the two days, 20 
candidates on the 21 st of February and 17 on the 22nd of February 2019. 


83 














2018-2019 Annual Report: Garden Route District Municipality 


21 st February 2019 

22 nd February 2019 

Did not 

pitch 

Unsuccessful 

Successful 

Did not 

pitch 

Unsuccessful 

Successful 

3 

8 

9 

6 

5 

6 


The course started on 4 March 2019 and the School phase finished on 31 May 2019 
Classes were presented from Monday to Thursday from 08:30 - 15:00. The course was 
presented at the Francois Ferreira Skills Academy at Oubaai. 


Cater Care Certificate Ceremony 2019 

A certificate ceremony was held on 12 July 2019 for the learners who completed the 
course. 

















2018-2019 Annual Report: Garden Route District Municipality 


REGIONAL TOURISM STRATEGY 

The Garden Route District Municipality's Integrated Development Plan (IDP) final 
review 2018/2019 - 2021/2022 states that the tourism industry generally spans across 
the economic sectors, ranging from accommodation and- catering, retail and 
wholesale, transport, manufacturing, business services and social services. The most 
visited towns in Garden Route and Klein Karoo include Knysna, Plettenberg Bay, 
Wilderness, Mossel Bay, George, and Oudtshoorn. Stilbaai is also a popular town for 
holiday homes. The most visited attractions by tourists in South 

Africa include the Garden Route (284 000 visitors in 2015), Karoo Ostrich Farms (144 000 
visitors in 2015) and the Congo Caves (132 000 visitors in 2015). 

The tourism unit of the Garden Route District Municipality was tasked to develop a new 
5-year Regional Tourism Strategy for Garden Route and Klein Karoo Tourism in order to 
stay up to date with the ever changing tourism environment and the economy. 

The document was developed in collaboration with Local Tourism organisations as well 
as private sector stakeholders in the region. The strategy is presented as a 5-year 
strategy to align with the reviewed IDP of the Garden Route District Municipality and is 
intended to clearly define the strategic priorities for regional tourism and to streamline 
all tourism activities in the region. 

Garden Route District Municipality's Tourism Unit's strategic objectives underpinned in 
the approved Tourism strategy developed in line with this vision and mission, and 
informed by the national and provincial objectives and local opinions, are: 

Effective Marketing 

■ Increase visitor numbers to the region; 

■ Enhance the effectiveness of international marketing to establish the Garden 
Route and Klein Karoo as a destination of choice; 


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2018-2019 Annual Report: Garden Route District Municipality 


■ Expand and improve domestic marketing activities 

■ Attraction and hosting of events (business, sporting and lifestyle) to improve the 
seasonal and regional spread of tourism benefits. 

Visitor Experience 

■ Diversify and enhance tourism product offerings 

■ Enhance local destination sites through cleanliness, safety and security, 
aesthetics, and information improvements 

■ Enhance tourist safety; 

■ Improve tourism skills and service excellence. 


Destination Management 

■ Improve the focus and delivery of tourism marketing and development support 
provided by local government (Lobby and ensure policy sustainability support 
from B's for tourism) 

■ Effective streamlining and strengthening of collaborative efforts in the region to 
make more impact. 

■ To provide knowledge to inform policy, planning and decision-making. 
Transformation 

■ Promote Broad-Based Black Economic Empowerment (B-BBEE) 

■ Support sustainable Enterprise development (LED strategies includes tourism 
development). 

Facilitate Ease of access 

■ Enhance ease of access to the region. 

■ Facilitate ease of doing business to ensure the growth of the tourism economy. 

The strategic objectives is based on the following five pillars; 

■ Effective marketing; 

■ Visitor experience; 


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2018-2019 Annual Report: Garden Route District Municipality 


■ Destination management; 

■ Transformation; 

■ Facilitate ease of access 


MARKETING PLATFORMS 

1. World Travel Market Africa 2019 

Garden Route & Klein Karoo Tourism exhibited on a regional Garden Route and Klein 
Karoo stand for the first time this year. This platform provided the region the opportunity 
to engage with tour operators, travel agents and travel writers to direct more tours and 
travels to the Garden Route & Klein Karoo, this regional initiative in turn sent a strong 
message of unity to our competitors. 

Garden Route & Klein Karoo booked 36m 2 providing space for the Local Tourism 
Offices and their products/services in the region to form part of the exhibition. The 
following Local Tourism Offices exhibited with Garden Route & Klein Karoo on the 
GR&KK stand; 

■ Oudtshoorn Tourism 

■ George Tourism 

■ Hessequa Tourism 

■ Calitzdorp Tourism 

■ Plettenberg Bay Tourism 

The following Local Tourism products/services exhibited with Garden Route & Klein 
Karoo on the GR&KK stand: 

■ Redberry farm 

■ Oubaai hotel and Spa 

■ De Rustica olive estate 

■ Destination Garden Route 


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2018-2019 Annual Report: Garden Route District Municipality 


Knysna River Club 
Gourikwa nature reserve 
Hog Hollow 
Dine with a Local 







^R&KK 


GARDEN ROUTE 
AND KLEIN KAROO 


GARDEN ROUTE 
AND KLEIN KAROO 


2. Annual 
Tourism 
Indaba 2019 


Garden Route & Klein Karoo 

Tourism attended this year's Indaba on the Cape Town and Western Cape Stand with 
Wesgro, for the 8th year. 

Indaba 2019 was attended by Ms. Amagene Koeberg, Mr. Denver Johnson (both from 
GRKK tourism office) and Ms. Joan Shaw (George Tourism), representing the Garden 
Route and Klein Karoo on the Cape Town and Western Cape stand. 



88 







2018-2019 Annual Report: Garden Route District Municipality 


COORDINATION OF EVENTS FUNDING THROUGH WESGRO 

The Garden Route & Klein Karoo Tourism Office coordinated tourism funding for events 
through Wesgro. A call for event applications were sent from the regional tourism 
office, requesting all Local Tourism Offices to submit event proposals and applications 
for events in their respective towns that required funding for the period starting from 1 
April 2019 to 31 March 2020. 

Wesgro has supported six (6) events in our area and contributed approximately R250 
000.00 towards these events for the Garden Route and Klein Karoo. 


GARDEN ROUTE AND KLEIN KAROO EVENTS AND FESTIVALS SPONSORSHIP 

The Garden Route & Klein Karoo Regional Tourism Office sent out a call for 
applications from Local Tourism Organisations for their submission of tourism festivals 
and events for funding from Garden Route District Municipality. 

Consideration is given for smaller events that take place from December 2018 until 
June 2019, which were not funded by Wesgro. The applications process closed on the 
28 th of September 2018, and no late applications were considered. The following 
events were sponsored with an amount of R25 000.00 each: 

■ Proe Bietjie Arts festival 

■ Ostrich Crawl Experience 

■ Saxophone Festival 

■ Calitzdorp Winter Festival 

GARDEN ROUTE ACSA EASTER CAMPAIGN 

The Airports Company of South Africa (ACSA) George, in collaboration with Garden 
Route & Klein Karoo Tourism (GR&KK) section of Garden Route District Municipality 


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2018-2019 Annual Report: Garden Route District Municipality 

(GRDM) hosted an Easter Welcoming Campaign at the George Airport on 17 & 18 
April 2019. 

The campaign aim was to create awareness about the Garden Route and Klein Karoo 
and its tourism offerings, which are mostly accessed by tourists whose first point of entry 
is the George Airport. 

Visitors to the region were welcomed and given goodie bags filled with promotional 
marketing material. ACSA concurrently had an Easter Egg Give-Away to kids and they 
are also had the opportunity to partake in a colouring competition. The following 
organisations for sponsored tourism products: 

Congo Caves Estate: Coffee Roastery, Congo Caves Zipline, Kobus se Gat and the 
Congo Wildlife Ranch. 

The GRDM Tourism Unit had a pop-up welcome desk in the foyer of the airport; guests 
took selfies with employees as they were handed goodie bags. 



90 









2018-2019 Annual Report: Garden Route District Municipality 


1.4 FINANCIAL HEALTH OVERVIEW 

Refer to Section 3 of the Annual Report for the highlights and challenges of the finance 
department as contained in the annual performance report. 


1.4 FINANCIAL HEALTH OVERVIEW 

Refer to Section 3 of the Annual Report for the highlights and challenges of the finance 
department as contained in the annual performance report. 


Financial Overview: 2018/19 R'000 


Details Original budget Adjustment budget Actual 


Income: 




Grants: 

158 885 

172 435 

1 65 934 

Other: 

231 230 

230 210 

234 435 

Sub Total: 

390 115 

402 645 

400 369 

Less: Expenditure 

387 838 

398 403 

385 685 

Net Total* 

2 277 

4 242 

14 684 

*Note: surplus/(deficit) 

T 1.4.2 


Operating Ratios 

Detail 

% 

Employee Cost 

57 

Repairs & Maintenance 

0.69 

Finance Charges & Impairment 

0 

T 1.4.3 


COMMENT ON OPERATING RATIOS: 

Employee Costs: 57% 

The employee related costs are higher than the norm, as the majority of the core 
functions must have a minimum of employees as stated in legislation to perform the 


91 























2018-2019 Annual Report: Garden Route District Municipality 


functions. This ratio is calculated on the consolidated financial statements, including 
the Roads agency function. 

Repairs and maintenance: 0.69% 

There are limited funding available to allocate to repairs and maintenance. The main 
source of income increases 3.5% which is not aligned to the average CPIX. 

This ratio is calculated on the consolidated financial statements, including the Roads 
agency function. 

Finance Charges and Impairment: 0% 

No new loans have been taken up for a number of years. The majority of the finance 
charges are for finance leases for mobile devices. 

COMMENT ON CAPITAL EXPENDITURE: 

The majority of the budget includes: 

1. Purchase of an office building for the Environmental Health section in 
Plettenberg Bay 

2. Purchase of fire fighting vehicles and equipment 

3. Purchase of IT equipment 

4. Purchase of risk management and internal audit software 

1.5 ORGANISATIONAL DEVELOPMENT OVERVIEW 

The Human Resources Section, located within the Department Corporate Services, 
delivers a support service to the other departments in Human Resource Management. 
Its primary function is to co-ordinate all Human Resource activities in order to achieve 
Garden Route District Municipality's objectives of service delivery of which 
enhancement of staff performance plays a fundamental role. 

In line with the constitutional mandate of Local Government, the legislative 
requirements for Human Resources, the Human Resources Section at Garden Route 
District Municipality regards it mission to serve and support the interest of all personnel. 
In this regard, the HR strives to: 


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2018-2019 Annual Report: Garden Route District Municipality 

■ Empower employees towards maximizing their personal potential, deliver on, 
and exceed organizational requirements. 

■ Continuously align the HR Strategy and the Organisational Strategy (IDP), 
legislative Requirements and best practices in the HR fields 

■ Promote and practice “Putting people first” Equity, fairness, objectivity and 
consistency. 

■ Committed to professional conduct, and 

■ Develop and adopt appropriate systems and procedures to ensure fair, 
efficient, effective and transparent personnel administration. 

1.5.1 BACKGROUND AND OBJECTIVE 

The efficient and effective management of the human capital in the public sector is 
widely recognised as one of the key pillars of service delivery in South Africa. 

Globally, there are currently no comprehensive statements of what constitutes good 
HR management, which will realize the potential of human capital. 

The South African Board for People Practices has taken the lead globally and has 
compiled, through a carefully crafted membership consultation/participation process, 
the South African HR Management Standard. This Management Standard sets out 
what needs to be in place in order to ensure compliance and good management of 
people in the workplace. 

This HR Management Standard has been acclaimed internationally and locally and 
although it was officially launched only in August 2013, South African organisations are 
adopting it and tertiary institutions are in the process of incorporating these HR 
Competency and Standards into their curricula. 

1.5.2 BENEFITS OF HR STANDARDS 

The vision of the project is to set national HR standards in order to improve the quality 
of HR work, irrespective of the location of a HR professional, or industry and 


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2018-2019 Annual Report: Garden Route District Municipality 

organisational differences. Ultimately, HR professionalism will be enhanced by 
reducing inconsistencies in the profession. 

The goals of the project are as follows: 

1. To improve standardised approaches to professional HR practices and thus 
promoting HR professionalism; 

2. To develop a national HR scorecard with specific HR measurements and 
metrics, supported by a National HR Research and Benchmarking Centre; 

3. To create a National HR Academy with a standardised HR Curriculum; 

4. To ensure that HR features in integrated reporting; 

5. To develop a foundation for integrating HR in the King IV Code of 
Governance. 


1.6 AUDITOR GENERAL REPORT 

1.6.1. AUDITED OUTCOMES 


Year 

2013/14 

2014/15 

2015/16 

2016/17 

2017/2018 

2018/2019 

Status 

Unqualified 

Opinion 

Unqualified 

Opinion 

Unqualified 

opinion 

Unqualified 
with findings 

Unqualified 
with findings 

Unqualified 
with findings 


1.7 STATUTORY ANNUAL REPORT PROCESS 

Annual Process Plan as per Circular 63 of the MFMA 


Activity 

Process Owner/Role Player 

Timeframes 

Consideration of next financial 

year's Budget and IDP Process 

plan. 

MM assisted by other 

Section 56 Managers & the 

CFO 

July 


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2018-2019 Annual Report: Garden Route District Municipality 


Implementation and 

monitoring of approved 

Budget and IDP through the 

approved SDBIP commences 

MM assisted by other 

Section 56 Managers & the 

CFO 

July 

Finalise 4 th quarter report of 

previous financial year 

MM assisted by other 

Section 56 Managers & the 

CFO 

July 

Submit draft previous financial 

year Annual Report and 

evidence to Internal and the 

Auditor General including 

annual financial statements 

and financial and non-financial 

information 

MM & CFO 

July 

Submit Annual Report including 

annual financial statements 

and Annual Performance 

Report to the Combined 

Audit/Performance Committee 

MM & CFO 

July/August 

Combined Audit/Performance 

Committee considers 

unaudited annual Report of 

municipality and entities 

Audit and Performance 

Audit Committee 

August 

Mayor tables the unaudited 

Annual Report in Council 

Mayor 

August 


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2018-2019 Annual Report: Garden Route District Municipality 


Council to submit unaudited 

tabled annual report to MPAC 

for vetting and verification of 

council's directive on service 

delivery & the committee to 

evaluate senior managers’ 

performance against 

agreement entered into 

HODs/CFO 


Municipality submits Annual 

Report including final annual 

financial statements and 

annual performance report to 

Auditor General for auditing 

purposes by 31 August 2018 

CFO 

August 

Commencement of IDP 

analysis of institutional services 

and infrastructure provision, 

backlogs and priorities. 

Unaudited Annual Report as 

submitted to Auditor-General 

to be used as input into the IDP 

strategic phase process and 

community verification & input 

by MPAC on reported 

performance. Such information 

includes that of various entities 

incorporated into the 

information of the parent entity 

Council 

September 


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2018-2019 Annual Report: Garden Route District Municipality 


Annual Report and oversight 

report process for adoption to 

be used as input into public 

participating meetings for the 

IDP review process 

Council 


Auditor-General audits the 

unaudited Annual Report and 

submit an audit report to the 

accounting officer for the 

municipality/municipal entity 

Auditor General 

November 

Auditor General's reports are 

issued during the period of 

Oct/Nov. Once the AG audit 

reports have been issued no 

further changes are allowed as 

the audit process is completed. 

MM 


Oversight committee finalises 

assessment on Annual Report 

within 7 working days of receipt 

of AGs report. 

Oversight Committee 

November 

Auditor General review the 

audited report 

Auditor General 

November/December 

Mayor tables audited Annual 

Report and financial to Council 

Mayor 

December 

Audited Annual Report is made 

public, e.g. posted on 

municipality's website. 

MM 


Council adopts oversight report 

Council 


Oversight report is made public 

MM 



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2018-2019 Annual Report: Garden Route District Municipality 

Oversight report is submitted to Mayor 
Legislators, Treasuries and 
DCoG 


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2018-2019 Annual Report: Garden Route District Municipality 


CHAPTER 2 

GOVERNANCE 



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2018-2019 Annual Report: Garden Route District Municipality 


CHAPTER 2: POLITICAL AND ADMINISTRATIVE 

GOVERNANCE 


Introduction to Governance 

Garden Route District Municipality has, as all other municipalities, essential 
administrative and other support functions that are not necessarily statutory 
prescribed, but that are necessary in order for the organization to function. These 
functions are referred to as support services functions. 

Good governance ensures Excellent, Accurate, Effective and Efficient administrative 
and secretarial/support service to Council, Mayoral Committee, Section 79 and 80 
Committees and other standing Committees. 

Introduction to Political and Administrative Governance 

Garden Route DM’s Corporate/Strategic Services ensures that Council, Executive 
Mayoral Committee, Portfolio Committees and other standing Committees meets 
regularly as by approved Council's meeting schedule. 

The directorate also arranges special meetings, as and when required to do so. 
Agendas of all Council and Committee meetings are compiled, produced and 
distributed to thirty four (34) Councillors, Management and officials. Minutes of all 
meeting proceedings are recorded and safeguarded for record purposes and future 
reference. 


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2018-2019 Annual Report: Garden Route District Municipality 


TOP POLITICAL STRUCTURE 







Cllr Memory Booysen 

EXECUTIVE MAYOR (DA) 


Cllr Rosina Ruiters 

DEPUTY EXECUTIVE 
MAYOR (DA) 


Cllr Barend Groenewald 
SPEAKER (DA) 

27 June 2019 
Acting Speaker 
28 May 2018 - 26 June 2019 
Acting Speaker 
1 November 2018 - 
12 December 2018 


Cllr Eleanore Bouw-Spies 
SPEAKER (DA) 

13 December 2019 
-8 May 2019 


Cllr Mark Willemse 
SPEAKER (DA) 
31 August 2016 - 
30 October 2018 



CHIEF WHIPS 


CHIEF WHIP 

Cllr Theresa Fortuin 

ICOSA 





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2018-2019 Annual Report: Garden Route District Municipality 


PORTFOLIO CHAIRPERSONS 



Cllr Rosina Ruiters 
Portfolio Chairperson: 
District Economic 
Development and Tourism 


Cllr Isaya Stemela 
Portfolio Chairperson: 
Corporate Services 


Cllr Jerome Lambaatjeen 
Portfolio Chairperson: 
Financial Services 



Cllr Joslyn Johnson 
Portfolio Chairperson: 
Property Management & 
Development 


Cllr Khayalethu Lose 
Portfolio Chairperson: 
Community Services 


Cllr Rowan Spies 
Portfolio Chairperson: 
Roads & Transport Planning 
Services 


Cllr Erica Meyer 
Portfolio Chairperson: 
Strategic Services 


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2018-2019 Annual Report: Garden Route District Municipality 


2016/17-2021/22 Council 











Cllr Albertus Rossouw 
DA 


Cllr Jennifer Hartnick 
DA 

(Starts 2 October 2018) 


Cllr Ivan Mangaliso 
ANC 


Cllr Jerome Lambaatjeen 
DA 


Cllr Bernardus van Wyk 
DA 







Cllr Daniel Saayman 
DA 


Cllr Klaas Windvogel 
ANC 


Cllr Luzuko Tyokolo 
DA 


Cllr Mputumi Mapitiza 
ANC 


Cllr Ndoda Tsengwa 
ANC 

(Starts 10 September 2018) 
































2018-2019 Annual Report: Garden Route District Municipality 


2016/17 - 2021/22 Council 





Cllr Thersia Van Rensburg 
DA 

(Starts 10 January 2019) 




Cllr Mark Willemse 
Speaker 
DA 

(Resigns 30 October 2018) 



Cllr Eleanore Bouw-Spies 
Speaker 
DA 

(13 December 2019-8 May 
2019) 

104 



Cllr Victor Molosi 
ANC 

(Deceased 23 July 2018) 



Cllr Simon Odendaal 
ANC 

(Resigns 5 December 2018) 
























2018-2019 Annual Report: Garden Route District Municipality 


2.1 COMPOSITION OF COUNCIL 

2.1.1 GARDEN ROUTE DISTRICT MUNICIPAL COUNCIL CONSISTS OF 35 

COUNCILLORS 


Democratic 
Alliance (DA) 

African National 
Congress (ANC) 

Plaaslike Besorgde Inwoners 
Democratic Party (PBI) 

Independent Civic 
Organisation of South Africa 
(ICOSA) 

21 

12 

1 

1 


2.1.2 COUNCIL COMPILATION (REFER TO APPENDIX A & B) 


Proportion 

al 

Councillors 

George 

Municipalit 

y 

Kannalan 

d 

Municipalit 

y 

Knysna 

Municipalit 

y 

Hessequa 

Municipalit 

y 

Mossel Bay 
Municipalit 

y 

Oudtshoor 

n 

Municipalit 

y 

Bitou 

Municipalit 

y 

ummmdi 


Billi# 



IEBH 




2.1.3 COMPOSITION OF COUNCIL 

Below is a table that categorised the Councillors within their specific political parties 

and municipalities 


Political Party 

Councillor Name & Surname 

Type of Councillor 

Democratic Alliance (DA) 

Memory Booysen 

Proportional Representation 

Daniel Saayman 

Bernardus Nicholson Van Wyk 

Rowan Emerson Spies 

Thersia Van Rensburg 

Anne Windwogel 

Albertus Johannes Rossouw 

Khayalethu Sabelo Lose 

African National Congress (ANC) 

Clodia Ntabiseng Lichaba 

Doris Xego 

Stephen De Vries 

Nontsikelo Frieda Kamte 

Mputumi Patco Mapitiza 

ICOSA 

Theresa Fortuin 

Proportional Representation 


105 

























2018-2019 Annual Report: Garden Route District Municipality 
Direct representation from the seven (7) local municipalities 


Local Municipality 

Name(s) 

Party 

Number of 
Councillors 

Kannaland 

1 

Joslyn Patricia Johnson 

DA 

i 

Hessequa 

1 

Ivan Trevor Mangaliso 

ANC 



2 

Jennifer Lorraine Hartnick 

DA 

2 

Mossel Bay 

1 

Sebenzile Stanford Mbandezi 

ANC 

1 


2 

Barend Hendrik Jacobus Groenewald 

DA 

4 


3 

Erica Meyer 

DA 



4 

Rosina Henrietta Ruiters 

DA 


George 

1 

Isaya Stemela 

DA 



2 

Elizabeth Hendrika Stroebel 

DA 



3 

Pieter Jacobus van der Hoven 

ANC 

6 


4 

Raybin-Gibb Sylvester Figland 

DA 



5 

Tobeka Teyisi 

ANC 



6 

Virgill Gericke 

PBI 


Oudtshoorn 

1 

Klaas Windvogel 

ANC 



2 

Jerome Ceaser Lambaatjeen 

DA 

3 


3 

Ryk Raymond Wildschut 

DA 


Bitou 

1 

Nomhiki Cynthia Jacob 

ANC 



2 

Memory Booysen 

DA 

2 

Knysna 

1 

Ndoda Aubrey Tsengwa 

ANC 



2 

DMC PofadderflO July 2019) 

DA 

3 


3 

Luzuko Tyokolo 

DA 



2.1.4 RACE AND GENDER REPRESENTATION IN COUNCIL 

During the year under view, political parties were represented as follows: 

Note: A = Africans, C = Coloured, I = Indians and W = Whites 


Political Party 

Male 

Female 

TOTAL 


A 

c 

1 

w 

A 

c 

1 

w 


Democratic Alliance (DA) 

4 

7 

0 

2 

0 

6 

0 

2 

21 

African National Congress (ANC) 

4 

2 

0 

1 

5 

0 

0 

0 

12 

Plaaslike Besorgde Inwoners (PBI) 

0 

1 

0 

0 

0 

0 

0 

0 

1 

Independent Civic Organisation of South 

0 

0 

0 

0 

0 

1 

0 

0 

1 


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2018-2019 Annual Report: Garden Route District Municipality 


Africa (ICOSA) 










TOTAL 

8 

10 

0 

3 

5 

7 

0 

2 

35 


During the year under review (1 July 2018 to 30 June 2019), the following numbers of 


meetings and total agendas distributed, took place: 


Type of meeting 

No. 

Agendas Distributed (Cllrs and 
officials) 

Council 

6 

330 

Special Council 

6 

330 

Executive Mayoral Committee 

8 

200 

Finance Service Committee 

5 

125 

Corporate Services Committee 

5 

125 

Community Services Committee 

4 

80 

Roads Services Committee 

4 

60 

Strategic Services Committee 

5 

105 

District Economic Development & Tourism Committee 

5 

100 

Property Management & Development Committee 

3 

66 

Governance Committee 

3 

36 

Occupational Health & Safety Committee 

4 

120 

Training & Development Forum 

7 

105 

Local Labour Forum 

6 

180 

Special Local Labour Forum 

3 

45 

Municipal Public Accounts Committee (MPAC) 

5 

100 

Audit and Performance Audit Committee (APAC) 

8 

200 

Budget Steering Committee 

2 

24 

Total of meetings held and agendas distributed 

89 

2331 


2.1.5 EXECUTIVE MAYORAL COMMITTEE 


The Executive Mayor is at the centre of the system of governance; therefore executive 
powers are vested in him to manage the day-to-day affairs. This means that he has an 
overarching strategic and political responsibility. (Refer to Section 60 of the Structures 
Act). 


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2018-2019 Annual Report: Garden Route District Municipality 

Although accountable for the strategic direction and performance of the 
Municipality, the Executive Mayor operates in consultation with the Mayoral 
Committee. The Mayoral Committee is chaired by the Executive Mayor. 

The name and portfolio of each member of the Mayoral Committee, is listed in the 
table below for the period 1 July 2018 to 30 June 2019: 


Name of Member 

Capacity 

RE Spies 

Roads and Transport Planning Services 

JC Lambaatjeen 

Financial Services 

KS Lose 

Community Services 

RH Ruiters 

District Economic Development and 
Tourism 

JP Johnson 

Property Management and 
Development 

1 Stemela 

Corporate Services 

E Meyer 

Strategic Services 


2.1.6 COMMITTEES 


The Municipal Structures Act allows a municipal council to establish two types of 
committees - Section 79 and Section 80 Portfolio Committees. 

Section 79 Committee, also known as council committees, meet every second 
month and report their oversight outcomes to Council, via the MAYCO. Garden 
Route DM has the following Section 79 Committees: 

■ Governance 

■ MPAC 

■ Training & Development 

■ Occupational Health & Safety 

■ Local Labour Forum; and 

■ Disciplinary Committee. 

Section 80 Portfolio Committees meet on a monthly basis to discuss matters 
referred to them and to make suitable recommendations to the MAYCO. Members 
are appointed to assist the Executive Mayor with his/her duties. Garden Route DM 
has the following Section 80 Committees: 

■ Roads & Transport Planning Services 


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2018-2019 Annual Report: Garden Route District Municipality 


■ Financial Services 

■ Community Services 

■ Property Management & Development 

■ District Economic Development & Tourism 

■ Corporate Services; and 

■ Strategic Services. 


109 




2.1.7 SECTION 79 AND 80 COMMITTEES 


Section 80 Committees 

Committee 

Functions 

Chairperson 

Deputy Chair 

Executive 

Manager 

Other political 
representation 

Roads and 
Transport 
Planning 

Roads, 

Maintenance 
Planning, RRAMS, 
Regional 
Integrated Public 
Transport Planning, 
EPWP related to 
roads projects 

RE Spies 

JP Johnson 

J Daniels 

T Van 

Rensburg(DA) 

D Saayman (DA) 
BN Van Wyk (DA) 
NF Kamte (ANC) 

PJ Van der Hoven 
(ANC) 

Financial 

Services 

Income and 
Expenditure, Supply 
Chain, BTO, 
Revenue 
Management, 
Asset 

Management, 
Stores, Financial 
Statements, GRAP 
Statements 

JC 

Lambaatjeen 

RE Spies 

JW De 
Jager 

BN van Wyk (DA) 
RR Wildschut (DA) 

L Tyokolo (DA) 

MP Mapitiza 
(ANC) 

D Xego (ANC) 

V Gericke (PBI) 

Community 

Services 

Fire and Rescue, 
Disaster 
Management, 
Municipal Health, 
Environmental 
Management 
(Waste 

Management/Air 
Quality), EPWP, 
Fleet 

Management, Call 
Centre 

KS Lose 

E Meyer 

C Africa 

RR Wildschut (DA) 

L Tyokolo (DA) 

JL Hartnick (DA) 
CN Lichaba 
(ANC) 

K Windvogel 
(ANC) 

T Fortuin (ICOSA) 

Property 

Management 

and 

Development 

Property Planning 
and Maintenance, 
Resorts, Strategic, 
Investment 
Properties, Regional 
Bulk Infrastructure 
Planning, Rural 

JP Johnson 

1 Stemela 

L Menze 

SF May (DA) 

EH Stroebel (DA) 
BHJ Groenewald 
(DA) 

NF Kamte (ANC) 
MP Mapitiza 
(ANC) 

V Gericke (PBI) 

District 
Economic 
Development 
and Tourism 

Regional Economic 
Development, 
Tourism, Arts and 
Culture, Youth 

RH Ruiters 

KS Lose 

L Menze 

SF May (DA) 

BHJ Groenewald 
(DA) 

EH Stroebel (DA) 

S De Vries (ANC) 
NATsengwa 
(ANC) 

V Gericke (PBI) 

Corporate 

Human Resource 

1 Stemela 

RH Ruiters 

B 

RGS Figland (DA) 


110 
















Services 

Development, 
Support services 
(Records / Tele¬ 
phone 

Management / 
Access Control), 
Committee 
Services, Legal 
Services, Gender / 
Disability related 
matters, HIV 
(Garden Route 
staff). 



Holtzhausen 

BHJ Groenewald 
(DA) 

AJ Rossouw (DA) 

SS Mbandezi 
(ANC) 

TTeyisi (ANC) 

T Fortuin (ICOSA) 

Strategic 

Services 

IGR, 

Communications, 
IDP, Information 
Communication & 
Technology, 
Shared Services, 
Funding 
Mobilisation, 
Strategic Properties 

E Meyer 

JC 

Lambaatjeen 

L Menze 

RGS Figland (DA) 

JL Hartnick (DA) 

D Saayman (DA) 
NC Jacob (ANC) 
MP Mapitiza 
(ANC) 

T Fortuin (ICOSA) 


Section 79 Committees 

Committee 

Chairperson 

Other political representation 

Unions 

Budget Steering 

JC 

Lambaatjeen 

(DA) 

RE Spies (DA) T Fortuin (ICOSA), D Xego 
(ANC), 

" 

Appeals 

Committee 


E Meyer (DA), RH Ruiters (DA), JL Hartnick 
(DA), PJ Van der Hoven (ANC), 

T Fortuin (ICOSA); V Gericke (PBI) 

“ 

Governance 


RE Spies (DA), PJ Van der Hoven (ANC), 

T Fortuin (ICOSA), V Gericke (PBI) 

- 

MPAC 

CN Lichaba 
(ANC) 

Eh Stroebel (DA), AJ Rossouw (DA), 

BHJ Groenewald (DA), BN van Wyk (DA), 

IT Mangaliso (ANC), T Fortuin (ICOSA) 


Training & 
Development 

S De Vries 
(ANC) 

RE Spies (DA), RGS Figland (DA), 

2 Imatu 

2 Samwu 

Occupational 
Health & Safety 

V Gericke 
(PBI) 

D Saayman (DA), 

NF Kamte (ANC) 

2 Imatu 

2 Samwu 

Local Labour 
Forum 


BHJ Groenewald (DA), D Saayman (DA),T 
Teyisi (ANC), PJ Van Hoven (ANC), V Gericke 
(PBI), R Spies(DA), S Mbandezi(ANC) 

5 Samwu 

3 Imatu 

Disciplinary 

Committee 


L Stroebel (DA), 

B Groenewald (DA) 

T Van Rensburg (DA) 

MP Mapitiza (ANC) 

CN Lichaba (ANC) 

T Fortuin (ICOSA) 



Ill 























Other Committees in terms of legislation 

Affiliation / 
Role 

Workplace 

Restructuring 

Basic 

Conditions of 
Service 

Human 

Resource 

Development 

Committee 

Audit and 
Performance Audit 
Committee 

Chairperson 




Dr A Potgieter 

Members 

- 

- 

- 

Adv D Block 

Ms. N Bulabula 

Mr G Stenekamp 

DA 

D Saayman 

BHJ Groenewald 
RH Ruiters 

BHJ 

Groenewald 

E Meyer 

RH Ruiters 

1 Stemela 

JP Johnson 

RGS Figland 

- 

ANC 

MP Mapitiza 

S De Vries 

IT Mangaliso 

- 

ICOSA 

- 

- 

- 

- 

BPI 


- 

V Gericke 


SAMWU 

M April 

N Nkasayi 

NW Nkasayi 

N Sthunda 

M April 

- 

IMATU 

H Herwels 

P Koopman 

P Koopman 

- 

Total 

6 

8 

6 

4 


Other Committees 

Affiliation / Role 

Public Transport Council 
representatives 

Road agency 

District Assessment Committee 
(DAC) 

Chairperson 

Public Transport Council 
representatives 

Road Agency 

District Assessment Committee 
(DAC) 

DA 

RE Spies 

RE Spies 

RH Ruiters 

ANC 

NF Kamte 

PJ Van der 
Hoven 

S De Vries 

ICOSA 

T Fortuin 



BPI 





112 





























2.1.8 POLITICAL DECISION-MAKING PROCESS 


Step 1 
Step 2 
Step 3 
Step 4 
Step 5 
Step 6 


Executive Managers 

Submit Reports to Portfolio Committee 

Council Committees 

For notice and/or Recommendations 

MAYCO Prelim 

Technical Review / Interrogate Reports 

Mayoral Committee 

Recommendation 

Council 

Approve / Consider 

Executive Manager 

Execution 


All decisions taken by Committees or Council are forwarded to the relevant Executive 

Manager for execution. 

2.2 ADMINISTRATIVE GOVERNANCE 

2.2.1 INTRODUCTION TO ADMINISTRATIVE GOVERNANCE 


The Municipal Manager is regarded, in terms of legislation, as the head of 
administration and is responsible and accountable for the management of the 
municipality's administration. The Accounting Officer must at all times act with fidelity, 
honesty, integrity and in the best interests of the municipality in managing its financial 
affairs. 

The Management team comprises of the following officials: 

Municipal Manager Mr MG Stratu 

Executive Manager: Community Services Mr C Africa 

Executive Manager: Corporate Services Ms B Holtzhausen 

Executive Manager: Financial Services Ms JW De Jager 

Executive Manager: Roads and Transport Planning Mr JG Daniels 

Executive Manager: Planning & Economic Development Mr L Menze 

In order to ensure that administrative governance is enforced and elevated, a number 
of departmental structures have been put in place viz: 

1. Senior Management meetings (ManCom); 

2. Middle Management meetings (Reflection group); 

3. Operation Clean Audit (GRAP / OPCAR); 

4. Excellence Enhancement Initiative Task Team; and 

5. Departmental Management meetings. 


113 













The administration ascribes to the Batho Pele Principles and the values are contained 
in the vision and mission of the Municipality. 

Senior Management is continuously striving at elevating the corporate culture of the 
administration, by inculcating corporate values, high levels of integrity and 
professionalism. 


2.2.2 TOP ADMINISTRATIVE STRUCTURE 



Mr Monde Stratu 

Municipal Manager 




Mr Clive Africa 

Executive Manager: 
Community Services 


MsTrix Holtzhausen 

Executive Manager: 
Corporate Services 


Mr Jan-Willem de Jager 

Executive Manager: 
Financial Services (CFO) 



Mr Lusanda Menze 

Executive Manager: 
Planning and Economic 
Development 



Mr John G Daniels 

Executive Manager: 
Roads Services 


114 










Performance Agreement Status 

Name of official 

Department 

Performance 
Agreement Signed? 
Y/N 

M Stratu 

Municipal Manager (From 1 March 2017) 

Yes 

B Holtzhausen 

Executive Manager: Corporate-/Strategic Services 

Yes 

C Africa 

Executive Manager: Community Services 

Yes 

JW De Jager 

Executive Manager: Financial Services 

Yes 

JG Daniels 

Executive Manager: Roads and Transport Planning 

Yes 

L Menze 

Executive Manager: Planning & Economic 
Development 

Yes 


COMPO NENT BjJNTERGOVERNMENTAL RELATIONS_ 

2.3 INTERGOVERNMENTAL RELATIONS 

2.3.1 INTRODUCTION TO CO-OPERATIVE GOVERNANCE AND 
INTERGOVERNMENTAL RELATIONS 

Garden Route DM, via the utilisation of its Intergovernmental Relations function and 
established functions, seeks to achieve the following: 

1. To promote horizontal and vertical partnership building towards coherent 
governance for the effective provision of municipal services and the 
realization of national priorities; 

2. Co - ordinate and partake in district, provincial and national 
intergovernmental structures; 

3. The implementation, reporting and monitoring of the Back - to Basics - 
Programme; 

4. To co-ordinate and facilitate good relationships with municipalities and 
Provincial and National spheres of government; 

5. To ensure that internal departments and sections build strategic 
developmental partnerships with their technical counterparts; 


115 














6. To co-ordinate the sharing of best practices, knowledge and information 
amongst municipalities; and 

7. To enhance both municipal human and financial resources capacity, leading 
to improved municipal service delivery. 

2.3.2 PROVINCIAL INTERGOVERNMENTAL STRUCTURE 

The Garden Route DM also serve on various provincial government platforms and 
structures mainly to report and share local experiences, best practices and identify 
practical solutions to enhance its developmental local government responsibility. 

2.3.3 Relationship with Municipal Structures 

Various internal municipal platforms are utilised by the Garden Route DM to enhance 
departmental accountability. These include; 

1. Mayoral Committee 

2. Council's Section 79 and Section 80 Committees 

3. Management Committee 

4. Municipal Public Accounts Committee (MPAC) 

5. Audit and Performance Management Committee 

6. Budget Steering Committee 

7. Garden Route IDP Task Team 

8. Garden Route Risk Committee 

9. Occupational Health and Safety Committee 

10. Training and Development Committee 

2.3.4 DISTRICT INTERGOVERNMENTAL STRUCTURES 

The following table provides an overview of Intergovernmental Relations Structures 
that are currently operational and co-ordinated by Garden Route DM. Garden Route 
DM serves 22 IGR Forums. The MEC of Local Government, during the 2014/2015 IDP 
review, has commented on and requested the Garden Route DM to strengthen the 
IGR Forums. 


116 



Of the 22 IGR Forums, it is reported that all Forums have been strengthened with the 
exception of the Youth, Legal and Speakers Forum. 

The District IGR, IDP and Public Participation office currently co-ordinates the IGR 
function in collaboration with the Office of the Municipal Manager. The IGR structures 
assist in aligning municipal planning and development initiatives, promotes an 
approach which fosters shared service agreements and collaborates on matters of 
mutual concern to the district. Joint long term planning, Indaba Agreements and cross 
border development initiatives through a district support register have proved 
successful in improving relations and collaboration on municipal challenges. The Joint 
Planning Initiative is a good example of Intergovernmental Relations at work in 
ensuring a cooperative and integrated approach to long term planning. The initiative 
has been spearheaded under the leadership of the Western Cape Provincial 
Government and involves constant dialogue, consensus and investigation of lucrative 
developmental opportunities for future implementation. 


It is envisaged that these long term planning instruments be supported with short term 
operational action planning mechanisms through indaba agreements leading to the 
successful implementation and realization of what have commonly become known as 
“game changers” for the Garden Route district. The Garden Route DM has hosted a 
number of successful community engagements (Anti-Fraud Hotline Campaign; 
Western Cape Supply Chain Database Campaign; Water Campaign in Kannaland; 
Garden Route LED Genesis Workshop and NCOP). 


Garden Route District Forums 

Forum name 

Frequenc 
y of 

meetings 

Purpose 

Composition 

Chairperson 

IDP Managers 
Forum 

Quarterly 

Platform to engage on 
the IDP process of the 
district & local B - 
Municipalities in the 
district; share best 
practices on IDP. 

Aim for alignment 
between the IDP of 
District & B - 
Municipalities. 

IDP Managers 

IDP 

Officers/Coordinators 
DPLG - Integrated 
Development Plan 
Directorate 

Garden Route 
DM, IDP 
Manager: Mr M 
Cekiso 


117 










Garden Route District Forums 


Frequenc 

Forum name y of Purpose Composition Chairperson 

meetings 


IDP, Budget and 
PMS 

Representative 

Forum 

Quarterly 

All Mayors of Local 
Municipalities will present 
the status of their 
Municipalities relating to 
IDP, Budget and 
Performance 
Management. Sector 
Departments will also 
present all their 
proposed projects and 
programmes for the 
Garden Route District 
jurisdiction 

District Mayors, Sector 
Departments, Ward 
Committees, 
Relevant 
Stakeholders 

All Mayors from 
Local 

Municipalities, 
HOD of sector 
departments 

South Cape 
Economic 
Partnership/LED 
Managers Forum 

Quarterly 

Platform for Economic 
Development 
Practitioners, 
government 
departments and 
private sector 
stakeholders to discuss 
best practices for the 
implementation of LED 
project and programs to 
stimulate the local 
economy. 

LED Managers 
SEDA, REDDOOR, 
and Relevant 
Stakeholders 

Garden Route 
DM, LED 
Manager: 

Ms M. Wilson 

District Green 
Energy Forum 

Quarterly 

Platform through which 
developers could 
engage regulators on 
issues affecting 
the Renewable Energy 

PMU Managers, 
Department of 
Energy and Provincial 
Sector Departments 
and relevant 
stakeholders. 

Garden Route 
DM, PMU 
Manager: 

Ms P.Dongi 

District Local 
Tourism Forum 

Quarterly 

To plan for the impact 
upon, improve and 
monitor tourism 
development. 

Tourism Portfolio 
Councillors 
Tourism Officials 
Technical Committee 
Members (LTO 
Members) 

Garden Route 
DM, LED & 
Tourism 

Manager: Ms M. 
Wilson 

District Public 
Participation 
Forum 

Quarterly 

Platform for district to 
discuss plans, strategies 
and best practices for 
public participation 
related matters. 

Public Participation 
Official 

GCIS 

DPLG-Public 
Participation 
Directorate 

Garden Route 
DM, IDP 
Manager: Mr M 
Cekiso 

District 

Communicators 

Forum 

Quarterly 

To discuss and Review 
the Communication 
Strategy and Policy 
related matters. 

District and Local 
Communication 
Managers/officials, 
GCIS, and Provincial 
Sector Department. 

Garden Route 
DM, Senior 
Communication 
Officer: Mr H. 
Pieters 


118 















Garden Route District Forums 


Frequenc 

Forum name y of Purpose Composition Chairperson 

meetings 


District Co¬ 
ordinating Forum 

Quarterly 

To identify and 
implement programs 
aimed at realising one of 
the key objectives of 
local government, i.e. to 
deepen local 
democracy. 

Mayors, Municipal 
Managers and 
Provincials 
Departments (when 
requested) 

Garden Route 
District, 
Executive 
Mayor: Mr M 
Booysen 

Garden Route 
Municipal 
Managers Forum 

Quarterly 

To discuss matters of 
Municipal interests. 

Municipal Managers, 
and Provincial 
Departments 

Garden Route 
DM, Municipal 
Manager: MrM 
Stratu 

Integrated 
Communications 
and Technology 
(ICT) Forum 

Quarterly 

To discuss and strategize 
issues with regard to IT. 

Local Municipalities IT 
Specialists and 
Administrators 

Garden Route 
DM, ICT 
Manager: K. 
Nieuwoudt 

District GIS Forum 

Quarterly 

To discuss Geographical 
Information System (GIS) 
related matters. 

District and Local GIS 
Managers and 
officers, Provincial 
Department 

Garden Route 
DM, GIS 

Coordinator: Mr 

S. Damons 

District Roads and 
Infrastructure 
Forum 

Quarterly 

To discuss the Integrated 
Roads, Bulk Infrastructure 
and Engineering related 
matters. 

District and local 
municipalities 
Engineers and 
Relevant Provincial 
Department 

Garden Route 
DM, Roads 
Manager: 

Mr J. Daniels 

Garden Route 
Waste 

Management 
Officers forum 

Quarterly 

To discuss matters 
related to Waste 
management and 
Landfill site 

District and Local 
Waste Managers, 
Provincial Sector 
Departments 

Garden Route 
DM, Waste 
Manager: Mr 
Morton Plubbe 

District GRRI Waste 
Beneficiation 
Flagship 

Quarterly 

To discuss Waste 
Minimisation strategy 
and action plan 

District and Local 
Waste Managers, 
Provincial Sector 
Departments 

Garden Route 
DM, Waste 
Manager: Mr 
Morton Flubbe 

District Air Quality 
Forum 

Quarterly 

To discuss educational 
and Awareness Air 
Quality Management 
Plan related issues. 

District and Local Air 
Quality Managers/ 
Officers, Provincial 
Sector Department, 
Relevant 
Stakeholders and 
Industries 

Garden Route 
DM, Waste 
Manager: DrJ. 
Schoeman 


119 

















Garden Route District Forums 


Frequenc 

Forum name y of Purpose Composition Chairperson 

meetings 


Garden Route Air 
Quality Working 
Group with 
Garden Route 
Industries 

Quarterly 

To discuss, communicate 
Air Quality issues with 
Industries and 
coordinate training 
related matters. 

District and Local Air 
Quality Managers/ 
Officers, Provincial 
Sector Department, 
Relevant 
Stakeholders and 
Industries 

Garden Route 
DM, Waste 
Manager: DrJ. 
Schoeman 

Garden Route Fire 
Chief Officers 
Forum 

Quarterly 

To discuss the district's 
Fire Services related 
issues. 

District and local 
municipalities Chief 
Fire Officers, 
Department of Local 
Government 

Garden Route 
DM, Fire Chief: 

Mr F. Thaver 

District Chief Risk 
Officers Forum 

Quarterly 

To discuss Transversal Risk 
Management related 
issues. 

District and Local 
Chief Risk Managers 
and officers 

Garden Route 
DM, Risk Officer: 
Ms L James 

District Chief Audit 
Executive Forum 

Quarterly 

To discuss challenges 
related to Internal Audit 
and implement 
resolutions from 
provincial structures 

District and Local 
Chief Audit 
Executive, 
Provincial Treasury, 
and AG 

Garden Route 
DM, CAE: Mr J- 
W de Jager/P 
Lufele 

Garden Route/ 
Central Karoo FIR 
Forum 

Bi- 

Monthly 

To discuss Corporate 
issues. 

District and local 
municipalities FIR 
Managers and 
Labour Relations 
Officers 

Garden Route 
DM, HR 
Managers: Ms 
N.KIaas 

Regional Skills 
Development 
Facilitators Forum 

Quarterly 

Skills development in the 
region (Central Karoo 
and Garden Route). 

Garden Route, B- 
Municipalities and 
Central Karoo, 
LGSETA and other 
relevant SETA's, 
Educational 
Institutions 

Skills 

Development 
Facilitator: Mr R 
Salmons 

District EPWP 
Forum 

Quarterly 

To discuss EPWP related 
matters 

District and Local 
EPDP 

Managers/Coordinat 
ors, Provincial and 
National Department 
of Public Works 

Garden Route 
DM, EPWP 
Managers: Mr R. 
Dyantyi 

District/Regional 
Task Committee 

Quarterly 

To discuss Job 
Description and 
evaluation related 
matters 

District and Local 
TASK/Job Evaluators 
Officials 

Garden Route 
DM, HR 
Managers: Ms 
N.KIaas 


120 

















COMPONENT C: PUBLIC ACCOUNTABILITY 


Overview of Public Accountability and Participation 

MSA section 15 (b) requires a municipality to establish and organise its administration 
to facilitate a culture of accountability amongst its staff. Section 16 (i) states that a 
municipality must develop a system of municipal governance that complements 
formal representative governance with a system of participatory governance. Section 
18 (i) (d) requires a municipality to supply its community with information concerning 
municipal governance, management and development. 

The participation outlined above is required in terms of: 

1. the preparation, implementation and review of the I DP; 

2. the preparation, implementation and review of the municipal SDF; 

3. the drafting of the municipal budget; 

4. strict adherence to Section 27 of the Municipal Systems Act; 

5. MPAC and APAC oversight committee; 

6. notifying the public on council meetings; 

7. publication of Performance Agreements on the municipal website; 

8. Supply Chain Management procedures and processes; 

9. the development, implementation and mitigation of municipal risks through a risk 
register; 

10. implementation of iComply Eunomia to ensure legislative compliance; 

11. the monitoring of the Garden Route Anti-Fraud Plotline; and 

the municipal annual report 

2.4 IDP PARTICIPATION & PERFORMANCE ALIGNMENT 


IDP Participation and Alignment Criteria 

Yes/No 

Does the municipality have input, output indicators? 

Yes 

Does the IDP have priorities, objectives, KPIs, development strategies? 

Yes 

Does the IDP have multi-year targets? 

Yes 

Are the above aligned and can they calculate into a score? 

Yes 

Does the budget align directly to the KPIs in the strategic plan? 

Yes 

Do the IDP KPIs align to the Section 57 Managers 

Yes 

Do the IDP KPIs lead to functional area KPIs as per the SDBIP? 

Yes 


121 














IDP Participation and Alignment Criteria 

Yes/No 

Do the IDP KPIs align with the provincial KPIs on the 12 Outcomes 

Yes 

Were the indicators communicated to the public? 

Yes 

Were the four quarter aligned reports submitted within stipulated time frames? 

Yes 

* Section 26, Municipal Systems Act 2000 


_COMPONENT Dj_CORPORATE GOVERNANCE 

Corporate governance is the set of processes, practices, policies, laws and 
stakeholders affecting the way an institution is directed, administered or controlled. 
Corporate governance also includes the relationships amongst the many stakeholders 
involved and the goals for which the institution is governed. 

2.5 RISK MANAGEMENT 

2.5.1 GOOD GOVERNANCE: RISK MANAGEMENT 

To maintain an overall positive perception of the municipality and confidence in the 
municipality from the public and other stakeholders, well planned goals and 
objectives should be coordinated and achieved within the district. Garden Route DM 
has instituted Risk Management as a systematic and formalised process in order to 
identify, assess, manage and monitor risks which effectively ensures achievement of 
those planned goals and objectives. Thus, Risk management is essentially a good 
governance measure instituted to ensure the municipality accomplishes its vision, 
mission and strategic plans. 

Risk refers to a beneficial or unwanted outcome, actual or potential, to the 
organisation's service delivery and other performance objectives, caused by the 
presence of risk factors. A risk factor is seen as any threat or event which creates, or 
has the potential to create risk, i.e. it is the root cause of the risk. The occurrence of 
these risks would be an example of a factor that could hamper service delivery. Some 
risk factors also present upside potential, which management must be aware of and 
be prepared to exploit. Such opportunities are encompassed in this definition of risk. 


122 











2.5.2 BENEFITS OF RISK MANAGEMENT 


Risk management is a valuable management tool which increases an institution's 
prospects of success through minimising negative outcomes and optimising 
opportunities. 

Instituting a system of risk management may have the following beneficial outcomes 
for Garden Route DM: 

1. More sustainable and reliable delivery of services; 

2. Informed decisions underpinned by appropriate rigour and analysis; 

3. Achievement of strategic goals as set out in the Integrated Development 
Plan; 

4. Reduced waste; 

5. Prevention of fraud and corruption; 

6. Better value for money through more efficient use of resources; and 

7. Better outputs and outcomes through improved project and program 
management. 

2.5.3 LEGISLATIVE REQUIREMENTS 

Sections 62(1 )(c)(i) and 95(c) (i) of the MFMA specifically require Accounting Officers to 
ensure that their municipalities and municipal entities have and maintain effective, 
efficient and transparent systems of risk management. 

2.5.4 THE RISK MANAGEMENT PROCESS 

The risk management process is the basic skeleton structure that guides the entire risk 
management unit and consists of 8 vital steps: 

1. Internal Environment - the municipality's internal environment is the 

foundation of all other components of risk management and needs to 
be thoroughly assessed. 

2. Objective Setting - this is a precondition to event identification, risk assessment 

and risk response. There must first be objectives before management 
can identify risks to their achievement and take necessary actions to 
manage the risks. 


123 



3. Event identification - as part of event identification management recognises 

that uncertainties exist, but does not know when an event may occur, 
or when its outcome should occur. 

4. Risk Assessment - management considers the mix of potential future events 

relevant to the municipality and its activities. This entails examining 
factors including the municipality's size, complexity of operations and 
degree of regulation over its activities that shape the municipality's risk 
profile and influence the methodology it uses to assess risks. Individual 
risks are assessed on inherent and residual levels, and on impact and 
likelihood of occurrence. 

5. Risk Response - this involves identifying and evaluating possible responses to 

the risks identified. Evaluation of likelihood and impact of risks is done 
then plotted on the following graph (which is used to categorise risks as 
low, medium or high) in order to gauge the type of response needed. 

6. Control Activities - three types of control activities are recognised in risk 

management. These are preventative controls (striving to eliminate the 
occurrence of certain risks), detective controls (striving to identify and 
bring attention to risks that have already occurred or materialised), and 
corrective controls (striving to counteract the effects of risks that have 
already occurred or materialised). In order for activities and operations 
to run effectively and efficiently Garden Route DM must optimally 
distribute its resources according to significance of those activities and 
operations. 

7. Information and Communication - information should be delivered to 

personnel in a form and timeframe that enables them to carry out their 
risk management and other responsibilities. 

8. Monitoring - risk management operates in an ever-changing and dynamic 

environment. Management needs to regularly determine whether the 
functioning of each risk management component continues to be 
effective. 


124 



Graph: Risk Response required according to impact and likelihood. 


Medium Risk 

High Risk 

Share (Insurance) 

Avoid & Reduce (Controls) 

Low Risk 

Medium Risk 

Accept (Risk Appetite) 

Reduce (Controls) & Monitor 


LIKELIHOOD / PROBABILITY 


It should be noted that the below risks were identified during the annual risk 
assessment and has been presented at the Strategic Session held in March 2019. 


As at 30 June 2018, the top ten risks to the municipality 

No. 

Risk Group 

Risk 

Cause of risk (root cause) 


Sustainable 

Environmental 
Management 
and Public Safety 

Excessive alien 
vegetation in the District 

•Alien infestation not being eradicated due to 
no Alien invasive species, monitoring, control 
and eradication plan 
•Droughts, 

•Unharvestable fields/crops 
•Non maintenance of fire breaks 
•Excessive alien invasive plant growth in the 
entire district. 


Sustainable 

Environmental 
Management 
and Public Safety 

Climate change 

•Greenhouse gases 
•Changes in temperature 
•Changes in weather patterns 
•Human fingerprint 


Financial Viability 

Financial Sustainability 

•Limited own revenue sources 
•Grant dependency 

•Lost opportunity of income due to minimal or 
no payments of Council properties 
•District municipality providing minimal leviable 
services 

Non recoverability of fire service accounts 


125 



























As at 30 June 2018, the top ten risks to the municipality 


No. Risk Group Risk Cause of risk (root cause) 







Good 

Governance 

Negative Audit Opinion 

•Irregular expenditure 

•Failure to provide credible AFS 

•Failure to properly administrate payments 

•Ineffective systems control procedures with 

regards to capturing of data 

•Lack of / no service delivery with regard to 

key areas within the finance department 

•Incorrect treatment of VAT resulting in over-or 

under payment to SARS 

•Vendor still developing basic functionality on 

the system e.g. Bank reconciliation module 

•Capacity of the vendor to support their client 

•SCM related processes 


Growing and 
inclusive district 

economy 

Lack in economic 
growth in the district 

•Ineffective facilitation and coordination of 
district economic activities, projects and 
programmes across the region. 

• Lack of funding; 

• Lack of investor confidence in GRDM - 
insufficient or ineffective investment promotion; 
Absence of investment incentive policies 

• Capacity constraints at B or C municipal 
level; 

• Lack of buy in from stakeholders; 

• Misalignment of programs; 

• Lack of coordinated strategic plan to grow 
the district; 

• Failure of b municipalities to regularly attend 
LED / IGR Forums; 

•Outdated Growth and Development Strategy 
for the district. 


Financial Viability 

Loss of Roads Agency 
Function 

There are discussion of taking the function 
back to province 

Receiving R150m 


Good 

Governance 

Litigation 

•Incorrect legal advice 

•Possible litigation as a result of district fire ( 

R500m) 

•Non Compliance with legislation an policies 
•Lack of knowledge/understanding 
•Poor Contract Management 
•Lack of life savers at resorts 


126 













As at 30 June 2018, the top ten risks to the municipality 


No. Risk Group Risk Cause of risk (root cause) 





•Poor service 


Good 

Governance 

Non Compliance with 
legislation and policies 

•Lack of knowledge and understanding 

•Lack of resources 

•Inaccurate reporting 

•Red tape 

•Lack of training 

•System failures 

+‘Incorrect decisions 


Healthy and 

Social stable 

communities 

Failure to properly 
dispose of waste 

Long process before the establishment of the 
land fill site 


2.5.5 RISK MANAGEMENT: ACCOMPLISHMENTS AND THE WAY FORWARD 

Risk management remains an ongoing process and an important factor in change 
management in Garden Route DM. Also, best practices are being formulated and 
evaluated within the field of risk management on a provincial level on a continuous 
basis. The Garden Route District Internal Audit and Risk Management Forum is going 
strong and quarterly engagements are taking place with all local municipalities in the 
District involved. This allows all members to give constructive inputs into risk discussions 
that affect the whole district. 


The newly amended Public Audit Act will ensure that Risk Management takes on a 
bigger role in the municipality, especially with regards to consequence management 
and the overall performance of the municipality. 

All staff members are involved in the identification of risk and the input of controls 
within their respective departments. Risk champions are constantly rotating to give all 
officials the platform to provide inputs and learn from the leadership of Garden Route 
DM. 


127 











The procurement of an electronic Risk and Audit system has been successful. The 
system will go live on 1 August 2019. Training is being rolled out and the Risk 
Management unit, Internal Audit unit, Risk Management Committee and Risk 
Champions have been trained. An awareness campaign to promote the system will 
be facilitated by the Risk Management unit to all officials. The system will enhance the 
streamline of integration between Risk Management, Internal Audit and Performance 
Management. This will allow the municipality to have a hands on approach to all risk 
identified, the monitor and evaluation thereof and the audit processes. 

2.6 ANTI-CORRUPTION AND FRAUD 

Section 83(c) of the Municipal Systems Act (MSA) refers to the implementation of 
effective bidding structures to minimize the possibility of fraud and corruption and the 
Municipal Finance Management Act (MFMA), Section 112(1) (m) (i) identifies supply 
chain measures to be enforced to combat fraud and corruption, favouritism and 
unfair and irregular practices. Section 115(1) (b) of the MFMA further states that the 
accounting officer must take steps to ensure mechanisms and separation of duties in a 
supply chain management system, to minimize the likelihood of corruption and fraud. 

2.6.1 GARDEN ROUTE ANTI-FRAUD AND ANTI-CORRUPTION STRATEGY 

A tender was awarded to Advanced Call for the Anti-Fraud Plotline after a 
competitive bidding process 

2.7 SUPPLY CHAIN MANAGEMENT 

Section 217 of the Constitution of the Republic of South Africa, 1996, states the 
following with reference to Procurement by the state: 

“(1) When an organ of state in the national, provincial or local sphere of government, 
or any other institution identified in national legislation, contracts for goods and 
services, it must do so in accordance with a system which is fair, equitable, 
transparent, competitive and cost effective. 

(2) Subsection 1 does not prevent the organs of state or institutions referred to in that 
subsection from implementing a procurement policy providing for, categories of 


128 



preference in all allocation of contracts and the protection of advancement of 
persons, or categories of persons, disadvantaged by unfair discrimination.” 

Section 11 lot the Municipal Finance Management Act 56 of 2003 gives effect to 
section 217 of the Constitution of the Republic and requires each Municipality (Local 
Government) to have and implement a supply chain management policy which is 
fair, equitable, transparent, competitive and cost effective; complies with all 
regulatory frameworks prescribed in Chapter of the Municipal Supply Chain 
Management Regulations. A supply chain management policy to also comply with 
any minimum norms and standards that may be prescribed in terms of section 168 of 
the Municipal Finance Management Act (MFMA). 

MFMA, section 63, 77 and 78 effectively allocate joint responsibility for integrity and 
maintenance of good corporate governance to all public servants with regards to 
Supply Chain Management. 

In terms of section 217(2) of the constitution as cited earlier. Preferential Procurement 
Policy Framework Act of 2007 gives effect to ensuring that provision in Policy is made in 
addressing and providing of preference in allocation of contracts to and the 
protection or advancement of persons, disadvantaged by unfair discrimination. The 
Act however may only be implemented within a framework as prescribed by national 
legislation as contemplated in section 217(3) of the Constitution. Preferential 
Procurement Regulations, 2017, then gives effect and guidelines on how to realise the 
objectives as enshrined in the constitution for the protection and advancement of 
persons, disadvantaged by unfair discrimination. 


There are more than 58 different pieces of legislation that have a direct impact and 
affect Supply Chain Management in Local Government, as we see more being 
enacted in addition to the various National Treasury Guidelines which Supply Chain 
Management is meant to comply with. Some of these to mention is; Competition Act 
(1998), Broad-Based Black Economic Empowerment Act (2003), Construction Industry 


129 



Development Board Act 38 of 2000, Prevention and Combating of Corrupt Activities 
Act of 2003, National Small Business Act 102 of 1996, NEMA Act 107 Of 1998 and many 
more to mention. 

As at July 2019 the Municipal Cost Containment Regulations, 2019, (MFMA) came into 
effect and in addition to the more than 58 different pieces of legislation. The object of 
the Cost Containment Regulations, in line with sections 61(1)(a), 78(1)(b), 95(a) and 
105(1 )(b) of the Municipal Finance Management Act, is to ensure that resources of a 
municipality or municipal entity are used effectively, efficiently and economically by 
implementing cost containment measures. The regulations broadly covers the 
following within the sphere of Supply Chain Management: 

Procurement of: Consultants, Vehicles used for political office bearers, Travel and 
subsistence, domestic accommodation, credit cards, sponsor ships, events and 
catering, communication, conferences, meetings and study tours and other related 
expenditure. Regulation 13(1) of the Cost Containment Regulations, states the 
following: All commodities, services and products covered by a transversal contract, 
concluded by the National Treasury must be considered before approaching the 
market, to benefit from savings where lower prices or rates have been negotiated. 

The constitution provides the 5 pillars of Supply Chain Management Act which is to be 
fair, equitable, transparent, competitive and cost effective. Out of these 5 pillars we 
more than 58 active pieces of legislations that have a direct impact on how 
procurement is within Municipal (local government) sphere is conducted. 

The burden cost of compliance on Local Government from a quantitative and 
qualitative aspect is clearly captured in the Auditor General Media Report of 26 June 
2019, where The Auditor General findings on local government are astounding. 

Of the 257 Municipalities and 21 Municipal entities in the country, only 18 Municipalities 
managed to comply with all key legislation thereby receiving a clean audit. This is a 
regression from 33 Municipalities in the previous financial year that had clean audits. 
Municipalities with material compliance findings on supply chain management 
increased from 72% to 81%. Irregular expenditure decreased from R29.7 Billion to R25.2 


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Billion. Irregular expenditure is mainly about one or other compliance matter not being 
complied with irrespective of prevailing circumstances or context at the time. 

In conclusion, the Supply Chain Management realm is a complex and heavily 
regulated space where various considerations must be taken into account before any 
procurement can be undertaken. It is not simply about an economic decision at arms- 
length between willing buyer and willing seller at market determined pricing. There is 
various multi regulatory compliance matters that ought to be ticked before we can 
proceed in procuring any goods or services. The promulgation of the Cost 
Containment Regulation which now requires us to first look at national contracts 
before we proceed on our own procurement process fails to see Local Government 
spending with its own borders as a major local economic stimulant. Therefore some of 
the regulations will have far reaching impact than merely just cost saving, the regional 
economy aspect has yet to be considered. As 2019/20 regularity Audit unfolds, we 
trust that the remedial audit implementation strategy put in place will yield better 
audit outcomes. 

2.8 MUNICIPAL WEBSITE 

Section 75 of the Municipal Finance Management Act requires municipalities to place 
key documents and information on their website, including the IDP, the annual 
budget, adjustments budgets and budget related documents and policies. 

Sections 21 (a) & 21 (b) of the Municipal Systems Act also obliged municipalities to 
convey specific documents and information to the public, displaying these 
documents on the municipality's official website. 

Based on the abovementioned, the Communication Unit strive to place all relevant 
and update information on the website. The Municipality views its website as an 
integral part of communication infrastructure and strategy. 

The website serves as a tool for community participation, information sharing and 
disclosure information about decisions taken, council's finances and activities. 


131 



Documents published on the Municipality's / Entity's Website 

Yes/No 

Current annual and adjustments budgets and all budget-related documents 

(2018/19) 

Yes 

All current budget-related policies for the 2017/18 budget 

Yes 

The annual report for 2017/18 

Yes 

The annual report for 2017/18 published 

December 2018 

All performance agreements required in terms of section 57(1 )(b) of the Municipal 
Systems Act (2018/19) and resulting scorecards 

Yes 

All supply chain management contracts above a prescribed value 

Yes 

An information statement containing a list of assets over a prescribed value that 
have been disposed of in terms of section 14 (2) or (4) during Year 1 

Nothing 

disposed 

Contracts agreed in Year 1 to which subsection (1) of section 33 apply, subject to 

subsection (3) of that section 

Yes 

Public-private partnership agreements referred to in section 120 made in Year 1 

No 

All quarterly reports tabled in the council in terms of section 52 (d) during Year 1 

Yes 


T2.10.1 


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CHAPTER 3 

SERVICE DELIVERY 
PERFORMANCE 

(PERFORMANCE REPORT PART 1) 





Cjcuedeti 

DISTRICT MUNICIPALITY I UMASIPALA WESITHILI I DISTRIKSMUNISIPALITEIT 





133 


CHAPTER 3: OVERVIEW OF PERFORMANCE WITHIN 

THE ORGANISATION 


3.1 OVERVIEW 

Performance management is a management tool to plan, monitor, measure and 
review performance indicators to ensure efficiency, effectiveness and the impact of 
service delivery by the Municipality. 

At local government level performance management is institutionalised through the 
legislative requirements on the performance management process for local 
government. Performance management provides the mechanism to measure 
whether targets to meet its strategic goals, set by the organisation and its 
employees, are met. 

The Constitution of South Africa (1996), Section 152, dealing with the objectives of 
local government, paves the way for performance management with the 
requirements for an “accountable government”. The democratic values and 
principles in terms of Section 195(1) are also linked with the concept of performance 
management, regarding the principles of inter alia: 

1. the promotion of efficient, economic and effective use of resources; 

2. accountable public administration; 

3. to be transparent by providing information; 

4. to be responsive to the needs of the community; and 

5. to facilitate a culture of public service and accountability amongst staff. 

The Municipal Systems Act (MSA), 2000 requires municipalities to establish a 
performance management system. Further, the MSA and the Municipal Finance 
Management Act (MFMA) requires the Integrated Development Plan (IDP) to be 
aligned to the municipal budget and to be monitored for the performance of the 
budget via the Service Delivery and the Budget Implementation Plan (SDBIP) 


134 



Legislative Requirements: 

In terms of Section 46( 1) (a) of the MSA a municipality must prepare for each financial 
year a performance report reflecting the municipality's and any service provider's 
performance during the financial year, including comparison with targets of and with 
performance in the previous financial year. The report must indicate the 
development and service delivery priorities and the performance targets set by the 
municipality for the following financial year and measures that were or are to be 
taken to improve performance 

3.1.1 ORGANISATIONAL PERFORMANCE 


Strategic performance indicates how well the municipality meet its objectives and 
which policies and processes are working. All government institutions must report on 
strategic performance to ensure that service delivery is efficient, effective and 
economical. Municipalities must develop strategic plans and allocate resources for 
the implementation. The implementation must be monitored on an ongoing basis 
and the results must be reported on during the financial year to various role-players 
to enable them to timeously implement corrective measures where required. 

This report highlights the strategic performance in terms of the Municipality's Top 
Layer SDBIP per strategic objective and the National KPI's prescribed in terms of 
Section 43 of the MSA, 2000 

3.1.2 THE PERFORMANCE SYSTEM FOLLOWED FOR 2017/18 

Adoption of a Performance Management Framework 

Regulation 7(1) of the Local Government: Municipal Planning and Performance 
Management Regulations, 2001 states that “A Municipality's Performance 
Management System entails a framework that describes and represents how the 
municipality's cycle and processes of performance planning, monitoring, 
measurement, review, reporting and improvement will be conducted, organised 
and managed, including determining the roles of the different role players.” 
Performance management is not only relevant to the organisation but also to the 


135 



individuals employed in the organization as well as the external service providers and 
municipal entities. This framework, infer alia, reflects the linkage between the IDP, 
budget, SDBIP and individual and service provider performance. 

Council approved and adopted a Performance Management Framework and 
Policy in April 2007. The Municipality reviewed the policy during April 2015 which was 
approved by Council on 23 November 2015 (Council resolution: DC 943/11/15). The 
policy was adjusted during the 2016/17 financial year In line with the implementation 
of Individual Performance Management. The Policy was workshopped with Council 
on 18 September 2017. The Policy/Framework was approved on 5 December 2017. 

3.1.3 THE IDP AND THE BUDGET 


The reviewed IDP and budget for 2018/19 was approved by Council on 28 May 2018. 
The IDP process and the performance management process are integrated. The 
strategic objectives that were identified in the reviewed 2018/19 IDP is aligned with 
the National KPA's. The strategic objectives are linked to the outcomes for 2018/19. 
The IDP fulfils the planning stage of performance management. Performance 
management in turn, fulfils the implementation management, monitoring and 
evaluation of the IDP. 


3.1.4 THE SDBIP 


The organisational performance is evaluated by means of a municipal scorecard 
(Top Layer SDBIP) at organisational level and at directorate levels. 

The Top Layer SDBIP was approved by the Executive Mayor on 19 June 2018 
The Top Layer SDBIP was revised with the adjustments budget in terms of Regulation 
26(2) (c) of the Municipal Budget and Reporting Regulations. These adjustments were 
approved by Council in February 2019. 

The following were considered in the development of the amended Top Layer SDBIP: 

1. Areas to be addressed and root causes of the Auditor-General 
Management Letter, as well as the risks identified during the 2017/18 audit 


136 



2. Alignment with the IDP, National KPA's, Municipal KPA's and IDP objectives 

3. Alignment with the adjustments budget 

4. Oversight Committee Report on the Annual Report of 2017/18 

5. The risks identified by the Internal Auditor / Risk Manager during the 
municipal risk analysis 

6. The recommended changes by the Internal Auditor 

7. The requested changes by departmental Heads of Departments 

8. The noted system descriptions 

3.1.5 ACTUAL PERFORMANCE 

The Municipality utilises an electronic web-based system on which KPI owners update 
actual performance monthly. KPI owners report on the results of the KPI by 
documenting the following information on the performance system: 

1. The actual result in terms of the target set 

2. A performance comment 

3. Actions to improve the performance against the target set, if the target 
was not achieved 

It is the responsibility of every KPI owner to maintain a POE to support actual 
performance results updated. 

3.2 PERFORMANCE MANAGEMENT 

3.2.1 ORGANISATIONAL PERFORMANCE 


The organisational performance is monitored and evaluated via the SDBIP and the 
performance process can be summarised as follows: 

1. The approved Top Layer SDBIP was approved on 19 June 2018 and loaded 
on an electronic web-based system 


137 



2. The web-based system sends automated e-mails to the users of the system 
as a reminder to all staff responsible for updating their actual performance 
against KPI targets by the pre-determined day of every month for the 
previous month's performance 

3. The performance system administrator reminded all departments monthly 
to update their actual performance on the web-based system 

4. The actual results against monthly targets set, are discussed in one-on-one 
session with the Municipal Manager and Executive Managers to determine 
early warning indicators and take corrective measures if needed 

5. Performance reports are submitted on a quarterly basis to the Municipal 
Manager and Council. The Section 72 report, as prescribed by the MFMA, 
was submitted to the Mayor and Council for approval 

3.2.2 INDIVIDUAL PERFORMANCE MANAGEMENT 


a) Municipal Manager and Managers Directly Accountable to the Municipal Manager 

The MSA, 2000 (Act 32 of 2000) prescribes that the municipality must enter into 
performance based agreements with all the S57-employees and that performance 
agreements must be reviewed annually. This process and the format are further 
regulated by Regulation 805 (August 2006). The performance agreements for the 
2018/19 financial year were signed before or on 31 July 2018. 

The appraisal of the actual performance in terms of the signed agreements takes 
place twice per annum as regulated. The final evaluation of the 2018/19 financial 
year (1 January 2019 to 30 June 2019) will take place during October 2019 and the 
mid-year performance of 2018/19 (1 July 2018 to 31 December 2018) was completed 
on 10 May 2019. 

The appraisals were done by an evaluation panel as indicated in the signed 
performance agreements and in terms of Regulation 805 and consisted of the 
following people: 

1) Executive Mayor 


138 



2) Portfolio Chairperson 

3) Municipal Manager 

4) Chairperson of the Audit Committee 

5) Municipal Manager from another municipality 

b) Other Municipal Personnel 

The Municipality is in process of implementing individual performance management to 
lower level staff in annual phases. 

3.3 SERVICE DELIVERY PERFORMANCE 

This section provides an overview of the key service achievements of the Municipality 
that came to fruition during 2018/19 in terms of the deliverables achieved compared 
to the KPI's and objectives in the IDP. It furthermore includes an overview on 
achievement in 2018/19 compared to actual performance in 2017/18 



KPI met 

KPI well 
met 

KPI 

extremely 
well met 



Explanation: 

Explanation : 

▼ 

ActuxUTarget * 

Actujl/Target > 

Explanation: 

tool 

loot 




• ISO* 


139 








KPI not yet 
measured 

w 

Explanation: 

KPI's with no 
targets or 
actuals in the 
selected period 


KPI not met 


Explanation: 
o% > = 

Actual/Target< 

75% 


KPI almost 
met 

v 

Explanation: 
75% > = 

Actual/Target < 
100 % 


Figure 1 SDBIP Measurement Categories 

The above indicates the method by which the overall assessment of actual 
performance against targets set for the KPI’s of the SDBIP is measured. 

3.3.1 STRATEGIC SDBIP (TOP LAYER) 


The graphs below give an indication of how the Municipality performed in terms of 
their Top Layer SDBIP: 

1) Overall Performance per Strategic Objective for the 2018/19 Financial Year 



| KPI Not Met 

6 f 15.79%1 

| KPI Almost Met 

1 ( 2.63%! 

| KPI Met 

19 150.00%! 

| KPI Well Met 

4 flO.53%1 

| KPI Extremely Well Met 

8 f21.05%) 

Total: 

38 (100%) 


Graph 1 Overall Performance per Strategic Objective for the 2018/19 Financial Year 


140 

























2) Performance per Strategic Objective 


Strategic Objective 



A Skilled 
Workforce and 
Communities 


Bulk 

Infrastructure 

Ca-ordinaticn 


Financial 

Viaoiiev 


Good Governance 


Grcwirc an 
Induave District 
Economy 


Healtny and 
Sooalfy Stable 
Communities 


Environmental 
Management and 
Pubic Safety 


Graph 2 : Overall Performance per Strategic Objective 


The table and figures below give details of the descriptions of the objectives and how 
the Municipality performed during the past financial year: 

Table 1: Top layer SDBIP performance as per Strategic Objective 



Objective 1 

Objective 2 

Objective 3 

Objective 4 

Objective 5 

Objective 6 

Objective 7 

Measurement 

category 

A Skilled 

Workforce 

and 

Communities 

Bulk 

Infrastructure 

Co-ordination 

Financial 

Viability 

Good 

Governance 

Growing an 
Inclusive 

District 

Economy 

Healthy and 
Socially 
Stable 

Communities 

Sustainable 

Environmental 
Management 
and Public 
Safety 

KPI Not Met 

1 

2 

1 

1 

1 

0 

2 

KPI Almost Met 

0 

1 

0 

0 

0 

0 

0 

KPI Met 

0 

2 

0 

9 

4 

0 

3 

KPI Well Met 

0 

1 

1 

0 

1 

1 

0 

KPI Extremely Well 
Met 

1 

0 

3 

3 

0 

0 

0 

Total 

2 

6 

5 

13 

6 

1 

5 


141 





















3.3.2 ACTUAL PERFORMANCE PER STRATEGIC OBJECTIVE AND 
CORRECTIVE MEASURES TO BE IMPLEMENTED 


a) A Skilled Workforce and Communities 



Actual 

Overall performance 2018/19 



Ref 

KPI 

measurement 

Area 

performance 
of 2017/18 

Q1 

Q2 

Targets 

Q3 

Q4 

Annual 

Actual 

Rating 

TL11 

Spend 0.5% of the 
personnel budget 
on training by 30 
June 2019 (Actual 
total training 

expenditure divided 
by total personnel 
budget) 

% of the 
personnel 
budget spent 
on training 

All 

1.17% 

0% 

0% 

0% 

0.50% 

0.50% 

1.23% 

B 

TL38 

Compile an Annual 
Training Framework 
and submit to 
Corporate Services 
by 31 March 2019 

Number of 

frameworks 

submitted 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audit results 

available 

0 

0 

0 

1 

1 

0 

R 

Corrective Measure 

this kpi will be addressed in the adjustment period of January 2020 


A Skilled Workforce and Communities 


b) Bulk Infrastructure Coordination 






Actual 



Overall performance 2018/19 



Ref 

KPI 


Area 

performance 



Targets 



Actual 

Rating 





of 2017/18 

Q1 

Q2 

Q3 

Q4 

Annual 


TL7 

Submit the Annual 

Financial 

Statements of 

2017/18 to the 
Auditor-General by 

31 August 2018 

Annual 

financial 

statements of 
2017/18 
submitted by 

31 August 

2018 

All 

1 

1 

0 

0 

0 

1 

1 

G 

TL4 

Report on the 
percentage of the 
municipal capital 
budget spent on 
capital projects by 
30 June 2019 
(Actual amount 

spent on capital 
projects /Total 

% of capital 
budget 
spent by 30 
June 

2019 

All 

70% 

0% 

0% 

0% 

90% 

90% 

93% 

G2 


142 




































TL33 

Spent 95% of the 
roads maintenance 
budget allocation by 
30 June 2019 (Actual 
expenditure divided 
by approved 

allocation received) 

% of the roads 

maintenance 
budget spent 
by 30 June 

2019 

All 

108% 

0% 

0% 

0% 

95% 

95% 

109% 

G2 

TL34 

Reseal 23.6km of 
roads by 30 June 
2019 

Number of 

km's of roads 

resealed 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audit results 

available 

0 

0 

0 

23.6 

23.6 

23.6 

G 

TL35 

Regravel 42.68km 
of roads by 30 June 
2019 

Number of 
km's of roads 
regravelled 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audit results 

available 

0 

0 

0 

42.68 

42.68 

25.45 

R 

Corrective Measure 

Not reached due to insufficient approved borrow pits and major mechanical breakdowns. 

Material will be sourced from commercial sources and more plant will be made available during the 
2019/2020 Financila Year 

TL36 

Repair 5000m 2 of 
black top patching 
by 30 June 2019 

Number of m 2 
repaired 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audit results 

available 

0 

0 

0 

5 000 

5 000 

2 886 

R 

Corrective Measure 

Three main problematic area roads in terms of black topping was put on the tender for a 
contractor by Provincial Government, hence it is out of the municipality's hands and 
jurisdiction. This was the main reason for the high target. As per the meeting with the District 

Roads Engineer the target will be reduced accordingly. 

TL37 

Blade 10000km of 
roads by 30 June 
2019 

Number of 

km's of roads 

bladed 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audit results 
available 

0 

0 

0 

10 000 

10 000 

9 041.02 

O 

Corrective measure 

Due to dry weather conditions the target was not reached. Additional water trucks will be rented to 
help with the dry conditions 


Bulk Infrastructure Coordination 


143 





















































c) Financial Viability 



Financial viability 
measured in 
terms of the 
municipality's 
ability to meet it's 
service debt 
obligations by 30 
June 2019 ((Short 
Term Borrowing + 
Bank Overdraft + 
Short Term Lease + 
Long Term 

Borrowing + Long 
Term Lease) / 
Total Operating 
Revenue 

Operating 

Conditional 

Grant) 

Financial viability 
measured in 
terms of the 
available cash to 
cover fixed 

operating 
expenditure by 30 
June 2019 ((Cash 
and Cash 

Equivalents 
Unspent 


Number of 
months that 
available 
cash is 

sufficient to 
cover the 

monthly 
operating 
expenditure 


Conditional Grants 


144 
















Corrective Measure 


The CFO up until November 2018 had not yet submitted the report, as the target was set for 
December 2018 only. The person acting as CFO from December 2018 onwards, interpreted 
the section 52 Report, as submitted, to meet the requirements of this KPI 


145 



















d) 


Good Governance 


Actual Overall performance 2018/19 


Ref 

KPI 


Area 

performanc 



Targets 







t 


e of 2017/18 

Q1 

Q2 

Q3 

Q4 

Annual 



TL1 

Submit the Final 
Annual Report 
2017/18 to 

Council by 31 
March 2019 

Final 

Annual 

Report for 
2017/18 
submitted 
to Council 

All 

1 

0 

0 

1 

0 

1 

1 

G 

TL2 

Submit the District 
Municipal 
Communication 
Strategy to 

Council by 31 
March 2019 

District 

Municipal 
Communicatio 
n Strategy 

submitted to 
Council by 31 
March 2019 

All 

New 

performanc 
e indicator 
for 2018/19. 
No 

comparativ 
e audit 
results 
available 

0 

0 

1 

0 

1 

1 

G 

TL3 

Submit the Top 
layer SDBIP for the 
2019/20 financial 
year for approval 
by the Mayor 
within 14 days 
after the budget 
has been 

approved 

Top Layer 
SDBIP for the 
2019/20 
budget 
submitted to 
the Mayor 

within 14 days 
after the 

budget has 
been 
approved 

All 

1 

0 

0 

0 

1 

1 

1 

G 

TL10 

The number of 
people from 

employment 
equity target 

groups appointed 
in the three 

highest levels of 
management 
during the 2018/19 
financial year in 
compliance with 
the municipality's 
approved 
Employment 

Equity Plan 

Number of 

people 

appointed in 
the three 

highest levels 
of 

management 
in compliance 
with a 

municipality's 
approved 
employment 
equity plan 

All 

7 

0 

0 

0 

1 

1 

2 

B 

TL12 

Limit the vacancy 
rate to 15% of 
budgeted posts by 
30 June 2019 
(Number of 
funded posts 
vacant divided by 
number of 
budgeted funded 
posts) 

% vacancy rate 

All 

8.07% 

0% 

0% 

0% 

15% 

15% 

9.43% 

B 


146 



















Actual 

Overall performance 2018/1 

9 


Ref 

KPI 

measuremen 

t 

Area 

performanc 
e of 2017/18 

Q1 

Q2 

Targets 

Q3 

Q4 

Annual 

Actual 

Rating 

TL13 

Review the 

Organisational 
Structure and 
submit to 

Council by 30 
June 2019 

Organisation 
al structure 
reviewed and 
submitted to 
Council by 30 
June 2019 

All 

1 

0 

0 

0 

1 

1 

1 

G 

TL14 

Award 2 

external 

bursaries to 

qualifying 
candidates by 

31 

Number 

of 

external 

bursaries 

awarded 

All 

8 

0 

0 

2 

0 

2 

16 

B 

TL15 

Develop a 

Corporate Plan for 
the Garden Route 
District Municipality 
and submit to 
Council by 30 June 
2019 

Number of 
plans 
submitted 
to Council 

All 

New 

performanc 
e indicator 
for 2018/19. 
No 

comparativ 
e audit 
results 
available 

0 

0 

0 

1 

1 

0 

R 

Corrective Measure 

Plan will be submitted to Council in July 2019 financial year 


TL16 

Develop an ICT 
Strategic Plan for 
the Garden Route 
District Municipality 
and submit to the 
Management 
Committee 
(MANCOM) by 30 
June 2019 

Number of 
plans 
submitted 
to 

MANCOM 

All 

New 

performanc 
e indicator 
for 2018/19. 
No 

comparativ 
e audit 
results 
available 

0 

0 

0 

1 

1 

1 

G 

TL17 

Submit a report 
to Council on the 
development of 
a Council 

Resolution 

System by 31 

January 2019 

Number of 
reports 
submitted 
to Council 

All 

New 

performanc 
e indicator 
for 2018/19. 
No 

comparativ 
e audit 
results 

0 

0 

1 

0 

1 

1 

G 


147 

































TL18 

Develop a 

Strategic Plan for 
the Centralisation 
of all records for 
the Municipality 
and submit to the 
Management 
Committee 
MANCOM by 31 
January 2019 

Number of 
plans 
submitted 
to 

MANCOM 

All 

New 

performanc 
e indicator 
for 2018/19. 
No 

comparativ 
e audit 
results 
available 

0 

0 

1 

0 

1 

1 


G 


Actual 

Overall performance 2018/19 



Ref 

KPI 

measurement 

Area 

performance 
of 2017/18 

Q1 

Q2 

Targets 

Q3 

Q4 

Annual 

Actual 

Rating 

TL26 

Develop a 5 year 
District Tourism 

Strategy and submit 
to Council by 31 
March 2019 

District Tourism 
Strategy 
submitted to 

Council 

All 

0 

0 

0 

1 

0 

1 

1 

G 

TL31 

Appoint a service 
provider for the 
development of a 
Tourism Strategy 
for Kannaland 

Municipality by 31 
March 2019 

Number of 

service 

providers 

appointed 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audit results 

available 

0 

0 

1 

0 

1 

1 

G 


Good Governance 


e) Growing an Inclusive District Economy 


Overall performance 2018/19 


Ref 

KPI 

Unit of 

measurement 

Area 

performance 
of 2017/18 

Q1 

Q2 

Target 

Q3 

S 

Q4 

Annual 

Actual 

Rating 

TL22 

Submit bi¬ 
annual reports 
to Council on 
the progress of 
Garden Route 

District 
Municipality 
becoming a 

Water Service 
Authority 

Number of 

progress 

reports 

submitted 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

1 

0 

i 

2 

2 

G 

TL27 

Submit the 
Expanded Public 
Works 

Programme 

EPWP 

business plan 
submitted to 

the National 

All 

1 

0 

0 

0 

i 

1 

1 

G 


148 











































Overall performance 2018/19 


Ref 

KPI 

Unit of 

measurement 

Area 

performance 



Target 

s 









of 2017/18 

Q1 

Q2 

Q3 


Q4 

Annual 




(EPWP) business 
plan to the 
National 

Minister of 

Public Works for 

all internal 
projects by 30 
June 2019 

Minister of 

Public Works 










TL28 

Create job 
opportunities 
through the 
Expanded Public 
Works 

Programme 
(EPWP) by 30 

June 2019 

Number of 
job 

opportunities 
created 
through the 
EPWP 

programme 

All 

499 

0 

0 

0 

409 

409 

411 

G2 

TL29 

Conduct work 

sessions with 
Small, Medium 
and Micro- 
Enterprises 
(SMME's) on 
development 
with special 
focus on export 
development 

Number of 
work sessions 

conducted 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

1 

0 

1 

2 

19 

B 

TL30 

Sign an 

agreement with 
the Western 

Cape Economic 
Development 
Partnership by 

31 December 

2018 

Number of 

agreements 

signed 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

1 

0 

0 

1 

1 

G 

TL32 

Submit the 

reviewed 

District 

Integrated 

Development 

Plan (IDP)to 
Council by 31 

May 2019 

Number of 

IDP's 

submitted 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

0 

0 

1 

1 

1 

G 


Growing an Inclusive District Economy 


149 


















f) Healthy and Socially Stable Communities 






Actual 



Overall performance 2018/19 

Ref 

KPI 


Area 

performance 



Targets 







of 2017/18 

Q1 

Q2 

Q3 

Q4 

Annual 

TL23 

Conduct training 
sessions on Public 
Health Awareness 
and Responsibilities 
to 50 school 

Number of 
training 

All 

New 

performance 
indicator for 
2018/19. No 

0 

25 

0 

25 

50 


governing bodies in 
the Garden Route 
District Municipal 

area 

sessions 

conducted 


comparative 
audit results 

available 







Actual Rating 


58 


G2 


Healthy and Socially Stable Communities 


g) Sustainable Environmental Management and Public Safety 


Overall performance 2018/19 


Ref 

KPI 

Unit of 

measurement 

Area 

performance 
of 2017/18 

Q1 

Q2 

Target 

Q3 

s 

Q4 

Annual 

Actual 

Rating 

TL19 

Develop and 
submit a Climate 
Change Strategy 
to Council for 
approval by 30 
June 2019 

Number of 

Climate 

Change 

Strategies 

developed 

and 

submitted to 

Council 

All 

1 

0 

0 

0 

1 

1 

1 

G 

TL20 

Submit bi-annual 
progress reports 
to Council on the 

construction of 
the Regional 
Landfill Site in 
Mossel Bay 

Number of 

progress 

reports 

submitted 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

1 

0 

1 

2 

2 

G 

TL21 

Install a Disaster 
Management 
System at 

Garden Route 

District 

Municipality by 

31 March 2019 

Number of 

systems 

installed 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

1 

0 

0 

1 

1 

G 

TL24 

Appoint a 
service provider 
for the 

construction of 

Number of 

service 

providers 

appointed 

All 

New 

performance 
indicator for 
2018/19. No 

0 

0 

0 

1 

1 

0 

R 


150 


































Actual 

Overall performance 2018/19 

Ref 

KPI 

Unit of 

measurement 

Area 

performance 
of 2017/18 

Q1 

Q2 

Target 

Q3 

S 

Q4 

Annual 

Actual 

Rating 


the Fire Station 
by 30 June 2019 



comparative 

audited 

results 

available 








Corrective Measure 

The KPI will be revisited as soon as land has been allocated for the construction of 

the fire station 

TL25 

Submit the 

Garden Route 

Air Quality 
Management 

Plan to Council 
by 30 June 2019 

Number of 

plans 

submitted 

All 

New 

performance 
indicator for 
2018/19. No 
comparative 
audited 

results 

available 

0 

0 

0 

0 

1 

1 

G 


Sustainable Environmental Management and Public Safety 


3.4 SERVICE PROVIDER STRATEGIC PERFORMANCE 

Section 76(b) of the MSA states that KPI's should inform the indicators set for every 
municipal entity and service provider with whom the Municipality has entered into a 
service delivery agreement. A service provider: 

■ means a person or institution or any combination of persons and institutions which 
provide to or for the benefit of the local community 

■ External service provider means an external mechanism referred to in Section 76(b) 
which provides a municipal service for a municipality 

■ Service delivery agreement means an agreement between a municipality and an 
institution or person mentioned in Section 76(b) in terms of which a municipal service is 
provided by that institution or person, either for its own account or on behalf of the 
municipality 

During the year under review the Municipality did not appoint any service providers 
who provided municipal services to or for the benefit of the local community on behalf 
of the Municipality and therefore this report contains no such details. All other contract 
appointments are regularly monitored in terms of the required legislation which 
stipulates that vendor performance must be monitored on a regular basis. 


151 
































3.5 MUNICIPAL FUNCTIONS 


The municipal functional areas are indicated below: 



Municipal function 

Municipal function 

Yes / No 

Constitution Schedule 4, Part B functions: 

Air pollution 

Yes 

Building regulations 

No 

Child care facilities 

Yes, none core 

Electricity and gas reticulation 

No 

Firefighting services 

Yes 

Local tourism 

Yes 

Municipal airports 

No 

Municipal planning 

Yes 

Municipal health services 

Yes 

Municipal public transport 

Yes 

Municipal public works only in respect of the needs of municipalities in the 

discharge of their responsibilities to administer functions specifically assignedNo 

Pontoons, ferries, jetties, piers and harbours, excluding the regulation of 

international and national shiooina and matters related thereto No 

Stormwater management systems in built-up areas 

Bulk infrastructure 

Trading regulations 

Yes 

Water and sanitation services limited to potable water supply systems and 

domestic waste-water and sewaae disnosal systems_ 

_No_ 

Constitution Schedule 5, Part B functions: 

Beaches and amusement facilities 

Yes 

Billboards and the display of advertisements in public places 

Yes 

Cemeteries, funeral parlours and crematoria 

Yes 

Cleansing 

No 

Municipal function 

Municipal function 

Yes / No 

Constitution Schedule 4, Part B functions: 

Control of public nuisances 

Yes 

Control of undertakings that sell liquor to the public 

Yes 

Facilities for the accommodation, care and burial of animals 

Yes 

Fencing and fences 

Yes, only regarding provincial roads 


152 
































Licensing of dogs 

No 



Licensing and control of undertakings that sell food to the public 

Yes 

Local amenities 

No 

Local sport facilities 

No 

Markets 

No 

Municipal abattoirs 

Yes 

Municipal parks and recreation 

No 

Municipal roads 

No. Agent for PGWC on provincial roads 

Noise pollution 

Yes 

Pounds 

No 

Public places 

No 

Refuse removal, refuse dumps and solid waste disposal 

Yes 

Street trading 

Yes 

Street lighting 

No 

Traffic and parking 

No 


Functional Areas 


3.6 COMPONENT A: BULK INFRASTRUCTURE PLANNING 
3.6.1 BULK INFRASTRUCTURE PLANNING 

On the 22nd of March 2018 Council supported the establishment of the Garden 
Route Water Management Forum as well as the start of the process to establish the 
Garden Route Water Services Authority (WSA). Subsequent this meeting 
engagements with the local municipal Water Services Authorities started in order to 
unpack the process in terms of the establishment of the Garden Route WSA as well 
as the areas to be transferred to the DM, should the DM be successful to become 
the WSA. In addition to this, the CEO of the Municipal Infrastructure Support Agent 
(MISA) committed to assist the Garden Route District Municipality with the processes 
required to be registered as the WSA for the district. He also committed to assist and 
provide funding for the compilation of a district Water Resources and Bulk Water 
Supply Master Plan. 


153 




1. In order to unpack the support to be provided by MISA the Municipal 
Manager and the Disaster Manager met with the CEO of the Municipal 
Infrastructure Support Agent (MISA) on Wednesday 5 September 2018. During 
this meeting the draft guidelines for the proposed Regional Bulk Water 
Planning Study as well as the draft action plan on acquiring accreditation as a 
Water Services Authority were discussed. During this meeting the Deputy 
Director General, Local Government Support and Intervention Management 
at the Department of Cooperative Governance and Traditional Affairs 
advised that the Garden Route DM should start the process to be registered 
as the WSA for the Garden Route District by, 

2. officially requesting the MEC to consider the re-allocation of this function, as 
well as to; 

3. request local municipalities in the district to formally resolve in terms of their 
support in terms of the registration of the Garden Route Water Services 
Authority 

The region is clearly at the crossroads with regard to the choices it is making for 
addressing water crises. It is therefore opportune for the Garden Route District 
Municipality to take stock of the water operations within the region, in order to 
identify the current and emerging water issues, as well as to determine the best ways 
in which it can support the local B-Municipalities to address issues to 2040 and 
beyond. On the 1st of October 2018 the Garden Route District Municipal re-affirmed 
that they support the establishment of the Garden Route Water Services Authority 
(WSA).The establishment of the Garden Route Water Services Authority (WSA) would 
be to provide leadership, coordination, guidance and support to local B- 
Municipalities in defining their respective local areas' water operations. 

The Municipal Infrastructure Support Agent (MISA) committed to assist the GRDM with 
the processes required to be registered as the WSA for the district. They also 
committed to assist and provide funding for the compilation of a district Water 
Resources and Bulk Water Supply Master Plan. 


154 



ENERGY SECURITY/RENEWABLE ENERGY 

Electricity in South Africa is a commodity that is not abundant, intermittent and 
because of frequent “spillovers”. This is problematic for the industrial production 
sectors, tourism, the economy in general and for the daily life of the South African 
citizen. In addition, electric power was a quasi-monopoly owned by ESKOM which 
sold its very expensive kWh to municipalities. GRDM has different types of renewable 
energy that it seeks to pursue in its endeavor to create a green economy. GRDM will 
pursue all these forms of renewable energy but will start with Wave Energy is going to 
be the first, since in terms of progress a lot of work has been done already. 

The law has recently evolved, and municipalities have obtained the right to buy from 
the producer of their choice through an Independent Power Producer (IPP) contract. 
Wave energy is part of the renewable energy mix and GRDM was approached by a 
French Company HACE. The company has a patented technology of generating 
electricity using sea waves. A meeting took place on 2nd of May 2019 between 
HACE and a delegation from the Garden Route District Municipality regarding the 
generation of electricity from waves. This project forms part of the Energy Master Plan 
of the Garden Route District Municipality. Garden Route District Municipality and 
HACE entered into a Memorandum of Understanding - this MOU, enabled HACE to 
submit an application to the French government to obtain funding for the first phase 
of the project. Given the current challenges with ESKOM's supply of electricity and 
pricing, the strategic significance of this project is to enable GRDM to meet its 
legislative mandate (section 84(1 )(c) in terms of providing bulk electrical services. This 
project is also aligned to Council's climate change and adaptation and mitigation 
strategy. 

FOOD SECURITY/FRESH PRODUCE MARKET 

Emerging vegetable and fruit producers in South Africa face a litany of constraints, 
with lack of post-harvest handling facilities being one of those constraints that 
emerging farmers can hardly resolve without external intervention. The Garden Route 
District Municipality here in referred to as GRDM, view the establishment of key 
marketing infrastructure as being imperative in giving emerging vegetable and fruit 
producers a competitive edge. Section 84 of MSA mandates the district municipality 


155 



to establishment, conduct and control of fresh produce markets and abattoirs 
serving the area of a major proportion of the municipalities in the district. The District 
municipality is mandated to lead and facilitate inclusive economic growth and 
development in the region. The agro-industry is one of the prioritised sectors to 
contribute towards the realisation of this mandate. This emanates from the fact that 
the region is well endowed with natural resources for agricultural development and 
industrialisation through the sector. This is also coupled by the spatial reach of the 
sector into poorer areas of the region, thus providing opportunity for inclusive 
participation, its labour absorbing nature as well as the abundance of large 
domestic and international markets. 

It is against this background that GRDM want to conduct a feasibility to enable the 
district to perform this function as mandated by the ACT. In instances where the 
agriculture sectors are well-organised, sharing of market infrastructure and transport 
could significantly reduce their expenditure and improve gross farm income. The 
market infrastructure would allow the producers to centrally bring in their produce, 
subject them to cleaning, managing post-harvest pests, grading, packaging, loading 
and transporting to markets in the region, region, nationally and exports if the prices 
are good. The proposed fresh produce market facilities could also act as points of 
leverage, where market information, production information and extension services 
are discharged to the producers hence working towards transformation of the agro- 
based value chain. Establishment of post-harvest handling technologies in the form 
of fresh produce depots would reduce post-harvest losses incurred by previously 
marginalised fresh produce farmers in South Africa. 

The facilities would confer a competitive advantage for this group of farmers to 
produce for established fresh produce markets all over the country. The GRDM view 
the establishment of key marketing infrastructure as being imperative for the survival 
of the emerging producers and for the inclusive economic growth of the region. If 
producers were well-organised, the sharing of market infrastructure and transport 
could significantly reduce their costs of doing business. 

1. Highlights: Bulk Services 

The following highlight was achieved during the financial year: 


156 



Highlight 


Description 


Communication with the Minister to assist 

Council took a resolution to have GRDM as WSA.The 

Municipal Manager sent a letter the Minister requesting 

GRDM to be WSA and MISA 

that assistance and also to MISA requesting funding and 

technical support 

Stakeholder Engagement 

B - Municipalities were engaged on this council 

resolution and a team Headed by the Municipal 

Manager has been visiting them to unpack the process 

and what it seeks to achieve for the greater good of the 

whole region.This process is still on - going and further 

engagements are still continuing at different fora like 

the DCF, MMF, IDP, IGR etc. 

Project Task Team 

Project Task Team has been established that consists of 

GRDM officials, MISA officials, and at a later stage it will 

bring the technical officials from all the B- Municipalities, 

BGCMA, CoGTA and DWS 

Guiding Documents 

An MoU was signed between MISA and GRDM for the 

financial and technical support that was requested. A 

Technical Support Plan for the period 2019 to 2021 was 

also signed between MISA and GRDM 

Appointments of service providers 

A tender document and the process of appointing a 

PSP for the development of a Water Resource Plan and 

Master Plan has started already and anticipated to be 

concluded by September 2019 

Study Tours 

The task team has visited two Municipalities in the 

Western Cape that are having the function of WSA and 

viz: West Coast DM and Overstrand Municipality. The 

team is also going to visit two other municipalities in the 

Eastern cape to learn on how the District Municipalities 

took over that function from Local Municipalities and 

these will be Joe Gqabi DM and Amathole DM 

Funding Applications 

GRDM has submitted an application for funding of R1.5 

billion to the National Treasury under the Bulk 

Infrastructure Funding Programme 

Progress on Energy 

PSP was appointed for the development of Energy 


157 














Highlight 


Description 



Master Plan for the region and is currently working with 

the expectation for conclusion on the GRDM and FIACE 

(a French Company) signed an Moll for the 

development of the Wave Energy on the coast of 

Garden Route 

Progress on Fresh Produce Market 

Call for proposals to carry out a feasibility study and 

development of a business plan in progress expected 

completion date is December 2019 


Bulk Services Highlights 


2 . Challenges: Bulk Services 

The table below indicates the challenges faced during the financial year: 


Description 


Resistance from some of the Stakeholders not 
keen to engage on the process 


Actions to address 


The Municipality through the office of the MM has 
started the process of engaging the management of 13- 
Municipalities to allay all the fears and put clarification 
as to what the process seeks to achieve. The process 
seeks to have a water secure region, it also seeks not to 
affect the revenue base of all the B-Municipalities, the 
balance sheets. GRDM also wants all the B- 
Municipalities to remain WSP and GRDM do the bulk 
side of the function 


Funding 


The funding is limiting the pace at which this process 
could be implemented. GRDM task team had 
requested R4.5 million for the development of the 
Master Plan for 2019/20 financial but MISA only 
allocated R1.2 million. Applications for funding are 
being submitted to NT. The GRDM engaged other 
partners like Industrial Development Corporation and 
New Development Bank to assist with funding of some 
of the projects like the Fresh Produce Market 


Bulk Services Challenges 


158 














3.6.2 WASTE DISPOSAL SITES 


In accordance with Section 84(1 )(e) of the Local Government: Municipal Structures 
Act,No. 117 of 1998, solid waste disposal sites, in so far it relates to the determination 
of a waste disposal strategy; the regulation of waste disposal and the establishment, 
operation and control of waste disposal sites, bulk waste transfer facilities and waste 
disposal facilities for more than one local municipality in the district, is a function of 
the district municipality. 

GRDM is therefore in the process to establish a Regional Waste Management Facility 
for the municipalities of Bitou, George, Hessequa (Gouritsmond and Albertinia) and 
Mossel Bay as well as other local municipalities in the district when and if required 


a) Highlights: Waste Disposal 

The following highlights were achieved during the financial year: 


Highlights 

Description 

Negotiations have been concluded with the preferred 

bidder for the establishment of a Regional Waste 

Management Facility 

The negotiations process with Interwaste / Eden Waste 

Management was concluded and the PPP Agreement will be 

finalised at the end of October 2019 

Waste Characterisation Studies conducted at 

George and Kannaland Municipalities and the South 

Waste Characterisation Studies were conducted, and final 

reports were compiled by GRDM and submitted 

Home Composting Pilot Project implemented in 

Hessequa, Mossel Bay, George and Knysna 

Municipalities 

The home composting pilot project was concluded in the 

Hessequa and Mossel Bay Municipalities and the data 

captured and analysed. George and Knysna Municipalities 

are still ongoing and data recorded on a monthly basis 

Compilation of a Waste Minimisation Plan for 

South African Breweries 

Following the Waste Characterisation Study conducted at 

SAB, a waste minimisation plan was compiled by GRDM for 

Implementation of a Schools Recycling Programme 

Pilot Project at Percy Mdala High School 

Waste education sessions conducted by GRDM to teachers 

and learners, recycling boxes and bags provided by GRDM 

Schools Education and Awareness 

Education & awareness sessions were held at Plettenberg Bay 

Secondary School, Little Lighthouse Preschool, Kings Kingdom 

Preschool, St. Pauls Primary School, Zenzele Day care 


159 












Recycling Mascot 

Rocky the Recycling Rooster (Mascot) was utilised at the George 

Strawberry Festival, Plett Secondary School, Little Lighthouse 

& Kings Kingdom Preschools, St. Pauls Primary, World Tobacco 

Day, Zenzele Day care. The Mossel Bay and Knysna 

Municipality have branded their fleet and educational material 

Enforcement of District Waste Management By-laws 

Notices served in terms of Section 10 of the District Waste 

Management By-laws PG 7818 of 01 September 2017 


Waste Disposal Highlights 


b) Challenges: Waste Disposal 

The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Constant delays in the finalisation of the PPP 

Agreement and subsequently delaying the 

construction of the Regional Waste 

Management Facility 

The agreements between the DBSA, GRDM and Eden 

Waste Management (Private Party) and the Treasury 

Views and Recommendations III and Section 33 

processes need to be concluded urgently 

Dispute by George and Mossel Bay 

Municipalities regarding the District Waste 

Management By-laws PG 7818 of 01 

September 2017 

Decisions made at the meeting held with the MEC 

Anton Bredell, GRDM and George and Mossel Bay 

Municipalities are being implemented 


Waste Disposal Challenges 


c ) Employees: Waste Disposal 

The table below indicates the number of staff employed by the unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

0 

0 

7-9 

1 

1 

1 

0 

0 

10- 12 

0 

0 

0 

0 

0 

13- 15 

2 

2 

2 

0 

0 

16-18 

0 

0 

0 

0 

0 

19-20 

0 

0 

0 

0 

0 


3 

3 

3 

0 

0 


160 



























Employees: Waste Disposal 


3.7 COMPONENT B: ROADS AND TRANSPORT 

3.7.1 ROADS 


a) Introduction to Roads 

The main objective is to provide an excellent service to the principle, which is the 
Provincial Department of Transport and Public Works. This is done through consistent 
planning and monitoring and regular feedback to the Provincial Government of the 
Western Cape (PGWC) with regards to expenditure, production and quality. 

This municipal service an area of approximately 47 000 km 2 and a total road network 
of 6 040 km per annum. The GRDM service a budget of more than R.5 billion which 
consists of a yellow fleet of more than R.35 billion and a monetary budget to the value 
of almost R.2 billion. This is done through efficient and effective management and 
leadership. Under the leadership of GRDM, the Roads function is currently the largest in 
the Western Cape and servicing the most staff compliment. Any new machine that 
are tested in the Western Cape are done at this Municipality. 

This is also one of the only district municipality that upgrade their own roads projects 
through in-house construction thus creating EPWP jobs and alleviating poverty in the 
rural areas. This is one of the major challenges of our country and district that we strive 
to adhere by overcoming through skills education and transfer leaving the community 
with exit strategies. 

Our highly capable staff compliment drive through excellence and discipline by 
tending to compliant in a timeously order with our huge fleet network. The major 
success is to meet the requirements of the principle but simultaneously meet the 
requirements of the public that use the roads. This comes down to effective spending, 
high quality maintenance and quick response to public complaints. Due to a shortage 
of borrow pits in the country the Municipality acquired an inline crusher that is now in 
the testing phase in our area to the value of R25 million for the unit. This will reduce the 
backlog going forward in the district of garden Route. 


161 



The Municipality has more than sixteen grader teams that blade the gravel roads and 
reward them annually with certificates for the best team in our district. 


b) Highlights: Roads 

The following highlight was achieved during the financial year: 


Highlights 

Description 

Phase 2 Complete Friemersheim 

Upgrading of 7.5km road to permanent surface 

The design of Slangrivier Road for 
implementation in 2019/2020 

Upgrading of 4.1 km road to permanent surface 

EPWP work opportunities of more than R3.2 
million 

Alleviating poverty 

Inline chrusher unit to the value of R25 million 

On site re-graveling of roads 


Roads highlight 


c ) Challenges: Roads 

The table below indicate the challenge faced during the financial year: 


Description 

Actions to address 

Lack of funding 

Work more effective, efficient and economical 

Lack of skilled personnel 

In-house training and mentoring 


Roads challenge 


d) Roads Service Delivery Statistics 

The following table indicates the amount of gravel road infrastructure improved and 
developed: 


Gravel road infrastructure: Kilometres 

Financial year 

Total gravel roads 

New gravel roads 
constructed 

Gravel roads 
upgraded to tar 

Gravel roads 
graded/maintained 

2017/18 

4 551.53 

0 

1 

4 551.53 

2018/19 

4 552.53 

0 

1.9 

4 554.43 


Gravel Road Infrastructure 


The following table indicates the amount of tarred road infrastructure improved and 
developed: 


Tarred road infrastructure: Kilometres 

Financial year 

Total tarred 
roads 

New tar roads 

Existing tar 
roads re-tarred 

Existing tar 
roads re¬ 
sheeted 

Tar roads 
maintained 

2017/18 

687.58 

1 

37.43 

0 

687.58 


162 



























Tarred road infrastructure: Kilometres 

Financial year 

Total tarred 
roads 

New tar roads 

Existing tar 
roads re-tarred 

Existing tar 
roads re¬ 
sheeted 

Tar roads 
maintained 

2018/19 

687.58 

1.9 

23.6 

0 

689.48 


Tarred Road Infrastructure 


The table below shows the costs involved for the maintenance and construction of 
roads within the municipal area: 



New and replacements 

Resealed 

Maintained 


R'000 

2017/18 

68 425 

15 160 

91 940 

2018/19 

58 923 

19 898 

105 647 


The cost for maintenance includes stormwater 


Construction and maintenance cost 


e) Employees: Roads 

The table below indicates the number of staff employed by the unit: 



2016/17 


2017/18 


(T-grade) 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as a 
% of total posts) 


Number 

% 

0-3 

176 

172 

172 

15 

8.72 

4-6 

43 

43 

43 

9 

20.93 

7-9 

45 

46 

46 

9 

19.56 

10- 12 

24 

26 

26 

3 

11.53 

13- 15 

6 

9 

9 

1 

11.11 

16- 18 

1 

1 

1 

0 

0 

19-20 

1 

0 

0 

0 

0 

Total 

296 

297 

297 

37 

12.45 


Employees: Roads 


163 






























3.7.2 TRANSPORT 


In terms of the National Land Transport Act, the provision of public transport is a B- 
Municipal competency. In the Garden Route District, it was decided to establish a 
forum (Eden Public Transport and Technical Steering Committee) where all the 
municipalities in the area will be represented. The function of the Committee is to assist 
in the co-ordination of the Integrated Transport Plans for local municipalities and 
District Integrated Transport Plan for the Garden Route District. 

Since the provincial strategic objectives require monitoring, the Integrated Transport 
Steering Community has been established which incorporates the Eden Public 
Transport Forum. The ITP was successfully implemented through funding from DOT that 
incorporated all the local municipalities. This was phase one and going forward into 
phase two non-motorised transport will be addressed in the Garden Route area. 

3.8 COMPONENT C: PLANNING AND LOCAL ECONOMIC DEVELOPMENT 

3.8.1 REGIONAL SPATIAL IMPLEMENTATION FRAMEWORK (RSIF) 

a) Purpose and scope of RSIF 

3.8.1 Southern Cape Regional Implementation Framework (SCRIF) 
a) Purpose and scope of SCRIF 
The purpose of the SCRIF: 

1. Provide a coherent spatial vision for the Southern Cape functional region 
considering the environmental, social and economic opportunities and 
constraints 

2. Provide guidance on the promotion of a rational and predictable 
infrastructure, economic and land use planning within the region 

3. Coordinate, integrate and align provincial and municipal land use planning, 
infrastructure and economic development policy, taking a regional approach 
to address regional environmental management, regional human settlement 


164 



provision, economic development, regional infrastructure, regional transport, 
landscape character, a sense of place preservation and heritage 

4. Specifically, the Regional Implementation Framework will give expression to 
the Provincial Spatial Development Framework at a regional level 


b) Highlights: Regional Development and Planning 

The following highlights were achieved during the financial year: 


Highlights 

Description 

Two long term lease agreements Regional Landfill 

■ Long term lease Regional Landfill 

site: Ikusasa: Construction of a 

chemical manufacturing plant, 

storage and distribution hub 

Site 

■ Long term lease Regional Landfill 

site: Moumakoe (Pty) Ltd: 

Construction of a petroleum 

product storage facility 


Regional Development and Planning highlights 


c) Challenges: Regional Development and Planning 

The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Rolling out development opportunities on identified 
Council properties 

Continue efforts to develop under utilized properties 

Vacant Town Planner position 

Fill vacancy as soon as funding becomes available 


Regional Development and Planning challenges 


d) Employees: Regional Development and Planning 

The table below indicates the number of staff employed by the unit: 



2017/18 


2018/19 


(T-grade) 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 


165 















(T-grade) 


2017/18 


2018/19 


CO 

o 

1 

0 

0 

0 

0 

4-6 

33 

0 

0 

0 

0 

7-9 

8 

0 

0 

0 

0 

10- 12 

0 

2 

2 

0 

0 

13- 15 

0 

1 

1 

0 

0 

16-18 

0 

0 

0 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

42 

3 

3 

0 

0 


Employees: Regional Planning and Development 

3.8.2 LED 


a) Introduction to LED 

i) Vision of the District Economic Development 

The Municipality's vision for economic growth and development continues to develop 
a diverse, sustainable and shared regional economy through innovation and 
partnerships. This has stimulated employment and business development opportunities 
which in turn increases the quality of life for all. 

ii) Current Context 

The focus for district economic development during the financial year under review 
has been and continues to be gearing the district economy for investment readiness 
and investment recruitment. This mission sees the Garden Route District Municipality 
continuously building on the progress and awareness created during 2017/2018 
processes in collaboration with the South Cape Economic Partnership (SCEP), Green 
Cape, Wesgro, Department of Economic Development and Tourism (DEDAT) and B- 
municipalities, to ensure that tangible outcomes and successes are reached in terms 
of investment promotion, facilitation and recruitment. 

The above roll out includes a Regional Airlift project initiated in collaboration with the 
Airports Company of South Africa (ACSA) and the George Municipality, in order to 
more effectively coordinate the system of transporting cargo and passengers by 
aircraft. The District Municipality is also driving a process in collaboration with the 


166 

















Mossel Bay Municipality by which an application will be submitted to the Department 
of Trade and Industry for the establishment of a Regional Special Economic Zone to 
further enhance the district's appeal for investment and increase the export potential 
of products and access to markets. Although this process was undertaken by a 
regional approach has been propounded, and thus the District will take the lead and 
also include all the B-Municipalities. 

The District Municipality was integrally involved in the establishment of the Regional 
(Garden Route) Film Office to grow and develop the film and media industry by co¬ 
funding the operations of the film office for the first year, together with the Mossel Bay 
Municipality. 

Municipalities are still applying the investment readiness checklist developed by SCEP 
as a self-assessment tool to prepare themselves for investment and to address gaps 
and shortcomings to make our district more investment friendly to draw more investors 
(national and international) to do business in our district. 

The Municipality is unambiguous that the Garden Route is open for business through 
active engagement with the private sector, small, medium and micro-enterprises 
(SMME's) and emerging entrepreneurs, and previously disadvantaged individuals and 
enterprises. 

At the centre of the Garden Route Investment drive is the message that the Garden 
Route District Municipality wants to grow the region's economy in collaboration with 
the private sector (domestic and foreign) and all municipalities in the district, as well as 
national and provincial government and state-owned companies (SOC's), in the 
pursuit of: 

■ job creation and training; 

■ business and skills retention; 

■ increasing quality of life; 

■ industry diversification; 

■ empowerment; 

■ food security; 


167 




■ adequate and diverse housing solutions; 

■ integrated and modern transportation; 

■ sustainable infrastructure and natural resource management; and 

■ protecting and enhancing our environmental and cultural heritage. 

Some of the key strategic issues remaining and currently in process of being addressed 
include: 

■ access to land, finance and funding 

■ the need for more streamlined and efficient decision-making 

■ managing red tape 

■ the need for institutionalised dialogue between government and the private 
sector and where relevant, labour developing clarity or better understanding 
for Public Private Partnerships, especially in the delivery of human settlements 
and bigger real estate developments 

■ modernising and optimizing Infrastructure 

■ the need to develop coherent regional coordination would be valuable in 
identifying new markets and grow export strategies and opportunities 

■ critical game changing opportunities in the agriculture sector - honey bush 
tea, essential oils, aloe and berries 

Currently, most of the economic development projects and processes are still geared 
towards implementing and rolling out initiatives to address the outcomes of the 
investment conference which provided the direction for district economic 
development. 

LED Strategic Objectives: 

■ Coordinate and facilitate key applications and procedures associated with 
the identification, implementation, monitoring and reporting of the 
effectiveness of Local Economic Development (LED) initiatives, programmes 
and projects in creating a conducive environment for entrepreneurship and 
business development and job creation 


168 



■ Commitment to supporting B-municipal LED units in terms of carrying out and 
achieving the objectives of the above mandate, creating and sharing 
linkages and networks in order to leverage opportunities for economic growth 
and development. 

■ Capacitating citizens, community-based organizations, business and other 
interest groups towards achieving sustainable ways to meet social, economic 
and material needs and improve quality of life. 

Strategic Interventions 

■ Drive process of Regional Special Economic Zone 

■ Regional Film Process 

■ Smart City Concept and ICT Hub 

■ Timber Economy 

■ Regional Skills Development 

■ Regional Airlift 

■ Export Development 

■ SMME Development 

Current formal partnerships in terms of growing the economy inclusively: 

■ MOU with Western Cape Department of Agriculture 

■ MOU with Airports Company of South Africa 

■ MOU with Garden Route Film Office 

■ MOU with Western Cape Economic Development Partnership. 

3. Highlights: LED 


Highlights 

Description 

SMME Export 

Development Programme 

The District Economic Development unit embarked on an informal 

tender process for the appointment of a service provider to 

conduct an Export Advancement: Gap Analysis and Mentorship 

programme for a total of 20 participants (SMME's), in order to build 

the competitive capacity, improve the trade potential and 

expand the export markets of the business. The project entailed 

assessment of the business identifying gaps and challenges for 


169 








Highlights 


Description 


each of the participating businesses. Tradewize International was 
the successful bidder and appointed as service provider to 
conduct one-on-one, on-site assessments of small businesses 
across the district. 

PROGRAMME BENEFITS 

The general benefits from the ‘Export Advancement’ programme 
include the following: 

- Knowledge and skills transfer 

- New market penetration and expansion 

- Higher exports 

- Improved productivity 

■ Opportunities to innovate, upgrade and increase 
competitiveness 

- Growth in employment creation 

1. The programme covered the following: 

ONE - ON - ONE MENTORSHIP - OUTCOMES 

- Business Export Gap Analysis 

* Export specific mentorship per business implemented 
based on findings of the export gap analysis. 

■ Specific goals to be set linked to a timeframe. 

- Exporters to be provided with practical guidance in order 
to implement the set goals. 

- Addressing specific business needs as per exporter’s 
business requirements 

- Mentor to work with the exporters, advising on developing 
certain business areas 

- Skills transferred should be tailored to the exporter’s 
requirements 


170 







Highlights 


Description 



- A “Ready to export checklist"; 

- Market information/research and match making 

resources to enable the compilation of a marketing plan; 

- Advise on technical material requirement for exporting; 

- A list of funding sources for product development and 

export marketing e.g. export marketing platform 

attendance 

CRITERIA FOR EXPORT PROGRAMME PARTICIPANTS 

- Product/Service should have a niche or competitive 

edge; 

- Company should be registered with registrar of 

companies CIPC; 

- Be in possession of a valid Tax Clearance Certificate; 

- Enterprise should have conquered the local market to an 

extent; 

- Enterprise must be committed to developing an export 

market; 

- Enterprise should have or have access to finance; 

- Enterprise should have operational capacity to service 

additional markets; 

The Small Enterprise Development Agency (SEDA) has agreed to 

become a partner and assist in addressing the gaps and 

challenges identified during these assessments and will compile a 

detailed intervention plan with actions for each of the 

participating businesses that will be directly linked to their export 

development programme. A comprehensive close-out and 

feedback report was provided by the Service Provider 

Garden Route Film Office 

This region has become increasingly popular as a film destination 

and the industry has the potential to create various business and 


171 








Highlights 


Description 



employment opportunities. 

The Garden Route Film Office concept and strategy was 

approved by Council in 2017 to support the formation of the 

regional film office. 

The film office has been established and registered as a Non-profit 

company and the official Board of Directors was elected and has 

been doing intense work for the promotion of the Garden Route 

film industry. 

In the 2018/19 financial year council contributed R190 000 towards 

the establishment of the Garden Route Film Office for the 

promotion of the Garden Route district as a preferred film 

destination. Mossel Bay Municipality has also contributed towards 

this initiative and has made office space and an intern available 

for this purpose 

South Cape Economic 

A partnering and partnership approach is essential to all 

economic development work, and one of the most debilitating 

aspects of many current city government development initiatives 

is a failure to recognise this. The growth and functioning of the 

regional economic system is dependent on a wide range of 

stakeholders beyond municipalities. Locational choices by 

investors, property developers, businesses, households, the urban 

poor and migrants contribute to the form and functioning of the 

region and the way that people and goods move within the 

Partnership 

region. Patterns of mobility, the cost of services, rental values, and 

the overall efficiency of the regional economy is influenced by a 

complex set of interactions and aspirations. Local government is 

not able to influence or improve the economy without partnering 

with business, academia, civil society, and labor, as well as other 

spheres of government. 

The South Cape Economic Development Partnership is a 

partnership between local Business Chambers (Business 

Organizations), Economic Development Practitioners from 


172 








Highlights 


Description 


municipalities, tertiary institutions, and economic sector specialists. 

Purpose: 

- More integrated and synchronized economic 
development strategy and implementation with a project 
approach that cuts across municipal geographic 
boundaries. 

- Mobilised resources from various other players, including 
meeting spaces and administrative support. 

- Heightened momentum on projects that have potential 
to drive the growth and inclusion of the regional 
economy. 

Strategic Objectives 

Within this context the partners have agreed on a set of objectives 
for the SCEP through a revised Partnership Charter in 2015. The 
medium-term partnership objectives are to: 

- Facilitate constructive interaction between Business 
Chambers from neighboring towns, local authorities and 
other key stakeholders influencing the business 
environment; towards the implementation of specific 
regional economic development projects and 
programmes across municipal boundaries 

■ Promote and support collaborative leadership and 
shared growth within the economic delivery system of the 
South Cape economic region; 

- Be a channel for communication and managing conflict 
within the regional business environment; 

* Serve as a vehicle towards developing strategic 
collaboration and partnerships with key stakeholders 
across the region, province and country; and 

• Provide a platform for the formulation of solutions to 


173 







Highlights 


Description 



pressing business related issues, problems and challenges 

DED Forum 

A platform where all LED Managers in the district meet for 

information and best practice sharing, and to discuss progress on 

regional projects and programmes 


c) Challenges: LED 

The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Funding 

Strategic Partnerships with private sector and 

other government departments to address 

economic challenges. 


LED challenges 


d) Strategic Areas 

The LED strategy identifies various issues and strategic areas for intervention: 


Strategic areas 

Description 

Strategic collaboration and partnerships 

SCEP to serve as a vehicle towards 

developing strategic collaboration and 

partnerships with key stakeholders across the 

region, province and country and provide a 

platform for the formulation of solutions to 

pressing business related issues, problems and 

challenges 

Collaborative leadership and shared growth 

A culture of collaborative leadership and 

shared growth needs to be cultivated and 

sustained amongst partners i.e. local, 

provincial and national government, private 

sector, and academic institutions 

Constructive communication and interaction 

Facilitate constructive interaction between 


174 




















Strategic areas 


Description 


toward problem solving 

business chambers from neighbouring towns, 

local authorities and other key stakeholders 

influencing the business environment. A 

channel for communication amongst the 

regional business/economic environment. 

Platforms for the formulation of solutions to 

pressing business/ economic related issues, 

problems and challenges 

Catalytic economic project 

conceptualisation, scoping and 

implementation 

A collaborative and holistic approach 

amongst partners towards the 

conceptualisation, scoping and 

implementation of cross-border/inter- 

municipal boundary catalytic economic 

projects 

Financing of projects 

Co-financing of resources and projects 

amongst partners 


LED strategic areas 


e) Employees: LED 

The table below indicates the number of staff employed by the unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

0 

0 

7-9 

0 

0 

0 

0 

0 

10-12 

2 

2 

2 

0 

0 

13-15 

0 

0 

0 

0 

0 

16-18 

0 

0 

0 

0 

0 

19-20 

0 

0 

0 

0 

0 


175 
























2017/18 


2018/19 


(T-grade) 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

Total 

2 

2 

2 

0 

0 


Employees: LED 


3.8.3 TOURISM 


a) Introduction to Tourism 

The Garden Route and Klein Karoo (GR&KK) are adjacent and overlapping tourism 
regions within the administrative boundaries of the Garden Route District in the 
Western Cape. The regions have complementary attractions with the Garden Route 
stretching along the South Cape coastline and characterised by several scenic places 
which includes beaches, mountains, forests, conservation areas and heritage sites. The 
semi-arid Klein Karoo region is home to attractions such as the Congo Caves, ostrich 
and wine farms, nature-reserves and arts and cultural events. Both regions offer high 
quality tourism experiences for road-trippers, adventurers, sportsmen, foodies and 
nature, art, culture and heritage enthusiasts. 

The two regions have been marketed together by national, provincial and local 
authorities responsible for tourism marketing and development for several years as 
Garden Route & Klein Karoo. There are seven local municipalities within the District and 
they all provide funding for Local Tourism Offices (LTOs) which are either independent, 
non-profit organisations or departments within each municipality. Those with external 
LTOs use a range of organisational and funding models with some LTOs funded 
exclusively with public funds and others that supplement their grant funding with 
membership fees and corporate sponsorships 


176 




b) Highlights: Tourism 


Highlight 

Description 

Development of a Tourism 

The Garden Route District Municipality allocated funds within the 

2018/2019 budget for the development of a Tourism strategy for 

Kannaland Municipal area. A service provider was appointed 

through the Supply Chain Management tender process to 

review, evaluate and conceptualise a tourism strategy 

document that will aid the Kannaland Municipality and 

Strategy for Kannaland 

stakeholders to prioritise and implement various tourism projects 

Local Municipality 

in order to market and develop Kannaland as a tourism 

destination. 

The aim of the tourism strategy is to ensure positive economic 

benefits and opportunities for all stakeholders. The development 

of the tourism strategy was informed by stakeholders’ inputs 

through various mechanisms including workshops that were held 

Garden Route Cater Care 

The Garden Route District Municipality made the amount of 

R300 000 available to train 15 previously disadvantaged 

individuals in the tourism and hospitality sector. Interviews with 

applicants for Cater Care course 2018/19 were held on 21 and 

22 February 2019 at the Francois Ferreira Academy in George. 

Programmme 

The course started on 4 March 2019 and the School phase 

finished on 31 May 2019. 

Classes were presented from Monday to Thursday from 08:30- 

15:00. The course was presented at the Francois Ferreira Skills 

Academy at Oubaai 

The Development of a 

The tourism unit of the Garden Route District Municipality was 

tasked to develop a new 5 year Regional Tourism Strategy for 

Regional Tourism Strategy 

Garden Route and Klein Karoo Tourism in order to stay up to 

for Garden Route 

date with the ever changing tourism environment and the 

economy. The document was developed in collaboration with 

Local Tourism organisations as well as private sector stakeholders 


177 










Highlight 


Description 



in the region. The strategy is presented as a 5-year strategy to 

align with the reviewed IDP of the Garden Route District 

Municipality and is intended to clearly define the strategic 

priorities for regional tourism and to streamline all tourism 

activities in the region. The Regional Tourism Strategy was 

approved by GRDM Council on 26 March 2019 

The Coordination, 

Garden Route District Municipality is responsible for tourism 

marketing and development and runs a regional tourism office 

Garden Route and Klein Karoo tourism from where tourism is 

coordinated at a district Level. The office works closely with the 

local tourism bureaus, provincial, national and international 

tourism organizations in promoting the Garden Route and Klein 

Karoo. The main domestic marketing platforms the region 

attended is the annual Tourism Indaba hosted in Durban and 

the World Travel Market Africa show hosted in Cape Town. It is 

the District Municipality’s mandated responsibility to coordinate 

and facilitate regional tourism marketing in the most effective 

manner possible. 

facilitation and attendance 

Garden Route and Klein Karoo Tourism decided to exhibit on a 

of marketing platforms 

regional Garden Route and Klein Karoo stand for the first time 

this year. This platform provided the region the opportunity to 

engage with tour operators, travel agents and travel writers to 

direct more tours and travels to the Garden Route & Klein Karoo, 

this regional initiative in turn sent a strong message of unity to our 

competitors. 

Garden Route and Klein Karoo booked 36m 2 providing space 

for the Local Tourism Offices and their products/services in the 

region to form part of the exhibition. The following Local Tourism 

Offices exhibited with Garden Route & Klein Karoo on the GRDM 

and KK stand: 


■ Oudtshoorn Tourism 


178 








Highlight 


Description 



■ George Tourism 

■ Hessequa Tourism 

■ Calitzdorp Tourism 

■ Plettenberg Bay Tourism 

The following Local Tourism products/services exhibited with 

Garden Route and Klein Karoo on the GRDM and KK stand: 

■ Redberry farm 

■ Oubaai hotel and Spa 

■ De Rustica olive estate 

■ Destination Garden Route 

■ Knysna River Club 

■ Gourikwa nature reserve 

■ Hog Hollow 

■ Dine with a Local 

Coordination of events 

The Garden Route and Klein Karoo Tourism Office coordinated 

tourism funding for events through Wesgro. A call for event 

applications were sent from the regional tourism office, 

requesting all Local Tourism Offices to submit event proposals 

and applications for events in their respective towns that 

funding through Wesgro 

required funding for the period starting from 1 April 2019 to 31 

March 2020. 

Wesgro has supported six (6) events in our area and contributed 

approximately R250 000.00 towards these events for the Garden 

Route and Klein Karoo 

Garden Route and Klein 

The Garden Route and Klein Karoo Regional Tourism Office sent 

Karoo Events and Festivals 

out a call for applications from Local Tourism Organisations for 

their submission of tourism festivals and events for funding from 


179 










Highlight 


Description 


sponsorship 

Garden Route District Municipality. Consideration is given for 

smaller events that take place from December 2018 until June 

2019, which were not funded by Wesgro. The application 

process closed on the 28 th of September 2018, and no late 

applications were considered. The following events were 

sponsored with an amount of R25 000.00 each: 


■ Proe Bietjie Arts festival 


■ Ostrich Crawl Experience 


■ Saxophone Festival 


■ Calitzdorp Winter Festival 


4. Challenges: Tourism 


Description 

Actions to address 

Deviations (particularly 

exhibition/trade shows 

and sole suppliers of a 

specific product/service) 

Signing of Agreements with possible partners, but it is not 

possible with all shows, as some of them are arranged by 

International companies. 


Challenges: Tourism 


Strategic Objectives 

Garden Route District Municipality's Tourism Unit's strategic objectives underpinned in 
the approved Tourism strategy developed in line with this vision and mission, and 
informed by the national and provincial objectives and local opinions, are: 

Effective Marketing 

■ Increase visitor numbers to the region; 

■ Enhance the effectiveness of international marketing to establish the Garden Route 
and Klein Karoo as a destination of choice; 

■ Expand and improve domestic marketing activities 


180 












■ Attraction and hosting of events (business, sporting and lifestyle) to improve the 
seasonal and regional spread of tourism benefits. 

Visitor Experience 

■ Diversify and enhance tourism product offerings 

■ Enhance local destination sites through cleanliness, safety and security, aesthetics, 
and information improvements 

■ Enhance tourist safety; 

■ Improve tourism skills and service excellence. 

Destination Management 

■ Improve the focus and delivery of tourism marketing and development support 
provided by local government (Lobby and ensure policy sustainability support from B's 
for tourism) 

■ Effective streamlining and strengthening of collaborative efforts in the region to make 
more impact. 

■ To provide knowledge to inform policy, planning and decision-making. 

Transformation 

■ Promote Broad-Based Black Economic Empowerment (B-BBEE) 

■ Support sustainable Enterprise development (LED strategies includes tourism 
development). 

Facilitate Ease of access 

■ Enhance ease of access to the region. 

■ Facilitate ease of doing business to ensure the growth of the tourism economy. 


e) Employees: Tourism 

The table below indicates the number of staff employed by the unit: 



2017/18 

2018/19 

(T-grade) 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

0 

0 


181 












(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

7-9 

0 

1 

1 

0 

0 

10 - 12 

3 

3 

3 

0 

0 

13 - 15 

0 

0 

0 

0 

0 

16-18 

0 

1 

1 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

3 

5 

5 

0 

0 


Employees: Tourism 


3.8.4 EXPANDED PUBLIC WORKS PROGRAM (EPWP) 

a) Introduction to EPWP 


EPWP phase three will be implemented over the next five years as from April 2014 to 
June 2019. A Presidential Public Employment Inter-Ministerial Committee has been 
established to monitor the implementation of phase three. In terms of the national 
employment target standards of EPWP, of the 6 million work opportunities to be 
created during phase three, 55% will be women, 55% youth and 2% for people with 
disabilities. 


EPWP is governed by four principles of which the adherence to minimum and 
employment conditions under the Ministerial Determination and Code of Good 
Practice define worker selection criteria and minimum labour intensity to all four- 
appropriate sector programmes. 

Project based training aimed at capacitating EPWP participants remains an important 
part. All municipalities are encouraged to dedicate a portion of their budgets for 
training opportunities. In response to the high levels of poverty and unemployment 
within the District, Garden Route Council recognised the implementation of the EPWP 
phase three, which aim to draw a significant number of the unemployed into 
productive work. This will ensure workers gain skills while they work and increase their 
capacity to earn an income. 


182 
















The National Development Plan Vision 2030 through the diagnostic report identified 
nine main challenges facing South Africa. Amongst others are “too few people work 
and the quality of education available to the majority is poor”. The persistently high 
rate of unemployment in South Africa (27,6%) is one of the most pressing socio¬ 
economic challenges facing government. High youth unemployment means that 
young people are not acquiring the skills or experience needed to drive the economy 
forward. This inhibits the country's economic development and imposes a larger 
burden on the state to provide social assistance 


b) Highlights: EPWP 

The following highlights were achieved during the financial year: 


Highlights 

Description 

411 Work Opportunities created 

Target of 409 have been achieved and 

exceeded 

Training of 222 EPWP participants within 

2018/19 financial year 

The objective of providing training for 

participants was achieved when 222 EPWP 

participants were trained in various skills: 

1. Driver’s license, 

2. First Aid, 

3. Herbicide, 

4. Financial Conduct Training; 

5. Law Enforcement 

Adherence to the protocol agreement for 

chairing District Municipal Forum 

EPWP Manager is the DMF chairperson 

Work opportunities for all target groups 

achieved 

Women 

Permanent appointments made 

1. 2 Friemersheim participants exited 

program and was appointed 

permanently at Mosselbay 

Municipality 

2. 1 Leaner Fire Fighter exited program 

and was appointed permanently at 

George Municipality 


183 











Highlights 


Description 


One-on-one engagements were held with 
local municipalities and agreed to 
participate at their Municipal Internal 
Steering Committees 


District Municipality is required to Coordinate 
EPWP in the Region by chairing the District 
Municipal Forum and mitigate challenges that 
Municipalities encounter for implementation 
of EPWP 


EPWP Highlights 


c) Work Opportunities Breakdown in Each EPWP Sector 

The following table gives detail of fhe EPWP projects that were implemented 


throughout the financial year: 


Focus area 

Project name 

Project 

number 

Work 

opportunities 

created 

Funding 

Source: 

Start date 

End date 

Status 

Environmental 

Heroldsbay 

73918 

54 

Alien 

Clearing 

funding 

2 July 2018 

31 July 
2018 

Contract 

Ended 

Environmental 

Kleinkrantz 

66963 

39 

Alien 

Clearing 

funding 

2 July 2018 

31 July 
2018 

Contract 

Ended 

Environmental 

Swartvlei 

66949 

26 

Alien 

Clearing 

funding 

2 July 2018 

31 July 
2018 

Contract 

Ended 

Environmental 

Fire Breaks 
Eden 
Properties 

77472 

96 

Alien 

Clearing 

funding 

2 July 2018 

27 July 
2018 

Contract 

Ended 

08 

October 

2018 

28 June 
2019 

21 January 
2019 

30 April 
2019 

09 January 
2019 

28 June 
2019 

01 March 
2019 

28 June 
2019 

4 March 
2019 

31 May 
2019 

5 March 
2019 

31 May 
2019 

Social 

ECD 

Assistants 

76756 

19 

Grant 

Funding 

17 July 
2018 

28 June 
2019 

Contract 

Ended 

Social 

Fire Fighters 

87121 

16 

Own 

Funding 

17 

December 

2018 

18 April 
2019 

Contract 

Ended 

Social 

Events 

Assistants 

85389 

6 

Alien 

Clearing 

funding 

23 

October 

2018 

25 

October 

2018 

Contract 

Ended 

Social 

Youth Safety 
and Security 

76754 

15 

Grant 

Funding 

Own 

18 

December 

2018 

28 June 
2019 

Contract 

Ended 


184 































Focus area 

Project name 

Project 

number 

Work 

opportunities 

created 

Funding 

Source: 

Start date 

End date 

Status 





Funding 




Infrastructure 

Freimersheim 

89645 

67 

Own 

Funding 

2 July 2018 
08 

October 

2018 

28 June 
2019 

Contract 

Ended 

Infrastructure 

Road 

Construction 

85326 

11 

Own 

Funding 

01 

September 

2018 

31 August 
2019 

Contract 

Ended 

Infrastructure 

Stilbay 

Project 

91636 

10 

Own 

Funding 

08 April 
2019 

24 May 
2019 

Contract 

Ended 

Infrastructure 

Maintenance 

Project 

83018 

2 

Own 

Funding 

2 July 2018 

31 

December 

2018 

Contract 

Ended 

1 January 
2019 

28 June 
2019 

Social 

School Safety 
Programmed 

87259 

4 

Alien 

Clearing 

funding 

17 August 
2018 

28 June 
2019 

Contract 

Ended 

Environmental 

Knysna 

Cleaner 

88666 

1 

Own 

Funding 

13 

November 

2018 

12 

November 

2019 

Contract 

Ended 

Environmental 

Resort 

Assistants 

86873 

10 

Own 

Funding 

7&12 

December 

2018 

28 

September 

2018 

Contract 

Ended 

20 

September 

2018 

10 January 
2019 

10 

September 

2018 

12 January 
2019 

Social 

Drivers' 

Licences 

89949 

20 

SLA 

(Own 

Funding) 

1 August 
2018 

31 July 
2019 

Contract 

Ended 

Environmental 

Cater Care 

89914 

15 

SLA 

(Own 

Funding 

4 February 
2018 

31 May 
2019 

Contract 

Ended 


EPWP projects 


The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

EPWP Pluman Resource and funding for this initiative 

Sourced alternative funding 

Projects commencement date delays, due to other 

stakeholders to sign Agreements SLA's and 

contracts of appointment 

Ongoing consultation were held with relevant 

parties responsible for delays to address and advise 

on consequences of delays 


EPWP challenges 


185 































5. Job Creation through the National EPWP 

GRDM has created 411 work opportunities in the 2018/19 financial year via the 
National EPWP. The table below indicates the number of FTE's created for 
2017/18 and 2018/19: 


Financial year 

Number of 
EPWP Projects 

Number of 
work 

Opportunities 

Number of 
training 
opportunities 

Number of 
training 
person 
days 

Number of FTE 
[Full Time 
Equivalent] 

2017/18 

19 

499 

15 

N/A 

241.03 

2018/19 

17 

411 

222 

579 

105 


EPWP Job Creation 


f) EPWP Performance against National EPWP Standards 

With regards to the national targets of vulnerable groups, the code of good practice 
articulates that the specific targets for the share of EPWP participants should be 55% 
for women, 55% for youth and 2% for people with disabilities. Targets are calculated 
within targets of work opportunities that were created. The Municipality's focus was on 
the lesser fortunate rural communities and areas where unemployment figures are 
high. These target groups were identified through a combination of geographical and 
community-based targeting, as well as the utilisation of the EPWP Policy that was 
approve by Garden Route District Council for the region. 

The following tables explains the Municipality's projected EPWP performance for the 
Financial Year 2018/19: 



Number 

% Achieved 

Descriptio 
n of 

EPW 

P 

Targ 

et 

Ann 

ual 


FTE’s 

Person days 

Youth 

Women 

Disabled 

sector 

program 

mes 

J OD 

opportu 
nities per 
Sector 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Environm 

ental 

409 

241 

113 

55.0 

N/A 

1265 

3 

55% 

115 

55% 

126 

2% 

2 

Social 

80 

19.0 

4359 

46 

51 

0 

Infrastruct 

ure 

90 

31.2 

7526 

60 

39 

0 

# National EPWP standard 


186 












































Descriptio 
n of 

Number 

% Achieved 

EPW 

P 

Targ 

et 

Ann 

ual 

Job 

opportu 
nities per 
Sector 

FTE’s 

Person days 

Youth 

Women 

Disabled 

sector 

program 

mes 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 

Targ 

et# 

Actu 

al* 


* EDM s actual achievement: The percentage calculated for youth includes males and females aged 16 to 
35. Percentage women includes youth and adults aged 36 and above 


2017/18 EPWP Performance against National EPWP Standards 


3.8.5 MUNICIPAL RESORTS 


a) Introduction to Municipal Resorts 

The District ran four resorts during the financial year: 

■ Calitzdorp Spa 

■ De Hoek Mountain Resort 

■ Swartvlei Caravan Park 

■ Victoria Bay Caravan Park 

Kleinkrantz, the fifth resort was not operational during the 2018/19 financial year. 

b) Description of Resorts 

i) Calitzdorp Spa 

This resort, situated 45 km from Oudtshoorn and 22 km from Calitzdorp on the old 
cement road linking the two towns is slightly off the beaten track, comprises of 42 self¬ 
catering chalets, 30 caravan sites as well as a day visitor area. The resort has cold and 
natural warm water pools, hiking trails, tennis courts and mountain bikes trails. There are 
13 staff members at Calitzdorp Spa. 

ii) De Hoek Mountain Resort 

Situated 33 km north of Oudtshoorn en route to Prince Albert via the historic Swartberg 
pass, this resort offers visitors 27 self-catering chalets, numerous camping sites and two 
dormitories which can accommodate 144 persons. There is 12 staff members 
employed at De Hoek. 


187 




iii) Swartvlei Caravan Park 

Swartvlei is situated just off the N2 and borders on the Swartvlei Lake approximately 25 
km from George. The caravan park consists of 156 grassed sites of which 49 are 
electrified with 4 ablution blocks. Four staff members are employed at Swartvlei. 

iv) Victoria Bay Caravan Park 

Victoria Bay Caravan Park has 38 caravan sites and is approximately 10 km from 
George. Four staff members are employed at Victoria Bay. 

v) Kleinkrantz Holiday Resort 

Kleinkrantz Ploliday Resorts is situated between Wilderness and Sedgefield on the 
southern side of the N2. The resort has not been in use for many years and has been 
vandalised substantially. The infrastructure is also vandalized substantially. 

A Process to develop and or lease out Kleinkrantz Ploliday Resort was started. 

c) Highlights: Municipal Resorts 


Highlights 

Description 

Increased Income De Ploek 

Increased by 51 % 

Increased Income Victoria Bay 

Caravan Park 

Increased by 7 % 

Increase Income Swartvlei Caravan 

PArk 

Increased by 4 % 

Future Revenue Enhancement 

Long term lease agreements: Developments 
Regional Landfill site: Ikusasa Engineering 
(Pty) Ltd and Mouimakoe (Pty) Ltd 

Upgraded security at Resorts and 

Council buildings 

Security cameras installed 


Highlights: Municipal Resorts 

d) Challenges: Municipal Resorts 


Challenges 

Actions to address 

Old water and electricity infrastructure 

Source additional funding 

Addressing maintenance backlogs at 

Source additional funding and project 

Resorts 

manage maintenance at Resorts 

Income decrease Calitzdorp Spa 9 % 

Focused marketing 


Challenges: Municipal Resorts 


188 


















e) Resorts Income for 2018/19 (Draft Information) 

The table below gives a layout of this years' income generated at the resorts: 


Month 

Calitzdorp Spa 

De Hoek 

Swartvlei 

Victoria Bay 

(R) 

July 2018 

81 412.69 

92 094.52 

78 745.28 

2 356.52 

August 2018 

67 481.36 

21 387.88 

412.66 

225.22 

September 2018 

132 263.38 

51 604.85 

0 

0 

October 2018 

124 777.73 

170 141.67 

200.00 

15 209.57 

November 2018 

189 422.93 

192 312.28 

41 213.93 

536 588.33 

December 2018 

194 587.55 

93 580.09 

67 053.93 

57 191.77 

January 2019 

475 371.69 

584 932.86 

1 147 897.40 

631 575.82 

February 2019 

133 333.29 

194 429.46 

128 284.42 

190 076.79 

March 2019 

112 016.60 

252 383.30 

61 923.03 

187 388.83 

April 2019 

203 632.46 

323 850.55 

49 294.78 

310 424.92 

May 2019 

108 107.50 

18 162.14 

11 327.81 

43 248.49 

June 2019 

418 445.39 

196 887.86 

64 800.01 

48 197.40 

Total 

2 240 852.57 

2 191 767.46 

1 650 327.93 

1 647 706.00 


Resorts Income for 2018/1 9 


f) Employees: Municipal Resorts 

The table below indicates the number of staff employed by the Unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

1 

0 

0 

0 

0 

4-6 

32 

30 

30 

2 

6.67 

7-9 

3 

0 

0 

0 

0 

10- 12 

2 

3 

3 

0 

0 

13- 15 

0 

0 

0 

0 

0 

16-18 

0 

1 

1 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

38 

33 

33 

2 

6.06 


Employees: Municipal Resorts 


189 






































g) Capital Expenditure: Municipal Resorts (Draft Information) 



2018/19 

Capital projects 

Budget 

Adjustment 

budget 

Actual 

expenditure 

Variance from 
adjustment 
budget 

(R) 

Upgrading of Council Buildings 

2 000 000 

804 000 

505 509 

298 491 

Total 

2 000 000 

804 000 

505 509 

298 491 


Capital Expenditure: Municipal Resorts 


3.9 COMPONENT D: ENVIRONMENTAL PROTECTION 

3.9.1 AIR QUALITY CONTROL 

a) Introduction to Air Quality Control 

The natural beauty and unique diversity of the Garden Route must be protected from 
abuse and exploitation if the region is to remain a tourist attraction and preferred 
residential region in years to come. A key step in this protection is management of the 
ambient air quality as it is a basic requirement for all living species. 

Part B of Schedule 4 to the Constitution lists air quality services as a local government 
matter to the extent set out in Section 155(6) (a) and (7). Garden Route is the licensing 
authority for listed activities in the region in terms of the National Environmental 
Management Air Quality Act NO. 39 of 2004 (NEMAQA). Notwithstanding limitations, 
the District has succeeded in substantially meeting the diverse tasks and duties 
associated with air quality management as defined in the Air Quality Management 
Plan (AQMP), compiled during 2014. 


b) Highlights: Air Quality Control 

The following highlights were achieved during the financial year: 


Highlights 

Description 

Atmospheric Emission Licensing (AEL) 

All new and renewal AEL application are processed 

via SAAELIP within the legislator timeframe 


190 











Highlights Description 


100% NAEIS completion and auditing 

All 30 industries submitted their NAEIS reports within 

the required timeframes. This is due to the 

assistance given to industry in this regard 

Routine inspections 

Compliance, enforcement inspections and 

administrative enforcement at listed activities and 

controlled emitters within the district 

Complaints dealing 

Supporting B-municipalities with air quality 

complaints and resolving complaints concerning 

listed activities and controlled emitters 

GRDM Air Quality working group meeting 

Held 4 industrial forums/ working group meetings 

and thereby capacitated the industry 

Sampling 

The procurement of a mobile air quality monitoring 

station and the addition of a methane cell to 

monitor landfill sites. Particulate matter sampling, 

vehicle emission testing, passive sampling and 

weatherstation operation 

Air quality improvements 

Mitigation of air pollution at industrial level 

GRDM: "Clean Fires Campaign” 

GRDM appointed a service provided to compile 

lesson plans aligned to the national curriculum 

(CAPS), as well as resources to complement 

teaching on Pollution (Air Pollution) as part of Life 

Skills for grade 3 leaners. These resources included 

A3 posters, games and content for use on the 

interactive whiteboard 

Ambient air quality monitoring 

Ambient air quality monitoring was conducted by 

means Radiello passive sampling, MiniVol 

Particulate Matter Sampler, portable Sentinel SL50 

and the three stationary monitoring stations of the 

Provincial Directorate: Air Quality Management 

that is located in Oudtshoorn, George and in 

Mossel Bay. The purpose of the sampling was to 

obtain baseline information and when dealing with 

air quality relating complaints 


Air Qualify Control Highlights 

c) Challenges: Air Quality Control 

The table below indicates the challenges faced during the financial year: 


191 














Description 

Actions to address 

Lack of capacity at local authority level 

Air Quality management plans to address 

Lack of coordination from Town Planning 

Establishing communications forums between air 

departments 

quality and town planning 

Budgetary constraints: No capital funding 

AQMP and IDP to address 

Poor support from National DEA 

Attendance of working group 2 meetings at 

national level 


Air Qualify Control Challenges 


d) Employees - Air Quality Control 

The table below indicates the number of staff employed by the unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

2 

0 

0 

0 

0 

7-9 

1 

1 

1 

0 

0 

10- 12 

0 

0 

0 

0 

0 

13- 15 

2 

2 

2 

0 

0 

16-18 

0 

0 

0 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

5 

3 

3 

0 

0 


Employees: Air quality Control 

3.10 COMPONENT E: MUNICIPAL HEALTH 

3.10.1 INTRODUCTION TO MUNICIPAL HEALTH 


According to the constitution of the Republic of South Africa 1996, the Local 
Government: Municipal Structures Act (No.l 17 of 1998) and the National Health Act 
(No. 61 of 2003) it is the statutory responsibility of the District Municipality to render 
municipal health services. 

Section 24 of the Constitution of the Republic of South Africa entrenches the right of all 
citizens to live in an environment that is not harmful to their health or well-being. 
Section 1 of the National Health Act (Act 61 of 2003) defines municipal health services 


192 


























and clearly stipulates the responsibilities of municipalities in the performance of such 
services. 

Environmental Health comprises those aspects of human health, including quality of 
life, that are determined by physical, chemical, biological, social and psycho-social 
factors in the environment. It refers to the theory and practice of assessing, correcting, 
controlling and preventing factors in the environment that can adversely affect the 
health of present and future generations. 

Environmental Health Services are services that implement environmental health 
policies through monitoring and controlling, which improves environmental 
parameters and encourage the use of environmentally friendly and healthy 
technologies and behaviours. Controlling and monitoring plays a leading role in 
suggesting and developing new policy areas. (These definitions are in line with the 
definitions of the World Health Organization). 

3.10.2 SERVICES RENDERED 

Residential, business and public premises are regularly monitored to ensure that there 
are no health nuisances. This is done to ensure compliance with the applicable 
legislation, the principles of Agenda 21 and the "Healthy Cities" approach, and the 
minimisation of any detrimental environmental health risk. 

Key Performance Areas: 

■ Chemical safety 

■ Disposal of the dead 

■ Environmental pollution control 

■ Food control 

■ Health surveillance of premises 

■ Surveillance and prevention of communicable diseases 

■ Vector control/monitoring 

■ Waste management 

■ Water quality monitoring 

■ Administration - general 


193 




Health Inspection, Food and Abattoir Licensing and Inspection 

To fulfil ifs consfifufional and legal obligafions, fhe Municipal Health Services Unit fulfils 
its mandate through knowledge and expertise of our highly qualified and skilled 
environmental health practitioners (EHPs). They provide and facilitate comprehensive, 
pro-active and needs-related services to ensure a safe, healthy and clean 
environment by preventing and eliminating sources of diseases. 

There are functional municipal health offices located in all the local municipalities in 
the district. The municipal health inspectorate is divided into 4 regions, namely: 

■ Klein-Karoo Region (Oudtshoorn and Kannaland) 

■ George 

■ Lakes Region (Bitou and Knysna) 

■ Langeberg (Mossel Bay and Hessequa) 

Municipal health Services is personnel driven function because monitoring, according 
to the scope of practice of environmental health, forms the basis of performing this 
function. Performing these functions will add value to “healthier people in healthier 
places.” 

Main functions: 

■ Monitoring of water reticulation 

■ Protection of water sources by enforcement of laws and regulations 

■ Implementation of health and hygiene awareness 

■ Control of food premises by issuing compliance certificates to food premises 

■ Ensure that food is safe and healthy for human consumption by the enforcement of 
laws and regulations 

■ The monitoring of the storage, treatment, collection, handling and disposal of the 
various categories of waste 

■ The identification, monitoring and evaluation of health risks, nuisances and hazards 

■ The promotion of health and hygiene aimed at preventing the incidence of 
environmental conditions that will result in contagious diseases 

■ Monitoring, identification, evaluation to ensure the prevention of vectors 

■ The identification, evaluation, monitoring and prevention of the pollution of soil, water 
and air 

■ Monitoring of cemeteries, crematoriums and other facilities for the disposal of corpses 


194 



The monitoring, identification, evaluation and prevention of risks relating to chemicals 
hazardous to humans 


a) Highlights: Health Inspection, Food and Abattoir Licensing and Inspections 

The following highlights were achieved during the financial year: 


Highlights Description 

Garden Route 


National Department of Health - Listeria 

■ The National Department of Health 

introduced control measures for 

the food industry regarding the 

Listeriosis outbreak. Municipal 

Investigation: Meat Processing Plants 20 June 2018 

Health was directly involved in the 

sampling and inspection of this 

programme 

Informal food trader's project. 

■ Provide education and awareness 

■ sessions to informal food traders 

Listeriosis awareness and recall 

■ Awareness, education material on 

Listeriosis was handed out to 

various outlets, formal, informal, 

and monitoring of recalls of food 

products 

■ During Garden Route employee 

wellness day, employees were 

educated through the method of 

an exhibition 

World Tobacco Day 

To educate the owners / managers of restaurants to 

locate designated smoking areas for public. 

Operation Fiela in collaboration with SAPS 

Monitoring food premises and give health 

education 


Riversdale 


World Environmental Health Day: 25 September Theme: Global Food Safety and Sustainability Target 


195 












2018 

group: food caterers. 

Department of Social Development Training 

Communicable Disease training - Training was 

provided to all sectional heads of the region. 

George Agriculture “Landbou Vereniging” 

Raw milk and listeriosis: training session provided to 

dairy farmers 

Department of Education 

Environmental health training and inspections of 

schools: Training with regard to 9 key performance 

areas of Municipal Health was provided to school 

governing bodies 

Heidelberg and Riversdale Agricultural shows 

Successful monitoring of informal food traders during 

the event 


Formal health and hygiene training: informal food 

All educators received health training in waste 

traders in Asia Park and Kwa Nonqaba 

management 

Formal health and hygiene training at 4 x creches 

51 participants (personnel) received certificates of 

attendance 

Door -to - door barber shop hygiene project and 

education, Kwa Nonqaba 

6 educators were trained regarding communicable 

diseases 

Health and Hygiene training at Admirals Casino 

12 food handlers received training, on health- 

related matters regarding the management of food 

premises 

■ Event Planning meetings eg. 


Buffalo Rallly, Whale Rally, Tarka 


festival, Mossel Bay Sport School 


week, Dias festival, Fnemersheim 


Fragrance festival and various 

Meetings were held with Mossel Bay Municipality 

other events 

and all role players before any event, to pro¬ 
actively prevent health hazards during events 

■ World Food Day event at 


Brandwag with national 


Department of Agriculture and 


other role players 


Daily Holiday season monitoring meetings with 

To coordinate activities and find solutions and give 

Mossel Bay Municipality, SAPS, Tourism, 

feedback on any matter that may cause a health 

Neighbourhood Watch, ATKV and other role 

hazard 


196 




















players 


Formal health and hygiene training at De Heus 

51 participants (personnel) received certificates of 

Feeds 

attendance 

Event Planning meetings 

Meetings were held with Mossel Bay Municipality 

and all role players before any event, to pro¬ 
actively prevent health hazards during events 

Daily Holiday season monitoring meetings 

To coordinate activities, and find solutions and give 

feedback on any matter that may cause a health 

hazard 


Outreach project at creches in collaboration with 

Presentation and demonstrations on health and 

the Department of Health 

hygiene practices 

Health and hygiene awareness (Clinics, schools, 

creches and food premises) 

Public outreach around currently experienced 

diseases (Listeriosis, Hepatitis B, Scabies and 

Enteroviral meningitis) 

Syferfontein basic subsistence evaluation 

Door to door sessions to complete the basic 

subsistence and evaluation questionnaires 

George Agricultural show 

Health and Hygiene education and awareness 

presentations and demonstrations in collaboration 

with other stakeholders 

Barbershop and hairdresser awareness 

Health and hygiene awareness 

(Thembalethu) 


Listeriosis awareness and education (George 

Farmers Association) 

Awareness on prevention of Listeriosis as well as 

Health and hygiene education 

Clean up campaign in collaboration with George 

Municipality (Molen River and Borcherds) 

Health and hygiene awareness on illegal dumping. 

Exhibition at George Civic Centre 

Public awareness and health education 

Health and hygiene inspection at the George Old 

Health surveillance of premises and food monitoring 

Car Show and CANSA RELAY, Strawberry festival) 



Klein Karoo National Arts Festival (KKNK) 

The Klein Karoo Municipal Health Office received a 

certificate for the rendering of outstanding 

environmental health services during the 2019 KKNK 

Food safety training in Oudtshoorn 

EHP's provided informal food safety training to 

formal and informal food handlers in Oudtshoorn 

Global handwashing day celebrations in 

EHP's held an awareness session on the importance 

Oudtshoorn 

of handwashing to school children 


197 




























Communicable diseases and diarrhoea education 

EHP’s held an awareness session on communicable 

and awareness sessions to creche principals in 

diseases, diarrhoea and importance of hand 

Dysselsdorp 

hygiene to creche principals and caregivers 


Barbers and hairdressers 

5 barbers and hairdressers in Nekkies and Damsebos 

area 

Formal food traders 

Education session was held at Knysna correctional 

services Health and hygiene session held with 

foreign nationals from the informal spaza shop 

trading and the distribution of pamphlets and 

posters 

Successful held and monitor oyster festival 

Monitoring food outlets 

Removal of asbestos material 

Successful completion of asbestos removal project 

Clean up project 

Partake in Community clean up at Kanonkop 

Blitz operation 

Joint blitz operation between Garden Route and 

Knysna SAPS on SPAZA shops 

Surveillance of premises Karatara fire 

Health surveillance of premises during the Karatara 

fire 

World Environment day 

Partake in door to door awareness regarding waste 

disposal in Knysna 


■ Health and Hygiene Awareness 

Presentation and demonstrations on health and 

hygiene practices to food managers and handlers 

in terms of R638 

World Food Day Celebrations 

Presentation on safe food handling at informal food 

traders - taxi rank, Bossiesgif Soup Kitchen Kranshoek 

Kleuterskool Kurland Creche 

Health and Hygiene Awareness program at Clinics 

Environmental Health Practitioners hand out 

Environmental Awareness booklets to various Clinics 

Global hand washing day 

To promote hygiene practices at Schools and 

Creches Kranshoek Kleuterskool 

World Environmental Day 

Environmental Health Practitioners held awareness 

sessions on Health & Hygiene Awareness, Waste 

Management, Recycling, and Water Quality to 

leaners 

Matric Rage Plettenberg Bay 

Registration and monitoring of food outlets were 

successfully held 


198 




























Health Inspection,; Food and Abattoir Licensing and Inspections 


b) Challenges: Health Inspection, Food and Abattoir Licensing and Inspections 


The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Lack of resources: Manpower and funding 

To be addressed during budget process 

Safety and security of personnel 

Awareness training, pepper spray training, develop 

panic button on cell phone 

Implementation of the Norms and Standards 

Re-address the Norms and Standards (ring fencing 

MHS) 

Language barriers 

Investigate language app, better communication 

skills 

Interpretations and enforcement of legislation 

Training on Interpretations and enforcement of 

legislation 

Forensic food chemical sampling services 

Improve turn-around time and investigate other 

options 

Lack of Inter-governmental relations support 

Better communication and cooperation 


Health Inspection, Food and Abattoir Licensing and Inspections 


c) Service Statistics - Health Inspection, Food and Abattoir Licensing and 
Inspections 


The following table indicates the services rendered by the Municipality: 


Type of service 

2017/18 

2018/19 

Inspections at food production and/or handling 
sites formal and informal 

8 030 

8 630 

Inspections at dairies to ensure legislative 
compliance 

231 

180 

Inspection to informal settlements 

427 

945 

Inspection of sewerage treatment /waste water 
sites 

554 

269 

Inspection of farms 

368 

292 

Inspection of non-food premises e.g. garages, 
creches, caravan parks 

22 769 

33 500 

Inspection environmental Pollution 

7 552 

8 676 

Inspection conditions promoting breeding and 
habits of vectors 

7 693 

9109 

Samples 

3106 

3590 


Service statistics - Health Inspection, Food and Abattoir Licensing and Inspections 


199 




























d) Employees - Health inspection, food and abattoir licensing and inspections 

The table below indicates the number of staff employed by the unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

0 

1 

1 

0 

0 

4-6 

8 

8 

8 

0 

0 

7-9 

0 

4 

4 

0 

0 

10- 12 

30 

29 

29 

2 

6.89 

13- 15 

8 

8 

8 

0 

0 

16-18 

1 

1 

1 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

46 

51 

51 

2 

3.92 


Employees - Health inspection, food and abattoir licensing and inspections 


e ) Capital Expenditure - Health Inspection, Food and Abattoir Licensing and 

Inspections (Draft Information) 

The table below indicates the capital m expenditure incurred by the section: 



2018/19 

Capital projects 

Budget 

Adjustment 

budget 

Actual 

expenditure 

Variance from 
adjustment 
budget 

(R) 

3x Notice Boards 

4 500 

4 500 

0 

4 500 

3 High back office desk chairs 

4 104 

4 104 

3 717 

387 

Semi Industrial Wet & Dry Vacuum 

Cleaner 

0 

3 850 

2 900 

950 

Security Fence Mossel Bay Office 

0 

30 000 

26 043 

3 957 

3 Drawer Desk 

4 300 

4 300 

3 445 

855 

Desk shell lockable top drawer 

3 871 

3 871 

1 322 

2 549 

Highback swivel chair 

944 

944 

913 

31 

2 x Saver Arm chair 

1 183 

1 183 

0 

1 183 

1 x Conference Table & 10 x Saver 

arm chair 

24 176 

16 027 

13 595 

2 432 

Refrigerator - 250 litre 

0 

4 299 

4 299 

0 

Plett Office Building 

0 

2 300 000 

2 255 480 

44519 


200 




































Total 


43 078 


2 373 078 


2311 714 


61 364 


3.11 COMPONENT F: FIRE SERVICES AND DISASTER MANAGEMENT 

3.11.1 FIRE 


a) Introduction to Fire Services 

The Fire and Rescue Service is provided by the Municipality as a requirement of 
Section 84 (j) of the Local Government: Municipal Structures Act 117 of 1998 which 
confers the following powers and functions: 

Fire fighting services serving the area of the district municipality as a whole, which 
includes- 

1. planning, co-ordination and regulation of fire services; 

2. specialised fire fighting services such as mountain, veld and chemical fire 
services; 

3. co-ordination of the standardisation of infrastructure, vehicles, equipment and 
procedures; 

4. training of fire officers. 

The Municipality has established and is maintaining the Fire and Rescue Services as 
required in terms of the Fire Brigade Services Act 99 of 1987. The area covered in 
providing the service includes the following local municipalities: 

■ George Local Municipality 

■ Mossel bay Local Municipality 

■ Flessequa Local Municipality 

■ Kannaland Local Municipality 

■ Knysna Local Municipality 

■ Bitou Local Municipality 

■ Oudtshoorn Local Municipality 

The Municipality has 3 stations, with the headquarters based in George and 2 satellite 
stations based in Riversdale and Ladismith. The organogram of the service includes a 
Chief Fire Officer, a Deputy Chief Fire Officer, 2 Station commanders, 4 Platoon 
Commanders at George, 1 Platoon Commander per station at Riversdale and 


201 





Ladismith, 24 Firefighters at George and 6 Firefighters at Riversdale and Ladismith 
respectively. 


The 3 stations are manned as listed below: 



Fire Stations 

Name 

George Fire Station 

Ladismith Fire Station: 

Riversdale Fire Station 

Members 

1 Platoon Officer 

5 members comprising 

either of Junior 

Firefighters, Firefighters or 

Senior Firefighters per 

shift. 

Total operational shift 

personnel is 24. 

1 Platoon Officer 

working office hours 

serving the station of 

Ladismith and 

Riversdale. 

3 members, either Junior 

Firefighters, Firefighters or 

Senior Firefighters 

3 members either Junior 

Firefighters, Firefighters or 

Senior Firefighters 

Station hours 

The shifts are arranged 

from 06:00 to 18:00 with 

4 rest days after 2 

consecutive days and 

nights 

Normal working hours 

apply to the Ladismith 

Fire Station and 

provision is made for 

stand-by duties (4 days 

on, 4 days off) 

Normal working hours 

apply to the Riversdale 

Fire Station and 

provision is made for 

stand-by duties (4 days 

on, 4 days off) 


Fire Stations in the Region 


The Municipality has a memorandum of agreement in place with 3 of the local 
municipalities whereby assistance to occurring emergencies are rendered without any 
cost implications to the municipalities. Services are rendered to other municipalities 
outside the district for an agreed upon fee. 

In terms of the establishment notice of Kannaland, a full function service is provided to 
the Kannaland Municipality and in addition to the legal mandate of the Garden 
Route District Municipality, also provides a service for strengthening infrastructure, 
firefighting, rescues and performing the fire safety function. 

The Provincial Disaster Management Centre (PDMC), via the Fire Services Unit, makes 
aerial firefighting resources available during the fire season which runs from December 
to March and extends that support into April for the District Municipality. This is due to 


202 







the extended fire season within this area. The support provided by the PDMC allows 
the District Municipality, and subsequently the local municipalities, to have the aerial 
support sponsored for the first hour. The support comprises of a chopper (helicopter), a 
bomber (airplane) and a spotter plane (airplane). 


b) Highlights: Fire Services 

The following table provides the highlights achieved during the financial year: 


Highlights 

Description 

Budget Allocation 

This year the GRDM was given a capital budget 

allocation to procure two fire trucks, an incident 

command vehicle, equipment and uniform 

Procurement 

The Incident Command vehicle was delivered and 

procured via a formal tender process. 

Procurement 

Two firefighting trucks have been ordered and will 

be delivered before the end of the calendar year 

and was procured via a formal tender process 

Procurement and Standards 

Procurement and Delivery 

Procurement and Delivery 

New grass fire fighting apparel which meets the 

required standards for its application was delivered 

and procured via a formal tender 

Station wear was delivered and procured via a 

formal tender 

15 Self-contained breathing apparatus was 

delivered and procured via an informal tender 

process 

Procurement and Delivery 

6 Level A and 16 level B hazmat suits was delivered 

and procured via an informal tender process. 

Procurement and Delivery 

4 Water nozzles were delivered 

Education and Training 

1 Member is being trained in the Firefighter 2 and 

Hazmat Operations courses being presented by the 

WCPG in Mossel Bay 

Education and Training 

2 Members completed the Advanced Rope 

Rescue training programme being presented by 

the WCPG in Bredasdorp. 

Education and Training 

2 Members are currently on the OETDP training 

programme being presented by the GRDM. 

Education and Training 

6 Members completed the Radio Telephonic Base 

Operator training. 


203 


















Highlights 


Description 


Education and Training 

2 Members attended the Incident Management 

training facilitated by the WCPG in Bredasdorp. 

Education and Training 

1 Member completed ISC Division Supervisor 

training 

Education and Training 

2 Members completed their SAESI Diploma in Fire 

Technology 

Education and Training 

4 Members wrote subjects in the SAESI Higher 

Certificate in Fire Technology 

Education and Training 

1 Member is busy with the Diploma in Public 

Management through Damelin 

Awareness Campaign 

Public Awareness programmes are conducted with 

communities to make them aware of the dangers 

of fire and the actions to be taken in the event of 

fire. 

Awareness and Compliance 

Fire safety compliance, inspections and awareness 

programmes are conducted in Kannaland where 

all functions of the fire service are provided. 

Grant Funding 

The October/November fires in George and 

Hessequa initiated a response from the provincial 

department responsible for fire services with 

operational assistance and a grant funding of RIO 

million. 

Emergency Response 

The October/November fires saw the following 

departments, municipalities and state entities 

involved in combating the disaster fires: GRDM, 

George Municipality, Mossel Bay Municipality, 

Hessequa Municipality, Knysna Municipality, Bitou 

Municipality, Overstrand Municipality, Overberg 

Municipality, City of Cape Town, Cape Winelands, 

West Coast Municipality, Cape Nature, SANS Parks, 

MTO, PG Bison and Working on Fire. 

Assistance to Overstrand Municipality 

The GRDM assisted with firefighting crews that were 

dispatched to Overstrand Municipality during its 

disastrous fires of December. 


Fire Services highlights 


204 
















c) Fires and Incidents 

The table below gives an indication of the fire and incidents that occurred during the 
financial year: 


Area 

Type of Fire 

07/12/2018 

Ladismith- Church street 

Vehicle Fire 

Pacaltsdorp .Dellville Park 

Veldt Fire 

Seweweeks Poort gravel road 

MVA 

Zoar Sports Grounds 

MVA 

Thembalethu/zone 9 

Shack Fire 

N2 / Heidelberg 

MVA 

Laingsburg Road 

MVA 

Corner R62 & Albert str. In Ladismith 

Oil Spill 

Opposite Sakkies Baai in Ladismith 

Veldt Fire 

R62, between Shell Garage & Olive Garden, 
Ladismith 

Diesel Spill 

Bo plaas 

Grass and Bush 

Oudtshoorn 

Diesel Spill 

Meiringspoort 

Diesel Spill 

Calitzdorp 

Grass and Bush 

Vleesbaai 

Grass and Bush 

Ladismith 

Grass and Bush 

Zoar 

House Fire 

Blanco 

Diesel Spill 

Ladismith 

House Fire 

Denneoord 

Control Burn 

N9 Crossing Oudtshoorn 

Grass and Bush 

Calitzdorp- Paul Theron 

Structural Fire 

Geelhoutboom Arabella 

Grass and Bush 

Geelhoutboom 

House and Veld Fire 

Ladismith 

Vehicle Fire 

Waterkloof road Ladismith 

MVA 

Echo Estate / Calitzdorp 

Structural Fire 

Van Wyksdorp 

Veldt Fire 

Klipfontein 

Veldt Fire 

Soutpan 

Veldt Fire 


205 




































Area 


Type of Fire 


Albertina- Soutpan area 

Veldt Fire 

Waterkloof Road Ladismith 

MVA 

Echo Estate / Calitzdorp 

Structural Fire 

Van Wyksdorp 

Veldt Fire 

Klipfontein 

Veldt Fire 

Soutpan 

Veldt Fire 

Albertina- Soutpan area 

Veld Fire 

Zoar Mountains / Veldt 

Missing person 

Waterkloof road Ladysmith 

MVA 

Echo Estate / Calitzdorp 

Structural Fire 

Van Wyksdorp 

Veldt Fire 

Klipfontein 

Veldt Fire 

Ladismith- January Street 

Vehicle Fire 

Ylandsvlei 

Tree Fire 

Esejag Farms 

Bush Fire 

Schoonberg 

Bush Fire 

Ezeljacht Fire 

Bush Fire 

Langkloof 

Veldt Fire 

Still Bay 

Veldt Fire 

Outeniqua Pass Fire 

Bush Fire 

Zoar 

Veldt Fire 

De Vlught Fire 

Bush Fire 

Klein kruis rivier 

Veld Fire 

Garcia Pass, Riversdale 

Veldt Fire 

Ladismith 

Structural Fire 

Ladismith 

Veldt Fire 

Ladismith- Town 

Veld Fire 

N1 R62 Huisrivierpas 

MVA 

Ladismith 

Vehicle Fire 

Calitzdorp- 9 th Ave 

Structural Fire 

Mosselbay - Alwyndal 

Veldt Fire 

01/06/2019 

Zoar- Farm Opsoek 

Snake Catch 

Calitzdorp- Wesoewer 

Veld Fire 

Calitzdorp- Wesoewer 

Veld Fire 


206 











































Area 


Type of Fire 


Malan street C/dorp 

Structural Fire 

Calitzdorp- R62 

Veld Fire 

Calitzdorp- R62 

Veld Fire 

U Save / Ladismith 

Snake Catch 

Albertinia N2 

Flazmat 

Ladismith 

MVA 

Ladismith- R62 

MVA 

George 

Scrap yard Fire 

Ladismith 

Veld Fire 

Zoar- Amaliensteyn 

Bush Fire 

Lainsburg gravel road 

MVA 

Langhoogte / Ladismith 

Snake Catch 

Touwsranten 

Bush Fire 

Hartenbos heuwels 

Bush Fire 

Geelhoutboom 

Bush Fire 

Calitzdorp 

Snake Search 

Hansmoeskraal 

Bush Fire 

Calitzdorp- Wesoewer 

Veld Fire 

Calitzdorp- Wesoewer 

Veld Fire 

Blanco Fire 

Bush Fire 

George 

Water Delivery 

Hoekwill 

Bush Fire 

Wilderness 

Bush Fire 

Syferfontein (George Assist) 

Veld 

Outeniqua pass 

Hazmat 

7 Passes 

Veld fire 

Ladismith- R62 Barrydale road 

Veld fire 

Ladismith- R62 Barrydale road 

MVA 

Syferfontein (George Assist) 

Veld 

N2 Riversdale 

MVA (Flazmat) 

Nissanville Ladismith 

Veld Fire 

Van Wyksdorp Gravel Road 

MVA 

Groenfontein, Calitzdorp 

Veld Fire 

Groenfontein, Calitzdorp 

Veld Fire 

George in town 

Diesel Spill 


207 









































Area 


Type of Fire 


Besemkop Calitzdorp 

Veld Fire 

Varkieskloof 

MVA 

Nissenville 

Veldt Fire 

Ladismith Municipality 

Snake Catch 

Huisrivier Pass 

MVA 

Riversdal, Vermaaklikheid 

Hazmat 

Van Wyksdorp Gravel road 

MVA 

Algereins Kraal 

MVA 

Vermaaklikheid 

Veld Fire 

York str, George 

Milk Spill 

Outeniqua Pass 

htazmat Diesel Spill (Vehicle Tank) 

Hoekoe 

Mountain Fire 

Knysna 

Boat capsized (Hazmat) 

George Bo dorp 

Snake Catch 

Wilderness, George 

Veldt Fire 

Hartmansleegte 

MVA 

Bruintjies hoogte 

Structure Fire 

Ladismith dorp 

Refuse Fire 

Amalienstein boerdery 

Veldt Fire 

R62 to Zoar 

MVA 

Ladismith dorp 

Refuse Fire 

Outeniqua Pass 

MVA 

Outeniqua Pass, George 

Diesel Spillage 

Mossiestr31 Ladismith 

Attempted Suicide 

R62 to Barrydale 

MVA 

Medical call 

Unresponsive Patient 

Ruitersbos 

Veldt Fire 

Voorbaat, Ladismith 

Veldt Fire 

Swavel2 crecent, Ladismith 

Snake Catch 

Sakkiesbaai, Ladismith 

False call (House fire) 

George 

MVA oil Spill 

Syferfontien 

Veldt Fire 

George fire station 

Spill 

Haroldsbaai Road 

Veldt Fire 

Amalienstein, Zoar, Ladismith 

MVA 


208 









































Area 


Type of Fire 


MtO offices in George 

Structure Fire 

Waterkloof Road, Ladismith 

MVA 

Geelhoutboom Road 

Spill 

Robertson Pass 

Hazmat Spill 

Jonkersberg 

Veld and Bush Fire 

Knysna 

Veld and Bush Fire 

Voorbaad, Ladismith 

Veldt Fire 

Gwaing sanitation farm 

Veldt Fire 

Golden Valley 

Veldt Fire 

Riverdale road between R62 Ladismth/ Riversdale 

MVA 

Nissanville, Ladismith 

House Fire 

Sakkiesbaai Ladismith 

Shack Fire 

N2 outside Heidelberg 

Hazmat 

Thembalethu Zone 9 

Shack Fire 

Groenkloof gravel road 

Bio Hazard Call 


Fires and Incidents 


d) Challenges: Fire Services 

The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Fragmented Services 

DCF resolution to restructure the Fire Services 

Aging Fleet 

Capital budget allocated to replace old vehicles 


Fire Services Challenges 


e) Service Statistics for Fire Services 

The following table gives information on the statistical information for services delivered 
during the financial year: 


Service 

Description 

Average turnout time - urban areas 

10 minutes 

Average turnout time - rural areas 

10 to 60 minutes & 60 to 30 minutes 

Fire fighters in post at financial year-end 

41 

Total fire appliances 

11 

Reservists and volunteers 

21 


209 




































Service 

Description 

Veld, mountain and vegetation fires 

70 

Motor vehicle accidents 

26 

Vehicle fires 

4 

Chemical incidents 

18 

Structural fires 

12 

Informal dwelling fires 

3 

Rescue incidents 

1 

Snake incidents 

7 

Refuse fires 

3 

Medical incidents 

2 

Water Delivery 

1 

False Calls 

1 


Service Statistics for Fire Services 


d) Employees: Fire Services 

The table below indicates the number of staff employed by the unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

7 

7 

7 

0 

0 

7-9 

4 

4 

4 

0 

0 

10- 12 

28 

29 

29 

1 

3.45 

13- 15 

1 

1 

1 

0 

0 

16-18 

1 

1 

1 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

41 

39 

39 

1 

2.56 


Employees: Fire Services 


e) Capital Expenditure: Fire Services (Draft Information) 

The table below indicates the capital expenditure incurred by the unit: 


210 



































2018/19 

Capital projects 

Budget 

Adjustment 

budget 

Actual 

expenditure 

Variance from 
adjustment 
budget 

(R) 

Water Tankers (CRR) 

1 550 000 

1 523 000 

1 372 159 

150 840 

LDV - 1 x Skid Unit & 1 x Command 

Unit (CRR) 

550 000 

515 000 

505 333 

9 667 

Hazmat Rescue & Fire Equipment 

Equipment 

300 000 

250 000 

129 710 

120 290 

Two Way Radio Repeater 

50 000 

50 000 

0 

50 000 

Hazmat suits - Level A 

160 000 

160 000 

0 

160 000 

Thermal Imaging Camera 

80 000 

80 000 

68215 

11 785 

New Fire Station/ Training Academy 

(CRR Funding) 

3 000 000 

0 

0 

0 

Computer Equipment Relay Stations 

0 

522 000 

521 987 

13 

Laptops (Fire Fighting) 

0 

35 000 

30 697 

4 303 

Total 

5 690 000 

4 613 000 

4 003 989 

609 011 


Capital Expenditure: Fire Services 

3.11.2 DISASTER MANAGEMENT SERVICES 

a) Introduction to Disaster Management Services 


The Municipality has a fully functional Disaster Management Centre (DMC). The centre 
is equipped with a joint operational command and tactical decision area. To stay 
abreast with regional emergency related activities, a 24/7 call centre has been 
established adjacent to the DMC. The 24/7 call centre is operated in conjunction with 
the Provincial Emergency and Medical Services (EMS) and renders an emergency call 
taking and dispatch platform servicing the district. 

During the year, the GRDM Call Centre updated the old analog based two-way radio 
communications platform to a digital system complete with GPS tracking capability. 
This system is similar to what Provincial EMS, provincial traffic and the South African 
Police Services (SAPS) uses. Sharing a common two-way radio platform enables the 
District's DMS to develop an emergency communications platform over the next 
couple of years. 


211 



















During October and November 2018, the GRDM district experienced a fire extending 
over more than 4 times the area that burnt in last year's Knysna / Bitou fire. 10 Lives 
were lost as a direct consequence to these fires and although very few formal 
structures burnt, the fire had a crippling effect on especially the forestry industry. For 
the 2019/2020 book year, the focus would be to quantify the current knock-on effects 
of this fire disaster as well as to predict the affect this fire would have over the next 
three to five years. The intention of the DMC would be to provide a heads-up to all 
stakeholders in order to collectively develop a “safety net” for those affected as well 
as to be affected by this disaster. In addition to this council has approved that a new 
approach namely: integrated veldt fire management should be rolled- out in the 
district. The Chief Fire Officer will be developing an integrated veldt fire management 
plan for immediate implementation by all stakeholders. 

The inability of local government to effectively deal with this type of incidents were a 
major area of concern highlighting the importance for the building of structures and 
capacity at local municipal level seen as the governance structure closest to the 
affected communities. Although district coordination and lines of communication to 
provincial as well as national spheres of government exist, there is still a substantial 
amount of work that needs to be done in terms of the current capacity constraints at 
local municipal level. In this regard the GRDMC developed the following guiding 
documentation namely: 

♦ A Local Disaster Manager Handbook, to be used by local municipal officials responsible for acting as first 
responders in the disaster management capacity; 

♦ A Disaster Relief Protocol for the District Municipality - This plan sets out the protocol for short-term relief 
assistance aimed at guiding the activities of both the Local Municipalities as well as the District 
Municipality and the Department of Social Development; 

♦ All Departments of the District Municipality updated the Garden Route Corporate Disaster Management 
Plan with emphasis on the inclusion of disaster risk reduction. 

The Garden Route DMC strives to deliver cost effective and efficient services to ensure 
that the District remains a safe and secure destination, not only to its inhabitants, but all 
those visiting the area. Due to financial constraints, the DMC's management has been 
forced to “plan out of the box”, partnering with existing programs and organisations to 
achieve economies of scale. In this regard funding to the value of more than R2,5 mil 


212 


has been secured from the Fund for the Reconstruction of Knysna and the Eden District 
(FRKED). To date most of this funding was used to implement soil erosion protection 
works, the cutting of firebreaks next to high fire risk settlements as well as the control of 
invasive alien plants in the 2017 Knysna/Bitou burn scar area. 

The Western Cape Provincial Disaster Management Centre (PDMC) contributed in 
terms of assistance to update existing local disaster risk assessments and the roll-out of 
disaster awareness campaigns, focusing on fire and flood awareness. The PDMC 
funded the appointment of external service providers to work with Garden Route DMC 
assisting Municipalities with the completion of their community based local disaster risk 
assessments. 


b) Organisational Structure 

The table below gives the departments structure in terms of the service rendered: 


Department: 

Community Services 

Division: 

Disaster Management 

Municipal official 

Designation 

Monde Stratu 

Municipal Manager 

Clive Africa 

Executive Manager: Community Services 

Gerhard Otto 

Manager Disaster Management 

Nina Viljoen 

Disaster Risk Reduction and Climate Change 
Adaptation Practitioner 

Wouter Jacobs 

Disaster Management Coordinator 

Post vacant 

Disaster Management Officer 

Post vacant 

Disaster Management Officer 

Stella Bouwer 

Call Centre Supervisor 

Call Centre Operators 

4 Permanent and 4 ad-hoc 

Gail Bekeer 

Administrative Assistant 

Stenden University final year students 

Disaster Management interns focusing on 
disaster related research 

The following people will be activated to render assistance to the DMC when the Eden Joint 
Operational Centre is activated in terms of the District Disaster Response Plan 

Systems support 

IT Section 

Koos Nieuwoudt 

Spatial information 


213 






















Department: 

Community Services 

Division: 

Disaster Management 

Municipal official 

Designation 

GIS Section 

Salman Damons 

Finance 

CFO 

Louise Hoek (until 5 December2018) 

Johan Stander (5 December 2018 until 28 
February 2019) 

Jan- Willem de Jager (1 March 2019 to date) 

Corporate Services 

Executive Manager Corporate Services 

Trix Holtzhausen 

Roads 

Executive Manager Roads 

Hans Ottervanger (until 30 September 2018) 
Lusanda Menze (October 2018) 

John Daniels (November 2018 to date) 

Risk and logistics 

DMC Building 

Mario Appels 

Call Centre 

Tippie Bouwer 

JOC 

Wouter Jacobs 


Disaster Management Structure 


For the 2019/20 financial year the intention would be the appointment and placement 
of at least two disaster management officials at the disaster management capacity 
constrained local municipalities. 

At this point in time local municipalities do not provide any staff or funding towards the 
district DMC, but the following local municipalities have appointed dedicated disaster 
management officials who closely work with the Garden Route Head of Centre: 

♦ Oudtshoorn LM; 

♦ George LM; 

Furthermore the intention would be to roll out the newly procured disaster 
management information management as well as fire dispatch platform to all local 
municipalities in the region. This platform will ensure standard operational procedures, 
tracking of all resources as well as better coordination during major incidents as well as 
disasters. 


214 

























c) DMC’s Annual Performance Plan (APP) and Operational Strategies 

The table below reflects the Municipalities annual plan and operational strategies: 


Garden Route vision 

Garden Route" the leading, enabling and inclusive district, 
characterised by equitable and sustainable development, high 
quality of life and equal opportunities for all 

DMC departmental vision 

Building towards a district of resilient communities where 
vulnerable people are able to prepare for, mitigate against, 
recover from and adapt to hazards and a changing climate 

Strategic objectives 

The Garden Route DMC believes in the 'added value' and 
complementarity of working together to achieve shared 
objectives and goals by undertaking joint actions and mutual 
support.The interaction between district role-players is guided by 
shared values of trust, mutual accountability; gender equity; a 
respect for diverse identities, perspectives and beliefs; a 
commitment to inclusion and participation; and openness to 
sharing and learning to build consensus and mutual 
understanding 

Inputs 

(what we use to do the 
work) 

Disaster risk assessments, research, GIS mapping, provincial 
decision support tool, the Unity disaster information management 
software, weather data, RADAR data, AFIS data and early 
warnings. 

Activities/mission 

(what we do) 

Building resilience against disaster risk 

Output 

(what we produce or 
deliver) 

Disaster risk assessments, disaster response and mitigation plans, 
disaster risk reduction plans. Rehabilitation and reconstruction 
after disasters to “build back better" as well as to develop a 
climate smart district 

Predetermined outcomes 

(what we wish to achieve) 

Developing a disaster resilient district 

Impact 

(what we aim to change) 

To build the capacity at local authority level to pro-actively plan 
and implement mitigation as well as adaptation strategies and 
disaster risk reduction actions to limit the exposure to as well as 
the possible impact of future disastrous events 


APP and Operational Strategy 


The legislative mandate of the Municipality in terms of disaster management services 
are: 


■ The 1996 Constitution RSA 

■ Disaster Management Amendment Act, 16 of 2015 as amended 


215 













■ Disaster Management Amendment Act, 57 of 2002 

■ National Disaster Management Framework, GN 654 OF 2005 

■ The Municipal Systems Act 32 of 2000 

■ The Municipal Structures Act 117 of 1998 

■ d) DMC Projects and programmes 


Project/Program 

Objective 

Date from - date to 

First aid training and building 
disaster management 

awareness 

To train disaster management 
volunteers to first aid level 3 
and build up a disaster 
management volunteer data 
base 

Continuous, at least 8 courses 

per year 

Update Oudtshoorn 

Municipal municipal risk 
assessment 

To identify emerging disaster 
risks in order to build resilience 
or to mitigate the possible 
affects thereof 

01/01/2019-30/10/2019 

Update Kannaland Municipal 
disaster risk assessment 

To identify emerging disaster 
risks in order to build resilience 
or to mitigate the possible 
affects thereof 

01/01/2019-30/10/2019 

Build local municipality 
disaster management 
capacity 

To appoint seven disaster 
management interns to be 
coached by the District HOC 
for placement at each LM 

Two DMO’s to be appointed 
and placed by the end of 
June 2019 

To develop a disaster risk 
reduction dashboard 

To spatially indicate all DRR 
initiatives currently being 
implemented/ to be 
implemented by Local 
Authorities in the district 

01/10/2018-31/12/2019 

Invasive alien plant clearing 

The alignment of current 
programmes aimed at the 
reduction of alien invasive 
plants 

Continuous over the next 3 to 

6 years 

Updating of water 
management plans 

To ensure uniformity in terms 
of water restrictions at all local 
water service providers (WSP) 

01/062018-30/06/2020 

Regional drought public 
awareness campaign 

To raise public awareness as 
well as to drive down water 
consumption 

Continuous 

Climate change 

■ Adaptation measures 

■ Mitigation measures 

■ Awareness and 

education 

■ Alternative food 

Continuous 


216 

















Project/Program 


Objective 


Date from - date to 



sources 

■ Water security 

measures 

■ Smarter building 

■ Increasing resilience 

■ Research 

■ Investment in 
renewable energy 
forms 

■ Biomass to energy 

■ Reforestation 


Biodiversity 

■ Critical biodiversity 
mapping 
incorporated into 
district SDF 

■ Declaration of more 

Protected areas 

■ Protection of core and 

buffer areas for 
connectivity 

■ Education and 

awareness 

■ Research 

■ Robust coastal and 
estuary management 

■ Sustainable building 
practices 

Continuous 

Disaster rehabilitation and 

reconstruction 

To ensure that the funds 
allocated in terms of post 
disaster rehabilitation and 
reconstruction are being 
spent as per the project plans 

Continuous 


Break down ofGRDM DMC's projects 2019/20 


Project Description 

Funding Source 

Update of local municipal disaster management plans 

Own staff 

Update of local municipal disaster risk assessments 

Own staff/lnterns 

Research on the re-growth of invasive alien plants in the district after 
the 2017 and 2018 fire 

Interns 

Research on civil unrest/protest action at the Bitou and Mossel Bay 

Local Municipal areas 

Interns 

Disaster/drought funding and prioritisation assistance 

Own staff 

GREF spatial data management and archive development 

Fund for the reconstruction of 


217 





















Knysna and the Garden Route 
District (FRKEDJ/GRDM 
environmental section 

Status of Forestry Industry Research, in collaboration with GRDM (LED), 
including reflection on indigenous forestry industry 

Fund for the reconstruction of 
Knysna and the Garden Route 
District (FRKED) 

Riversdale/Still Bay burn scar herbicide assistance 

Fund for the reconstruction of 
Knysna and the Garden Route 
District (FRKED) 

Herbicide assistance in the Knysna burn scar 

Fund for the reconstruction of 
Knysna and the Garden Route 
District (FRKED) 

WWF herbicide assistance, project completed February 2019 

WWF 

TMF/GREF/SCLI/SANParks/CNC Floristic Corridor Revival 

Table Mountain Fund 

Establishment of Garden Route Environmental Forum 

Fund for the reconstruction of 
Knysna and the Garden Route 
District (FRKEDJ/GRDM 
environmental section 

Regional fire risk assessment 

Fund for the reconstruction of 
Knysna and the Garden Route 
District (FRKED) 

Regional Invasive Alien Plant assessment and formulation of a strategy 
to address this emerging risk 

Fund for the reconstruction of 
Knysna and the Garden Route 
District (FRKED) 


Project description 


Disasters and Major Incidents that Occurred During the Year 

■ During October and November 2018, the GRDM district experienced a fire 
extending over more than 4 times the area that burnt in last year's Knysna / 
Bitou fire. 10 Lives were lost as a direct consequence to the fires and although 
very few formal structures burnt the fire had a crippling effect on especially 
the forestry industry. For the 2019/2020 book year the focus would be to 
quantify the current knock-on effects of this fire disaster as well as to predict 
the affect this fire would have over the next three to five years. The intention of 
the DMC would be to provide a heads-up to all stakeholders in order to 
collectively develop a “safety net” for those affected as well as to be 
affected by this disaster. 

■ Continuation of the drought conditions affecting mostly the Northern parts of 
the District; 


218 




f) Strategic Overview 
Economic Perspective 

The Garden Route DM is an important economic growth area for the Western Cape. It 
has an expanding population on account of immigration from other parts of the 
country, bringing a dynamic mix of skills and cultures to the district. The relatively high 
percentages of households with no income in areas with higher population density, 
creates several social challenges. The October and November 2018 disaster fires as 
well as the prevailing drought conditions will continue to cripple the local economy of 
the district. 

ii) Basic Services and Infrastructure 

Challenges in terms of the provision of basic services infrastructure are experienced at 
the local municipalities that have seen rapid population growth. The natural 
environment and its resources of the GRDM are sensitive and susceptible to 
overexploitation or inappropriate use. 

iii) Condition of Natural “Disaster Barriers” 

The Garden Route has largely intact wetlands which attenuate water; prevent erosion 
and flooding and which naturally purify the water. However, many wetlands are being 
slowly degraded through illegal channelling, the removal of reeds, peat and other 
water flora by transgressors who abstract water, mostly for agricultural purposes 

iv) Seasonal Climate Outlook 

In its Seasonal Climate Watch Report the South African Weather Service (SAWS), along 
with other international forecasting systems, predicted a very neutral El-Nino episode 
towards the summer season with the expectation to continue throughout the autumn 
season. This indicated that South Africa and especially the Northern parts of the 
Garden Route District could continue to experience extremely warm and dry 
conditions for the 2018/19 period. The SAWS also predicted high probabilities of below- 
normal rainfall from mid-summer, which was expected to continue into autumn with 
small chances of localized above-normal rainfall, they warned that “the condition 
could promote a regional or localized drought.” 


219 



v) District Council Commitment 

The Garden Route District Municipality Council recognises that if the objective of 
achieving sustainable development in Garden Route is to be realised, a concerted 
effort is required to reduce recurrent disaster risks in its area. 

This can only be achieved by: 

■ creating resilience amongst its people and its infrastructure; 

■ strengthening capacity to anticipate significant events and disasters; and 

■ improving the management of such events in order to limit the effects 
wherever possible. 

It also requires the development and implementation of appropriate disaster risk 
reduction (DRR) methodologies and the integration of such methodologies into 
development plans, programs and initiatives as well as the management of high risk 
developments. These DRR plans should be included into the IDP and SDF of each local 
authority with sustainable implementable projects and plans aligned to the budget. 
Extremely High Risks: 

Should the relative risk priority of a particular hazard event impacting on a community 
be rated as extremely high, that community faces a potentially destructive risk with a 
high probability of occurrence, for which they are unprepared. This combination 
equates to an extremely high risk and is a disaster in the making. For these extremely 
high risks you must prepare urgent risk reduction interventions. 

High Risks: 

If the relative risk priority of a particular hazard event impacting on a community is 
rated as high, the risks to which these communities are exposed are potentially 
destructive, but the community is modestly prepared for the hazard event 
occurrence. This combination equates to a high risk and you must prepare a 
combination of risk reduction interventions and preparedness plans for these risks. 
Tolerable Risks: 

If the relative risk priorities of a particular hazard event impacting on a community is 
rated as tolerable, it translates into an acceptable risk for a largely prepared 
community. This combination equates to a tolerable risk and you must prepare 
preparedness plans for these risks. 


220 



Low Risks: 

Relative risk priorities of a particular hazard event impacting on a community is rated 
as low risk, it translates into a very small risk for a largely prepared community. This 
combination equates to a low risk and any hazard preparedness plans are sufficient 
for these risks. 

■ Challenges identified at local municipal level 

■ Municipalities do have contingency plans, but these plans are not tested 
during annual table to exercises; 

■ Mass care facilities have been identified for some areas, but not for 
inhabitants in rural areas. The management of these facilities does not form 
part of current contingency plans; 

■ Municipalities lack a proper plan to oversee the receipt and storage of 
humanitarian relief donations; 

■ There is need for integrated planning with all spheres of government in terms 
of humanitarian aid management; 

■ A plan and monitoring tool needs to be developed to be used for registration 
of aid recipients and use this tool to prioritise aid as well as to manage 
distribution; 

■ Management of volunteers needs to be beefed-up; 

■ There is a total lack of SLA’s with identified aid organisations; 

■ The willingness of local authorities in the district to establish a multi-disciplinary 
one stop emergency call centre; 

■ The lack of disaster risk reduction projects listed as part of the local authority 
level IDP and included into multi -year budgets; 

ii) General challenges 

■ The absence at National, Provincial and Local level of a fund aimed specifically at reducing disaster 
risk; 

■ The Garden Route DMC do not have the capacity to deploy command staff to local municipalities 
during major incidents due to the lack of a motorised suitably equipped operational command vehicle; 

iii) Strategic Risk 

■ Insufficient funds to implement disaster risk reduction initiatives; 


221 



■ Lack of disaster management information management system; 

■ Lack of an integrated real time all Hazards as well as severe weather early 
warning system; 

■ Lack of engineering capacity to provide oversight in terms of regional water 
security, surface as well as ground water; 

iv) Coordination structure 

The Section consults regularly at various platforms with other government departments. 
The Municipality has a fully functional District Disaster Management Advisory Forum 
(DMAF) as well as a Safety and Security Cluster Joint Structure that meets on a 
quarterly basis, with B-Municipalities and other stakeholders. These meetings are 
followed up with quarterly attendance of both the Heads of Disaster Centre as well as 
the Provincial Advisory Forum meetings. At these meetings regional matters that could 
not be addressed at district level is escalated to provincial- as well as national 
governmental level. 


Frequent meetings are held with senior officials from the DSD, Water Affairs, DEA, 
Education and Training, Heath, Agriculture and Transport as well as NGO's including 
the Red Cross, Garden Route Initiative, SCLI etc. In addition to this local engagement 
with major role players i.e.:Airports Company South Africa (ACSA), PetroSA, Cape 
Nature, San Parks, SCFPA, the local industry i.e.Cape Pine, PG Bison etc. is held. 


The following table shows the various coordination structures: 


Forum name 

Terms of 

reference? 

Is forum 

active? 

Frequency of 
meetings 

Forum purpose 

Forum 

composition 

Forum 

chairperson 

DMAF 

Yes 

Yes 

Bi -annually 

Discuss 

regional 

disaster 

management 

issues 

Regional 

Garden 

Route 

Portfolio 

Chairperson 

Provincial 




Discuss 



Disaster 




provincial 


Plead of 

Centre 

Management 

Yes 

Yes 

Quarterly 

disaster 

Provincial 

Advisory Forum 




management 


(PDMAF) 




issues 



SAPS Cluster 

Joints 

Yes 

Yes 

Bi-monthly 

Discuss district 
safety and 
security 

Regional 

Maj. Gen. 
Reddy 


222 














Forum name 

Terms of 

reference? 

Is forum 

active? 

Frequency of 
meetings 

Forum purpose 

Forum 

composition 

Forum 

chairperson 





concerns 



Climate 

Change 

Adaptation 

Yes 

Yes 

Bi -annually 

Discuss district 

climate 

change 

adaptation 

matters 

Regional 

Head of 

Garden 

Route DMC 

SCLI 

Yes 

Yes 

Bi -annually 

Discuss invasive 
alien plant 
eradication 

Regional 

Kobus 

Meiring 

SCFPA 

Yes 

Yes 

Quarterly 

Discuss the roll 

out of fire 
protection 
associations, 
integrated fire 
management 
and proactive 
fire response 

Regional 

Paul Gerber 


Disaster Management Coordination Structures 


Disaster Management Coordination Structures 

Preparation and Regular Updating of Disaster Management Plans and 


Strategies by Municipal Organs of State Involved in Disaster Management 
The following table depicts the status quo of current plans for Garden Route District 
Municipality: 


Municipal Area 

Plan 

Last Updated 


Corporate Disaster Management Plan 

May 2018 


Winter Preparedness Plan 

March 2019 


State Funeral Plan 

June 2013 

GRDM 

Disaster Management Relief Protocol 

June 2018 

Master Evacuation Plan 

Dec 2018 


Load Shedding Contingency Plan 

March 2019 


Infectious Disease Contingency Plan 

March 2013 (Update in 

Process) 

Bitou 

Disaster Management Plan 

Jan 2018 (Update in Process) 

Knysna 

Disaster Management Plan 

May 2019 (Update in Process) 

George 

Disaster Management Plan 

May2019 (Update in Process) 


1. Disaster Management Plan (Annexure 

as part of DM Plan) 


Mossel Bay 

■ Contact Particulars 

Nov 2018 (Update in Process) 


■ Social Management Plan 



223 































■ Little Brak River Flood 

Contingency Plan 

■ Little Brak River Estuary 
Management Plan 

■ Great Brak River Flood 

Contingency Plan 

■ Great Brak River Estuary 

Management Plan 

■ Plartenbos River Estuary 
Management Plan 

■ Social Relief Policy 

■ Load Shedding Contingency 

Plan 

■ Communications Plan 

■ Water and Sanitation 

Contingency Plan 

■ Electrical Network Services 

Emergency 

■ and Operational Plan 

■ Streets and Storm Water 

Contingency Plan 

■ IT Data and 

Telecommunications Plan 

■ Event Management Plan 

■ Landslide Contingency Plan 

■ Voorbaai Joint Emergency 

Response Plan 


224 






■ Climate Change Sector plan 

■ Public Unrest Contingency Plan 


Hessequa 

Disaster Management Plan 

Oct 2017 (Update in process) 

Kannaland 

Disaster Management Plan 

Jul 2018 (Update in process) 


Disaster Management Plan 

Feb 2019 

Oudtshoorn 

KKNK Contingency Plan 

March 2019 


Meiringspoort Flood Contingency Plan 

March 2018 


Status quo of Disaster Management plans in the District 


Garden Route District Municipality Corporate Disaster Management Plan 


During this year each sector department at the Municipality started with the 
compilation of their departmental response/contingency plans. Once completed 
these plans will be added to the current district corporate Disaster Management Plan 
to be used as the District's comprehensive pro- as well as re-active disaster 
management plan. 


I) Service Statistics for Disaster Management Services 

The tables below indicate the services rendered by the Municipality: 


Call Answering Statistics - Garden Route District and Metro Emergency Medical Services 

Month 

Average Answering 
Speed 

Incoming Calls 

% Answered 

July 2018 

.9 sec 

24826 

89.70 

August 2018 

.8 sec 

21631 

91.94 

September 2018 

.7 sec 

23659 

94.82 

October 2018 

.8 sec 

22777 

85.23 

November 2018 

.8 sec 

24526 

90.79 

December 2018 

1.0 Sec 

28862 

87.51 

January 2019 

.9 sec 

22970 

88.52 

February 2019 

1.2 sec 

23484 

82.54 

March 2019 

1.0 sec 

24940 

88.06 

April 2019 

.9 sec 

21322 

89.58 

May 2019 

1.1 sec 

23116 

83.02 

June 2019 

.9 sec 

23448 

83.90 

Total 


Disaster Management Call Answering Statistics 


225 




























Emergency calls received 


Month 

Structure / 
Hazmat 

Fires 

Vehicle 

Accidents 

Special 

services 

Rescue 

Medical 10177 

July 2018 

0 

10 

2 

0 

0 

24 826 

August 2018 

4 

10 

4 

0 

1 

21 631 

September 2018 

2 

10 

5 

0 

1 

23 659 

October 2018 

2 

58 

6 

0 

0 

22 777 

November 2018 

2 

108 

5 

0 

0 

24 526 

December 2018 

1 

9 

3 

0 

0 

28 862 

January 2019 

2 

24 

4 

3 

0 

22 970 

February 2019 

1 

10 

4 

2 

0 

23 484 

March 2019 

6 

4 

4 

1 

0 

24 940 

April 2019 

2 

4 

2 

1 

0 

21 322 

May 2019 

3 

8 

9 

0 

0 

23 116 

June 2019 

2 

12 

4 

0 

0 

23 448 

Total 

27 

267 

52 

7 

2 

1. 561 


Emergency Calls Received 


Details of calls received 

2017/18 

2018/19 

Flooding 

None 

None 

Structure / Hazmat calls 

20 

27 

Fires calls 

155 

267 

Motor Vehicle Accidents calls 

42 

52 

Special services calls 

16 

7 

Rescue calls 

3 

2 

Medical calls 

266 046 

1. 8 


Disaster Management Services Data 


m) Employees - Disaster Management Services 

The table below indicates the number of staff employed by the unit: 



2017/18 

2018/19 

(T-grade) 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 


226 






































(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies (as 
a % of total 
posts) 


Number 

% 

0-3 

2 

0 

0 

0 

0 

4-6 

1 

2 

2 

0 

0 

7-9 

1 

4 

4 

0 

0 

10- 12 

0 

3 

1 

2 

66.67 

13- 15 

9 

1 

1 

0 

0 

16-18 

1 

1 

1 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

8 

11 

9 

2 

18.18 


Employees - Disaster Management Services 


n) Capital Expenditure - Disaster Management Services (Draft Information) 

The table below indicates the capital expenditure incurred by the unit 


Capital projects 


Conference Speaker / recording 
system with 12 mics 


2018/19 

Budget 

Adjustment 

budget 

Actual 

expenditure 


80 000 


80 000 


Variance from 
adjustment 
budget 


80 000 


Water Cooler/Dispensers 


5 000 


5 000 


4 087 


913 


Chairs 


12 000 


12 000 


11 406 


594 


Small fridge 


3 000 


3 000 


1 735 


1 265 


Kettle 


200 


100 200 


200 


100 200 


0 


17 228 


200 


82 972 


Capital Expenditure: Disaster Management 

3.12 COMPONENT G: CORPORATE POLICY OFFICES AND OTHER SERVICES 

3.12.1. EXECUTIVE AND COUNCIL 


a) Employees: Executive and Council 

The table below indicates the number of staff employed by the unit: 


Political employees 2017/18 2018/19 


227 


































Councillors 

35 

35 

Administrative staff (contract 
employees employed in the 
Office of the Executive 

Mayor) 

5 

6 


Employees: Executive and Council 


b) Capital Expenditure - Executive and Council (Draft Information) 

The table below indicates the capital expenditure incurred by the unit 



2017/18 

Capital projects 

Budget 

Adjustment 

budget 

Actual 

expenditure 

Variance 

from 

adjustment 

budget 

(R) 

Office Chair 

0 

6 000 

3 301 

2 699 

Office Chair 

10 000 

9 000 

2 892 

6 108 

Aluminium Tables 

0 

10 000 

9 600 

400 

Two Visitors chairs - PA of 
the Deputy Mayor 

10 000 

10 000 

3 458 

6 542 

Total 

20 000 

35 000 

19 251 

15 749 


Capital Expenditure: Executive and Council 

3.12.2FINANCIAL SERVICES 


a) Introduction to Financial Services 

1. Financial Services 2018/19 priorities: 

■ Cash backed credible budget presented to council for approval by end of May. 

■ Timeously submission of all required reports by prescribed due date. 

■ Timeously submission of GRAP compliant annual financial statements by 31 August. 

■ Submission of draft financial statements to the internal audit unit and the audit 
committee for review by 26 August. 

■ Implementation of the credit control and debt management policy to ensure debt is 
recovered. 


228 




















■ Review of all debtors to ensure correct billings are raised and receipts are correctly 
allocated to ensure correct balances. 

■ Revision of the SCM policy and implementation thereof. 

■ Review of all current finance policies. 

■ Compilation of new policies not yet in place and presented to council for approval. 

■ Review of electronic SCM and contract management system to eliminate irregular 
expenditure as identified by the Auditor-General and ensure all relevant SCM 
procedures are followed. This is the responsibility of all personnel involved in the 
procurement of goods and services, starting with the user department. 

■ Workshops by SCM to familiarize all involved of the correct processes and procedures 
to follow to ensure adherence to the SCM Policy and SCM Regulations. 

■ Creditors paid within 30 days after receipt of invoice/statements as required by the 
MFMA. 

■ Optimal interest generated on investments. 

■ Salary payments by the 25th of each month. 

■ Adequate asset management. 

■ Safeguarding of assets by all personnel. 

■ Ensure GRAP compliant Fixed Asset Register are maintained. 

■ Ensure compliance to GRAP requirements/standards with regards to assets. 

■ Annual asset count to ensure all assets is physically verified annually. 

■ Ensuring the safeguarding of inventory/stock items. 

■ Ensure minimum stock levels are maintained for service delivery. 

■ Revision of cash management processes and procedures. 

■ Ensure cash received are correctly captured onto the system. 

■ Safeguarding of cash 

■ Timeously deposit of cash receipts. 

■ Reconciliations of cash received. 

■ Support services rendered to the other departments. 

■ Workshops/training provided to other departments as requests are received. 

■ Implementation of mSCOA 


229 




b) Highlights: Financial Services 

The following highlights were achieved during the financial year: 


Highlights 


Unqualified audit opinion with findings from AGSA for 2017/18 statutory audit 
Overall assessment on financial viability improved from “concerning” to “good” as per 
AGSA Management Report issued on 30 November 2018 

Continued progress in implementation and operation of new financial system that was 
implemented to comply to mSCOA regulations 

Successful restructuring of Finance Department for increased capacity and working 
towards decrease in dependency on the use of consultants 

Actuals vs Budget for revenue, operational and capital expenditure exceeded 90% 
Deviations reported in 2018/19 is half of deviations reported in previous two financial 
years. 

Financial Services highlights 


c) Challenges: Financial Services 

The table below indicates the challenges faced during the financial year: 


Challenge 

Actions to address 

Long term financial sustainability 

■ Revenue enhancement strategy 

and implementation plan 

■ Additional funding sources 

■ Review investment strategy 


■ Skills assessment in department 


■ Update of PDP (assistance from FIR) 

Fully capacitated and motivated 
workforce 

■ Training 

■ Regular strategic engagements / 

consultations 

■ Show appreciation towards staff 

■ Utilisation of WC FMG funding 

Efficient/effective SCM turnaround time 
for procurement 

Departmental planning and ownership of 
procurement plans by FIODs 

Continued mSCOA system 

Engagement with service provider re 


230 




















Challenge 


Actions to address 


implementation challenges 


system improvements/ developments and 
training to all staff on functionalities of new 
system 


Financial Services challenges 


d) Employees: Financial Services 

The table below indicates the number of staff employed by the Unit: 


(T-grade) 

2017/18 

Employees 

Posts 

2018/19 

Vacancies 

Employees (fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

4 

1 

1 

0 

0 

7-9 

15 

11 

11 

1 

9.09 

10-12 

13 

11 

11 

5 

45.45 

13-15 

3 

2 

2 

0 

0 

16-18 

0 

1 

1 

0 

0 

19-20 

1 

1 

1 

0 

0 

Total 

36 

27 

27 

6 

22.22 


Employees: Financial Services 


■ Capital Expenditure: Financial Services (Draft Information) 



2018/19 

Capital projects 

Budget 

Adjustment 

budget 

Actual 

expenditure 

Variance 

from 

adjustment 

budget 

(R) 

Chairs 

37 000 

37 000 

26 006 

10 994 

Desks 

5 000 

5 000 

3 865 

1 135 

Total 

42 000 

42 000 

29 871 

12 129 


Capital Expenditure: Financial Services 


231 





































3.12.3HUMAN RESOURCES 


a) Introduction to Human Resources (HR) 

Introduction to Human Resources (HR) 

The HR section delivers a support service to the other departments in the organisation. 
Its primary function is to co-ordinate all HR activities to achieve the Municipality's 
objectives of service delivery and to adhere to legislative requirements which will 
enhance staff performance and play a fundamental role within the District 
Municipality. 

The HR Unit strives to: 

■ Empower employees towards maximizing their personal potential and deliver 
on and exceed organisational requirements; 

■ Continuously align the HR Strategy and the IDP, legislative requirements and 
best practices in HR fields; 

■ Promote and practice “Putting people first” equity, fairness, objectivity and 
consistency; 

■ Committed to professional conduct; and 

■ Develop and adopt appropriate systems and procedures to ensure fair, 
efficient, effective and transparent personnel administration. 

1. The HR Unit consists of the following disciplines: 

■ Learning and Development, Employment Equity and Employee Wellness 

■ Employee Relations (Labour Relations) 

■ Recruitment and Selection and Contract Administration 

■ Occupational Health and Safety (OHS) 

■ Reward and Recognition, Leave, Claims and Conditions of Service 


■ Task District Unit 

b) Highlights: HR 

The following highlights were achieved during the financial year: 


Highlight 

Description 

Skills Summit 

Skills Summit was held on 7 February 2019 in Still Bay. 
The event was a great success 


232 









Highlight 

Description 

External and internal bursary 

Successful allocation of internal and external 
bursary 

Expenditure on training Votes 

The prescribed percentage on the expenditure on 
the training votes was achieved 

Annual Training Plan 

Successful implementing of annual Training Plan 

Work Place Skills Plan 

Successful submission 30 April 2019 

Employment Equity Plan 

Successful submission and implementation of the 
Employment Equity Plan 

Driver's license project 

Successful implementation of the driver’s license 
project for unemployed youth 

Youth Summit 

Implementation of Youth Summit 

CANSA Relay 

Raising money for the George CANSA office and 
creating cancer awareness 

No Tobacco Day 

Awareness on Smoking 

Employee Wellness Day 

Focus on healthy living by getting more information 
regarding your physical & financial condition 

Policies and Standard Operating Procedures 
(SOP's) 

Amendment of policies and development of SOP’s 

Appointments 

That all the appointments made in the last financial 
year have been within the EE Targets 

Recruitment and Selection Policy 

The review and approval of the Recruitment and 
Selection Policy 


HR Highlights 


c) Challenges: HR 

The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Lack of Funding for skills Mecca Implementation 

Appointment of the Project Manager for skills 

Mecca to fast track the implementations of the 
resolutions taken from the Skills Summit 


HR Challenges 


d) Labour Relations Statistics 

The table below indicates the labour relations activities throughout the financial year: 



Number 

Description 

2017/18 

2018/19 

Cases 

57 

46 

Terminations 

4 

3 


233 































Counselling sessions 

15 

4 

Disputes 

6 

5 

Incapacities 

6 

6 

Grievances 

26 

22 

Suspensions 

1 

6 


Labour Relations Statistics 


e) Employees: HR 

The table below indicates the number of staff employed by the Unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

2 

0 

7-9 

5 

5 

5 

1 

20 

10-12 

9 

6 

6 

2 

33.33 

13-15 

0 

3 

3 

0 

0 

16-18 

1 

1 

1 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

15 

15 

15 

5 

33.33 


Table 1: Employees: HR 


f) Capital Expenditure: HR (Draft Information) 


The table below indicates the capital expenditure incurred by the unit: 




2018/19 


Capital projects 

Budget 

Adjustment 

Actual 

Variance 

from 


budget 

expenditure 

adjustment 

budget 


Office Chairs 





(Recruitment and 
Selection) 

10 000 

10 000 

6 846 

3 154 


234 


































Capital Expenditure: HR 


3.12.4 INFORMATION AND COMMUNICATION TECHNOLOGY (ICT) 

SERVICES 

The GRDM ICT Function is currently serving 250 (ICT-related) users with computer and 
network services within the District Municipality. 

Our coverage area consists of Garden Route District Municipality Head Office, Roads, 
Health Environment, Fire stations in George, Disaster Management, Remote Offices, 
Calitzdorp Spa, De Hoek Resort, Swartvlei and Kraaibosch. We are directly involved 
with the local municipalities in our region with regards to shared services offer and in 
fulfilling our constitutional mandate. 

The ICT Unit actively serves as members on the following forums: 

■ Western Cape ICT Forum 

■ Garden Route regional ICT Forum 

■ Garden Route ICT Steering Committee 

■ South African Geomatics Council 

■ Western Cape Spatial Information Forum 


■ Garden Route regional GIS discussion groups 

a) Highlights: ICT Services 

The following highlights were achieved during the financial year: 


Highlights 

Description 

Hosting regional ICT Forums 

The GRDM host's and coordinates regional 
ICT Forums with great success 

Introducing Paperless Agendas 

Council adopted a paperless environment. 
Tablets were provided and the project 
proofed to be a great success 

Hosting GIS regional Forums 

The GRDM host's and coordinates regional 
GIS Forums with great success 

Provincial Broadband installed 

successfully 

Fibre connection provided, and installed 
successfully 


235 





















Highlights 


Description 


Council Resolution Register 

As per request from Councillors a 
Resolution register was provided on the 
Collaborator system 

Developing GIS Web Viewer for GRDM 
spatial data. 

■ Integration of spatial data with 

reporting data used by the 

Environmental Health Section of 

GRDM. 

■ Spatial viewer developed for 

council owned properties 

■ Spatial viewer developed for 

Disaster Management functions of 

GRDM 

Organigram , Delegation Register on 
Collaborator 

Organogram, Delegations Register 

modules successfully implemented on the 
Collaborator system 

Time and Attendance with Access 
Control 

In the process of implementation of time 
and attendance system linked to HR 
modules 

Table 2: 

ICT Service Highlights 


b) Challenges: ICT Services 

The table below indicates the challenges faced during the financial year: 


Description Actions to address 


Description 

Actions to address 

Late submission of reports, still a 
challenge 

Training of staff and Councillors will be on 
an ongoing basis 

Resolution register will only work if 
resolutions and actions are kept 
updated 

Investigate the possibility of populating the 
Resolution in real time 

Data cleansing needs to be done 

■ Data cleansing to be done by 31 

August 2019 

■ ICT Section to liaise and assist 

■ Implementation continuous with 


236 

















Description 


Actions to address 



current data 

Integration between Systems 

Data cleansing to be done. Human 

Recourses section tasked with the process, 

but the lack of resources is hampering the 

process 


ICT Service Challenges 


c) Service Statistics - ICT Services 

The table below indicates the services rendered by the Unit: 


Details 

2017/18 

2018/19 

% of software licensed 

100 

100 

% of back-ups done 

100 

100 

% of viruses attended to 

100 

100 

% of network downtime 

0.08 

0.12 

% of queries resolved with 
guidelines of the policy 

87 

92 


Service Data for ICT Services 


d) Employees: ICT Services 

The table below indicates the number of staff employed by the Unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

0 

0 

7-9 

0 

1 

1 

0 

0 

10-12 

6 

4 

4 

0 

0 

13-15 

3 

3 

3 

0 

0 

16-18 

0 

0 

0 

0 

0 


237 
































(T-grade) 


2017/18 


2018/19 



3.12.5 LEGAL SERVICES 

a) Introduction to Legal Services 

The Legal Services Unit consists of four (4) employees. 

Legal Services assist Council and the administration with legal opinions, commenting 
on policies, review and/or comments on new and amended legislation, 
proclamations, compliance issues, vetting and drafting of contracts and ensure 
litigation matters are instituted and/or defended to prevent costs being incurred for or 
against the Municipality. We also provide training on the drafting of policies and 
contract management. 


b) Highlights: Legal Services 

The following highlights were achieved during the financial year: 


Highlights 

Description 

SODA 

Involved with hosting in the first successful 
State of the District Address (SODA) 

Good Governance Summit 

Assisted with the first Good Governance 

Summit, in consultation with SALGA for the 

Garden Route District 

Contract with French Government 

Assisted in drafting the contract with the 
French Government for funding 

SOP's 

Assisted with the review and/or drafting of 
SOP's for the administration 

Anti-Fraud Hotline 

Establishment of an Anti-Fraud Hotline 

Facilitated investment into the region 

Negotiated and drafted contracts with 
investors stemming from the Investment 
Conference (Ikusasa and Mamoukwe) 


Legal Services Highlights 


238 























c) Challenges: Legal Services 

The Municipality faces the following challenge to address in the new financial year: 


Description 

Actions to address 

Training 

More training/workshop sessions will be held with the 
administration on contract management, PAIA and 
consequence management 

Disciplinary Hearings 

Staff will be equipped to act as 

chairpersons/initiators to assist with disciplinary 
hearings not only for this Municipality, but also 
requests received from other municipalities 

Policy review/SOP's 

SOP's for each department must be reviewed and 
drafted where none are existing. Policies must also 
be reviewed to be in line with the latest legislative 
developments 

Rules of Order 

New Rules of Order to be workshopped - current 
Rules are dated 2008 


Legal Services Challenge 


d) Employees: Legal Services 

The table below indicates the number of staff employed by the Unit: 


(T-grade) 

2017/18 

Employees 

Posts 

2018/19 

Vacancies 

Employees (fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

0 

0 

7-9 

1 

1 

1 

0 

0 

10-12 

0 

0 

0 

0 

0 

13-15 

0 

0 

0 

0 

0 

16-18 

1 

2 

2 

0 

0 

19-20 

0 

0 

0 

0 

0 

Total 

2 

3 

3 

0 

0 


Employees: Legal Services 


239 



























3.12.6 


PROPERTY SERVICES 


a) Introduction to Property Services 

Garden Route District Municipality was established on the 22nd of September 2000 in 
terms of the Municipal Structures Act, 1998 ( Act 117 of 1998 ) as per Public Notice P.N. 
497 / 2000 and simultaneously became the legal successor in title of the following 
municipalities which were simultaneously disestablished, namely: Bo-Langkloof 
Transitional Representative Council, Haarlem Transitional Local Council, Klein Karoo 
District Council, South Cape District Council, Uniondale Transitional Council and 
Uniondale Transitional Representative Council. 

The Council Property Portfolio has been brought about after the realisation of the 
necessity of a structured database, implementation plans and policy to deal with the 
immoveable assets of Council. Most of the properties in the portfolio were mainly 
carried over from the former historical local government structures. The existing 
property database includes properties of the following nature, namely: agriculture, 
residential, road reserves, conservation, resorts, mountain areas, estuaries, institutions, 
offices, waste and sewage works, depots and open spaces. The MFMA provides 
guidelines to all spheres of government to effectively manage their financial affairs. 
Section 122(1) of the MFMA refers specifically to financial statements and stipulates 
that every municipality must for each financial year prepare annual financial 
statements. These statements reflect the revenue and expenditure status of Council. 
The principle of reporting on the financial position of a municipality should underlie the 
preparation and presentation of financial statements that are required to give a true 
and fair reflection of the financial position and performance of a municipality. The 
political change that came about with the amendment of the local government 
system was due to the local municipal elections of May 2011. The amendment of local 
government structures resulted in the loss of rates and taxes as a source of revenue for 
the District Municipality. The Municipality is, since May 2011, fully dependent on funding 
from National and Provincial Treasury (grants and equitable share). 


240 



The District Municipality, as property owner of a comprehensive immovable asset 
portfolio, can generate additional revenue, through the selective disposal, 
development and/or short, medium and long term leasing of Council properties. 
Various options are available to Council to manage the immovable asset portfolio 
which include the following: 

■ Retain the present situation (maintain the status quo) 

■ Enter into short-term lease agreements 

■ Enter into medium lease agreements 

■ Enter into long-term lease agreements 

■ Disposal of certain non-strategic land 

■ Enter into a private-public partnership agreements 


b) Highlights: Property Services 

The following highlights were achieved during the financial year: 


Highlights 

Description 

Long term lease Regional Landfill site: 
Ikusasa 

Construction of a chemical manufacturing 
plant, storage and distribution hub 

Long term lease Regional Landfill site: 
Moumakoe (Pty) Ltd 

Construction of a petroleum product 
storage facility 

Valuation of Council owned erven 

Market related valuations and 

determination of market related leases 

Registration of water rights on 
applicable Council properties 

Registered water rights will increase the 
value of the applicable Council properties 

Memorandum of agreement with 
Department of Agriculture 

Agricultural opportunities to historically 
disadvantaged individuals on applicable 
Council properties 


Property Services Highlights 


d) Challenges: Property Services 

The table below indicates the challenges faced during the financial year: 


241 












Description 


Action to address 


Legal eviction processes on applicable 
Council properties 

Legal processes managed by Legal Section 

Obtaining National approval to enter 
into long term lease agreements 

Following due processes on any 
developmental projects and long term 
lease processes 


Property Services Challenges 


3.12.7 PROCUREMENT SERVICES 

a) Introduction to Procurement Services 

Supply Chain Management in the Public Sector continues to draw much interest and 
attention from all stake holders in the country. Current media attention of high-profile 
matters relating to procurement within public sector space has also cast much dark 
cloud within the Supply Chain Management space. There are lessons to learn on all 
fronts but more so for those directly involved in Supply Chain Management process as 
such we continue to watch closely as the events unfold. 

As the amended Public Audit Act came into effect, we are keen to see the impact on 
general attitude to procurement as the focus becomes on consequence 
management. The amended act will have various implications to all those involved in 
decision making and execution, and from a positive outlook we trust that it will mean 
greater awareness and increased maturity to the organisation in supply chain 
management and better planning will take effect. 

Promulgation of new regulations specifically, Cost Containment Regulations, could 
possibly have a significant impact on the Supply Chain Management processes. As we 
see the tightening of regulatory and compliance environment, we could only hope for 
a positive change within organisation on attitude towards Supply Chain Management. 

Council and the Accounting Officer have been consistent in maintaining keen interest 
in good governance especially with particular focus on supply chain management. 
Some of the key outcomes to this concerted effort is seen in a near 50% reduction in 


242 








Deviations as a result of conscious Executive oversight on proper implementation of 
procurement 


b) Central Supplier Database (CSD) 

Council fully adopted the use of CSD as at the 1 July 2017, in line with the Circular as 
published by the National Treasury. CSD is a national supplier database managed by 
National Treasury, where all potential suppliers are registered and vetted and given 
the green card to do business with any of the government spheres or government 
entities. CSD is a one stop shop for prospective suppliers of goods and services where 
they register once and are not required to register anywhere else in comparison to the 
past where they had to register with each government institution with which they 
wished to render their services to. 


Garden Route District Municipality advertises our tenders both formal quotes and 
informal on the e-tender thus widening our reach to as wide and as tar as possible. E- 
tender is the electronic version of government bulletin that is linked to CSD. The 
expansion with CSD has been in leaps and bounds and reducing the red tape and 
cost drastically for those entities looking to render services or sell goods to government. 
Therefore, the Municipality will continue to encourage prospective suppliers of goods 
and services to register on CSD if they are to enjoy the potential of transacting with 
government. 


c) Summary of BB-EEE companies differentiating between capital, non-capital 
items for formal tenders 

i) Capital projects with value exceeding one million rand: 

The following table indicates the number of tenders awarded exceeding R 1 million: 


Type 

Total 

number of 
tenderers 
awarded for 
the year 

Total number of 
companies with 
BB-EEE 

certificates to 
whom tenders 
was awarded 

Total number of 
companies 
without bee 
certificates to 
whom tenders 
were awarded 

Percentage of 
bee certified 
companies 


243 



to 


Formal: 

Garden Route 

3 

2 

1 

67% 

Formal: Roads 

0 

0 

0 

0 

Section 32 
applications 

0 

0 

0 

0 

Capital projects consist of all capital related items 


Capital Projects with Value Exceeding One Million Rand 


ii) Non-capital projects with value exceeding one million rand 

The table below indicates non-capital projects awarded: 


Type 

Total number 
of tenderers 
awarded for 
the year 

Total number of 
companies with 
BB-EEE 

certificates to 
whom tenders 
was awarded 

Total number of 
companies 
without bee 
certificates to 
whom tenders 
were awarded to 

Percentage of 
BEE certified 
companies 

Formal: 

Garden Route 

13 

12 

1 

92% 

Formal: Roads 

2 

2 

0 

100% 

S32 

applications 

0 

0 

0 

0% 

Non-capital refers to all service providers and small quotations for all goods and 
services procured other than non-capital 


Non-Capital Projects with Value Exceeding One Million Rand 


iii) Capital projects with value less than one million rand: 

The table below indicates capital projects awarded for less that R 1 million. 


Type 

Total number 
of tenderers 
awarded for 
the year 

Total number of 
companies with 
BB-EEE 

certificates to 
whom tenders 
was awarded 

Total number of 
companies 
without bee 
certificates to 
whom tenders 
were awarded to 

Percentage of 
BEE certified 
companies 

Formal: 

Garden Route 

4 

3 

1 

0 

Formal: Roads 

0 

0 

0 

0% 

Informal: 

Garden Route 

3 

2 

1 

67% 


244 


































Type 

Total number 
of tenderers 
awarded for 
the year 

Total number of 
companies with 
BB-EEE 

certificates to 
whom tenders 
was awarded 

Total number of 
companies 
without bee 
certificates to 
whom tenders 
were awarded to 

Percentage of 
BEE certified 
companies 

Informal: 

Roads 

0 

0 

0 

0% 

Quotations 

0 

0 

0 

0% 

Section 32 
applications 

0 

0 

0 

0% 

Capital projects consist of all capital related items 


Capital Projects with Value less than One Million Rand 


iv) Non-capital projects (regardless of value): 

The table below indicates the awarding of all tenders for non-capital projects: 


Type 

Total number of 
tenderers 
awarded for the 
year 

Total number of 
companies with BB- 
EEE certificates to 
whom tenders was 
awarded 

Total number of 
companies without 
bee certificates to 
whom tenders were 
awarded to 

Percentage of 
BEE certified 
companies 

Formal: Garden 
Route 

20 

19 

1 

95% 

Formal: Roads 

6 

6 

0 

100% 

Informal: Garden 
Route 

21 

20 

1 

95% 

Informal: Roads 

9 

8 

1 

89% 

Quotations 

9 343 

n/a 

n/a 

n/a 

Section 32 
applications 

7 

7 

0 

100% 

Non-capital refers to all service providers and small quotations for all goods and services procured other 

than non-capital 


Non- Capital Projects (Regardless of Value) 


d) Annual Deviations (Draft Information) 

The table below shows the summary of deviations for the 2018/19 and 2017/18 
financial years: 


Annual deviation 

Department 

Annual deviations 
2018/19 

Annual deviations 
2017/18 

Change in 
percentages 

Community 

7 790 668 

8 060 687 

-3.35 


245 


































Annual deviation 


Department 

Annual deviations 
2018/19 

Annual deviations 
2017/18 

Change in 
percentages 

Services 




Corporate Services 

565 947 

4 865 659 

-88 

Financial Services 

152 262 

281 961 

-46 

Planning and 

Economic 

Development 

672 813 

120 433 

459 

Roads and 

Transport Services 

3 433 3852 

8 188 182 

-58 

Office of the 

Municipal Manager 

203 251 

1 324 751 

-85 

Total 

12 818 294 

22 841 673 

-44 


Annual Deviations 


e) Highlights: Procurement Services 


The following highlights were achieved during the financial year: 


Highlights 

Description 

Significant reduction in overall 
organisational deviations from Supply 
Chain Management Policy of the 
organisation due to a drive by the 

Office of the Municipal Manager to put 
stricter internal controls in place with 
regards procurement processes 

Deviations were reduced by an overall 43% 
in total from prior financial year, from R 

22 841 673 to R 12 818 294. A good 
percentage of the current year's deviations 
was mainly due to unfortunate catastrophic 
fire event that took place in the region 

Organisational Maturity level with 
regards to Supply Chain Management 
has increased, far much greater 
awareness of regulatory requirement in 
the environment 

Office of the Municipal Manager has placed 
far much emphasis on Demand 

Management as such use of procurement 
plans to execute the budget 

Greater capacitation for Supply Chain 
Management through various 
appointments to the unit to ensure 
greater internal control process 

2 additional buyers were appointed at 
stores, a procurement administration officer 


Procurement Services Highlights 


246 






















f) Challenges: Procurement Services 


The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Supply Chain Management is a 
complex and highly regulated 
environment that's continuously 
evolving. It is an exceptional area of 
interest to a number of stake holders 

and that is due to the nature of the risk 
profile associated with it 

Continuous learning and capacitation of the 
unit, organisation and various committees 
and the organisation especially on new or 
amended regulations. Greater 
organisational awareness and compliance 
to procurement processes and guard the 
organisation against risk of irregular 
expenditure due to no compliance 


Procurement Services Challenges 


6 . The Way Forward 

Section 217 of the Constitution of the Republic of South Africa, 1996, states When an 
organ of state in the national, provincial or local sphere of government, or any other 
institution identified in national legislation, contracts for goods and services, it must do 
so in accordance with a system which is fair, equitable, transparent, competitive and 
cost effective. Subsection 1 does not prevent the organs of state or institutions referred 
to in that subsection from implementing a procurement policy providing for, 
categories of preference in all allocation of contracts and the protection of 
advancement of persons, or categories of persons, disadvantaged by unfair 
discrimination. 

The adoption of the Preferential Procurement Policy by Council will give new meaning 
to implementation of Section 217(2) of the Constitution of the Republic of South Africa, 
Subsection (1) does not prevent the organs of state or institutions referred to in that 
subsection from implementing a procurement policy providing for- 

■ Categories of preference in allocation of contracts; and 

■ The protection or advancement of persons, or categories of persons, 
disadvantaged by unfair discrimination. 

Adoption of the Preferential Procurement Policy by Council is intended to assist council 
in realising its mission of: 


247 







■ unlocking resources for equitable, prosperous and sustainable development; 
and 

■ provide strategic leadership towards inclusive / radical / rigorous socio¬ 
economic transformation to address social, economic and spatial injustice. 

Implementation process will require a close working relationship between SMC Unit, 
Local Economic Development Unit and Extended Public Works Programme Unit 
(EPWP). The focus into the 2018/19 financial year will require active participation by the 
units involved to ensure council realises its objectives. 


3.12.8 SHARED SERVICES 

a) Introduction to Shared Services 

The promotion of shared services falls under the Support Services Department, 
although initiatives may reside within other departments as well. The Shared Services 
Unit constitutes the provision or sharing of services to local municipalities in the region. 
The Garden Route District Municipality Shared Services Forums is operating effectively 
and there are several services currently being shared in the district namely; GIS, Call 
Centre, TASK job evaluations and the Anti-Fraud Plotline. 

3.12.9 INTERNAL AUDIT 

a) Introduction to Internal Audit 

Section 165 of the MFMA prescribes that each municipality must have an internal audit 
unit. The District's Internal Audit Charter defines the service and function as follows: 
Internal Audit is an independent, objective assurance and consulting activity designed 
to add value and improve Garden Route District Municipality’s operations. It helps 
Garden Route District Municipality to accomplish its objectives by bringing a 
systematic , disciplined approach to evaluate and improve the effectiveness of risk 
management , control and governance processes. 

The Internal Audit unit is responsible for the following: 


248 



■ Develop a Risk-Based Audit Plan (RBAP), incorporating any risks or control concerns 
identified by management and submit the plan to the Audit and Performance Audit 
Committee (APAC) for review and approval. 

■ Implement the annual internal audit plan, as approved covering Section 165(2) of the 
Municipal Finance Management Act (MFMA) and, as appropriate, any special tasks 
or projects requested by management and the APAC. 

■ Advising the Municipal Manager and report to the APAC on the implementation of 
the internal audit plan and matters relating to: 

> Internal audit 

> Internal controls 

> Accounting procedures and practices 

> Risk and risk management 

> Performance management 

> Loss control 

> Compliance with the MFMA, the annual Division of Revenue Act and any 
other applicable legislation 

> Performing any other such duties as may be assigned to the unit by the Municipal 
Manager. 

b) Role of Internal Audit 

■ Assist the Municipal Manager and Council to meet their objectives and to discharge 
their responsibilities by providing an independent evaluation of the adequacy and 
effectiveness of the Municipality’s network of risk management, control and 
governance processes; 

■ Establish policies and procedures to guide the Internal Audit Unit and direct its 
administrative functions; 

■ Implement the approved risk-based audit plan, covering section 165(2) of the MFMA 
and, as appropriate, any special tasks or projects requested by management and the 
Audit and Performance Audit Committee; 

■ Establish policies and procedures to guide the Internal Audit Unit and direct its 
administrative functions; 

■ Maintain a professional audit staff with sufficient knowledge, skills, experience and 
professional certifications to meet the requirements of this charter (refer standard 1200 
of the International Standards for the Professional Practice of Internal Auditing); 


249 



■ Develop and implement a Quality Assurance Improvement Program (QAIP) designed 
by the Chief Audit Executive to provide reasonable assurance to the various 
stakeholders regarding the operations of the Internal Audit Unit (refer standard 1300 of 
the International Standards for the Professional Practice of Internal Auditing); 

■ Perform consulting services, beyond internal auditing assurance services, to assist 
management in meeting its objectives. Examples include advisory services on the 
implementation of mSCOA, as well as training as and when required. Informal 
consulting engagements include routine activities such as participating in Council 
and Management meetings, ad-hoc meetings and routine information exchange 
(refer standard 1100 of the International Standards for the Professional Practice of 
Internal Auditing); 

■ Monitor the implementation of action plans to address Auditor-General findings and 
report progress to management and the Audit and Performance Audit Committee 
(APAC); and 

■ Issue at least quarterly reports to the APAC and management, summarising results of 
audit activities and reporting on progress on the annual risk-based audit plan. 

c) Service statistics; Internal Audit 


Internal audit procedures were performed based on the 2018/19 RBAP on the 
following areas and the following number of findings listed for each audit performed; 


Area of review 



Findings 



Critical 

Significant 

Housekeeping 

Total 

Performance 

(Ql) 

Management 

0 

0 

0 

0 

Performance 

(Q2) 

Management 

0 

3 

0 

3 

Performance 

(Q3) 

Management 

0 

3 

0 

3 

Performance 

(Q4) 

Management 

In progress 

Information 

Communication 

(ICT) 

and 

Technology 

0 

11 

0 

11 

Overtime, Standby and Acting 
Allowance 

0 

13 

0 

13 

Grants 

In progress 





250 



















Area of review 

Findings 

Critical 

Significant 

Housekeeping 

Total 

Risk Management 

0 

10 

0 

10 

Occupational Health and 
Safety 

0 

12 

0 

12 

Inventory and Store 

Management 

In progress 





Service statistics: Internal Audit 


The IA unit also completed a number of investigations and consulting assignments - 
the more significant ones are listed below: 

2. OPCAR 201 7/18 

3. Internal and External Bursaries 

4. 2016/17 and 2017/18 Irregular Expenditure review 

5. 2016/17 and 2017/18 Unauthorised Expenditure review 

6. 2016/17 and 2017/18 Fruitless and Wasteful Expenditure review 

d) Assistance to local municipalities 

Garden Route DM's Internal Audit Unit is chairing the Regional Chief Audit Executive 
Forum. The purpose of the forum is to engage on challenges and other matters 
relating to internal audit, this platform also serves to discuss issues raised in the 
Provincial Chief Audit Executive for further deliberations. 

The forum is also serving to identify areas where support might be required, GRDM 
provided training through a service provider to Bitou and Oudtshoorn Municipality on 
the automated Audit Software. 

Garden Route DM's Internal Audit Unit has also been involved in the project of 
implementing a turnaround strategy to assist Kannaland Municipality that is under 
Provincial administration. 

e) Highlights: Internal Audit 

Key projects that were achieved during the financial year: 


Project name Description Duration / When 


251 














Project name 


Description 


Duration / When 


Development and 

execution of the 

RBAP 

APAC approved the risk-based audit plan 

for the financial year for execution by the 

internal audit department 

2018/19 

Development of 

the Internal Audit 

Methodology 

APAC approved the new Internal Audit 

Methodology that provides guidance on 

the key phases and activities applied in an 

internal audit engagement to ensure 

consistency in the delivery of internal audit 

services 

June 2019 

BarnOwl Internal 

Audit Software 

We successfully procured an internal audit 

software through a Tender Process; the 

successful bidder was BarnOwl. The 

intention is to go live on 1 August 2019 

May/June 2019 

Annual stock-take 

on behalf of the 

AGSA 

At year-end, the Internal Audit Unit 

conducted stock counts at selected 

Council stores and fuel depos across the 

District on behalf of the Auditor General 

South Africa 

2018/19 

Continuous 

training of IA 

Officials 

■ In order to ensure best quality of 

internal audit services, officials in the 

unit attend appropriate training 

programs 

■ 2 officials completed the 

Professional Internal Auditor (PIA) 

course presented by NASA - final 

exams due in August 2019 

■ 1 official completed 7 out of 8 

modules for the Internal Audit 

2018/19 


252 












Project name 

Description 

Duration / When 


Technician (IAT) course by NASA - 

final assessment due in October 

2019 


Celebrating 

Internal Audit 

Month 

The month of May is the International 

Internal Auditors Month; the GRDM's 

Internal Audit unit wrote an article in 

celebrating of this event, which received a 

lot of positive response from a number of 

people 

May 2019 


Internal Audit Highlights 


■ Challenges: Internal Audit 


The table below indicates the challenges faced during the financial year: 


Description 

Actions to address 

Funding for External Quality Assessment 

Provincial Treasury is in process of 

negotiating an affordable price with 

suppliers to assist the municipalities in the 

Western Cape to perform the requested 

external quality assessment (once every 

five years) 

Capacity constraints after CAE was 

appointed as CFO 

Recruitment is in process to appoint a 

new CAE and to appoint an intern in the 

Internal Audit Unit for a duration of 3 years 


Internal Audit Challenges 


The Infernal Audit Unit is striving to cover the full mandate of the Internal Audit Charter 
within the Municipality by ensuring that the unit is providing an independent, objective 
assurance and consulting service beyond internal auditing assurance service, to assist 
Management in meeting its objectives that is designed to add value and improve the 
Municipality's operations. 


253 















The annual risk-based audit plan (RBAP) as approved by the APAC is an extensive plan 
that covers all areas of the Municipality, focusing on areas with higher risks as identified 
by management and recorded in the Municipality's risk register. Over and above the 
approved plan, the IA unit is regularly approached by management to assist in other 
areas (investigations, reviews, consulting assignments) but cannot always assist due to 
capacity constraints. 

To address the above. Council approved a R200,000 budget to buy in external 
services to assist in cases where resources in the unit itself are unable to cover 
additional work/assignments. 

The Internal Audit Unit currently utilised Microsoft Office to perform all functions when 
executing the RBAP, including audit planning, execution of fieldwork (including 
sampling and analysis), through to the draft and final reporting phase. There are 
systems available in the market to assist in completing and reporting on audit reviews 
in a more time-efficient manner whilst increasing sample sizes and coverage when 
compared to manually performing such tasks. 

■ Composition of the Audit and Performance Audit Committee (APAC) 

The APAC is an independent advisory body to Council and this committee was 
established to assist Council with the execution of its mandate. Currently the APAC 
comprises of four members, namely: 

1. Dr A Potgieter (Chairperson) 

2. Adv D Block 

3. Ms N Bulabula 

4. MrGStenekamp 

Both the internal and external auditors had unrestricted access to the Audit and 
Performance Audit Committee. The roles of the Audit & Performance Audit Committee 
are set out in the Municipality's APAC Charter and covers the requirements of section 
166 of the MFMA. 

h) Main Responsibilities of the APAC 

■ Advising Council, the Political Office-bearers, the Accounting Officer and the 
management staff of the municipality; 


254 



■ Overseeing internal controls, financial reporting and compliance with regulatory 
matters; 

■ Review the effectiveness of the Council’s system of internal control and risk 
management; 

■ Review the financial reporting and financial statements; 

■ Review the internal audit function; 

■ Review the performance management system and reports; 

■ Review compliance to policies, regulations and procedures in terms of prescribed 
guidelines and applicable laws; 

■ Internal audit reports are submitted to the Audit and Performance Audit Committee 
on a quarterly basis for review, through formal meetings; and 

■ The Audit and Performance Audit Committee is functional and their purpose is in line 
with the Municipal Finance Management Act and clearly outlined in the APAC 
Charter which was approved by Council. 

For the period under review, the APAC had seven formal meetings. APAC 
recommendations and minutes of meetings are presented to Council. Additionally, 
the APAC Chairperson prepares a report on performance management to Council on 
a bi-annual basis. 


i) Employees: Internal Audit 

The table below indicates the number of staff employed by the unit: 


(T-grade) 

2017/18 

2018/19 

Employees 

Posts 

Employees 

Vacancies 

(fulltime 

equivalents) 

Vacancies 
(as a % of 
total posts) 


Number 

% 

0-3 

0 

0 

0 

0 

0 

4-6 

0 

0 

0 

0 

0 

7-9 

0 

0 

0 

0 

0 

10-12 

3 

3 

3 

0 

0 

13-15 

0 

0 

0 

0 

0 

16-18 

1 

0 

0 

1 

0 

19-20 

0 

0 

0 

0 

0 


255 


















(T-grade) 

2017/18 

2018/19 

Total 

4 

3 

3 

1 

33.33 


Employees: Internal Audit 


3.13 COMPONENT H: ORGANISATIONAL PERFORMANCE SCORECARD 

3.13.1 DEVELOPMENT AND SERVICE DELIVERY PRIORITIES FOR 2018/19 

The main development and service delivery priorities forms part of the Municipality's 
Top Layer SDBIP for 2019/20 and are indicated in the table below: 


1. A Skilled Workforce and Communities 


Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL10 

Number of people from 
employment equity target 
groups that will be 
appointed in the three 
highest levels of 
management during the 
2019/20 financial year in 
compliance with the 
municipality's approved 
employment equity plan 

Number of people that will 
be appointed in the three 
highest levels of 
management in 
compliance with a 
municipality's approved 
employment equity plan 

All 

1 

TL11 

Spent 0.5% of personnel 
budget on training by 30 
June 2020 (Actual total 
training expenditure 

divided by total personnel 
budget) 

% of the personnel budget 
spent on training by June 
2020 

All 

0.5% 

TL12 

Limit vacancy rate to 10% 
of budgeted post by 30 
June 2020 (Number of 
funded posts vacant 
divided by number of 
budgeted funded posts) 

% vacancy rate 

All 

10% 

TL13 

Develop an Work Study 
Strategy and submit to 
MANCOM for approval by 
March 2020 

Work Study Strategy 

developed and submitted 
to MANCOM by March 
2020 

All 

1 

TL14 

Review the organisational 
structure and submit to 
Council by 30 June 2020 

Organisational structure 
reviewed and submitted 
to Council by 30 June 2020 

All 

1 

TL15 

Compile a Fleet 

Management Policy for 

Fleet Management Policy 
developed and submitted 

All 

1 


256 


















Ref 


KPI 


Unit of measurement 


Areas Annual target 



the Organisation and 
submit to Council for 
approval by March 2020 

to Council by March 2020 



TL16 

Develop an 

Implementation Plan for 
the Skills Mecca concept 
and submit to MANCOM 
by January 2020 

Implementation Plan 

developed and submitted 
to MANCOM by January 
2020 

All 

1 

TL17 

Award 2 external bursaries 
to qualifying candidates 
by 31 March 2020 

Number of external 
bursaries awarded by 
March 2020 

All 

2 

TL28 

Job creation through the 
construction and 

operation of the Regional 
Landfill facility 

Number of Jobs created 
by 30 June 2020 

All 

100 

TL35 

Develop an 

Implementation Strategy 
to obtain EPWP funding for 
Calitzdorp and submit to 
the Municipal Manager by 
December 2019 

Implementation Strategy 
submitted to the Municipal 
Manager by December 
2019 

All 

1 


Service Delivery Priorities for 2018/19 -A Skilled Workforce and Communities 


2. Bulk Infrastructure Coordination 


Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL37 

Compile a Development 
Strategy on the upgrading 
of the Radio 
Communication System 
and submit to the 

Municipal Manager by 
December 2019 

Development Strategy 
compiled and submitted 
to the Municipal Manager 
by December 2019 

All 

1 


Services Delivery Priorities for 2018/19- Bulk Infrastructure Coordination 


3. Financial Viability 


Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL23 

Appointment of an 
Independent Valuer to 
evaluate the District 
Properties by June 2020 

Valuer appointed by June 
2020 

All 

1 

TL36 

Spent 95% of the roads 

% of the roads 

All 

95% 

maintenance budget 

maintenance spent by 30 


257 
































Ref 


KPI 


Unit of measurement 


Areas Annual target 



allocation by 30 June 2020 
(Actual expenditure 

divided by approved 
allocation received) 

June 2020 



TL38 

Financial viability 

measured in terms of the 
available cash to cover 
fixed operating 

expenditure by 30 June 
2020 ((Cash and Cash 
Equivalents - Unspent 
Conditional Grants 

Overdraft) + Short Term 
Investment) / Monthly 
Fixed Operational 

Expenditure excluding 

(Depreciation, 

Amortisation, and Provision 
for Bad Debts, Impairment 
and Loss on Disposal of 
Assets)) 

Number of months that 
available cash is sufficient 
to cover the monthly 
operating expenditure 

All 

5.2 

TL39 

Submit a Strategic Plan to 
Council to address the 
financial sustainability of 
Garden Route District 
Municipality by December 
2019 

Strategic Plan submitted to 
Council by December 
2019 

All 

1 

TL40 

Achieve a current ratio of 

1 (Current assets: Current 
liabilities) 

Number of times the 
municipality can pay back 
its short term-liabilities with 
its short-term assets 

All 

1 

TL43 

The percentage of the 
municipal capital budget 
spent on capital projects 
by 30 June 2020 (Actual 
amount spent on capital 
projects /Total amount 
budgeted for capital 
projects) (Report submitted 
by CFO) 

% of capital budget spent 
by 30 June 2020 

All 

90% 

TL44 

Financial viability 

measured in terms of the 
municipality's ability to 
meet it's service debt 
obligations by 30 June 
2017 ((Short Term 

% of debt coverage 

All 

30% 


258 















Ref 


KPI 


Unit of measurement 


Areas Annual target 



Borrowing + Bank 

Overdraft + Short Term 
Lease + Long Term 
Borrowing + Long Term 
Lease) / Total Operating 
Revenue - Operating 
Conditional Grant) 




TL45 

Compilation of the Annual 
Financial Statements (AFS) 
for the 2018/2019 financial 
year and submit to the 
Auditor General (AG) by 
31 August 2019 

Compilation and 

submission of the AFS to 
the AG by 31 August 2019 

All 

1 


Services Delivery Priorities for 2018/19 - Financial Viability 


4. Good Governance 


Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL1 

Submit an OPCAR progress 
report to the MANCOM on 
a quarterly basis 

Number of progress reports 
submitted quarterly 

All 

4 

TL2 

Develop Standard 

Operating Procedures for 
the Municipality and 
submit to MANCOM for 
approval(lnclusive Report) 

Number of SOP's 

developed and submitted 
to MANCOM 

All 

10 

TL3 

Submit the Top layer SDBIP 
for 2020/21 for approval by 
the Mayor within 14 days 
after the budget has been 
approved 

Top Layer SDBIP for 
2020/21 submitted to the 
Mayor within 14 days after 
the budget has been 
approved 

All 

1 

TL4 

Draft the annual 

performance report for 
2018/19 and submit to the 
Auditor General by 31 
August 2019 

Annual performance 

report for 2018/19 drafted 
and submitted to the 
Auditor General by 31 
August 2019 

All 

1 

TL5 

Develop an Individual 
Performance 

Management System for 
the first five levels of 
reporting within the 

Organisation by June 2020 

Individual Performance 

Management System 

developed by June 2020 

All 

1 

TL6 

Review the risk 

management policy 

submit to Council by 31 
May 2020 

Reviewed risk 

management policy 

submitted to Council by 31 
May 2020 

All 

1 


259 
























Ref 


KPI 


Unit of measurement 


Areas Annual target 


TL 7 

Compile the Risk based 
audit plan (RBAP) for 
2020/21 and submit to the 
Audit Committee for 
consideration by 30 June 
2020 

RBAP for 2020/21 compiled 
and submitted to the Audit 
Committee by 30 June 
2020 

All 

1 

TL8 

Report to MANCOM on 
the revision of the Human 
Resource Policies of the 
Organisation 

Number of reports 

submitted to MANCOM 

All 

4 

TL9 

Compile and submit an 
implementation plan to 
MANCOM addressing the 
Improved Corporate 

Image of the Organisation 
by March 2020 

Number of 

implementation plans 

compiled and submitted 
to MANCOM by March 
2020 

All 

1 

TL33 

Signing an MOU with 
Stellenbosch University to 
improve qualifications by 
December 2019 

MOU signed by December 
2019 

All 

1 

TL41 

Develop Standard 

Operating Procedures for 
the Finance department 
on the ten most critical 
processes and submit to 
MANCOM for approval by 
December 2019 

Number of SOP's 

developed and submitted 
to MANCOM by 

December 2019 

All 

10 

TL42 

Develop a Strategic Plan 
to address the 

minimization of the use of 
Consultants within the 
Department and submit to 
MANCOM by December 
2019 

Strategic Plan submitted to 
MACNOM by December 
2019 

All 

1 


Service Delivery Priorities for 2018/19 - Good Governance 


5 . Growing an Inclusive District Economy 


Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL18 

Development of a Growth and 
Development Strategy and submit 
to Council by June 2020 

Growth and Development 

Strategy developed and 

submitted to Council by June 2020 

All 

1 

TL19 

Development of a Garden Route 
Tourism Strategy and submit to 
Council by June 2020 

Tourism Strategy develop and 
submitted to Council by June 2020 

All 

1 

TL20 

Develop a Strategy on SME's 
development and submit to 

SME's development strategy 
developed and submitted to 

All 

1 


260 

























Ref 

KPI 

Unit of measurement 

Areas 

Annual target 


Council by March 2020 

Council by March 2020 



TL21 

Compile a Township Economic 
Development Strategy and submit 
to MANCOM by March 2020 

Implementation Plan on Township 
Economic Development 

compiled and submitted to 
MANCOM by March 2020 

All 

1 

TL22 

Develop an Implementation Plan 
addressing the Investment 

Conference, Smart City Summit 
and Green Energy Summit 
resolutions and submit to 
MANCOM by January 2020 

Implementation Plan developed 
and submitted to MANCOM by 
January 2020 

All 

1 

TL24 

Create job opportunities through 
the Expanded Public Works 
Programme (EPWP) by 30 June 
2020 

Number of Job opportunities 
created through the Expanded 
Public Works Programme (EPWP) 
by 30 June 2020 

All 

150 

TL25 

Create job opportunities through 
the Expanded Public Works 
Programme (EPWP) by 30 June 
2020 

Number of Job opportunities 
created through the (EPWP) 
(Extensions of contracts) by 30 
June 2020 

All 

80 

TL26 

Compile a Development Strategy 
on Organisational Implementation 
of EPWP and submit to Council by 
March 2020 

Development Strategy compiled 
and submitted to Council by 
March 2020 

All 

1 

TL27 

Compile and submit the final 
annual report and oversight report 
for 2018/19 to Council by 31 
December 2019 

Final annual report and oversight 
report for 2018/19 submitted to 
Council by 31 December 2019 

All 

1 


Service Delivery Priorities for 2018/19 - Growing an Inclusive District Economy 


6. 

Healthy and Socially Stable Communities 



Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL32 

Conduct Public Health Awareness 
through 8 sessions with the 
community by 30 June 2020 

Number of sessions conducted by 
30 June 2020 

All 

8 

TL34 

Develop a Strategic Plan for the 
establishment of a Regional 
Waste Management Facility and 
submit to Council by March 2020 

Strategic Plan submitted to 
Council by March 2020 

All 

1 


Service Delivery Priorities for 2018/19 - Healthy and Socially Stable Communities 


7. Sustainable Environmental Management and Public Safety 


Ref 

KPI 

Unit of measurement 

Areas 

Annual target 

TL29 

Compile a development plan to 
establish a fire training division and 
submit to Council by March 2020 

Development plan submitted to 
Council by March 2020 

All 

1 

TL30 

Compile a strategy to address the 
management of emergency 
incidents due to inadequate 
equipment and submit to 

Strategy submitted to MANCOM 
by March 2020 

All 

1 


261 


































Ref 


KPI 


Unit of measurement 


Areas Annual target 



MANCOM by March 2020 




TL31 

Development of climate change 
adaptation interventions in terms 
of Municipal Health and 

Environmental Services Strategy 
and submit to Council by March 
2020 

Municipal Health and 

Environmental Services Strategy 
submitted to Council by March 
2020 

All 

1 


Service delivery priorities for 2018/19: - Sustainable Environmental Management and Public Safety 


262 











CHAPTER 4 

ORGANISATIONAL 
DEVELOPMENT PERFORMANCE 
(PERFORMANCE REPORT PART 2) 



263 


CHAPTER 4: ORGANISATIONAL DEVELOPMENT PERFORMANCE 


4.1 NATIONAL KPI'S - MUNICIPAL TRANSFORMATION AND 
ORGANISATIONAL DEVELOPMENT 


The following table indicates the Municipality's performance in terms of the national 
KPI's required in terms of the Local Government: Municipal Planning and the 
Performance Management Regulations of 2001 and Section 43 of the MSA. These KPI's 
are linked to the national key performance area - municipal transformation and 
organisational development. 


KPA and indicators 

Municipal achievement 


2017/18 

2018/19 

The number of people from employment equity 

target groups appointed in the three highest levels of 

management during the 2018/19 financial year in 

compliance with the municipality's approved 

Employment Equity Plan 

7 

2 

Spend 0.5% of the personnel budget on training by 

30 June 2019 (Actual total training expenditure 

divided by total personnel budget) 

1.17% 

1.23% 


National KPIs- Municipal Transformation and Organisational Development 

4.2 INTRODUCTION TO THE MUNICIPAL WORKFORCE 


The District Municipality currently employs 557 permanent officials as at 30 June 2019, 
who individually and collectively contribute to the achievement of the Municipality's 
objectives. The primary objective of HR is to render an innovative service that 
addresses both skills development and an administrative function. 


264 









4.2.1 EMPLOYMENT EQUITY 


The Employment Equity Act (1998) Chapter 3, Section 15(1) states that affirmative 
action measures are measures designed to ensure that suitable qualified people from 
designated groups have equal employment opportunities and are equitably 
represented in all occupational categories and levels in the workforce of a designated 
employer. The national performance indicator also refers to: ‘‘Number of people from 
employment equity target groups employed in the three highest levels of 
management in compliance with a municipality's approved employment equity 
plan” 

a) Occupational Levels - Race 


The table below categories the number of employees by race within the occupational 
levels: 


Occupational 

Male 

Female 

Total 

Levels 

A 

c 

1 

W 

A 

C 

1 

w 

Top management 

4 

2 

0 

7 

1 

1 

0 

2 

17 

Senior management 

3 

4 

1 

2 

0 

6 

0 

2 

18 

Professionally qualified and 
experienced specialists and 
mid- management 

5 

19 

0 

15 

8 

16 

0 

6 

69 

Skilled technical and 
academically qualified workers, 
junior management, 
supervisors, foremen and 
superintendents 

22 

102 

0 

29 

11 

51 

1 

8 

224 

Semi-skilled and discretionary 
decision making 

4 

23 

0 

0 

2 

9 

0 

0 

38 

Unskilled and defined decision 
making 

41 

66 

1 

2 

32 

53 

0 

2 

197 

Total permanent 

79 

216 

2 

55 

54 

136 

1 

20 

563 

Non permanent employees 

31 

178 

1 

5 

59 

191 

1 

3 

469 

Grand total 

110 

394 

3 

60 

113 

327 

2 

23 

1032 


Occupational Levels 


265 



































b) Departments - Race 

The following table categorise the number of employees by race within the different 


departments: 



Male 

Female 

Total 

Department 

A 

c 

1 

W 

A 

C 

1 

W 

Office of the Municipal 
Manager 

3 

0 

0 

2 

2 

5 

0 

1 

13 

Community Services 

7 

40 

1 

20 

9 

29 

0 

5 

111 

Corporate Services 

5 

12 

0 

4 

7 

17 

1 

3 

49 

Financial Services 

2 

15 

0 

1 

5 

8 

0 

5 

36 

Planning & Eco 

Management Services 

6 

21 

0 

1 

1 

25 

0 

2 

56 

Roads Services 

56 

128 

1 

27 

30 

52 

0 

4 

298 

Total permanent 

79 

216 

2 

55 

54 

136 

1 

20 

563 

Non - permanent 

31 

178 

1 

5 

59 

191 

1 

3 

469 

Grand total 

no 

394 

3 

60 

113 

327 

2 

23 

1032 


Department - Race Classification 


c) Vacancy Rate 

The approved organogram for the Municipality had 615 posts for the 2018/19 financial 
year. The actual positions filled are indicated in the tables below by post level and by 
functional level. 90 Posts were vacant at the end of 2018/19, resulting in a vacancy 
rate of 9.43% 


Below is a table that indicates the vacancies within the Municipality: 


Per post level 

Post level 

Filled 

Vacant 

MM & MSA section 57 & 56 



Employees 

6 

0 

Middle management 

167 

0 

Skilled technical and 

academically qualified 

workers, junior 

management, supervisors, 

foremen and 

164 

0 


266 










































Per post level 

Post level 

Filled 

Vacant 

superintendents 



Unskilled and defined 

decision making 

226 

0 

Total 

563 

0 

Per functional level 

Functional area 

Filled 

Vacant 


1 

0 


1 

0 


1 

0 


1 

0 


1 

0 


Total 5 


Vacancy Rate Per Post and Functional Level 


d) Employee Turnover Rate 

A high employee turnover may be costly to a municipality and might negatively affect 
productivity, service delivery and institutional memory/organisational knowledge. 
Below is a table that shows the employee turnover rate within the Municipality for the 
past two financial years: 


Financial year 

Total no 

appointments at 
the end of each 
financial year 

New 

appointments 

Terminations 
during the year 

Turn-over rate 

2017/18 

556 

54 

12 

2.23% 

2018/19 

557 

21 

26 

4.49% 


Employee Turnover Rate 


267 





























4.3 MANAGING THE MUNICIPAL WORKFORCE 


Managing the municipal workforce refers to analysing and coordinating employee 
behaviour. 


4.3.1 INJURIES 

An occupational injury is a personal injury, disease or death resulting from an 
occupational accident. Compensation claims for such occupational injuries are 
calculated according to the seriousness of the injury/disease and can be costly to a 
municipality. Occupational injury will influence the loss of man hours and therefore 
financial and productivity performance. 


The table below indicates the total number of injuries within the different departments: 


Department 

2017/18 

2018/19 

Office of the Municipal 
Manager 

0 

0 

Corporate Services 

1 

0 

Financial Services 

1 

0 

Community Services 

0 

0 

Planning and Economic 
Development Services 

0 

0 

Roads and Transport 
Planning 

38 

32 

Total 

40 

32 


Injuries 


Injuries in the Roads and Transport Planning Unit are normally higher due to the nature 
of work and the constant handling of equipment and machinery. 

4.3.2 SICK LEAVE 

The number of days' sick leave taken by employees has service delivery and cost 
implications. The monitoring of sick leave identifies certain patterns or trends. Once 
these patterns are identified, corrective action can be taken. The total number of 
employees that have taken sick leave during the 2018/19 financial year shows a 
decrease when comparing it with the 2017/18 financial year. 


268 













The table below indicates the total number sick leave days taken within the different 
directorates: 


Department 

2017/18 

2018/19 

Number of 
Employees per 
department 

Office of the Municipal Manager 

72.29 

125.66 

17 

Corporate Services 

275.90 

640.14 

53 

Financial Services 

165.94 

254.72 

42 

Community Services 

377.79 

744.04 

112 

Planning and Economic Development Services 

151.04 

451.84 

64 

Roads and Transport Planning 

2 166.21 

4 290.33 

360 

Total 

3 209.17 

6 506.73 

648 


Sick Leave Days 


4.3.3 HR POLICIES AND PLANS 


Policies and plans provide guidance for fair and consistent staff treatment and a 
consistent approach to the managing of staff. 


The table below shows the HR policies and plans that are approved: 


Approved policies 

Name of policy 

Council resolution 

Travel & Subsistence Policy 

DC 744/12/14 / DC 520/03/14 / DC 
Cl 5/12/2017 

Funeral Memorial Services Policy 

DC 1091/06/16 

Leave Policy 

DC 1091/06/16/ DC Cl6/12/2017 

Gender Empowerment Policy 

DC 1091/06/16 

Overtime Policy 

DC 520/03/14 

Recruitment & Selection Policy 

DC 444/04/11 / DC 744/12/14 / DC 
1091/06/16 

Smoking Policy 

DC 514/08/13/DC03/15 

Experiential Training Policy 

DC 515/08/13 

Private Work Policy 

DC 58/08/05 

Bouquets Policy 

DC 517/08/13 

Telephone Use Policy 

DC 1091/06/16 

Key Use Policy 

DC 1091/06/16 

Security & Risk Policy 

DC 1091/06/16 

Parking Policy 

DC 12/14 

Records Management Policy 

DC 12/14 

Placement Policy 

DC 520/08/13 / DC 192/07/17 

Contract Appointments Policy 

DC 516/08/13 


269 




































Approved policies 


Experiential Training Policy 

DC 515/08/13 

Skills Development Policy 

DC 744/12/14 

Succession Planning & Career Pathing 

DC 12/14 

SHE Rep Policy 

DC 520/03/14 

SHE Committee Policy 

DC 520/03/14 

Policy on incentives for exceptional 
performance 

Draft to be developed during 2019/20 

Succession Planning and Career Pathing 
Policy 

DC 744/12/14 

Employee Assistance Policy 

C.5 

Draft Disability Policy 

C.5 

Revised Employment Equity Policy 

C.5 

Abscondment Policy 

C.5 

Grievance Procedure 

C.5 

Task 

20 July 201 

Appointment of Consultants Policy 

C.5 


HR Policies and Plans 


The HR Department submits policies to the Local Labour Forum on a regular basis for 
review purposes. 

4.3.4 INDIVIDUAL PERFORMANCE AND REWARDS 

In accordance with Regulation 32, a performance bonus, based on affordability, may 
be paid to an employee, after - 

1. The annual report for the financial year under review has been tabled and 
adopted by the municipal council; 

2. an evaluation of performance in accordance with the provisions of 
Regulation 23; and 

3. approval of such evaluation by the municipal council as a reward for 
outstanding performance. 

The performance management system was not rolled out to employees from post 
level 1 -6.No performance rewards (bonuses), were paid during 2018/19. 


270 




















4.4 CAPACITATING THE MUNICIPAL WORKFORCE 


Section 68(1) of the MSA states that a municipality must develop its HR capacity to a 
level that enables it to perform its functions and exercise its powers in an economical, 
effective, efficient and accountable way. For this purpose, the HR capacity of a 
municipality must comply with the Skills Development Act (SDA), 1998 (Act No. 81 of 
1998), and the Skills Development Levies Act, 20 1999 (Act No. 28 of 1999). 

4.4.1 SKILLS MATRIX 

The table below indicates the number of employees that received training in the year 


under review: 


Management level 

Gender 

Number of employees 
identified for training at 
start of the year 

Number of employees 
that received training 

MM and S57 

Female 

0 

0 

Male 

1 

0 

Legislators, senior 

Female 

27 

8 

officials and managers 

Male 

53 

13 

Associate professionals 

Female 

23 

10 

and Technicians 

Male 

35 

0 

Professionals 

Female 

43 

0 

Male 

29 

2 

Clerks 

Female 

33 

8 

Male 

16 

4 

Service and sales 

Female 

13 

2 

workers 

Male 

25 

5 

Craft and related trade 

Female 

0 

0 

workers 

Male 

50 

7 

Plant and machine 

Female 

0 

0 

operators and 
assemblers 

Male 

50 

7 

Elementary occupations 

Female 

92 

38 

Male 

131 

72 


271 


























Management level 

Gender 

Number of employees 
identified for training at 
start of the year 

Number of employees 
that received training 

Sub total 

Female 

231 

66 

Male 

370 

no 

Total 

620 

377 


Skills Matrix 


The following training was provided for employees trained: 




Number trained at 

Type of learning intervention 

Name of training intervention 

NQF 1 - 

NQF 3 - 



2 

8 

Learnership 

Fire Fighting 

3 

6 


■ National Certificate: Road 



Learnership 

■ Construction 

64 

46 

Skills Programme 

Identify responsibilities of a team 
leader in ensuring that 
organisational standards are met 

0 

32 

Skills Programme 

Labour Law 

0 

4 

Skills Programme 

Operate a truck mounted loader 
crane 

15 

0 

Skills Programme 

Law Enforcement Training 

0 

16 

Total 

82 

104 


Training Provided 


4.4.2. SKILLS DEVELOPMENT TRAINING 

The Skills Development Act (1998) and the MSA, (2000), require employers to supply 
employees with the necessary training to develop its HR capacity. Section 55(1 )(f) 
states that as head of administration, the Municipal Manager is responsible for the 
management, utilization and training of staff. 

The table below indicates the training that was provided to various levels of staff: 


Occupational Gender Training provided within the reporting period (2018/19) 


272 


















categories 


Learnership 

Skills programmes 
and other short 

courses 

Total 



Actual 

Target 

Actual 

Target 

Actual 

Target 

MM and S57 

Female 

0 

0 

0 

0 

0 

0 

Male 

0 

1 

0 

1 

0 

1 

Legislators, 

Female 

0 

27 

7 

27 

7 

27 

senior officials 
and 

managers 

Male 

0 

52 

21 

52 

21 

52 

Professionals 

Female 

0 

43 

23 

43 

23 

43 

Male 

0 

29 

10 

29 

10 

29 

Technicians 

Female 

0 

23 

3 

23 

3 

23 

and 

associate 

professionals 

Male 

0 

35 

14 

35 

14 

35 

Clerks 

Female 

0 

33 

21 

33 

21 

33 

Male 

0 

16 

11 

16 

11 

16 

Service and 

Female 

0 

13 

3 

13 

3 

13 

sales workers 

Male 

0 

25 

12 

25 

12 

25 

Craft and 

Female 

0 

0 

0 

0 

0 

0 

related trade 
workers 

Male 

0 

50 

0 

50 

0 

50 

Plant and 

Female 

0 

0 

0 

0 

0 

0 

machine 

operators 

and 

assemblers 

Male 

0 

31 

5 

31 

5 

31 

Elementary 

Female 

47 

92 

0 

92 

47 

92 

occupations 

Male 

75 

131 

0 

131 

75 

131 

Sub total 

Female 

75 

370 

73 

370 

148 

370 

Male 

47 

231 

57 

231 

104 

231 

Total 


122 

601 

130 

601 

252 

601 


Skills Development Training 


273 































4.4.3 SKILLS DEVELOPMENT BUDGET ALLOCATION (DRAFT INFORMATION) 

The table below indicates the budget allocated and total spent on skills development: 


Total personnel 
budget (R) 

Total allocated (R) 

Total spent (R) 

% Spent 

R152 467 000.00 

R4 186 935.00 

R3 325 455.86 

1.9% 


Budget Allocated and Spent on Skills Development 


4.4.4 MFMA COMPETENCIES 

In terms of Section 83 (1) of the MFMA, the accounting officer, senior managers, the 
chief financial officer, non-financial managers and other financial officials of a 
municipality must meet the prescribed financial management competency levels that 
are key to the successful implementation of the MFMA. National Treasury has 
prescribed such financial management competencies in Government Notice 493 
dated 15 June 2007. 

To assist the above-mentioned officials to acquire the prescribed financial 
competencies, National Treasury, with the collaboration of various stakeholders and 
role players in the local government sphere, developed an outcomes-based NQF 
Level 6 qualification in municipal finance management. In terms of the Government 
Notice 493 of 15 June 2007, “(1) No municipality or municipal entity may, with effect 1 
January 2013 (exempted until 30 September 2015 as per Government Notice No. 179 
of 14 March 2014), employ a person as a financial official if that person does not meet 
the competency levels prescribed for the relevant position in terms of these 
Regulations.” 


The table below provides details of the financial competency development progress 
as required by the regulation: 



Total number of 
officials 
employed by 
municipality 
(Regulation 
14(4)(a) and 
(c)) 


Total number of 

Total number of 


Competency 

officials whose 

officials that 


assessments 

performance 

meet 

Description 

completed 

(Regulation 

agreements 
comply with 

prescribed 

competency 


14(4)(b) and 

Regulation 16 

levels 


(d)) 

(Regulation 

(Regulation 



14(4X0) 

14(4)(e)) 


274 










Financial officials 


Accounting 

Officer 

1 

1 

1 

1 

Chief Financial 
Officer 

1 

1 

1 

1 

Senior 

managers 

5 

5 

5 

5 

Any other 

financial 

officials 

591 

0 

0 

0 

SCM officials 

Heads of SCM 
units 

1 

0 

0 

0 

SCM senior 
managers 

2 

0 

0 

0 

TOTAL 

601 

7 

7 

7 


Financial Competency Dewelopment Progress of Officials 


4.5 THE MUNICIPAL WORKFORCE EXPENDITURE 

Section 66 of the MSA states that the Accounting Officer of a municipality must report 
to Council on all expenditure incurred by the municipality on staff salaries, wages, 
allowances and benefits. This is in line with the requirements of the Public Service 
Regulations, (2002), as well as National Treasury Budget and Reporting Regulations 
SA22 and SA23. 

4.5.1 PERSONNEL EXPENDITURE (DRAFT INFORMATION) 

The percentage personnel expenditure is essential in the budgeting process as it 
reflects on current and future efficiency. The table below indicates the percentage of 
the municipal budget that was spent on salaries and allowance for the past two 
financial years. The Municipality is well over the national norm of between 35 to 40%: 


R’OOO 


R’OOO 

Total operating 
expenditure 




Percentage 


275 























R’OOO 


R’OOO 


Total operating 
expenditure 


Percentage 


2017/18 

128 451 

201 170 

63 . 85 % 

2018/19 

136 426 

222 809 

61 % 


Operating Expenditure (excluding Roads) 


Below is a summary of Councillors and staff benefits for the year under review: (Draft 
Information) 


Financial year 

2017/18 

2018/19 


Actual 

Original budget 

Adjusted budget 

Actual 

Description 

R'000 

Councillors (Political office bearers plus other) 

Salary 

7 370 

8 947 

7 481 

7 792 

Pension 

contributions 

261 

247 

463 

428 

Medical-aid 

contributions 

142 

52 

122 

144 

Motor vehicle 
allowance 

2312 

1 020 

1 696 

1 088 

Cell phone 
allowance 

325 

664 

1 125 

1 023 

Housing allowance 

405 

642 

1 046 

631 

Other benefits or 
allowances 

0 

0 

0 

0 

In-kind benefits 

0 

0 

0 

0 

Sub Total 

10815 

11 572 

11 933 

11 105 

% increase/ 
(decrease) 

N/A 

7.0% 

10.3% 

93.1% 

Senior managers of the Municipality 

Salary 

4 022 

5 277 

4 501 

5 267 

Pension 

contributions 

481 

359 

165 

790 

Medical-aid 

contributions 

117 

161 

125 

186 

Performance 

bonus 

484 

777 

838 

703 

Motor vehicle 
allowance 

670 

772 

724 

788 

Cell phone 

61 

83 

114 

114 


276 





































Financial year 

2017/18 

2018/19 


Actual 

Original budget 

Adjusted budget 

Actual 

Description 

R’000 

allowance 





Housing allowance 

84 

285 

0 

321 

Other benefits or 

132 

100 


153 

allowances 

0 

Payments in lieu of 
leave 

70 

77 

0 

0 

Long service 
awards 

0 

0 

0 

0 

In-kind benefits 

0 

0 

0 

0 

Sub total 

6 120 

7 890 

6 462 

8 323 

% increase/ 
(decrease) 

N/A 

29.3% 

5.9% 

128.8% 

Other municipal staff 

Basic salaries and 
wages 

71 403 

79 891 

82 376 

76 435 

Pension 

contributions 

15 225 

10 474 

16 907 

11 897 

Medical aid 
contributions 

10 067 

9 132 

10351 

6 505 

Overtime 

2 623 

2 985 

3 328 

2 866 

Motor vehicle 
allowance 

4 921 

6 539 

6 363 

6 344 

Cell phone 
allowance 

119 

174 

160 

82 

Housing allowance 

888 

1 397 

1 484 

978 

Other benefits or 
allowances 

3 475 

3 424 

4 121 

4 859 

Payments in lieu of 
leave 

5 334 

6 064 

6 116 

5 631 

Long service 
awards 

533 

0 

0 

247 

Post-retirement 

benefits 

obligations 

8 043 

5 698 

2 866 

1 153 

Sub total 

122 630 

125 779 

134 072 

116 997 

% increase/ 
(decrease) 

N/A 

2.6% 

9.3% 

87.3% 

Total Municipality 

139 565 

145 242 

152 467 

136 426 

% increase/ 

7.59 

4.1% 

9.2% 

87.3% 


277 

































Financial year 


2017/18 

Actual 


Original budget 


2018/19 

Adjusted budget 


Actual 


Description 

(decrease) 


R’000 


Personnel Expenditure (exluding Roads) 


*Note: Figures in the previous year may be amended and will therefore not necessarily 
match the figures in the previous year annual report. Figures for 2018/19 financial year 
are unaudited figures as at 30 June 2019. 


278 




CHAPTER 5 

FINANCIAL PERFORMANCE 





Qoi}uterv*Qput& 

DISTRICT MUNICIPALITY I UMASIPALA WESITHILI I DISTRIKSMUNISIPALITEIT 




279 


CHAPTER 5: FINANCIAL PERFORMANCE 

5.1 FINANCIAL MATTERS 

C OMP ONENT^A: STATE MENTS OFTlNANCIALP ERFO RM ANCE 
COMMENT ON FINANCIAL PERFORMANCE: 

Based on the consolidated 2018/19 financial performance, the municipality made a 
surplus of R14.684m in comparison to R7.882m surplus in 2017/18. Overall, the 
municipality is in good financial health. 

Note should be taken of the increase of salaries which indicate an average increase 
by 7-8%, compared to the Equitable Share (municipality's main income source), which 
only increased by 3.5%. 

5.2 GRANTS 

COMMENT ON OPERATING TRANSFERS AND GRANTS: 

The municipality is more than 81% dependant on grants and subsidies and are aiming 
to be less dependable on grants and to generate more own revenue. A Revenue 
Enhancement Strategy is in process. 

5.3 ASSET MANAGEMENT 

INTRODUCTION TO ASSET MANAGEMENT 

An asset management unit is established at Garden Route District Municipality 
consisting of the asset manager and an official. Annual asset verification is 
conducting to ensure all assets are accounted for. Missing assets must be explained 
by the responsible person the asset is allocated to on the reasons why the assets are 
missing. 

When assets are transferred, an asset transfer form must be completed and submitted 
to the asset section to update their records. 


280 






Every personnel member assets are allocated to, are responsible for the safeguarding 
of their assets. Aurecon have previously been appointed to compile an asset 
maintenance plans for the properties. 

There is a new approved asset management policy approved by council in 2019 in 
place, this policy will be reviewed annually to ensure it is aligned with GRAP 
requirements. 

The key objectives of the asset management policy are: 

1. The accurate recording of essential asset information; 

2. The accurate recording of asset movements; 

3. Exercising strict physical controls over all assets; 

4. Treating the assets correctly in the Municipality's Financial Statements; 

5. Providing accurate and meaningful management information; 

1. Compliance with the Council's accounting policies and GRAP; 

2. Adequate insuring of assets; 

3. Maintenance of Council's assets; 

4. Ensuring that managers are aware of their responsibilities with regard to the 
assets; and 

5. Setting out the standards of management, recording and internal controls so 
as to safeguard the assets against inappropriate utilization or loss. 

T5.3.1 


Details of capital expenditure 

Asset 1 

New Water Tankers for Fire Fighting 

R3 523 000 

Asset 2 

Purchase of office building in 
Plettenberg Bay 

R2 300 000 

Asset 3 

New LDV Skid Unit for Fire Fighting 

R515 000 

Asset 4 

Risk Management aind Internal 
Audit software 

R500 000 

Asset 5 

Plazmat Rescue & Fire Equipment 
Equipment 

R250 000 


The other capital items purchased are mainly IT equipment and building upgrades at 
Resorts. 

COMMENT ON ASSET MANAGEMENT 


281 










Refer to previous table and comments with regards to the additions for the year. 


Repair and Maintenance Expenditure 2018/19 
(R'000) 




Original Budget 

Adjustment 

Budget 

Actual 

Budget 

variance 

Repairs and maintenance 
expenditure 

4 598 

3 501 

2 450 

30% 


COMMENT ON REPAIR AND MAINTENANCE EXPENDITURE: 

There are limited funding available to allocate to repairs and maintenance. In prior 
years, Aurecon was appointed to compile a maintenance plan for the properties, and 
the fleet manager compiled a fleet maintenance plan. This will be used in the future 
as basis for planning and budgeting purposes. 

The challenge still remains of funding to source the increased maintenance. The main 
source of income increases 3.5% which is not aligned to the average CPIX. 

5.4 FINANCIAL RATIOS BASED ON KEY PERFORMANCE INDICATORS 

Liquidity ratios measure the municipality's ability to pay its bills and are calculated by 
dividing the current assets, due within one year by the municipality's current liabilities, 
payable within one year. The higher the ratio, the better it is for the organisation. 


282 













Ratio Calculations: 30 June 2019 









Name of Municipality: Garden Route District Municipality 



Financial year-end: 30 June 2019 












Current Ratio: 

(Current Assets / Current Liabilities) 





Norm: 1.5-2.1 















30 June 2019 30 June 2018 



Current Assets 


208 240 364 

186 175 228 



Current Liabilities 


75 302 524 

56 854 768 



Current ratio 


2,77 

3,27 

times 









Comment 







The purpose of the current ratio is to determine whether GRDM has the ability to pay its 
shortterm liabilities 

The norm is 1.5 - 2.1 times. As at 30 June 2019 GRDM's current ratio is almost 3 times, which 

is far betterthan the norm. 

It has deterioated slighty from the previous financial year. 


283 





















































Ratio Calculations: 30 June 2019 









Cash / Cost Coverage Ratio (Excl. Unspent Conditional Grants): 










((Cash and Cash Equivalents - Unspent Conditional Grants - Overdraft) + Short 
Term Investment) / Monthly Fixed Operational Expenditure excluding 
(Depreciation, Amortisation, Provision for Bad Debts, Impairment and Loss on 
Disposal of Assets) 





Norm: 1-3 months 















30 June 2019 30 June 2018 










Cash and cash equivalents 

174 238 085 

162 340 923 



Unspent conditional grants 

6 893 628 

8 038 509 






167 344 457 

154 302414 










Total expenditure 


395 989 018 

362 015 952 



Depreciation and Amortisation 

4 033 309 

3 974117 



Provision for bad debts 

- 

- 



Loss on disposal of assets 

- 

573 997 






391955 709 

357467 838 










Monthly average 


32 662 976 

29 788 987 










Cost cove 

Comment 



5,1 

5,2 

times 














The purpo 
operating 

On a norrr 

operating 

se of this ratio is to determine the amount of cash available to pay monthly 
expenses. 

of 3 months, GRDM has a strong result showing that it is able to pay 5 months' 
expenses from the current cash and cash equivalent balance. 


284 



















































































Ratio Calculations: 30 June 2019 

Net debtor days: ((Gross Debtors - Bad debt Provision)/ Actual Billed Revenue)) x 365 
Norm: 30 days 

30 June 2019 30 June 2018 

Gross debtors closing balance 23 956 054 16 759 557 

Billed revenue 29 590 672 17019 815 

Bad debt provision _-_-_ 

_295_359 days 


Comment 

This ratio indicates how quick (in days) the municipality is able to receive payment from 
bills sent out to the public on a monthly basis. 

There has been an improvement in the results since June 2018 (from 359 days to 295 days), 
but the result is still substantially worse than the norm of 30 days. 

The main reason for this relates to the complexities and legal challenges associcated with 
billing and payment of fire fighting services in the district. 

GRDM sends out letters of demand and, as applicable, hands over non-paying debtors to 
the legal department. Proving however where a fire originated from remains a challenge 
and a protracted legal process. 

GRDM installed a new incident management system in the Disaster Management section, 
which will greatly strengthen GRDM's ability to prove fire origination, which is expected to 
result in an improvement regarding receiving payment from fire fighting services debtors. 


285 







Grant dependency: 

(Government grants and subsidies / Total revenue) x 100 










30 June 2019 

30 June 2018 









Total revenue (Excluding roads) 

205 857138 

191 044 998 



Government grants and susidies 

165 934 347 

154142 467 





81% 

81% 









Comment 






The purpose of this ratio is to indicate the dependency of GRDM on government grants and 
subsidies. 

As mentioned elsewhere in the report, the result of 81% is considered to be substantially 
too high. 

GRDM is therefore actively pursueing alternative sources of own revenue in order to 
address this in future. 


COMPONENT B: SPENDING AGAINST CAPITAL BUDGET 


5.5 CAPITAL EXPENDITURE 

Introduction to spending against capital budgets 


Total Capital Expenditure: 2016/17 to 2018/19 (R’000) 

Detail 

2016/17 

2017/18 

2018/19 

Original Budget 

5415 

2 459 

9 303 

Adjustment Budget 

6 713 

4 677 

10 623 

Actual 

6 181 

5 324 

9 800 


COMMENT ON CAPITAL EXPENDITURE: 

The majority of the budget includes the purchase of an office building in Plettenberg 
Bay, Fire fighting vehicles and equipment, IT equipment and new risk management 
and internal audit software. 


FUNDING OF CAPITAL BUDGET: 2018/2019 

Provincial Treasury funded the purchase of new fire fighting vehicles to the value of R2 
million. The rest of the funding is from own sources. 


286 















5.6 SOURCES OF FINANCE 


With the current financial constraints, limited funding is available to fund capital 
expenditure. 

5.7 CAPITAL SPENDING ON 5 LARGEST PROJECTS 

The capital expenditure was spent on: 

1. Purchase of an office building for the Environmental Health section in 
Plettenberg Bay 

2. Purchase of fire fighting vehicles and equipment 

3. Purchase of IT equipment 

4. Purchase of risk management and internal audit software 


The majority of the budget includes the purchase of an office building in Plettenberg 
Bay, Fire fighting vehicles and equipment, IT equipment and new risk management 
and internal audit software. 


COMPONENT C: CASHFLOW MANAGEMENT AND INVESTMENTS 

5.8 CASH FLOW 

INTRODUCTION TO CASH FLOW MANAGEMENT AND INVESTMENTS 

Refer to cash flow statement included in this report. 

After the abolishment of the RSC levies, district municipalities are cash strained as they 
are about 81% dependent on grant funding to sustain operations. The Equitable Share 
Grant only increases 3.5% annually which is not aligned to the continuous increase in 
expenditure. 

District Municipalities have very limited own revenue sources e.g. tariffs that can be 
raised. Revenue from own resources are limited, the majority own income is the 
administration fee received for the Roads agency function performed on behalf of 
Department of Transport. 

Various engagements are in process with Provincial Treasury, National Treasury to 
address this issue. A district municipality task team for the Western Cape has been 
established. 


287 






5.9 BORROWING AND INVESTMENTS 


5.9.1 INVESTMENTS 

Money is invested in short term investments (32 day deposits). Excess cash not needed 
for the daily operations for the next month are invested. Maximum of 25% may be 
invested with one institution as per the cash and investment policy. 

Investments are made in accordance with the cash and investment policy. Excess 
funds not needed within the next 32 days are invested to generate maximum interest. 
Investments are limited to 25% per financial institution to diversify risk to council. 

5.9.2 BORROWINGS 

No new loans have been taken up in the 2018/2019 financial year. It is not envisioned 
that new loans will be taken up in 2019/2020. 

COMMENT ON BORROWINGS: 

Borrowings: No new loans have been taken up in the 2018/2019 financial year. It is not 
envisioned that new loans will be taken up in 2019/2020. Long term loans were fully 
repaid during the 2015/2016 financial year. 


5.10 PUBLIC PRIVATE PARTNERSHIPS 

Garden Route District Municipality is in the process to enter into a Public Private 
Partnership (PPP) with Eden Waste Management, the Preferred Bidder, for a period of 
ten (10) years to build and operated a Regional Waste Management Facility. The PPP 
Agreement will include the build and operation of a domestic and hazardous disposal 
facility as well as the availability of a rotating mobile chipper and crusher to the 
participating local municipalities. The participating local municipalities that will make 
use of the facility will be Bitou, Knysna, George, Mossel Bay and Hessequa 
(Gouritzmond and Albertinia). 

The due diligens process initiated by the Development Bank of South Africa that is the 
financier of the Private Partner was completed and can the final PPP process be 


288 



concluded. The preparation of the Treasury Views and Recommendation III 
documentations as well as the Section 33 in terms of the MFMA (contract longer than 
three years) process documentation are nearly finalised to be submitted to Nasional 
and provincial Treasury for their comments as well as to the Nasional and Provincial 
Sector Department for their comments. The comments timeline for their comments are 
thirty (30) days. 

As soon as the comments are received the PPP Agreement will be finalised and 
submitted to Council for approval and signature of the Municipal Manager. It is 
anticipated that the above mentioned processes will be finalised at the end of 
November 2019 and construction can proceed from 20 January 2020. The private 
Partner, Eden Waste Management, will set up camp during the first two (2) weeks of 
December 2019. 

All participating local municipalities have made provision in their existing multi year 
budgets for thier individual operating cost contribution from date of in operation of the 
regional Waste Management Facility. 

5.11 GRAP COMPLIANCE 

With the lack of capacity in the GRAP unit, consultants are assisting with the 
implementation of GRAP standards. 

There are two GRAP steering committees: 

One committee consists of the finance personnel, chaired by the CFO. This is where 
the progress by the different sections are discussed, the action plans to address 
previous audit findings, etc. The meeting is attended by: 

1. The Managers of the finance department; 

2. Their first line of supervisors; 

3. The risk officer and 

4. Internal audit. 


289 



The second committee serves as a bigger meeting for discussion of financial issues 
pertaining to the whole municipality and all departments. The meeting is attended 
by: 

1. CFO 

2. Municipal Manager; 

3. Head of Department's; 

4. Finance Deputy Managers; 

5. Internal Audit; 

6. Other Role-Players 

5.12 PERFORMANCE OF SERVICE PROVIDERS 

In terms of section 116(2) (d) of the Local Government: Municipal Finance 
Management Act, 2003 (Act 56 of 2003), the Accounting Officer of a municipality 
must report on the management of the contract or agreement and the 
performance of the contractor. Please see below the performance of service 
providers who delivered material services. 


290 



Description 

Department 

Responsible 

person 

Tender no 
allocated 

Awarded to 

Amount (VAT included) 

Performance Review 
of the Suplier - Give a 
brief description of the 
supplier performance 

Supply of PABX and 

Telephone 

Management 

Solution system 
(voice) for a period 
of three period- 
renting option 

Corp Dept: IT 
Dept 

Rhyn Alberts 

E/02/16-17 

Telkom 

R4 000 000,00 

Satisfactory 

Supply and delivery 
of spares and 
accessories 

Roads 

Department 

Marisa/Melvin 

R/02/16-17 

Autozone and 

Wurth SA (Pty) LTd 

R2 000 000,00 

Satisfactory 

Supply and delivery 
of concrete block 
pavers 

Roads 

Department 

Bernadende 

Prinsloo 

R/05/16-17 

Mobicast Pty Ltd 

R 4 000 000,00 

Satisfactory 

Review and 
development of 
intergrated waste 
management plans 
for the municipalities 
of Hessequa, Mosel 
Bay, George, 

Knysna, Bitou, 
Kannaland and 
Garden Route 

District Municipality 

Community 

services 

Morton Hubbe 

E/16/18-19 

Gibb Pty Ltd 

R 1 541 000,00 

Satisfactory 

Fencing of Roads 

Dept in George 

Roads 

department 

Mr. JP Du 
Plessis/E Du 

Plessis 

R/04/18-19 

Jonty Engineering 
amd Trading SA 

CC 

R 616 044.65 

Satisfactory 


291 
















Purchasing of a 

Planning & 

Mario Appels 

E/43/18-19 

Me AJ Pretorious/ 

R 2450 000.00 

Satisfactory 

building for office 

Development 



Helen Melon 



use near the central 
business park of Bitou 
(Plettenberg Bay) 

Dept 



Properties 




292 



APPENDICES 


VOLUME II: 

ANNUAL FINANCIAL STATEMENTS 


293 



GARDEN ROUTE DISTRICT 

MUNICIPALITY 




FINANCIAL STATEMENTS 
30 JUNE 2019 


294 


GARDEN ROUTE DISTRICT MUNICIPALITY 


Index 


Contents 


General Information 2 

Approval of the Financial Statements 5 

Report of the Auditor General 

Statement of Financial Position 6 

Statement of Financial Performance 7 

Statement of Changes In Net Assets 8 

Cash Flow Statement 9 

Statement of Comparison of Budget and Actual Amounts - Statement of 

Financial Position 10 

Statement of Comparison of Budget and Actual Amounts - Statement of 

Financial Performance 11 

Statement of Comparison of Budget and Actual Amounts - Cash Flow 

Statement 12 

Accounting Policies 13 

Notes to the Financial Statements 45 

APPENDICES 

A Schedule of External Loans 89 

Disclosure of Grants and Subsidies In Terms of Section 123 of MFMA, 

B 56 of 2003 90 

C Appropriation Statements 91 


l 


295 





GARDEN ROUTE DISTRICT MUNICIPALITY 
FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 
GENERAL INFORMATION 


NATURE OF BUSINESS 

Garden Route District Municipality is a district municipality performing the functions as set out in the Constitution. 
(Act no 105 of 1996) 

COUNTRY OF ORIGIN AND LEGAL FORM 

South African Category C Municipality (District Municipality) as defined by the Municipal Structures Act. (Act no 
117 of 1998) 

JURISDICTION 

The Garden Route District Municipality includes the following municipalities: 

Bitou Municipality 
George Municipality 
Hessequa Municipality 
Kannaland Municipality 
Knysna Municipality 
Mossel Bay Municipality 
Oudtshoorn Municipality 

EXECUTIVE MAYOR 

Mr. M Booysen 

DEPUTY EXECUTIVE MAYOR 

Ms. RH Ruiters 

SPEAKER 

Mr. BHJ Groenewald 

CHIEF WHIP 

Mr. RE Spies 


MEMBERS OF THE EXECUTIVE COMMITTEE 


Executive Mayor 

Mr. M Booysen 

Deputy Executive Mayor 

Ms. RH Ruiters 

Chief Whip 

Mr. RE Spies 

Executive Councillor 

Mr. RE Spies 

Executive Councillor 

Mr. 1 Stemela 

Executive Councillor 

Mr. JJC Lambaatjeen 

Executive Councillor 

Ms. JP Johnson 

Executive Councillor 

Mr. KS Lose 

Executive Councillor 

Ms. E Meyer 


296 



GARDEN ROUTE DISTRICT MUNICIPALITY 
FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 
GENERAL INFORMATION 


MUNICIPAL MANAGER 

Mr. M.G Stratu 

CHIEF FINANCIAL OFFICER 

Mr. J.V.H de Jager 

REGISTERED OFFICE 

54 York Street 

GEORGE 

6529 

AUDITORS 

Office of the Auditor General (WC) 

PRINCIPLE BANKERS 

Nedbank, George 

ATTORNEYS 

Raubenheimers Attorneys 

Cilliers Odendaal Attorneys 

Millers Attorneys 

Regan Brown Attorneys 

Schroter Attorneys (Lamont Settlement) 

Boer Arries Attorneys 
Le Roux Lamprecht Attorneys 
Stadler & Swart Attorneys 
Rauch Gertenbach Attorneys 
AA Solwane Attorneys 
Mamatela Attorneys 
Mosdell, Pama & Cox Attorneys 

RELEVANT LEGISLATION 

Basic Conditions of Employment Act (Act no 75 of 1997) 
Collective Agreements 
Division of Revenue Act 
Electricity Act (Act no 41 of 1987) 

Employment Equity Act (Act no 55 of 1998) 

Housing Act (Act no 107 of 1997) 

Infrastructure Grants 

Municipal Budget and Reporting Regulations 
Municipal Finance Management Act (Act no 56 of 2003) 
Municipal Planning and Performance Management Regulations 
Municipal Property Rates Act (Act no 6 of 2004) 

Municipal Regulations on Standard Chart of Accounts 
Municipal Structures Act (Act no 117 of 1998) 

Municipal Systems Act (Act no 32 of 2000) 

Municipal Systems Amendment Act (Act no 7 of 2011) 

SALBC Leave Regulations 

Skills Development Levies Act (Act no 9 of 1999) 

Supply Chain Management Regulations, 2005 
The Income Tax Act 

Unemployment Insurance Act (Act no 30 of 1966) 

Value Added Tax Act 

Water Services Act (Act no 108 of 1997) 


297 



GARDEN ROUTE DISTRICT MUNICIPALITY 
FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 
GENERAL INFORMATION 


MEMBERS OF THE GARDEN ROUTE DISTRICT MUNICIPALITY 


WARD 


COUNCILLOR 

Proportional 


Ms T Fortuin 

Proportional 


Mr. S de Vries 

Proportional 


Ms. NF Kamte 

Proportional 


Mr. MP Mapitza 

Proportional 


Ms. D Xego 

Proportional 


Ms. CN Lichaba 

Proportional 


Ms. JL Hartnick 

Proportional 


Ms. S May 

Proportional 


Mr. RE Spies 

Proportional 


Mr. M Booysen 

Proportional 


Mr. KS Lose 

Proportional 


Mr. D Saayman 

Proportional 


Mr. BN van Wyk 

Proportional 


Mr. AJ Rossouw 

Representative: 

George Municipality 

Ms. T Teyisi 

Representative: 

George Municipality 

Mr. PJ van der Hoven 

Representative: 

George Municipality 

Mr. 1 Stemela 

Representative: 

George Municipality 

Ms. EH Stroebel 

Representative: 

George Municipality 

Mr. RS Figland 

Representative: 

George Municipality 

Mr. V Gericke 

Representative: 

Mossel Bay Municipality 

Mr. BHJ Groenewald 

Representative: 

Mossel Bay Municipality 

Ms. E Meyer 

Representative: 

Mossel Bay Municipality 

Ms. RH Ruiters 

Representative: 

Mossel Bay Municipality 

Mr. SS Mbandezi 

Representative: 

Oudtshoorn Municipality 

Mr. JJC Lambaatjeen 

Representative: 

Oudtshoorn Municipality 

Mr. RR Wildschut 

Representative: 

Oudtshoorn Municipality 

Mr. K Windvogel 

Representative: 

Knysna Municipality 

Mr. L Tyokoto 

Representative: 

Knysna Municipality 

Mr. DMC Pofadder 

Representative: 

Knysna Municipality 

Mr. A Tsengwa 

Representative: 

Hessequa Municipality 

Ms. T Van Rensburg 

Representative: 

Hessequa Municipality 

Mr. IT Mangaliso 

Representative: 

Bitou Municipality 

Ms. NC Jacob 

Representative: 

Bitou Municipality 

Ms. ASM Windvogel 

Representative: 

Kannaland Municipality 

Ms. JP Johnson 


298 



GARDEN ROUTE DISTRICT MUNICIPALITY 


APPROVAL OF FINANCIAL STATEMENTS 

I am responsible for the preparation of these annual financial statements year ended 30 
June 2019 in terms of Section 126 (1) of the Municipal Finance Management Act and which 
I have signed on behalf of the Municipality. 

The annual financial statements have been prepared in accordance with Standards of 
Generally Recognised Accounting Practice (GRAP), including any interpretations, guidelines 
and directives issued by the Accounting Standards Board. 

The annual financial statements are based upon appropriate accounting policies 
consistently applied and supported by reasonable and prudent judgements and estimates. 

I acknowledge that I am ultimately responsible for the system of internal financial control and 
that the system of internal control provides reasonable assurance that the financial records 
can be relied on. 

I have reviewed the Municipality’s cash flow forecast for the year to 30 June 2020 and am 
satisfied that the Municipality can continue in operational existence for the foreseeable 
future. 

The external auditors are responsible for independently reviewing and reporting on the 
Municipality's financial statements. 

I certify that the remuneration of Councillors and in-kind benefits are within the upper limits 
of the framework envisaged in Section 219 of the Constitution, read with the Remuneration 
of Public Officer Bearers Act and the Minister of Provincial and Local Government's 
determination in accordance with this Act. 



299 




GARDEN ROUTE DISTRICT MUNICIPALITY 


ASSETS 


STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2019 

Notes 2019 2018 

R R 


Non-Current Assets 307 903 003 289 970 725 


Property, Plant and Equipment 

2 

159 923 096 

145 428 100 

Investment Property 

3 

86 108 386 

85 420 899 

Intangible Assets 

4 

2 138 885 

1 362 639 

Investments 

5 

27 445 

26 027 

Employee Benefits 

13 

59 705 191 

57 733 060 

Current Assets 


208 240 364 

186 175 228 

Inventory 

7 

2 730 766 

2 567 785 

Receivables from Exchange Transactions 

8 

23 956 054 

16 759 557 

Receivables from Non-exchange Transactions 

9 

100 556 

100 556 

Operating Lease Asset 

6.1 

69 950 

18 833 

Taxes 

16 

3 278 029 

279 131 

Current Portion of Non-Current Employee Benefits 

12 

3 866 923 

4 108 443 

Cash and Cash Equivalents 

10.1 

174 238 085 

162 340 923 

Total Assets 


516 143 368 

476 145 953 

NET ASSETS AND LIABILITIES 

Non-Current Liabilities 


144 851 903 

137 986 376 

Long-term Borrowings 

11 

28 488 

590 799 

Non-current Employee Benefits 

12 

144 823 415 

137 395 577 

Current Liabilities 


75 302 524 

56 854 768 

Current Employee Benefits 

13 

37 155 386 

32 411 893 

Trade and Other Payables from Exchange Transactions 

14 

30 555 297 

15 533 418 

Unspent Transfers and Subsidies 

15 

6 893 628 

8 038 509 

Operating Lease Liability 

6.2 

- 

13 658 

Current Portion of Long-term Borrowings 

11 

698 214 

857 290 

Total Liabilities 


220 154 428 

194 841 144 

Net Assets 


295 988 940 

281 304 809 

Capital Replacement Reserve 

18 

31 325 891 

31 704 865 

Accumulated Surplus/(Deficit) 


264 663 049 

249 599 945 

Total Net Assets and Liabilities 


516 143 368 

476 145 953 


300 








GARDEN ROUTE DISTRICT MUNICIPALITY 


STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 30 JUNE 2019 


REVENUE 


Notes 2019 

R 


2018 

R 


Revenue from Non-exchange Transactions 

Transfer Revenue 

Government Grants and Subsidies 
Public Contributions and Donations 

Other Revenue 

Actuarial Gains 


166 274 058 159 236 939 



Revenue from Exchange Transactions 


231 906 683 

218 529 023 

Department of Transport - Roads Service Charges 

22 

192 323 602 

186 720 963 

Sales of Goods and Rendering of Services 

23 

21 572 639 

16 227 717 

Rent on Land 

24 

704 013 

444 513 

Rental of Facilities and Equipment 

25 

978 020 

347 585 

Interest Earned - External Investments 

26 

12 306 263 

11 936 951 

Interest Earned - Exchange Transactions 

27 

2 423 660 

1 639 116 

Licences and Permits 

21 

484 416 

213 594 

Operational Revenue 

28 

1 114071 

998 584 

Total Revenue 


398 180 740 

377 765 961 

EXPENDITURE 




Employee related costs 

29 

(220 799 701) 

(204 452 482) 

Remuneration of Councillors 

30 

(11 053 302) 

(10 980 692) 

Bad Debts Written Off 


(3 994 605) 

(3 527 609) 

Contracted Services 

31 

(32 674 297) 

(26 977 749) 

Depreciation and Amortisation 

32 

(4 033 309) 

(3 974 117) 

Actuarial Losses 

12 

(1 508 425) 

- 

Finance Costs 

33 

(127 408) 

(79 372) 

Inventory Consumed 

7 

(78 190 579) 

(73 172 033) 

Operating Leases 


(541 897) 

(975 205) 

Transfers and Subsidies 

34 

(2 355 601) 

(2 303 540) 

Operational Costs 

35 

(40 709 893) 

(35 573 154) 

Total Expenditure 


(395 989 018) 

(362 015 952) 

Operating Surplus/fDeficit) for the Year 


2191 723 

15 750 009 

Inventories: (Write-down)/Reversal of Write-down to Net Realisable 
Value 

7 

34 596 

(50 064) 

Reversal of Impairment Loss/(lmpairment Loss) on Receivables 

36 

(8 560 292) 

(7 300 140) 

Gains/(Loss) on Sale of Fixed Assets 

37 

2 188 768 

(573 997) 

Reversal of Impairment Loss/(lmpairment Loss) on Fixed Assets 

38 

18 829 335 

57 050 

NET SURPLUS/(DEFICIT) FOR THE YEAR 


14 684 130 

7 882 858 


301 





GARDEN ROUTE DISTRICT MUNICIPALITY 


STATEMENT OF CHANGES IN NET ASSETS FOR THE YEAR ENDED 30 JUNE 2019 



Capital 

Replacement 

Reserve 

Accumulated 

Surplus/ 

(Deficit) 

Total 


R 

R 

R 

Balance at 1 July 2017 

27 728 374 

245 214177 

272 942 550 

Correction of Error - note 39 

- 

479 402 

479 402 

Restated balance 

27 728 374 

245 693 579 

273 421 952 

Net Surplus/(Deficit) for the year 

- 

7 882 858 

7 882 858 

Net Surplus/(Deficit) previously reported 

Effects of Correction of Errors - note 39 

- 

5 987 172 

1 895 686 

5 987 172 

1 895 686 

Transfer to/from CRR 

Property, Plant and Equipment purchased 

3 976 492 

(3 976 492) 

- 

Balance at 30 June 2018 

31 704 866 

249 599 945 

281 304 810 

Restated balance 

31 704 866 

249 599 945 

281 304 810 

Net Surplus/(Deficit) for the year 

Transfer to/from CRR 

Property, Plant and Equipment purchased 

4 033 309 
(4 412 283) 

14 684 130 
(4 033 309) 

4 412 283 

14 684 130 

Balance at 30 June 2019 

31 325 891 

264 663 049 

295 988 940 


302 



GARDEN ROUTE DISTRICT MUNICIPALITY 


CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2019 


CASH FLOW FROM OPERATING ACTIVITIES 

Cash receipts 

Other Revenue 
Government - Operating 
Interest 

Cash payments 

Suppliers and Employees 
Finance Charges 
Transfers and Grants 


Net Cash from Operating Activities 
CASH FLOW FROM INVESTING ACTIVITIES 

Purchase of Property, Plant and Equipment 
Proceeds on Disposal of Fixed Assets 
Purchase of Intangible Assets 
Decrease/(lncrease) in Non-Current Debtors 
Decrease/(lncrease) in Non-Current Investments 

Net Cash from Investing Activities 
CASH FLOW FROM FINANCING ACTIVITIES 

Borrowing - Long term/Refinancing 
Repayment of Borrowing 

Net Cash from Financing Activities 

NET INCREASE/(DECREASE) IN CASH AND CASH 
EQUIVALENTS 

Cash and Cash Equivalents at the beginning of the year 
Cash and Cash Equivalents at the end of the year 

NET INCREASE/(DECREASE) IN CASH AND CASH 
EQUIVALENTS 


Notes 


40 


41 


2019 

2018 

R 

R 


377 131 557 

371 669 097 

198 890 947 

205 589 679 

165 934 347 

154 142 467 

12 306 263 

11 936 951 

(363 807 043) 

(347 671 254) 

(361 324 034) 

(345 288 341) 

(127 408) 

(79 372) 

(2 355 601) 

(2 303 540) 

13 324 513 

23 997 843 


(4 246 688) 

6 334 079 

(5 266 062) 

(1 061 328) 

(1 730 610) 

(1 419) 

(58 362) 
(499 815) 

(705 965) 

(5 824 239) 

212 074 

1 748 942 

(933 460) 

(300 856) 

(721 385) 

1 448 086 

11 897 163 

19 621 690 

162 340 923 

142 719 233 

174 238 085 

162 340 923 

11 897 163 

19 621 690 


303 



GARDEN ROUTE DISTRICT MUNICIPALITY 
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS 
STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2019 


Actual 

Final Outcome as % 




Original 

Budget 

Adjustment 

Shifting of 



Actual 

of Final 


Notes 

Budget 

Adjustments 

Budget 

Funds 

Virement 

Final Budget 

Outcome 

Budget 




(i.t.o. s28 and 



(i.t.o. Council 







s31 of the 


(i.t.o. s31 of 

approved by- 







MFMA) 


the MFMA) 

law) 


2019 




R 

R 

R 

R 

R 

R 

R 

% 

ASSETS 










Current Assets 










Cash 


164 926 531 

9 376 173 

174 302 704 



174 302 704 

174 238 085 

-0,04% 

Call Investment Deposits 








- 

0,00% 

Consumer Debtors 




- 


- 



0,00% 

Other Debtors 


8 216 984 

7 988 107 

16 205 091 


- 

16 205 091 

27 404 590 

69,11% 

Current Portion of Employee Benefits 


3 549 700 


3 549 700 



3 549 700 

3 866 923 

8,94% 

Inventory 


3 638 980 

(1 071 000) 

2 567 980 


- 

2 567 980 

2 730 766 

6,34% 

Total Current Assets 

44.2.1 

180 332 195 

16 293 280 

196 625 475 



196 625 475 

208 240 364 

5,91% 

Non-Current Assets 










Employee Benefits 


61 508 000 


61 508 000 



61 508 000 

59 705 191 

-2,93% 

Investments 


26 000 


26 000 


- 

26 000 

27 445 

5,56% 

Investment Property 


84 677 439 


84 677 439 


- 

84 677 439 

86 108 386 

1,69% 

Property, Plant and Equipment 


152 178 260 

7 561 379 

159 739 639 


- 

159 739 639 

159 923 096 

0,11% 

Intangible Assets 


2717 116 

(1 354 000) 

1 363 116 


- 

1 363116 

2 138 885 

56,91% 

Total Non-Current Assets 

44.2.2 

301 106 815 

6 207 379 

307 314 194 


- 

307 314194 

307 903 003 

0,19% 

TOTAL ASSETS 


481 439 010 

22 500 659 

503 939 669 



503 939 669 

516 143 368 

2,42% 

LIABILITIES 










Current Liabilities 










Bank Overdraft 




- 


. 




Borrowing 



857 290 

857 290 


- 

857 290 

698 214 

-18,56% 

Consumer Deposits 









0,00% 

Trade and Other Payables 


46 012 462 

25 831 000 

71 843 462 



71 843 462 

37 448 924 

- 47 , 87 % 

Provisions 


29 692 277 


29 692 277 


- 

29 692 277 

37 155 386 

25,13% 

Total Current Liabilities 

44.2.3 

75 704 739 

26 688 290 

102 393 029 



102 393 029 

75 302 524 

-26,46% 

Non-Current Liabilities 










Borrowing 



590 799 

590 799 


- 

590 799 

28 488 

-95,18% 

Provisions 


163 152 756 

(25 757 000) 

137 395 756 


- 

137 395 756 

144 823 415 

5,41% 

Total Non-Current Liabilities 

44.2.4 

163 152 756 

(25 166 201) 

137 986 555 



137 986 555 

144 851 903 

4,98% 

TOTAL LIABILITIES 


238 857 495 

1 522 089 

240 379 584 


- 

240 379 584 

220 1 54 428 

-8,41% 

NET ASSETS 










Accumulated Surplus/(Deficit) 


218 064 000 

17 189 221 

235 253 221 


. 

235 253 221 

264 663 049 

12,50% 

Reserves 


24 518 000 

3 788 865 

28 306 865 


- 

28 306 865 

31 325 891 

10,67% 

TOTAL NET ASSETS 

44.2.5 

242 582 000 

20 978 086 

263 560 086 



263 560 086 

295 988 940 

12,30% 


304 



GARDEN ROUTE DISTRICT MUNICIPALITY 
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS 
STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 30 JUNE 2019 


REVENUE 

Rental of Facilities and Equipment 
Interest Earned - External Investments 
Interest Earned - Outstanding Debtors 
Licences and Permits 
Agency Services 

Transfers Recognised - Operational 

Other Revenue 

Cains on Disposal of PPE 

Total Revenue (excluding capital transfers and 
contributions) 

EXPENDITURE 

Employee Related Costs 
Remuneration of Councillors 
Debt Impairment 

Depreciation and Asset Impairment 
Finance Charges 
Other Materials 
Contracted Services 
Other Expenditure 

Total Expenditure 
Surplus/(Deficlt) 

Transfers Recognised - Capital 
Contributions Recognised - Capital 
Contributed Assets 

Surplus/(Deficit) after Capital Transfers & 
Contributions 

SurplusZ(Deficit) for the year 


Actual 


Notes 

Original 

Budget 

Budget 

Adjustments 

Final 

Adjustment 

Budget 

Shifting of 
Funds 

Virement 

Final Budget 

Actual 

Outcome 

Outcome as 
of Final 
Budget 


R 

(i.t.o. s28 and 
s31 of the 
MFMA) 

R 

R 

(i.t.o. s31 of 
the MFMA) 

R 

(i.t.o. Council 
approved by¬ 
law) 

R 

R 

2019 

R 

% 


2 718 175 

1 127 771 

3 845 946 

3 845 946 

1 682 033 

-56,26% 

15 714 823 

0 

15 714 824 

15 714 824 

12 306 263 

-21,69% 

896 605 

0 

896 605 

896 605 

2 423 660 

170,32% 

332 522 


332 522 

332 522 

484 416 

45.68% 

19 021 800 

2 040 000 

21 061 800 

21 061 800 

17 243 706 

-18,13% 

158 885 301 

13 550120 

172 435 421 

172 435 421 

166 274 058 

-3,57% 

189 389 910 

(5 031 826) 

184 358 085 

184 358 085 

197 766 606 

7.27% 

3 156 000 

844 000 

4 000 000 

4 000 000 

2 188 768 

-45,28% 


390 115 137 

12 530 066 

402 645 204 

- 402 645 204 

400 369 509 

-0,57% 

133 669 447 

6 864 593 

140 534 040 

140 534 040 

220 799 701 

57,11% 

11 572 212 

360 500 

11 932 712 

11 932 712 

11 053 302 

-7,37% 

1 600 597 

(0) 

1 600 597 

1 600 597 

12 554 897 

684,39% 

3 271 549 

(100 000) 

3171 550 

3171 550 

(14 796 026) 

-566,52% 





127 408 

100,00% 

185 056 

(148 898) 

36 158 

36 158 


-100,00% 

60 636 145 

(10 281 692) 

50 354 453 

50 354 453 

32 674 297 

-35,11% 

176 902 601 

13 871 265 

190 773 867 

190 773 867 

123 271 800 

-35,38% 

387 837 608 

10 565 768 

398 403 376 

398 403 376 

385 685 379 

-3,19% 

2 277 530 

1 964 298 

4 241 827 

4 241 827 

14 684 130 

246,17% 


2 277 530 

1 964 298 

4 241 827 

4 241 827 

14 684 130 

246,17% 

2 277 530 

1 964 298 

4 241 827 

4 241 827 

14 684 130 

246,17% 


GARDEN ROUTE DISTRICT MUNICIPALITY 
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS 
CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2019 


Actual 

Final Outcome as 


CASH FLOW FROM OPERATING ACTIVITIES 

Receipts 

Other Revenue 

Government - Operating 

Government - Capital 

Interest 

Payments 

Suppliers and Employees 

Finance costs 

Transfers and Grants 

Original 
Notes Budget 

R 

211 462 408 
158 885 301 

15 714 823 

(382 965 461) 

Budget 
Adjustments 
(i.t.o. s28 and 
s31 of the 
MFMA) 

R 

3 032 551 

13 550 120 

0 

(5 886 659) 

Adjustment 

Budget 

R 

214 494 959 
172 435 421 

15 714 824 

(388 852120) 

Shifting of 
Funds 

(i.t.o. s31 of 
the MFMA) 

R 

Virement 
(i.t.o. Council 
approved by¬ 
law) 

R 

Final Budget 

R 

214 494 959 
172 435 421 

15 714 824 

(388 852 120) 

Actual 

Outcome 

2019 

R 

198 890 947 
165 934 347 

12 306 263 

(361 324 034) 
(127 408) 
(2 355 601) 

% of Final 
Budget 

% 

-7,27% 

-3,77% 

0,00% 

-21,69% 

-7,08% 

-100,00% 

-100,00% 

Net Cash from/(used) Operating Activities 

3 097 071 

10 696 013 

13 793 084 



13 793 084 

13 324 513 

-3,40% 

CASH FLOW FROM INVESTING ACTIVITIES 

Receipts 

Proceeds on disposal of PPE 

3156 000 


3 156 000 



3 156 000 

6 334 079 

-3,77% 

Decrease/(lncrease) in Non-Current Debtors 


- 



- 


(1 730 610) 

-100,00% 

Decrease/(lncrease) in Other Non-Current Receivables 

(1 791 000) 


(1 791 000) 



(1 791 000) 


100,00% 

Decrease/(lncrease) in Non-Current Investments 







(1 419) 

-100,00% 

Payments 

Capital Assets 

(9 303 379) 

(1 320 000) 

(10 623 379) 



(10 623 379) 

(5 308 015) 

-50,03% 

Net Cash from/(used) Investing Activities 

44.2.8 (7 938 379) 

(1 320 000) 

(9 258 379) 



(9 258 379) 

(705 965) 

-92,37% 

CASH FLOW FROM FINANCING ACTIVITIES 

Receipts 

Short Term Loans 









Borrowing long term/refinancing 







212 074 

100,00% 

lncrease/(Decrease) in Consumer Deposits 









Payments 

Repayment of Borrowing 







(933 460) 

-100,00% 

Net Cash from/(used) Financing Activities 







(721 385) 

-100,00% 

NET INCREASE/(DECREASE) IN CASH HELD 

(4 841 308) 

9 376 013 

4 534 704 



4 534 704 

11 897 161 

162,36% 

Cash and Cash Equivalents at the year begin: 

169 768 000 


169 768 000 



169 768 000 

162 340 923 

-4,37% 

Cash and Cash Equivalents at the year end: 

164 926 692 

9 376 013 

174 302 704 



174 302 704 

174 238 083 

-0,04% 


305 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1. ACCOUNTING PRINCIPLES AND POLICIES APPLIED IN THE FINANCIAL STATEMENTS 

1.1. BASIS OF PREPARATION 

The annual financial statements have been prepared on an accrual basis of accounting 
and are in accordance with historical cost convention unless specified otherwise. 

The annual financial statements have been prepared in accordance with the Municipal 
Finance Management Act (MFMA) and effective standards of Generally Recognised 
Accounting Practices (GRAP), including any interpretations and directives issued by the 
Accounting Standards Board (ASB) and also in accordance with Section 122(3) of the 
Municipal Finance Management Act, (Act No 56 of 2003). 

Accounting policies for material transactions, events or conditions not covered by the 
GRAP reporting framework, have been developed in accordance with paragraphs 8, 10 
and 11 of GRAP 3 (Revised - March 2015) and the hierarchy approved in Directive 5 issued 
by the Accounting Standards Board. 

A summary of the significant accounting policies, which have been consistently applied 
except where an exemption has been granted, are disclosed below. 

Assets, liabilities, revenue and expenses have not been offset except when offsetting is 
permitted or required by a Standard of GRAP. 

The accounting policies applied are consistent with those used to present the previous 
year’s financial statements, unless explicitly stated. The details of any changes in 
accounting policies are explained in the relevant notes to the annual financial statements. 

In terms of Directive 7: “The Application of Deemed Cost on the Adoption of Standards of 
GRAP” issued by the Accounting Standards Board, the Municipality applied deemed cost 
to Investment Property, Property, Plant and Equipment and Intangible where the 
acquisition cost of an asset could not be determined. 

1.2. PRESENTATION CURRENCY 

Amounts reflected in the financial statements are in South African Rand. Financial values 
are rounded to the nearest one Rand. 

1.3. GOING CONCERN ASSUMPTION 

These annual financial statements have been prepared on a going concern basis. 

1.4. COMPARATIVE INFORMATION 

When the presentation or classification of items in the annual financial statements is 
amended, prior period comparative amounts are restated, unless a standard of GRAP does 
not require the restatements of comparative information. The nature and reason for the 
reclassification is disclosed. Where material accounting errors have been identified in the 
current year, the correction is made retrospectively as far as is practicable, and the prior 
year comparatives are restated accordingly. Where there has been a change in accounting 


306 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


policy in the current year, the adjustment is made retrospectively as far as is practicable, 
and the prior year comparatives are restated accordingly. 

The Municipal Regulations on Standard Chart of Accounts (mSCOA) came into effect on 1 
July 2017. The mSCOA Charts are updated annually by National Treasury. The 
municipality has realigned items in the financial statements with the Item Segment of 
mSCOA Version 6.2, on which the municipality was required to transacted for periods after 
1 July 2018. The result of this process was a reclassification and naming of items in the 
annual financial statements. 

1.5. MATERIALITY 

Material omissions or misstatements of items are material if they could, individually or 
collectively, influence the decision or assessments of users made on the basis of the annual 
financial statements. Materiality depends on the nature or size of the omission or 
misstatements judged in the surrounding circumstances. The nature or size of the 
information item, or a combination of both, could be the determining factor. Materiality is 
determined as 1% of total operating expenditure. This materiality is from management’s 
perspective and does not correlate with the auditor's materiality. 

1.6. PRESENTATION OF BUDGET INFORMATION 

The presentation of budget information is prepared in accordance with GRAP 24 and 
guidelines issued by National Treasury. The comparison of budget and actual amounts 
are disclosed as a separate additional financial statement, namely Statement of 
comparison of budget and actual amounts. 

Budget information is presented on the accrual basis and is based on the same period as 
the actual amounts. The budget information is therefore on a comparable basis to the actual 
amounts. 

The comparable information includes the following: 

• the approved and final budget amounts; 

• actual amounts and final budget amounts; 

Explanations for differences between the approved and final budget are included in the 
Notes to the Financial Statements. Material differences are being defined by Management 
as 10% of a specific line-item with a minimum of R500.000. 

Explanations for material differences between the final budget amounts and actual 
amounts are included the Notes to the Financial Statements. 

The disclosure of comparative information in respect of the previous period is not required 
in terms of GRAP 24. 


1.7. STANDARDS, AMENDMENTS TO STANDARDS AND INTERPRETATIONS ISSUED BUT 
NOT YET EFFECTIVE 

GRAP 18 Segment Reporting is effective from 1 April 2015. The implementation of GRAP 
18 is delayed, in terms of Directive 5, for municipalities for the 2017/18 financial year and 
municipalities are not required to apply or early adopt GRAP 18. The implementation date 
of GRAP 18 is 1 April 2020. 


307 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


The following GRAP standards have been issued but are not yet effective and have not 
been early adopted by the municipality: 


REFERENCE 

TOPIC 

EFFECTIVE 

DATE 

GRAP 20 
(Original - 
Jun 2011) 

Related Partv Disclosure 

The objective of this Standard is to ensure that a 
Municipality’s financial statements contains the 
disclosures necessary to draw attention to the possibility 
that its financial position and surplus or deficit may have 
been affected by the existence of related parties and by 
transactions and outstanding balances with such parties. 

The Municipality resolved to adopt some of the disclosure 
requirements as per GRAP 20. The information is 
therefore included in the financial statements. 

1 April 2019 

GRAP 32 

(Original - 
Aug 2013) 

Service Concession Arranqements: Grantor 

1 April 2019 

The objective of this Standard is to prescribe the 
accounting for service concession arrangements by the 
grantor and a public entity. 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 

GRAP 34 
(Revised - 
April 2019) 

Separate Financial Statements 

The objective of this Standards is to prescribe the 
accounting and disclosure requirements in controlled 
entities, joint ventures and associates when an entity 
prepares separate financial statements. 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 

Unknown 

GRAP 35 
(Revised - 
April 2019) 

Consolidated Financial Statements 

The objective of this Standard is to establish principles 
for the presentation and preparation of consolidated 
financial statements when an entity controls one or more 
other entities. 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 

Unknown 

GRAP 36 

(Revised - 
April 2019) 

Investments in Associates and Joint Ventures 

Unknown 

The objective of this Standard is to prescribe the 
accounting for investments in associates and joint 
ventures and to set out the requirements for the 
application of the equity method when accounting for 
investments in associates and joint ventures. 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 


308 






GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


GRAP 37 
(Revised - 
April 2019) 

Joint Arranqements 

The objective of this Standard is to establish principles 
for financial reporting by entities that have an interest in 
arrangements that are controlled jointly (i.e. joint 
arrangements) 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 

Unknown 

GRAP 38 

(Revised - 
April 2019) 

Disclosure of Interest in Other Entities 

The objective of this Standard is to require an entity to 
disclose information that enables users of its financial 
statements to evaluate: 

a) the nature of, and risks associated with, its interest 
in controlled entities unconsolidated controlled 
entities, joint arrangements and associates, and 
structure entities that are not consolidated; and 

b) the effects of those interests on its financial position, 
financial performance and cash flows. 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 

Unknown 

GRAP 104 
(Revised - 
April 2019) 

Financial Instruments 

The objective of this Standard is to establish principles 
for recognising, measuring, presenting and disclosing 
financial instruments. 

No significant impact is expected as the Municipality’s 
current treatment is already in line with the Standards 
treatment. 

Unknown 

GRAP 108 

(Original - 
Sept 2013) 

Statutory Receivables 

The objective of this Standard is to prescribe accounting 
requirements for the recognition, measurement, 
presentation and disclosure of statutory receivables. 

The Municipality has revolved to adopt the principles as 
set out in GRAP 108 to formulate its own accounting 
policy. 

1 April 2019 

GRAP 109 

Accounting bv Principles and Aaents 

The objective of this Standard is to outline principles to 
be used by an entity to assess whether it is party to a 
principal-agent arrangement, and whether it is a principal 
or an agent in undertaking transactions in terms of such 
an arrangement. 

No significant impact is expected as the Municipality’s 
current treatment is already in line with the Standards 
treatment. 

1 April 2019 


309 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


GRAP 110 

Livinq and non-livinq resources 

1 April 2020 

The objective of this Standard is to prescribe the 
recognition, measurement, presentation and disclosure 
requirements for living resources; and disclosure 
requirements for non-living resources. 

No significant impact expected as no such transactions 
or events are expected in the foreseeable future. 

IGRAP 17 

Service Concession Arranqements where a qrantor 

Unknown 

controls a siqnificant residual interest in an Asset 

The Interpretation of the Standards is to provide 
guidance to the grantor where it has entered into a 
service concession arrangement, but only controls, 
through a significant residual interest in a service 
concession asset at the end of the arrangement, where 
the arrangement does not constitute a lease. 

No such transactions or events are expected in the 
foreseeable future. 

IGRAP 18 

Recoqnition and Derecoqnition of Land 

The Interpretation provide guidance on when an entity 
should recognise and derecognise land as an asset in its 
financial statements. 

The municipality needs to assess whether there are any 
changes to binding agreements that may impact its 
assessment of control. 

1 April 2019 

IGRAP 19 

Liabilities to Pav Levies 

The Interpretation provides guidance on the accounting 
for levies in the financial statements of the entity that is 
paying the levy. It clarifies when entities need to 
recognise a liability to pay a levy that is accounted for in 
accordance with GRAP 19. 

No such transactions or events are expected in the 
foreseeable future. 

1 April 2019 


These standards, amendments and interpretations will not have a significant impact on the 
Municipality once implemented. 


310 






GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.8. RESERVES 

1.8.1. Capital Replacement Reserve (CRR) 

In order to finance the provision of infrastructure and other items of property, plant and 
equipment from internal sources, amounts are transferred from the accumulated surplus to 
the CRR. The cash in the CRR can only be utilized to finance items of property, plant and 
equipment. The CRR is reduced and the accumulated surplus is credited by a 
corresponding amount when the amounts in the CRR are utilized. 

1.9. LEASES 

1.9.1. Municipality as Lessee 

Leases are classified as finance leases where substantially all the risks and rewards 
associated with ownership of an asset are transferred to the Municipality. Property, plant 
and equipment or intangible assets (excluding licensing agreements for such items as 
motion picture films, video recordings, plays, manuscripts, patents and copyrights) subject 
to finance lease agreements are initially recognised at the lower of the asset’s fair value 
and the present value of the minimum lease payments. The corresponding liabilities are 
initially recognised at the inception of the lease and are measured as the sum of the 
minimum lease payments due in terms of the lease agreement, discounted for the effect of 
interest. In discounting the lease payments, the Municipality uses the interest rate that 
exactly discounts the lease payments and unguaranteed residual value to the fair value of 
the asset plus any direct costs incurred. 

Subsequent to initial recognition, the leased assets are accounted for in accordance with 
the stated accounting policies applicable to property, plant and equipment, investment 
property or intangibles assets. The lease liability is reduced by the lease payments, which 
are allocated between the lease finance cost and the capital repayment using the effective 
interest rate method. Lease finance costs are expensed when incurred. The accounting 
policies relating to de-recognition of financial instruments are applied to lease payables. 

Operating leases are those leases that do not fall within the scope of the above definition. 
Operating lease rentals are recognised on a straight-line basis over the term of the relevant 
lease. The difference between the straight-lined expenses and actual payments made will 
give rise to a liability. The Municipality recognises the aggregate benefit of incentives as a 
reduction of rental expense over the lease term, on a straight-line basis unless another 
systematic basis is representative of the time pattern of the lessee’s benefit from the use 
of the leased asset. 

1.9.2. Municipality as Lessor 

Under a finance lease, the Municipality recognises the lease payments to be received in 
terms of a lease agreement as an asset (receivable). The receivable is calculated as the 
sum of all the minimum lease payments to be received, plus any unguaranteed residual 
accruing to the Municipality, discounted at the interest rate implicit in the lease. The 
receivable is reduced by the capital portion of the lease instalments received, with the 
interest portion being recognised as interest revenue on a time proportionate basis. The 
accounting policies relating to de-recognition and impairment of financial instruments are 
applied to lease receivables. 

Operating leases are those leases that do not fall within the scope of the above definition. 
Operating lease revenue is recognised on a straight-line basis over the term of the relevant 
lease. The difference between the straight-lined revenue and actual payments received 


311 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


will give rise to an asset. The Municipality recognises the aggregate cost of incentives as 
a reduction of rental revenue over the lease term, on a straight-line basis unless another 
systematic basis is representative of the time pattern over which the benefit of the leased 
asset is diminished. 

1.10. UNSPENT TRANSFERS AND SUBSIDIES 

Conditional transfers and subsidies are subject to specific conditions. If these specific 
conditions are not met, the monies received are repayable. 

Unspent conditional transfers and subsidies are liabilities that are separately reflected on 
the Statement of Financial Position. They represent unspent government grants, subsidies 
and contributions. Unspent conditional grants are not considered to be financial 
instruments as there are no contractual arrangements as required per GRAP 104. Once 
the conditional grant becomes repayable to the donor due to conditions not met, the 
remaining portion of the unspent conditional grant is reclassified as payables, which is 
considered to be a financial instrument. 

This liability always has to be cash-backed. The following provisions are set for the creation 
and utilisation of this creditor: 

• Unspent conditional transfers and subsidies are recognised as a liability when the 
grant is received. 

• When grant conditions are met an amount equal to the conditions met are transferred 
to revenue in the Statement of Financial Performance. 

• The cash which backs up the creditor is invested as individual investment or part of 
the general investments of the Municipality until it is utilised. 

• Interest earned on the investment is treated in accordance with grant conditions. If it 
is payable to the funder it is recorded as part of the creditor. If it is the Municipality’s 
interest, it is recognised as interest earned in the Statement of Financial 
Performance. 

1.11. UNPAID CONDITIONAL TRANSFERS AND SUBSIDIES 

Unpaid conditional transfers and subsidies are assets in terms of the Framework that are 
separately reflected on the Statement of Financial Position. The asset is recognised when 
the Municipality has an enforceable right to receive the grant or if it is virtually certain that 
it will be received based on that grant conditions have been met. They represent unpaid 
government grants, subsidies and contributions from the public. 

The following provisions are set for the creation and utilisation of grant receivables: 

• Unpaid conditional transfers and subsidies are recognised as an asset when the grant 
is receivable. 

1.12. PROVISIONS 

Provisions are recognised when the Municipality has a present legal or constructive 
obligation as a result of past events, it is probable that an outflow of resource embodying 
economic benefits or service potential will be required to settle the obligation and a reliable 
estimate of the provision can be made. Provisions are reviewed at reporting date and 
adjusted to reflect the current best estimate of future outflows of resources. Where the 
effect is material, non-current provisions are discounted to their present value using a 


312 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


discount rate that reflects the market’s current assessment of the time value of money, 
adjusted for risks specific to the liability. 

Future events that may affect the amount required to settle an obligation are reflected in 
the amount of a provision where there is sufficient objective evidence that they will occur. 
Gains from the expected disposal of assets are not taken into account in measuring a 
provision. Provisions are not recognised for future operating losses. The present 
obligation under an onerous contract is recognised and measured as a provision. 

A provision for restructuring costs is recognised only when the following criteria over and 
above the recognition criteria of a provision have been met: 

(a) The municipality has a detailed formal plan for the restructuring identifying at least: 

• the business or part of a business concerned; 

• the principal locations affected; 

• the location, function and approximate number of employees who will be 
compensated for terminating their services; 

• the expenditures that will be undertaken; and 

• when the plan will be implemented. 

(b) The Municipality has raised a valid expectation in those affected that it will carry out 
the restructuring by starting to implement that plan or announcing its main features to 
those affected by it. 

The amount recognised as a provision is the best estimate of the expenditure required to 
settle the present obligation at the reporting date. 

If it is no longer probable that an outflow of resources embodying economic benefits or 
service potential will be required to settle the obligation, the provision is de-recognised. 

1.13. EMPLOYEE BENEFITS 

Defined contribution plans are post-employment benefit plans under which the Municipality 
pays fixed contributions into a separate entity (a fund) and will have no legal or constructive 
obligation to pay further contributions if the fund does not hold sufficient assets to pay all 
employee benefits relating to employee service in the current and prior periods. 

Defined benefit plans are post-employment benefit plans other than defined contribution 
plans. 


1.13.1. Post-Retirement Medical Obligations 

The Municipality provides post-retirement medical benefits by subsidizing the medical aid 
contributions of certain retired staff according to the rules of the medical aid funds. Council 
pays 70% as contribution and the remaining 30% is paid by the members. The entitlement 
to these benefits is usually conditional on the employee remaining in service up to 
retirement age and the completion of a minimum service period. The present value of the 
defined benefit liability is actuarially determined in accordance with GRAP 25 - “Employee 
Benefits” (using a discount rate applicable to government bonds). The plan is unfunded. 

These contributions are charged to the Statement of Financial Performance when 
employees have rendered the service entitling them to the contribution. The interest cost 
of the defined benefit obligation is recognised as finance cost in the Statement of Financial 


313 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Performance, as it meets the definition of Interest Cost in GRAP 25. The liability was 
calculated by means of the projected unit credit actuarial valuation method. The liability in 
respect of current pensioners is regarded as fully accrued and is therefore not split between 
a past (or accrued) and future in-service element. The liability is recognised at the fair value 
of the obligation. Payments made by the Municipality are set-off against the liability, 
including notional interest, resulting from the valuation by the actuaries and are charged 
against the Statement of Financial Performance as employee benefits upon valuation. 

Actuarial gains and losses arising from the experience adjustments and changes in 
actuarial assumptions, is recognised in the Statement of Financial Performance in the 
period that it occurs. These obligations are valued annually by independent qualified 
actuaries. 

1.13.2. Long Service Awards 

Long service awards are provided to employees who achieve certain pre-determined 
milestones of service within the Municipality. The Municipality's obligation under these 
plans is valued by independent qualified actuaries periodically and the corresponding 
liability is raised. Payments are set-off against the liability, including notional interest, 
resulting from the valuation by the actuaries and are charged against the Statement of 
Financial Performance as finance cost upon valuation, as it meets the definition of Interest 
Cost in GRAP 25. Defined benefit plans are post-employment plans other than defined 
contribution plans. 

Actuarial gains and losses arising from the experience adjustments and changes in 
actuarial assumptions, is recognised in the Statement of Financial Performance in the 
period that it occurs. These obligations are valued annually by independent qualified 
actuaries. 


1.13.3. Ex gratia Gratuities 

Ex gratia gratuities are provided to employees that were not previously members of a 
pension fund. The Municipality’s obligation under these plans is valued by independent 
qualified actuaries and the corresponding liability is raised. Payments made by the 
Municipality are set-off against the liability, including notional interest, resulting from the 
valuation by the actuaries and are charged against the Statement of Financial Performance 
as financial cost upon valuation as it meets the definition of Interest Cost in GRAP 25. 
Defined benefit plans are post-employment plans other than defined contribution plans. 

Actuarial gains and losses arising from the experience adjustments and changes in 
actuarial assumptions, is recognised in the Statement of Financial Performance in the 
period that it occurs. These obligations are valued annually by independent qualified 
actuaries. 


1.13.4. Provision for Staff Leave 

Liabilities for annual leave are recognised as they accrue to employees. The liability is 
based on the total amount of leave days due to employees at year-end and also on the 
total remuneration package of the employee at year-end. 

Accumulating leave is carried forward and can be used in future periods if the current 
period’s entitlement is not used in full but is limited to a maximum of 48 days. All unused 
leave will be paid out to the specific employee at the end of that employee’s employment 
term. 


314 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Accumulated leave is vesting. 


1.13.5. Staff Bonuses Accrued 

Liabilities for staff bonuses are recognised as they accrue to employees. The liability at 
year-end is based on bonus accrued at year-end for each employee. 


1.13.6. Provision for Performance Bonuses 

A provision, in respect of the liability relating to the anticipated costs of performance 
bonuses payable to Section 57 employees, is recognised as it accrues to Section 57 
employees. 

1.13.7. Pension and retirement fund obligations 

The Municipality provides retirement benefits for its employees and councillors. 

Defined contribution plans are post-employment benefit plans under which the Municipality 
pays fixed contributions into a separate entity (a fund) and will have no legal or constructive 
obligation to pay further contributions if the fund does not hold sufficient assets to pay all 
employee benefits relating to employee service in the current and prior periods. 

The contributions to fund obligations for the payment of retirement benefits are recognised 
in the Statement of Financial Performance in the year they become payable. 

The defined benefit funds, which are administered on a provincial basis, are actuarially 
valued tri-annually on the projected unit credit method basis. Deficits identified are 
recovered through lump sum payments or increased future contributions on a proportional 
basis to all participating municipalities. The contributions and lump sum payments are 
charged against income in the year they become payable. Sufficient information is not 
available to use defined benefit accounting for a multi-employer plan. As a result, defined 
benefit plans have been accounted for as if they were defined contribution plans. 

The Municipality operate various pension schemes. The schemes are generally funded 
through payments to insurance companies or trustee-administered funds, determined by 
periodic actuarial calculations. The Municipality has both defined benefit and defined 
contribution plans. A defined contribution plan is a pension plan under which the 
Municipality pays fixed contributions into a separate entity. The municipality has no legal 
or constructive obligations to pay further contributions if the fund does not hold sufficient 
assets to pay all employees the benefits relating to employee service in the current and 
prior periods. A defined benefit plan is a pension plan that is not a defined contribution plan. 
Typically, defined benefit plans define an amount of pension benefit that an employee will 
receive on retirement, usually dependent on one or more factors such as age, years of 
service and compensation. 

The liability recognised in the balance sheet in respect of defined benefit pension plans is 
the present value of the defined benefit obligation at the balance sheet date less the fair 
value of plan assets, together with adjustments for unrecognised actuarial gains or losses 
and past service costs. The defined benefit obligation is calculated annually by 
independent actuaries using the projected unit credit method. The present value of the 
defined benefit obligation is determined by discounting the estimated future cash outflows 
using interest rates of high-quality corporate bonds that are denominated in the currency 


315 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


in which the benefits will be paid and that have terms to maturity approximating to the terms 
of the related pension liability. 

Actuarial gains and losses arising from the experience adjustments and changes in 
actuarial assumptions, is charged or credited to the Statement of Financial Performance in 
the period that it occurs. 

Past-service costs are recognised immediately in income, unless the changes to the 
pension plan are conditional on the employees remaining in service for a specified period 
of time (the vesting period). In this case, the past-service costs are amortised on a straight- 
line basis over the vesting period. 

For defined contribution plans, the Municipality pays contributions to publicly or privately 
administered pension insurance plans on a mandatory, contractual or voluntary basis. The 
contributions are recognised as employee benefit expense when they are due. Prepaid 
contributions are recognised as an asset to the extent that a cash refund or a reduction in 
the future payments is available. 

1.13.8. Other Short-term Employee Benefits 

When an employee has rendered service to the Municipality during a reporting period, the 
Municipality recognises the undiscounted amount of short-term employee benefits 
expected to be paid in exchange for that service: 

• as a liability (accrued expense), after deducting any amount already paid. If the 
amount already paid exceeds the undiscounted amount of the benefits, the 
Municipality recognises that excess as an asset (prepaid expense) to the extent that 
the prepayment will lead to, for example, a reduction in future payments or a cash 
refund; and 

• as an expense, unless another Standard requires or permits the inclusion of the 
benefits in the cost of an asset. 

1.14. BORROWING COSTS 

The Municipality recognises all borrowing costs as an expense in the period in which they 
are incurred. 

1.15. PROPERTY, PLANT AND EQUIPMENT 

1.15.1. Initial Recognition and Measurement 

Property, plant and equipment are tangible non-current assets (including infrastructure 
assets) that are held for use in the production or supply of goods or services, rental to 
others, or for administrative purposes, and are expected to be used during more than one 
year. The cost of an item of property, plant and equipment is recognised as an asset if, 
and only if it is probable that future economic benefits or service potential associated with 
the item will flow to the Municipality, and the cost or fair value of the item can be measured 
reliably. Items of property, plant and equipment are initially recognised as assets on 
acquisition date and are initially recorded at cost. The cost of an item of property, plant 
and equipment is the purchase price and other costs attributable to bring the asset to the 
location and condition necessary for it to be capable of operating in the manner intended 
by the Municipality. Trade discounts and rebates are deducted in arriving at the cost. The 


316 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


cost also includes the necessary costs of dismantling and removing the asset and restoring 
the site on which it is located. 

When significant components of an item of property, plant and equipment have different 
useful lives, they are accounted for as separate items (major components) of property, 
plant and equipment. 

Where an asset is acquired by the Municipality for no or nominal consideration (i.e. a non¬ 
exchange transaction), the cost is deemed to be equal to the fair value of that asset on the 
date acquired. 

Where an item of property, plant and equipment is acquired in exchange for a non¬ 
monetary asset or monetary assets, or a combination of monetary and non-monetary 
assets, the assets acquired is initially measured at fair value (the cost). It the acquired 
item’s fair value is not determinable, it’s deemed cost is the carrying amount of the asset(s) 
given up. 

Major spare parts and servicing equipment qualify as property, plant and equipment when 
the Municipality expects to use them during more than one period. Similarly, if the major 
spare parts and servicing equipment can be used only in connection with an item of 
property, plant and equipment, they are accounted for as property, plant and equipment. 

1.15.2. Subsequent Measurement - Cost Model 

Subsequent to initial recognition, items of property, plant and equipment are measured at 
cost less accumulated depreciation and any accumulated impairment losses. Land is not 
depreciated as it is deemed to have an indefinite useful life. 

Where the Municipality replaces parts of an asset, it derecognises the part of the asset 
being replaced and capitalises the new component. Subsequent expenditure incurred on 
an asset is capitalised when it increases the capacity or future economic benefits or service 
potential associated with the asset. 

1.15.3. Depreciation and Impairment 

Depreciation is calculated on the depreciable amount, using the straight-line method over 
the estimated useful lives of the assets to the residual value of the asset, where applicable. 
Depreciation of an asset begins when it is available for use, i.e. when it is in the location 
and condition necessary for it to be capable of operating in the manner intended by 
management. Components of assets that are significant in relation to the whole asset and 
that have different useful lives are depreciated separately. The estimated useful lives, 
residual values and depreciation method are reviewed at each year-end, with the effect of 
any changes in estimate accounted for on a prospective basis. 


The annual depreciation rates are based on 

Years 

Infrastructure 

Roads Infrastructure 16-36 


the following estimated useful lives: 

Years 

Other 

Computer equipment 2-33 

Furniture and Office 2-54 
Equipment 


317 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Community Machinery and Equipment 4 - 36 

Resorts 7-36 Transport Assets 7-37 

Municipal Offices 8-102 


Property, plant and equipment are reviewed at each reporting date for any indication of 
impairment. If any such indication exists, the asset’s recoverable amount is estimated. The 
impairment recognised in the Statement of Financial Performance is the excess of the 
carrying value over the recoverable amount. 

An impairment is reversed only to the extent that the asset’s carrying amount does not 
exceed the carrying amount that would have been determined had no impairment been 
recognised. A reversal of an impairment is recognised in the Statement of Financial 
Performance. 

1.15.4. De-recognition 

Items of property, plant and equipment are derecognised when the asset is disposed or 
when there are no further economic benefits or service potential expected from the use of 
the asset. The gain or loss arising on the disposal or retirement of an item of property, 
plant and equipment is determined as the difference between the sales proceeds and the 
carrying value and is recognised in the Statement of Financial Performance. 

1.15.5. Land and buildings and Other Assets - application of deemed cost (Directive 7) 

The Municipality opted to take advantage of the transitional provisions as contained in 
Directive 7 of the Accounting Standards Board, issued in December 2009. The Municipality 
applied deemed cost where the acquisition cost of an asset could not be determined. For 
Land and Buildings the fair value as determined by a valuator was used in order to 
determine the deemed cost as on 1 July 2007. For Other Assets the depreciated 
replacement cost method was used to establish the deemed cost as on 1 July 2007. 

1.16. INTANGIBLE ASSETS 

1.16.1. Initial Recognition 

An intangible asset is an identifiable non-monetary asset without physical substance. 

An asset meets the identifiability criterion in the definition of an intangible asset when it: 

• is separable, i.e. is capable of being separated or divided from the Municipality and 
sold, transferred, licensed, rented or exchanged, either individually or together with a 
related contract, identifiable asset or liability, regardless of whether the Municipality 
intends to do so; or 

• arises from binding arrangements from contracts, regardless of whether those rights 
are transferable or separable from the Municipality or from other rights and obligations. 

The Municipality recognises an intangible asset in its Statement of Financial Position only 
when it is probable that the expected future economic benefits or service potential that are 
attributable to the asset will flow to the Municipality and the cost or fair value of the asset 
can be measured reliably. 

Intangible assets are initially recognised at cost. 


318 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Where an intangible asset is acquired in exchange for a non-monetary asset or monetary 
assets, or a combination of monetary and non-monetary assets, the asset acquired is 
initially measured at fair value (the cost). If the acquired item’s fair value is not 
determinable, it’s deemed cost is the carrying amount of the asset(s) given up. 

1.16.2. Subsequent Measurement- Cost Model 

Intangible assets are subsequently carried at cost less accumulated amortisation and any 
accumulated impairments losses. The cost of an intangible asset is amortised over the 
useful life where that useful life is finite. Where the useful life is indefinite, the asset is not 
amortised but is subject to an annual impairment test. 

1.16.3. Amortisation and Impairment 

Amortisation is charged so as to write off the cost or valuation of intangible assets over its 
estimated useful lives using the straight-line method. Amortisation of an asset begins when 
it is available for use, i.e. when it is in the condition necessary for it to be capable of 
operating in the manner intended by management. Components of assets that are 
significant in relation to the whole asset and that have different useful lives are amortised 
separately. The estimated useful lives, residual values and amortisation method are 
reviewed at each year-end, with the effect of any changes in estimate accounted for on a 
prospective basis. The annual amortisation rates are based on the following estimated 
useful lives: 

Intangible Assets Years 

Computer Software 3-19 


1.16.4. De-recognition 

Intangible assets are derecognised when the asset is disposed or when there are no further 
economic benefits or service potential expected from the use of the asset. The gain or loss 
arising on the disposal or retirement of an intangible asset is determined as the difference 
between the sales proceeds and the carrying value and is recognised in the Statement of 
Financial Performance. 


1.17. INVESTMENT PROPERTY 
1.17.1. Initial Recognition 

Investment property is recognised as an asset when, and only when: 

• it is probable that the future economic benefits or service potential that are associated 
with the investment property will flow to the Municipality, and 

• the cost or fair value of the investment property can be measured reliably. 


319 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Investment property includes property (land or a building, or part of a building, or both land 
and buildings held under a finance lease) held to earn rentals and/or for capital 
appreciation, rather than held to meet service delivery objectives, the production or supply 
of goods or services, or the sale of an asset in the ordinary course of operations. Property 
with a currently undetermined use, is also classified as investment property. 

At initial recognition, the Municipality measures investment property at cost including 
transaction costs once it meets the definition of investment property. However, where an 
investment property was acquired through a non-exchange transaction (i.e. where it 
acquired the investment property for no or a nominal value), its cost is its fair value as at 
the date of acquisition. The cost of self-constructed investment property is measured at 
cost. 

Transfers are made to or from investment property only when there is a change in use. For 
a transfer from investment property to owner occupied property, the deemed cost for 
subsequent accounting is the fair value at the date of change in use. If owner occupied 
property becomes an investment property, the Municipality accounts for such property in 
accordance with the policy stated under property, plant and equipment up to the date of 
change in use. 

1.17.2. Subsequent Measurement - Cost Model 

Subsequent to initial recognition, items of investment property are measured at cost less 
accumulated depreciation and any accumulated impairment losses. Land is not 
depreciated as it is deemed to have an indefinite useful life. 

1.17.3. Depreciation and Impairment - Cost Model 

Depreciation is calculated on the depreciable amount, using the straight-line method over 
the estimated useful lives of the assets. Depreciation of an asset begins when it is available 
for use, i.e. when it is in the location and condition necessary for it to be capable of 
operating in the manner intended by management. Components of assets that are 
significant in relation to the whole asset and that have different useful lives are depreciated 
separately. The estimated useful lives, residual values and depreciation method are 
reviewed at each year-end, with the effect of any changes in estimate accounted for on a 
prospective basis. 

Investment Property Years 

Buildings 11-102 

1.17.4. De-recognition 

Investment property is derecognised when it is disposed or when there are no further 
economic benefits expected from the use of the investment property. The gain or loss 
arising on the disposal or retirement of an item of investment property is determined as the 
difference between the sales proceeds and the carrying value and is recognised in the 
Statement of Financial Performance. 

1.18. HERITAGE ASSETS 

1.18.1. Initial Recognition 

A heritage asset is defined as an asset that has a cultural, environmental, historical, natural, 
scientific, technological or artistic significance and is held and preserved indefinitely for the 
benefit of present and future generations. 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


A heritage asset is recognised as an asset if, and only if it is probable that future economic 
benefits or service potential associated with the asset will flow to the Municipality, and the 
cost or fair value of the asset can be measured reliably. 

A heritage asset that qualifies for recognition as an asset, is measured at its cost. Where 
a heritage asset is acquired through a non-exchange transaction, its cost is deemed to be 
its fair value as at the date of acquisition. 

1.18.2. Subsequent Measurement - Cost Model 

After recognition as an asset, heritage assets are carried at its cost less any accumulated 
impairment losses. 

1.18.3. Depreciation and Impairment 

Heritage assets are not depreciated 

Heritage assets are reviewed at each reporting date for any indication of impairment. If any 
such indication exists, the asset’s recoverable amount is estimated. The impairment 
recognised in the Statement of Financial Performance is the excess of the carrying value 
over the recoverable amount. 

An impairment is reversed only to the extent that the asset’s carrying amount does not 
exceed the carrying amount that would have been determined had no impairment been 
recognised. A reversal of an impairment is recognised in the Statement of Financial 
Performance. 

1.18.4. De-recognition 

Heritage assets are derecognised when it is disposed or when there are no further 
economic benefits or service potential expected from the use of the heritage asset. The 
gain or loss arising on the disposal or retirement of a heritage asset is determined as the 
difference between the sales proceeds and the carrying value of the heritage asset and is 
recognised in the Statement of Financial Performance. 

1.19. IMPAIRMENT OF NON-FINANCIAL ASSETS 

1.19.1. Cash-generating assets 

Cash-generating assets are assets held with the primary objective of generating a 
commercial return. 

The Municipality assesses at each reporting date whether there is an indication that an 
asset may be impaired. If any indication exists, or when annual impairment testing for an 
asset is required, the Municipality estimates the asset’s recoverable amount. 

(a) External sources of information 

• During the period, an asset's market value has declined significantly more than 
would be expected as a result of the passage of time or normal use; 

• Significant changes with an adverse effect on the Municipality have taken place 
during the period, or will take place in the near future, in the technological, 
market, economic or legal environment in which the Municipality operates or in 
the market to which an asset is dedicated; 


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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


• Market interest rates or other market rates of return on investments have 
increased during the period, and those increases are likely to affect the discount 
rate used in calculating an asset's value in use and decrease the asset's 
recoverable amount materially. 

(b) Internal sources of information 

• Evidence is available of obsolescence or physical damage of an asset; 

• Significant changes with an adverse effect on the Municipality have taken place 
during the period or are expected to take place in the near future, in the extent 
to which, or manner in which, an asset is used or is expected to be used. These 
changes include the asset becoming idle, plans to discontinue or restructure the 
operation to which an asset belongs, plans to dispose of an asset before the 
previously expected date, and reassessing the useful life of an asset as finite 
rather than indefinite; 

• Evidence is available from internal reporting that indicates that the economic 
performance of an asset is, or will be, worse than expected. 

The re-designation of assets from a cash-generating asset to a non-cash generating asset 
or from a non-cash-generating asset to a cash-generating asset shall only occur when there 
is clear evidence that such a re-designation is appropriate. A re-designation, by itself, does 
not necessarily trigger an impairment test or a reversal of an impairment loss. Instead, the 
indication for an impairment test or a reversal of an impairment loss arises from, as a 
minimum, the indications listed above. 

An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) 
fair value less costs to sell and its value in use and is determined for an individual asset, 
unless the asset does not generate cash inflows that are largely independent of those from 
other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds 
its recoverable amount, the asset is considered impaired and is written down to its 
recoverable amount. In assessing value in use, the estimated future cash flows are 
discounted to their present value using a pre-tax discount rate that reflects current market 
assessments of the time value of money and the risks specific to the asset. In determining 
fair value less costs to sell, an appropriate valuation model is used. Impairment losses are 
recognised in the Statement of Financial Performance in those expense categories 
consistent with the function of the impaired asset. 

After the recognition of an impairment loss, the depreciation (amortisation) charge for the 
asset is adjusted in future periods to allocate the asset's revised carrying amount, less its 
residual value (if any), on a systematic basis over its remaining useful life. 

An assessment is made at each reporting date as to whether there is any indication that 
previously recognised impairment losses may no longer exist or may have decreased. If 
such indication exists, the Municipality estimates the asset’s or CGU’s recoverable amount. 
A previously recognised impairment loss is reversed only if there has been a change in the 
assumptions used to determine the asset’s recoverable amount since the last impairment 
loss was recognised. The reversal is limited so that the carrying amount of the asset does 
not exceed its recoverable amount, nor exceed the carrying amount that would have been 
determined, net of depreciation, had no impairment loss been recognised for the asset in 
prior years. Such reversal is recognised in the Statement of Financial Performance. 


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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.19.2. Non-cash-generating assets 

Non-cash-generating assets are assets other than cash-generating assets. 

The Municipality assesses at each reporting date whether there is an indication that an 
asset may be impaired. If any indication exists, or when annual impairment testing for an 
asset is required, the Municipality estimates the asset’s recoverable service amount. 

In assessing whether there is any indication that an asset may be impaired, the Municipality 
considers the following indications: 

(a) External sources of information 

• Cessation, or near cessation, of the demand or need for services provided by 
the asset; 

• Significant long-term changes with an adverse effect on the Municipality have 
taken place during the period or will take place in the near future, in the 
technological, legal or government policy environment in which the Municipality 
operates. 

(b) Internal sources of information 

• Evidence is available of physical damage of an asset; 

• Significant long-term changes with an adverse effect on the Municipality have 
taken place during the period or are expected to take place in the near future, 
in the extent to which, or manner in which, an asset is used or is expected to be 
used. These changes include the asset becoming idle, plans to discontinue or 
restructure the operation to which an asset belongs, or plans to dispose of an 
asset before the previously expected date; 

• A decision to halt the construction of the asset before it is complete or in a 
usable condition; 

• Evidence is available from internal reporting that indicates that the service 
performance of an asset is, or will be, significantly worse than expected. 

An asset’s recoverable service amount is the higher of a non-cash-generating asset’s fair 
value less costs to sell and its value in use. If the recoverable service amount of an asset 
is less than its carrying amount, the carrying amount of the asset is reduced to its 
recoverable service amount. That reduction is an impairment loss is recognised in the 
Statement of Financial Performance. 

The value in use of a non-cash-generating asset is the present value of the asset’s 
remaining service potential. The present value of the remaining service potential of the 
asset is determined using any one of the following approaches, depending on the nature 
of the asset in question: 

• depreciation replacement cost approach - the present value of the remaining service 
potential of an asset is determined as the depreciated replacement cost of the asset. 
The replacement cost of an asset is the cost to replace the asset’s gross service 
potential. This cost is depreciated to reflect the asset in its used condition. An asset 
may be replaced either through reproduction (replication) of the existing asset or 
through replacement of its gross service potential. The depreciated replacement cost 
is measured as the reproduction or replacement cost of the asset, whichever is 
lower, less accumulated depreciation calculated on the basis of such cost, to reflect 
the already consumed or expired service potential of the asset. 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


• restoration cost approach - the cost of restoring the service potential of an asset to 
its pre-impaired level. Under this approach, the present value of the remaining 
service potential of the asset is determined by subtracting the estimated restoration 
cost of the asset from the current cost of replacing the remaining service potential of 
the asset before impairment. The latter cost is usually determined as the depreciated 
reproduction or replacement cost of the asset, whichever is lower. 

• service unit approach - the present value of the remaining service potential of the 
asset is determined by reducing the current cost of the remaining service potential 
of the asset before impairment, to conform with the reduced number of service units 
expected from the asset in its impaired state. As in the restoration cost approach, 
the current cost of replacing the remaining service potential of the asset before 
impairment is usually determined as the depreciated reproduction or replacement 
cost of the asset before impairment, whichever is lower. 

Fair value less costs to sell is the amount obtainable from the sale of an asset in an arm’s 
length transaction between knowledgeable, willing parties, less the costs of disposal. 

An impairment loss is recognised immediately in surplus or deficit, unless the asset is 
carried at a revalued amount in accordance with another Standard of GRAP. Any 
impairment loss of a revalued asset shall be treated as a revaluation decrease in 
accordance with that Standard of GRAP. 

The Municipality assesses at each reporting date whether there is any indication that an 
impairment loss recognised in prior periods for an asset may no longer exist or may have 
decreased. If any such indication exists, the Municipality estimates the recoverable service 
amount of that asset. 

An impairment loss recognised in prior periods for an asset is reversed if there has been a 
change in the estimates used to determine the asset’s recoverable service amount since 
the last impairment loss was recognised. If this is the case, the carrying amount of the asset 
is increased to its recoverable service amount. The increased carrying amount of an asset 
attributable to a reversal of an impairment loss does not exceed the carrying amount that 
would have been determined (net of depreciation or amortisation) had no impairment loss 
been recognised for the asset in prior periods. Such a reversal of an impairment loss is 
recognised in the Statement of Financial Performance. 

1.20. INVENTORIES 

1.20.1. Initial Recognition 

Inventories comprise of current assets held for sale, consumption or distribution during the 
ordinary course of business. Inventories are recognised as an asset if, and only if, it is 
probable that future economic benefits or service potential associated with the item will 
flow to the Municipality, and the cost of the inventories can be measured reliably. 
Inventories are initially recognised at cost. Cost generally refers to the purchase price, plus 
non-recoverable taxes, transport costs and any other costs in bringing the inventories to 
their current location and condition. Where inventory is manufactured, constructed or 
produced, the cost includes the cost of labour, materials and overheads used during the 
manufacturing process. 

Where inventory is acquired by the Municipality for no or nominal consideration (i.e. a non¬ 
exchange transaction), the cost is deemed to be equal to the fair value of the item on the 
date acquired. 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.20.2. Subsequent Measurement 

Inventories, consisting of consumable stores, raw materials, work-in-progress and finished 
goods, are valued at the lower of cost and net realisable value. Redundant and slow- 
moving inventories are identified and written down. Differences arising on the valuation of 
inventory are recognised in the Statement of Financial Performance in the year in which 
they arose. The amount of any reversal of any write-down of inventories arising from an 
increase in net realisable value or current replacement cost is recognised as a reduction in 
the amount of inventories recognised as an expense in the period in which the reversal 
occurs. 

The carrying amount of inventories is recognised as an expense in the period that the 
inventory was sold, distributed, written off or consumed, unless that cost qualifies for 
capitalisation to the cost of another asset. 

The basis of allocating cost to inventory items is the weighted average method. 

1.21. FINANCIAL INSTRUMENTS 

Financial instruments recognised in the Statement of Financial Position include receivables 
(both from exchange transactions and non-exchange transactions), cash and cash 
equivalents, annuity loans and payables (both form exchange and non-exchange 
transactions) and non-current investments. The future utilization of Unspent Conditional 
Grants is evaluated in order to determine whether it is treated as financial instruments. 

1.21.1. Initial Recognition 

Financial instruments are initially recognised when the Municipality becomes a party to the 
contractual provisions of the instrument at fair value plus, in the case of a financial asset 
or financial liability not at fair value, transaction costs that are directly attributable to the 
acquisition or issue of the financial asset or financial liability. If finance charges in respect 
of financial assets and financial liabilities are significantly different from similar charges 
usually obtained in an open market transaction, adjusted for the specific risks of the 
municipality, such differences are immediately recognised in the period it occurs, and the 
unamortised portion adjusted over the period of the loan transactions. 

1.21.2. Subsequent Measurement 

Financial assets are categorised according to their nature as either financial assets at fair 
value, loans and receivables at cost and loans and receivables at amortised cost. Financial 
liabilities are categorised as either at fair value or financial liabilities carried at amortised 
cost. The subsequent measurement of financial assets and liabilities depends on this 
categorisation. 


1.21.2.1. Receivables 

Receivables are classified as financial assets at amortised cost and are subsequently 
measured at amortised cost using the effective interest rate method. 

1.21.2.2. Payables and Annuity Loans 

Financial liabilities consist of payables and annuity loans. They are categorised as 
financial liabilities held at amortised cost and are initially recognised at fair value and 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


1 . 21 . 2 . 3 . 


1 . 21 . 2 . 4 . 


1 . 21 . 3 . 

1 . 21 . 3 . 1 . 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


subsequently measured at amortised cost using an effective interest rate, which is the 
initial carrying amount, less repayments, plus interest. 

Cash and Cash Equivalents 

Cash includes cash on hand (including petty cash) and cash with banks. Cash 
equivalents are short-term highly liquid investments, readily convertible into known 
amounts of cash that are held with registered banking institutions with maturities of 
three months or less and are subject to an insignificant risk of change in value. For 
the purposes of the cash flow statement, cash and cash equivalents comprise cash 
on hand, highly liquid deposits and net of bank overdrafts. The Municipality 
categorises cash and cash equivalents as financial assets carried at amortised cost. 

Bank overdrafts are recorded based on the facility utilised. Finance charges on bank 
overdraft are expensed as incurred. Amounts owing in respect of bank overdrafts are 
categorised as financial liabilities carried at amortised cost. 

Non-Current Investments 


Investments which include fixed deposits invested in registered commercial banks, 
are stated at cost or amortised cost. 

Where investments have been impaired, the carrying value is adjusted by the 
impairment loss, which is recognised as an expense in the Statement of Financial 
Performance in the period that the impairment is identified. 

On disposal of an investment, the difference between the net disposal proceeds and 
the carrying amount is recognised in the Statement of Financial Performance. 

The carrying amounts of such investments are reduced to recognise any decline, other 
than a temporary decline, in the value of individual investments. 

De-recognition of Financial Instruments 

Financial Assets 

A financial asset (or, where applicable a part of a financial asset or part of a group of 
similar financial assets) is derecognised when: 

• the rights to receive cash flows from the asset have expired; or 

• the Municipality has transferred its rights to receive cash flows from the asset 
or has assumed an obligation to pay the received cash flows in full without 
material delay to a third party under a ‘pass-through’ arrangement; and either 
(a) the Municipality has transferred substantially all the risks and rewards of 
the asset, or (b) the Municipality has neither transferred nor retained 
substantially all the risks and rewards of the asset, but has transferred control 
of the asset. 

When the Municipality has transferred its rights to receive cash flows from an asset or 
has entered into a pass-through arrangement, and has neither transferred nor retained 
substantially all the risks and rewards of the asset nor transferred control of the asset, 
the old asset is derecognised and a new asset is recognised to the extent of the 
Municipality’s continuing involvement in the asset. 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.21.3.2. Financial Liabilities 


A financial liability is derecognised when the obligation under the liability is discharged 
or cancelled or expires. 

When an existing financial liability is replaced by another from the same lender on 
substantially different terms, or the terms of an existing liability are substantially 
modified, such an exchange or modification is treated as a de-recognition of the 
original liability and the recognition of a new liability, and the difference in the 
respective carrying amounts is recognised in the Statement of Financial Performance. 

1.21.4. Impairment of Financial Assets 

For amounts due from debtors carried at amortised cost, the Municipality first assesses 
whether objective evidence of impairment exists individually for financial assets that are 
individually significant, or collectively for financial assets that are not individually significant. 
Objective evidence of impairment includes significant financial difficulties of the debtor, 
probability that the debtor will enter bankruptcy or financial reorganisation and default or 
delinquency in payments (more than 90 days overdue). If the Municipality determines that 
no objective evidence of impairment exists for an individually assessed financial asset, 
whether significant or not, it includes the asset in a group of financial assets with similar 
credit risk characteristics and collectively assesses them for impairment. Assets that are 
individually assessed for impairment and for which an impairment loss is, or continues to 
be, recognised are not included in a collective assessment of impairment. 

If there is objective evidence that an impairment loss has been incurred, the amount of the 
loss is measured as the difference between the asset’s carrying amount and the present 
value of estimated future cash flows (excluding future expected credit losses that have not 
yet been incurred). The carrying amount of the asset is reduced through the use of an 
allowance account and the amount of the loss is recognised in the Statement of Financial 
Performance. Interest income continues to be accrued on the reduced carrying amount 
based on the original effective interest rate of the asset. Loans together with the associated 
allowance are written off when there is no realistic prospect of future recovery and all 
collateral has been realised or has been transferred to the municipality, after the appropriate 
legislative processes have been followed. If, in a subsequent year, the amount of the estimated 
impairment loss increases or decreases because of an event occurring after the 
impairment was recognised, the previously recognised impairment loss is increased or 
reduced by adjusting the allowance account. If a future write-off is later recovered, the 
recovery is recognised in the Statement of Financial Performance. 

The present value of the estimated future cash flows is discounted at the financial asset’s 
original effective interest rate, if material. If a loan has a variable interest rate, the discount 
rate for measuring any impairment loss is the current effective interest rate. 

1.21.5. Offsetting of Financial Instruments 

Financial assets and financial liabilities are offset and the net amount reported in the 
Statement of Financial Position if, and only if, there is a currently enforceable legal right to 
offset the recognised amounts and there is an intention to settle on a net basis, or to realise 
the assets and settle the liabilities simultaneously 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.22. STATUTORY RECEIVABLES 

Statutory receivables arise from legislation, supporting regulations, or similar means and 
require settlement by another entity in cash or another financial asset. Statutory 
receivables generally arise from non-exchange transactions. 

1.22.1. Initial Recognition 

Statutory receivables are recognised when the related revenue is recognised or when the 
receivable meets the definition of an asset. 

1.22.2. Measurement 

The Municipality initially measures the statutory receivables at their transaction amount. 
The Municipality measure statutory receivables after initial recognition using the cost 
method. Under the cost method, the initial measurement of the receivable is changed 
subsequent to reflect any: 

(a) interest or other charges that may have accrued on the receivable; 

(b) impairment losses; and 

(c) amounts derecognised. 

The Municipality assesses at each reporting date whether there is any indication that a 
statutory receivable may be impaired. If there is an indication that a statutory receivable 
may be impaired, the Municipality measures the impairment loss as the difference between 
the estimated future cash flows and the carrying amount. Where the carrying amount is 
higher than the estimated future cash flows, the carrying amount of the statutory receivable 
is reduced, through the use of an allowance account. The amount of the loss is recognised 
in the Statement of Financial Performance. In estimating the future cash flows, the 
Municipality considers both the amount and timing of the cash flows that it will receive in 
future. Consequently, where the effect of the time value of money is material, the 
Municipality discounts the estimated future cash flows using a rate that reflects the current 
risk free rate and any risks specific to the statutory receivable for which the future cash flow 
estimates have not been adjusted. 

An impairment loss recognised in prior periods for a statutory receivable is revised if there 
has been a change in the estimates used since the last impairment loss was recognised, 
or to reflect the effect of discounting the estimated cash flows. Any previously recognised 
impairment loss is adjusted by adjusting the allowance account. The amount of any 
adjustment is recognised in the Statement of Financial Performance. 

1.22.3. Derecognition 

The Municipality derecognises a statutory receivable when: 

(a) the rights to the cash flows from the receivable are settled, expire or are waived; 

(b) the Municipality transfers to another party substantially all of the risks and rewards 
of ownership of the receivable; or 

(c) the Municipality, despite having retained some significant risks and rewards of 
ownership of the receivable, has transferred control of the receivable to another 
party and the other party has the practical ability to sell the receivable in its entirety 
to an unrelated third party, and is able to exercise that ability unilaterally and 
without needing to impose additional restrictions on the transfer. In this case, the 
Municipality: 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


(i) derecognise the receivable; and 

(ii) recognise separately any rights and obligations created or retained in the 
transfer. 

1.23. REVENUE 

1.23.1. Revenue from Non-Exchange Transactions 

Revenue from non-exchange transactions refers to transactions where the Municipality 
received revenue from another entity without directly giving approximately equal value in 
exchange. Revenue from non-exchange transactions is generally recognised to the extent 
that the related receipt or receivable qualifies for recognition as an asset and there is no 
liability to repay the amount. 

Grants, transfers and donations received or receivable are recognised when the resources 
that have been transferred, meet the criteria for recognition as an asset. A corresponding 
liability is recognised to the extent that the grant, transfer or donation is conditional. The 
liability is transferred to revenue as and when the conditions attached to the grant are met. 
Grants without any conditions attached are recognised as revenue when the asset is 
recognised. 

Fine Revenue constitutes spot fines .t Fine revenue is recognised when the spot fine is 
issued. In cases where fines are issued by another government institute, revenue will only 
be recognised by the Municipality when the receivable meets the definition of an asset. 

Revenue from public contributions and donations is recognised when all conditions 
associated with the contribution have been met or where the contribution is to finance 
property, plant and equipment, when such items of property, plant and equipment qualifies 
for recognition and first becomes available for use by the Municipality. Where public 
contributions have been received, but the Municipality has not met the related conditions, 
it is recognised as an unspent public contribution (liability). 

Contributed property, plant and equipment is recognised when such items of property, plant 
and equipment qualifies for recognition and become available for use by the Municipality. 

Revenue from the recovery of unauthorised, irregular, fruitless and wasteful expenditure is 
based on legislated procedures, including those set out in the Municipal Finance 
Management Act (Act No. 56 of 2003) and is recognised when the recovery thereof from 
the responsible councillors or officials is virtually certain. 

Revenue is measured at the fair value of the consideration received or receivable. 

When, as a result of a non-exchange transaction, a Municipality recognises an asset, it 
also recognises revenue equivalent to the amount of the asset measured at its fair value 
as at the date of acquisition, unless it is also required to recognise a liability. Where a 
liability is required to be recognised it will be measured as the best estimate of the amount 
required to settle the present obligation at the reporting date, and the amount of the 
increase in net assets, if any, recognised as revenue. When a liability is subsequently 
reduced, because the taxable event occurs or a condition is satisfied, the amount of the 
reduction in the liability will be recognised as revenue. 

Services in-kind that are significant to the Municipality’s operations are recognised as 
assets and the related revenue when: 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


• it is probable that the future economic benefits or service potential will flow to the 
Municipality; and 

• the fair value of the assets can be measured reliably. 

If the services in-kind are not significant to the Municipality’s operations or does not satisfy 
the above-mentioned criteria, the Municipality only disclose the nature and type of services 
in-kind received during the reporting period. When the criteria for recognition is satisfied, 
services in-kind are measured on initial recognition at their fair value as at the date of 
acquisition. Services in-kind include services provided by individuals to the Municipality 
and the right to use assets in a non-exchange transaction. These services meet the 
definition of an asset, because the Municipality controls the resource from which future 
economic benefits or service potential is expected to flow to the Municipality. The assets 
are immediately consumed and a transaction of equal value is also recognised to reflect 
the consumption of these services in-kind, resulting in a decrease of the asset and an 
increase in an expense. The Municipality therefore recognises an expense and related 
revenue for the consumption of services in-kind. 

1.23.2. Revenue from Exchange Transactions 

Revenue from exchange transactions refers to revenue that accrued to the Municipality 
directly in return for services rendered or goods sold, the value of which approximates the 
consideration received or receivable. 

Revenue from the sale of goods is recognised when all the following conditions have been 
satisfied: 

• The Municipality has transferred to the purchaser the significant risks and rewards 
of ownership of the goods. 

• The Municipality retains neither continuing managerial involvement to the degree 
usually associated with ownership nor effective control over the goods sold. 

• The amount of revenue can be measured reliably. 

• It is probable that the economic benefits or service potential associated with the 
transaction will flow to the Municipality. 

• The costs incurred or to be incurred in respect of the transaction can be measured 
reliably. 

At the time of initial recognition the full amount of revenue is recognised where the 
Municipality has an enforceable legal obligation to collect, unless the individual 
collectability is considered to be improbable. If the Municipality does not successfully 
enforce its obligation to collect the revenue this would be considered a subsequent event. 

Interest revenue is recognised using the effective interest rate method. 

Revenue from third parties i.e. insurance payments for assets impaired, are recognised 
when it can be measured reliably and is not being offset against the related expenses of 
repairs or renewals of the impaired assets. 

All unclaimed deposits are initially recognised as a liability until 12 months expires, when 
all unclaimed deposits into the Municipality’s bank account will be treated as revenue. 
Historical patterns have indicated that minimal unidentified deposits are reclaimed after a 
period of twelve months. This assessment is performed annually at 30 June. Therefore the 


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GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


substance of these transactions indicate that even though the prescription period for 
unclaimed monies is legally three years, it is reasonable to recognised all unclaimed 
monies older than twelve months as revenue. Although unclaimed deposits are recognised 
as revenue after 12 months, the Municipality still keep record of these unclaimed deposits 
for three years in the event that a party should submit a claim after 12 months, in which 
case it will be expensed. 

Revenue from the rental of facilities and equipment is recognised on a straight-line basis 
over the term of the lease agreement. 

Revenue arising from the application of the approved tariff of charges is recognised when 
the relevant service is rendered by applying the relevant tariff. This includes the issuing of 
licences and permits. 

Rental from Holiday Resorts is measured at the fair value of the consideration received or 
receivable taking into account the amount of any trade discounts and volume rebates 
allowed by the Municipality, as well as the Cancellation Policy of the municipality. The 
Cancellation Policy has the following refund principles: 

• Less than 72 hours: 0% refund of the fees paid. 

• Less than 14 days: 25% refund of the fees paid. 

• Less than 1 month: 50% refund of the fees paid. 

• More than 1 month: 90% refund of the fees paid. 

Revenue from the sale of goods is recognised when: 

• Substantially all the risks and rewards in those goods are passed to the consumer; 
and 

• The municipality seizes managerial involvement and control of the goods; and 

• The amount of the revenue can be measured reliably; and 

• It is probable that economic benefits or service potential associated with the 
transaction will flow to the municipality; and 

• The costs incurred or to be incurred can be measured reliably. 

Revenue arising out of situations where the Municipality acts as an agent on behalf of 
another entity (the principal) is limited to the amount of any fee or commission payable to 
the municipality as compensation for executing the agreed services. 

Revenue is measured at the fair value of the consideration received or receivable. 

The amount of revenue arising on a transaction is usually determined by agreement 
between the Municipality and the purchaser or user of the asset or service. It is measured 
at the fair value of the consideration received or receivable taking into account the amount 
of any trade discounts and volume rebates allowed by the Municipality. 

In most cases, the consideration is in the form of cash or cash equivalents and the amount 
of revenue is the amount of cash or cash equivalents received or receivable. However, 
when the inflow of cash or cash equivalents is deferred, the fair value of the consideration 
may be less than the nominal amount of cash received or receivable. When the 
arrangement effectively constitutes a financing transaction, the fair value of the 


331 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


consideration is determined by discounting all future receipts using an imputed rate of 
interest. The imputed rate of interest is the more clearly determinable of either: 

• The prevailing rate for a similar instrument of an issuer with a similar credit rating; 

• A rate of interest that discounts the nominal amount of the instrument to the current 
cash sales price of the goods or services. 

The difference between the fair value and the nominal amount of the consideration is 
recognised as interest revenue. 

When goods or services are exchanged or swapped for goods or services which are of a 
similar nature and value, the exchange is not regarded as a transaction that generates 
revenue. When goods are sold or services are rendered in exchange for dissimilar goods 
or services, the exchange is regarded as a transaction that generates revenue. The 
revenue is measured at the fair value of the goods or services received, adjusted by the 
amount of any cash or cash equivalents transferred. When the fair value of the goods or 
services received cannot be measured reliably, the revenue is measured at the fair value 
of the goods or services given up, adjusted by the amount of any cash or cash equivalents 
transferred. 

1.24. RELATED PARTIES 

The Municipality resolved to adopt the disclosure requirements as per GRAP 20 - “Related 
Party Disclosures”. 

A related party is a person or an entity: 

• with the ability to control or jointly control the other party, 

• or exercise significant influence over the other party, or vice versa, 

• or an entity that is subject to common control, or joint control. 

The following are regarded as related parties of the Municipality: 

(a) A person or a close member of that person’s family is related to the Municipality if 
that person: 

• has control or joint control over the Municipality. 

• has significant influence over the Municipality. Significant influence is the 
power to participate in the financial and operating policy decisions of the 
Municipality. 

• is a member of the management of the Municipality or its controlling entity. 

(b) An entity is related to the Municipality if any of the following conditions apply: 

• the entity is a member of the same Municipality (which means that each 
controlling entity, controlled entity and fellow controlled entity is related to the 
others). 

• one entity is an associate or joint venture of the other entity (or an associate 
or joint venture of a member of a Municipality of which the other entity is a 
member). 

• both entities are joint ventures of the same third party. 

• one entity is a joint venture of a third entity and the other entity is an associate 
of the third entity. 


332 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


• the entity is a post-employment benefit plan for the benefit of employees of 
either the Municipality or an entity related to the Municipality. If the reporting 
entity is itself such a plan, the sponsoring employers are related to the entity. 

• the entity is controlled or jointly controlled by a person identified in (a). 

• a person identified in (a) has significant influence over that entity or is a 
member of the management of that entity (or its controlling entity). 

Close members of the family of a person are those family members who may be expected 
to influence or be influenced by that person in their dealings with the Municipality. A person 
is considered to be a close member of the family of another person if they: 

(a) are married or live together in a relationship similar to a marriage; or 

(b) are separated by no more than two degrees of natural or legal consanguinity or 
affinity. 

Management (formerly known as “Key Management”) includes all persons having the 
authority and responsibility for planning, directing and controlling the activities of the 
Municipality, including: 

(a) all members of the governing body of the Municipality; 

(b) a member of the governing body of an Economic Entity who has the authority and 
responsibility for planning, directing and controlling the activities of the Municipality; 

(c) any key advisors of a member, or sub-committees, of the governing body who has 
the authority and responsibility for planning, directing and controlling the activities of 
the Municipality; and 

(d) the senior management team of the Municipality, including the accounting officer or 
permanent head of the Municipality, unless already included in (a). 

Management personnel include: 

(a) All directors or members of the governing body of the Municipality, being the 
Executive Mayor, Deputy Mayor, Speaker and members of the Mayoral Committee. 

(b) Other persons having the authority and responsibility for planning, directing and 
controlling the activities of the reporting Municipality being the Municipal Manager, 
Chief Financial Officer an all other managers reporting directly to the Municipal 
Manager or as designated by the Municipal Manager. 

Remuneration of management includes remuneration derived for services provided to the 
Municipality in their capacity as members of the management team or employees. Benefits 
derived directly or indirectly from the Municipality for services in any capacity other than as 
an employee or a member of management do not meet the definition of remuneration. 
Remuneration of management excludes any consideration provided solely as a 
reimbursement for expenditure incurred by those persons for the benefit of the Municipality. 

The Municipality operates in an economic environment currently dominated by entities 
directly or indirectly owned by the South African government. As a result of the 
Constitutional independence of all three spheres of government in South Africa, only 
parties within the same sphere of government will be considered to be related parties. Only 
transactions with such parties which are not at arm’s length and not on normal commercial 
terms are disclosed. 


333 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.25. UNAUTHORISED EXPENDITURE 

Unauthorised expenditure is expenditure that has not been budgeted, expenditure that is 
not in terms of the conditions of an allocation received from another sphere of government, 
municipality or organ of state and expenditure in a form of a grant that is not permitted in 
terms of the Municipal Finance Management Act (Act No. 56 of 2003). Unauthorised 
expenditure is accounted for as an expense (measured at actual cost incurred) in the 
Statement of Financial Performance and where recovered, it is subsequently accounted 
for as revenue in the Statement of Financial Performance. 

1.26. IRREGULAR EXPENDITURE 

Irregular expenditure is expenditure that is contrary to the Municipal Finance Management 
Act (Act No. 56 of 2003), the Municipal Systems Act (Act No. 32 of 2000), the Public Office 
Bearers Act, and (Act. No. 20 of 1998) or is in contravention of the Municipality’s Supply 
Chain Management Policy. Irregular expenditure excludes unauthorised expenditure. 
Irregular expenditure is accounted for as expenditure (measured at actual cost incurred) in 
the Statement of Financial Performance and where recovered, it is subsequently accounted 
for as revenue in the Statement of Financial Performance. 

1.27. FRUITLESS AND WASTEFUL EXPENDITURE 

Fruitless and wasteful expenditure is expenditure that was made in vain and could have 
been avoided had reasonable care been exercised. Fruitless and wasteful expenditure is 
accounted for as expenditure (measured at actual cost incurred) in the Statement of 
Financial Performance and where recovered, it is subsequently accounted for as revenue 
in the Statement of Financial Performance. 

1.28. CONTINGENT LIABILITIES AND CONTINGENT ASSETS 

A contingent liability is a possible obligation that arises from past events and whose 
existence will be confirmed only by the occurrence or non-occurrence of one or more 
uncertain future events not wholly within the control of the Municipality. A contingent liability 
could also be a present obligation that arises from past events but is not recognised 
because it is not probable that an outflow of resources embodying economic benefits will 
be required to the obligation or the amount of the obligation cannot be measured with 
sufficient reliability. 

The Municipality does not recognise a contingent liability or contingent asset. A contingent 
liability is disclosed unless the probability of an outflow of resources embodying economic 
benefits or service potential is remote. A contingent asset is disclosed where the inflow of 
economic benefits or service potential is probable. 

Management judgement is required when recognising and measuring contingent liabilities. 

1.29. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES 

In the process of applying the Municipality’s accounting policy, management has made the 
following significant accounting judgements, estimates and assumptions, which have the 
most significant effect on the amounts recognised in the annual financial statements: 

1.29.1. Post-retirement medical obligations, Long service awards and Ex-gratia gratuities 

The cost of post-retirement medical obligations, long service awards and ex-gratia 
gratuities are determined using actuarial valuations. The actuarial valuation involves 


334 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


making assumptions about discount rates, expected rates of return on assets, future salary 
increases, mortality rates and future pension increases. Major assumptions used are 
disclosed in note 13 of the annual financial statements. Due to the long-term nature of 
these plans, such estimates are subject to significant uncertainty. 

1.29.2. Impairment of Receivables 

The calculation in respect of the impairment of debtors is based on an assessment of the 
extent to which debtors have defaulted on payments already due, and an assessment of 
their ability to make payments based on their creditworthiness. This was performed per 
service-identifiable categories across all classes of debtors. 

1.29.3. Property, Plant and Equipment 

The useful lives of property, plant and equipment are based on management’s estimation. 
Infrastructure’s useful lives are based on technical estimates of the practical useful lives 
for the different infrastructure types, given engineering technical knowledge of the 
infrastructure types and service requirements. For other assets and buildings management 
considers the impact of technology, availability of capital funding, service requirements and 
required return on assets to determine the optimum useful life expectation, where 
appropriate. The estimation of residual values of assets is also based on management’s 
judgement whether the assets will be sold or used to the end of their useful lives, and in 
what condition they will be at that time. 

Management referred to the following when making assumptions regarding useful lives and 
residual values of property, plant and equipment: 

• The useful life of movable assets was determined using the age of similar assets 
available for sale in the active market. Discussions with people within the specific 
industry were also held to determine useful lives. 

• Local Government Industry Guides was used to assist with the deemed cost and 
useful life of infrastructure assets. 

• The Municipality referred to buildings in other municipal areas to determine the 
useful life of buildings. The Municipality also consulted with engineers to support the 
useful life of buildings, with specific reference to the structural design of buildings. 

For deemed cost applied to other assets as per adoption of Directive 7, management used 
the depreciation cost method which was based on assumptions about the remaining 
duration of the assets. 

The cost for depreciated replacement cost was determined by using either one of the 
following: 

• cost of items with a similar nature currently in the Municipality’s asset register; 

• cost of items with a similar nature in other municipalities’ asset registers, given that 
the other municipality has the same geographical setting as the Municipality and that 
the other municipality’s asset register is considered to be accurate; 

• cost as supplied by suppliers. 

For deemed cost applied to land and buildings as per adoption of Directive 7, management 
made use of on independent valuator. The valuator’s valuation was based on assumptions 
about the market’s buying and selling trends and the remaining duration of the assets. 


335 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.29.4. Intangible Assets 

The useful lives of intangible assets are based on management’s estimation. Management 
considers the impact of technology, availability of capital funding, service requirements and 
required return on assets to determine the optimum useful life expectation, where 
appropriate. 

Reference was made to intangibles used within the Municipality and other municipalities to 
determine the useful life of the assets. 

For deemed cost applied to intangible assets as per adoption of Directive 7, management 
used the depreciation cost method which was based on assumptions about the remaining 
duration of the assets. 

1.29.5. Provisions and Contingent Liabilities 

Management judgement is required when recognising and measuring provisions and when 
measuring contingent liabilities. Provisions are discounted where the time value effect is 
material. 

1.29.6. Revenue Recognition 

Accounting Policy 1.23.1 on Revenue from Non-Exchange Transactions and Accounting 
Policy 1.23.2 on Revenue from Exchange Transactions describes the conditions under 
which revenue will be recognised by management of the Municipality. 

In making their judgement, management considered the detailed criteria for the recognition 
of revenue as set out in GRAP 9: Revenue from Exchange Transactions and GRAP 23: 
Revenue from Non-Exchange Transactions.). Specifically, whether the Municipality, when 
goods are sold, had transferred to the buyer the significant risks and rewards of ownership 
of the goods and when services are rendered, whether the service has been 
performed. The management of the Municipality is satisfied that recognition of the revenue 
in the current year is appropriate. 

1.29. 7 . Provision for Staff leave 

Staff leave is accrued to employees according to collective agreements. Provision is made 
for the full cost of accrued leave at reporting date. This provision will be realised as 
employees take leave or when employment is terminated. 


1.29.8. Provision for Performance bonuses 

The provision for performance bonuses represents the best estimate of the obligation at 
year-end and is based on historic patterns of payment of performance bonuses. 
Performance bonuses are subject to an evaluation by Council. 

1.29.9. Componentisation of Infrastructure assets 

All infrastructure assets are unbundled into their significant components in order to 
depreciate all major components over the expected useful lives. The cost of each 
component is estimated based on the current market price of each component, depreciated 
for age and condition and recalculated to cost at the acquisition date if known or to the date 
of initially adopting the standards of GRAP. 


336 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


1.30. TAXES - VALUE ADDED TAX 

Revenue, expenses and assets are recognised net of the amounts of value added tax. The 
net amount of Value Added Tax recoverable from, or payable to, the taxation authority is 
included as part of receivables or payables in the Statement of Financial Position. 

1.31. CAPITAL COMMITMENTS 

Capital commitments disclosed in the annual financial statements represents the 
contractual balance committed to capital projects on reporting date that will be incurred in 
the period subsequent to the specific reporting date. 

1.32. EVENTS AFTER REPORTING DATE 

Events after the reporting date are those events, both favourable and unfavourable, that 
occur between the reporting date and the date when the annual financial statements are 
authorised for issue. Two types of events can be identified: 

• those that provide evidence of conditions that existed at the reporting date (adjusting 
events after the reporting date); and 

• those that are indicative of conditions that arose after the reporting date (non¬ 
adjusting events after the reporting date). 

If non-adjusting events after the reporting date are material, the Municipality discloses the 
nature and an estimate of the financial effect. 


337 




338 


























339 














340 




































GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2. PROPERTY, PLANT AND EQUIPMENT 


2019 

R 


2018 

R 


2.3 


2.4 


2.5 


2.7 


2.8 


2.9 


Expenditure incurred to repair and maintain Property, Plant and Equipment: 


Employee related costs 

Other materials 553 747 

Contracted Services 1 824 724 

Other Expenditure 71 805 


Total Repairs and Maintenance 2 450 276 


Assets pledged as security: 

Leased Property, Plant and Equipment of R 1,071,292 is secured for leases as set out in Note 11. 

Third party payments received for losses incurred: 

Payments received (Excluding VAT) 694 006 

Carrying value of assets written off/lost (124 262) 

S u rpl us/( Def i cit) 569 744 

Impairment losses of Property, Plant and Equipment 

Impairment losses on Property, Plant and Equipment recognised in Statement of Financial Performance are as 
Other 

Total Impairment Losses 

Reversal of Impairment losses of Property, Plant and Equipment 

Reversal of Impairment losses on Property, Plant and Equipment recognised in statement of financial performance 
are as follows: 

Other 

Total Reversal of Impairment losses 
Effect of changes in accounting estimates 

The effect of a change in accounting estimate will have on the current period and subsequent periods. 

2019 2020 

R R 


21 609 805 
21 609 805 


7 554 824 
7 554 824 


Effect on Property, plant and equipment 631 537 439 921 


2019 

R 

Contractual commitments for acquisition of Property, Plant and Equipment: 


451 478 
2 576 534 
117 780 


3145 791 


40 243 
(326 921) 


(286 678) 


57 050 
57 050 


2021 

R 

(220 387) 


2018 

R 


Approved and contracted for: 5 003 527 


Infrastructure 

. 



Community 

- 



Other 

5 003 527 



Total 

5 003 527 


This expenditure will be financed from: 

External Loans 

Capital Replacement Reserve 2 255 480 

Government Grants 2 748 047 

Own Resources 
District Council Grants 


Total 5 003 527 


341 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


3. INVESTMENT PROPERTY 


2019 

R 


2018 

R 


3.1 


3.2 


Net Carrying amount at 1 July 85 420 899 85 532 766 


Cost 

173 315 415 


173 315 415 

Accumulated Depreciation 

(2 394 037) 


(2 282 170) 

Accumulated Impairment Loss 

(85 500 479) 


(85 500 479) 

Additions 

_ 

. 

Disposal 

(3 975 000) 

- 

Cost 

(4 816 000) 


. 

Accumulated Depreciation 

- 


- 

Accumulated Impairment Loss 

841 000 


- 

Depreciation for the year 

(111 867) 

(Ill 867) 

Impairment loss 

(14 822 797) 

- 

Reversal of Impairment loss 

19 597 150 

- 

Net Carrying amount at 30 June 

86 108 386 

85 420 899 

Cost 

168 499 415 


173 315 415 

Accumulated Depreciation 

(2 505 904) 


(2 394 037) 

Accumulated Impairment Loss 

(79 885 126) 


(85 500 479) 


Revenue from Investment Property 

Revenue derived from the rental of Investment Property 963 347 534 842 


There are no restrictions on the realisability of Investment Property or the remittance of revenue and proceeds of 
disposal. 

There are no contractual obligations to purchase, construct or develop investment property or for repairs, 
maintenance or enhancements. 

4. INTANGIBLE ASSETS 


4.1 


Net Carrying amount at 1 July 1 362 639 1 819 116 


Cost 

5 448 934 


5 390 572 

Accumulated Amortisation 

(3 965 900) 


(3 451 061) 

Accumulated Impairment Loss 

(120 395) 


(120 395) 

Additions 

1 061 328 

58 362 

Amortisation 

(239 030) 

(514 839) 

Disposals 

(46 051) 

- 

Cost 

(682 036) 


- 

Accumulated Amortisation 

635 985 


- 


Net Carrying amount at 30 June 2 138 885 1 362 639 


Cost 

5 828 225 


5 448 934 

Accumulated Amortisation 

(3 568 945) 


(3 965 900) 

Accumulated Impairment Loss 

(120 395) 


(120 395) 


No intangible asset were assessed having an indefinite useful life. 

There are no internally generated intangible assets at reporting date. 

There are no intangible assets whose title is restricted. 

There are no intangible assets pledged as security for liabilities. 

There are no contractual commitments for the acquisition of intangible assets. 
5. INVESTMENTS 


Unlisted 

27 445 

26 027 

KKLK shares and Loan Account 

27445 | | 

26 027 | 

Total Investments 

Listed shares are held in public companies. No specific maturity dates and interest rates are applicable to those 

Unlisted investments comprise of the following. Valuations of investments supplied by council are: 

27 445 

26 027 

KKLK shares 

27 445 

26 027 


27 445 

26 027 


342 








GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


7.1 


7.2 



2019 

2018 

OPERATING LEASE ARRANGEMENTS 

R 

R 

The Municipality as Lessor 

Operating Lease Asset 

69 950 

18 833 

Reconciliation 

Balance at the beginning of the year 

18 833 

32 445 

Movement during the year 

51 117 

(13 612) 

Balance at the end of the year 

At the Statement of Financial Position date, where the municipality acts as a lessor under operating leases, it will 
receive operating lease income as follows: 

69 950 

18 833 

Up to 1 Year 

363 135 

18 833 

1 to 5 Years 

580 566 

- 

More than 5 Years 



Total Operating Lease Arrangements 

943 701 

18 833 

The Municipality as Lessee 

Operating Lease Liability 


13 657 

Reconciliation 

Balance at the beginning of the year 

13 657 


Movement during the year 

(13 657) 

13 657 

Balance at the end of the year 

At the Statement of Financial Position date, where the municipality acts as a lessee under operating leases, it will pay 
operating lease expenditure as follows: 

■ = 

13 657 

Up to 1 Year 


13 657 

1 to 5 Years 


- 

More than 5 Years 



Total Operating Lease Arrangements 

' = 

13 657 

INVENTORY 

Consumables 

2 730 766 

2 567 785 

Total Inventory 

2 730 766 

2 567 785 

The municipality recognised only purification costs in respect of non-purchased purified water inventory. 


2019 

2018 

Inventories recognised as an expense during the year: 

R 

R 

Roads Function - Consumables 

75 328 510 

71 965 273 

Consumables 

2 651 249 

1 005 884 

Materials and Supplies 

210 820 

200 876 

Total 

Roads Function inventory is classified as consumables as this inventory is consumed in the performance of the 
service of maintaning the provincial roads on behalf of the Department of Transport. The roads are not the asset of the 
Garden Route District Municipality. 

Inventory surplusses / (written down due to losses) as identified during the annual stores counts: 

78 190 579 

73 172 033 

Consumables 

34 596 

(50 064) 

Materials and Supplies 

- 

- 

Total 

34 596 

(50 064) 


No inventories were pledged as security for liabilities. 


343 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 



2019 

2018 

RECEIVABLES FROM EXCHANGE TRANSACTIONS 

R 

R 

Property Rentals 

2 085 198 

1 669 235 

Ambulance and Fire Fighting Fees 

28 188 847 

18 349 695 

Other Arrears 

5 673 138 

4 380 416 

Balance previously reported 

r 

3 720 411 

Correction of error - interest recognised in the incorrect financial period - Note 39.3 

L 

660 005 

Government subsidies: Department of Transport - Roads 

12142 238 

10 953 897 

Roads - Other Arrears 

224 518 

1 337 278 

Prepayments and Advances 

5 003 527 

- 

PPE 

5 003 527 | | 

-1 

Total: Receivables from exchange transactions (before provision) 

53 317 466 

36 690 521 

Less: Provision for Debt Impairment 

(29 361 411) 

(19 930 964) 

Total: Receivables from exchange transactions (after provision) 

23 956 054 

16 759 557 


Consumer debtors are payable within 30 days. This credit period granted is considered to be consistent with the 
terms used in the public sector, through established practices and legislation. Discounting of consumer debtors are 
not performed in terms of GRAP 104 on initial recognition. 


The fair value of receivables approximate their carrying value. 
Property Rentals: Ageing 


Current (0 - 30 days) 

266 043 

129 985 

31 - 60 Days 

56 178 

176 695 

61 - 90 Days 

53 111 

47 475 

+ 90 Days 

1 709 866 

1 315 066 

Total 

2 085 198 

1 669 222 

Ambulance and Fire Fiahtina Fees: Aaeina 

Current (0 - 30 days) 

501 048 

1 194 937 

31 - 60 Days 

492 937 

812 191 

61 - 90 Days 

375 801 

1 267 184 

+ 90 Days 

26 819 061 

15 075 382 

Total 

28 188 847 

18 349 695 

Other Arrears: Ageing 

Current (0 - 30 days) 

1 533 993 

1 057 799 

31 - 60 Days 

143 213 

193 867 

61 - 90 Days 

346 731 

78 918 

+ 90 Days 

3 649 201 

3 049 832 

Total 

5 673 138 

4 380 416 


2019 

2018 

(Total): Ageing 

R 

R 

Current (0 - 30 days) 

2 301 084 

2 382 722 

31 - 60 Days 

692 328 

1 182 753 

61 - 90 Days 

775 642 

1 393 578 

+ 90 Days 

32 178 129 

19 440 280 

Total 

35 947 183 

24 399 333 


2019 

2018 

Reconciliation of Provision for Debt Impairment 

Garden Route District Municipality 

R 

R 

Balance at beginning of year 

19 703 621 

11 304 849 

Contribution to provision 

8 560 292 

7 072 798 

VAT on provision 

1 097 498 

1 325 975 

Balance at end of year 

29 361 411 

19 703 621 

Roads Function 

Balance at beginning of year 


- 

Contribution to provision 


227 342 

Balance at end of year 

- 

227 342 

Total Balance at end of year 

29 361 411 

19 930 964 


344 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


8. RECEIVABLES FROM EXCHANGE TRANSACTIONS (CONTINUED) 2019 2018 

R R 

Ageing of amounts past due but not impaired: 

1 month past due 130 409 134 812 

2+ months past due 3 629 949 1 146 150 

3 760 357 1 280 962 


The provision for doubtful debts on debtors (loans and receivables) exists due to the possibility that not all debts will 
be recovered. Loans and receivables were assessed individually and grouped together at the Statement of Financial 
Position date as financial assets with similar credit risk characteristics and collectively assessed for impairment. 


Concentrations of credit risk with respect to trade receivables are limited due to the municipality's large number of 
customers. The municipality’s historical experience in collection of trade receivables falls within recorded allowances. 

Due to these factors, management believes that no additional risk beyond amounts provided for collection losses is 
inherent in the municipality's trade receivables. 

9. RECEIVABLES FROM NON-EXCHANGE TRANSACTIONS 

Insurance Claims 100 556 100 556 

100 556 100 556 

Less: Provision for Debt Impairment 

Total Receivables from non-exchange transactions 100 556 100 556 

The fair value of other receivables approximate their carrying value. 

10. BANK ACCOUNTS 

10.1 Cash and Cash Eguivalents 

Current Accounts 145 935 030 129 397 430 

Balance previously reported 129 440 177 

Correction of Roads Auction monies incorrectly included in bank - Note 39.2 (42 748) 

Roads - Bank Account 28 287172 32 429 004 

Call Deposits and Investments - 498 607 

Cash On-hand 15 883 15 883 

Total Cash and Cash Equivalents - Assets 174 238 085 162 340 923 


10.2 Short-term Investments 
Call Deposits 

Total Short-term Investments 

Cash and cash equivalents comprise cash held and short term deposits. The carrying amount of these assets 
approximates their fair value. The muncipality followed a formal tender process and Nedbank was awarded the 
tender. The previous bankers of Garden Route District Municipality was Standard Bank. 

Included in other deposits and bank balances are an amount of 2019: R6.893.628 (2018: R8.038.509) which is 
attributable to unspent grants and subsidies; and 2019: R31.325,891 (2018: R31.704.866) which is attributable to the 
Capital Replacement Reserve. 

The municipality has the following bank accounts: 

Current Accounts 


Nedbank Limited - Account Number 1186616261 (Primary Current Account): 97 597 437 

Nedbank Limited - Account Number 1153066203 (Secondary Current Account) 27 936 080 

Standard Bank Limited - Account Number 06 083 263 000 0 (Previous Primary Bank Account): 48 321 838 129 440 177 

Standard Bank Limited - Account Number 06 083 283 500 0 (Previous Roads Account): 299 491 32 428 004 


174 154 846 161 868 181 


Call Deposits and Investments 

ABSA Bank Limited - Account Number 91 8226 2703 (Cash Account): - 9 247 

Standard Bank Limited - Account Number 401719790 (Cash Account): - 337 925 

Standard Bank Limited - Account Number 48872744847 (Cash Account): - 151435 


498 607 


345 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


BANK ACCOUNTS (CONTINUED) 


2019 

2018 



R 

R 

Details of current accounts are as follow: 




Nedbank Limited - Account Number 1186616261 (Primary Current Account): 




Cash book balance at beginning of year 




Cash book balance at end of year 


97 597 437 


Bank statement balance at beginning of year 




Bank statement balance at end of year 


97 597 437 


Nedbank Limited - Account Number 1153066203 (Secondary Current Account) 




Cash book balance at beginning of year 




Cash book balance at end of year 


27 936 080 


Bank statement balance at beginning of year 




Bank statement balance at end of year 


27 936 080 


Standard Bank Limited - Account Number 06 083 263 000 0 (Previous Primary Bank Account): 




Cash book balance at beginning of year 


129 440 177 

137 670 300 

Cash book balance at end of year 


48 321 838 129 440 177 

Bank statement balance at beginning of year 


129 445 527 

137 590 406 

Bank statement balance at end of year 


48 321 838 

129 445 527 

Standard Bank Limited - Account Number 06 083 283 500 0 (Previous Roads Account): 




Cash book balance at beginning of year 


32 428 004 

3 898 308 

Cash book balance at end of year 


299 491 

32 428 004 

Bank statement balance at beginning of year 


32 263 342 

3 711 227 

Bank statement balance at end of year 


299 491 

32 263 342 

Details of call investment accounts are as follow 




ABSA Bank Limited ■ Account Number 91 8226 2703 (Cash Account): 




Cash book balance at beginning of year 


9 247 

8 882 

Cash book balance at end of year 



9 247 

Bank statement balance at beginning of year 


9 247 

8 882 

Bank statement balance at end of year 


' 

9 247 

Standard Bank Limited - Account Number 48872744847 (Cash Account): 




Cash book balance at beginning of year 


151 435 

141 749 

Cash book balance at end of year 


' 

151 435 

Bank statement balance at beginning of year 


151 435 

141 749 

Bank statement balance at end of year 



151 435 

Standard Bank Limited - Account Number 401719790 (Cash Account): 




Cash book balance at beginning of year 


984 111 

984 111 

Cash book balance at end of year 



337 925 

Bank statement balance at beginning of year 


984 111 

984 111 

Bank statement balance at end of year 



337 925 

LONG-TERM BORROWINGS 




Capitalised Lease Liability - At amortised cost 


726 702 

1 448 088 



726 702 

1 448 088 

Less: Current Portion transferred to Current Liabilities 


698 214 

857 290 

Capitalised Lease Liability - At amortised cost 

[ 

698 214 | f 

857 290 | 

Total Long-term Borrowings 


28 488 

590 798 

The obligations under finance leases are scheduled below 


Minimum 




payments 




2019 

2018 



R 

R 

Amounts payable under finance leases: 




Payable within one year 


729 307 

965 467 

Payable within two to five years 


29 335 

613 201 

Payable after five years 


- 




758 641 

1 578 668 

Less: Future finance obligations 


(31 939) 

(130 580) 

Present value of finance lease obligations 


726 702 

1 448 088 

The capitalised lease liability consist out of the following contracts: 




Effective 




Supplier Description of leased item Interest rate Annual Escalation 

Lease Term 

Maturity Date 

Telkom Mobile Communication Devices Prima rate 

None 

24 Months 

2020/06/14 


Refer to Appendix A for descriptions, maturity dates and effective interest rates of structured loans and finance. 


346 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


12. NON-CURRENT EMPLOYEE BENEFITS 

Provision for Post Retirement Health Care Benefits 
Roads - Provision for Post Retirement Health Care Benefits 
Provision for Ex-Gratia Pension Benefits 
Roads - Provision for Ex-Gratia Pension Benefits 
Provision for Long Service Awards 
Roads - Provision for Long Service Awards 

Total Non-current Employee Benefits 

Less: Transfer of Current Portion to Current Provisions - Note 13 


2019 

2018 

R 

R 


81 558 740 

76 304 093 

57 004 161 

55 105 327 

132 414 

122 168 

436 234 

414 764 

9 079 043 

8 351 859 

6131 718 

6 321 412 

154 342 310 

146 619 623 

(9 518 895) 

(9 224 046) 

144 823 415 

137 395 577 


Employee Benefits - Receivables (Note 12.5) 

Included in the above provision for Employee Benefits are the following amounts receivable from the Department of 
Transport with regards to employee benefits: 


Roads - Provision for Post Employment Health Care Benefits (Note 12.5) 

57 004 161 

55 105 327 

Roads - Provision for Ex-Gratia Pension Benefits (Note 12.5) 

436 234 

414 764 

Roads - Provision for Long Service Leave Awards (Note 12.5) 

6131 718 

6 321 412 


63 572113 

61 841 503 

Less: Short Term Portion Transferred to Current Employee Benefits Receivable (Note 12.5) 

(3 866 922) 

(4 108 443) 


59 705 191 

57 733 060 

Post Retirement Health Care Benefits 

Balance 1 July 

131 409 420 

131 612 674 

Contribution for the year 

14 891 090 

15 088 400 

Expenditure for the year 

(6 957 208) 

(6 826 916) 

Actuarial Loss/(Gain) 

(780 401) 

(8 464 738) 

Total provision 30 June 

138 562 901 

131 409 420 

Less: Transfer of Current Portion to Current Provisions - Note 13 

(7 446 411) 

(6 957 208) 

Balance 30 June 

131 116 490 

124 452 212 

Ex-Gratia Pensions 

Balance 1 July 

536 932 

632 904 

Contribution for the year 

37 920 

44 048 

Expenditure for the year 

(119 772) 

(138 283) 

Actuarial Loss/(Gain) 

113 568 

(1 737) 

Total provision 30 June 

568 648 

536 932 

Less: Transfer of Current Portion to Current Provisions - Note 13 

(120 072) 

(119 772) 

Balance 30 June 

448 576 

417 160 


347 



GARDEN ROUTE DISTRICT MUNICIPALITY 


12.1 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

Long Service Awards 


Balance 1 July 


14 673 271 

13 390 147 

Contribution for the year 


2 054 934 

1 871 284 

Expenditure for the year 


(2 147 066) 

(1 730 825) 

Actuarial Loss/(Gain) 


629 622 

1 142 665 

Total provision 30 June 


15 210 761 

14 673 271 

Less: Transfer of Current Portion to Current Provisions - Note 13 


(1 952 412) 

(2 147 066) 

Balance 30 June 

Provision for Post Retirement Health Care Benefits 

The Post Retirement Health Care Benefit Plan is a defined benefit plan, 
follows: 

of which the members are made up as 

13 258 349 

12 526 205 

In-service (employee) members 


240 

262 

In-service (employee) non-members 




Continuation members (e.g. Retirees, widows, orphans) 


160 

160 

Total Members 


400 

422 

The liability in respect of past service has been estimated to be as follows: 

In-service members 


26 049 806 

25 022 841 

Roads - In-service members 


22 706 924 

26 054 520 

Continuation members 


55 508 934 

50 249 573 

Roads - Continuation members 


34 297 237 

30 082 486 

Total Liability 

The liability in respect of periods commencing prior to the comparative year has been estimated as follows: 

138 562 901 

131 409 420 


2017 

2016 

2015 


R 

R 

R 

In-service members 

23 575 497 

24 562 583 

27 765 009 

Roads - In-service members 

In-service non-members 

24 784 249 

25 619 998 

25 100 227 

Continuation members 

52 907 829 

51 101 895 

42 809 857 

Roads - Continuation members 

30 345 101 

29 695 204 

26 575 338 

Total Liability 

131 612 676 

130 979 680 

122 250 431 


The municipality makes monthly contributions for health care arrangements to the following medical aid schemes: 

Bonitas 
Hosmed 
LA Health 
Key Health, and 
SAMWU Medical Aid 

The Current-service Cost for the ensuing year is estimated to be R2 504 440, whereas the Interest Cost for the next 
year is estimated to be R12 480 288. 


Key actuarial assumptions used: 

2019 

% 

2018 

% 


i) Rate of interest 

Discount rate 

9,25% 


9,48% 

Health Care Cost Inflation Rate 

6,74% 


7,30% 

Net Effective Discount Rate 

2,35% 


2,03% 


ii) Mortality rates 

The PA 90 ultimate table, rated down by 1 year of age with a 1% mortality improvement p.a. from 2010 was used 
by the actuaries. 

iii) Normal retirement age 

The normal retirement age for employees of the municipality is 65 years. It has been assumed that in-service 
members will retire at age 60, which then implicitly allows for expected rates of ill-health, early and late 
retirement. 


348 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


iv) Expected rate of salary increases 

2018/2019 - increase of seven percent (7%) 

The three-year Salary and Wage Collective Agreement ends on 30 June 2021. 


The amounts recognised in the Statement of Financial Position are as follows: 

Present value of fund obligations 

Roads Function - Present value of fund obligations 

Net liability/(asset) 


2019 

R 


81 558 740 
57 004 161 


138 562 901 


2018 

R 


75 272 414 
56 137 006 


131 409 420 


Reconciliation of present value of fund obligation: 


Present value of fund obligation at the beginning of the year 131 409 420 131 612 674 

Total expenses 7 933 882 8 261 484 


Current service cost 

2 755 783 


2 880 039 

Interest Cost 

12135 307 


12 208 361 

Benefits Paid 

(6 957 208) 


(6 826 916) 


Actuarial (gains)/losses (780 401) (8 464 738) 


Present value of fund obligation at the end of the year 138 562 901 131 409 420 


Sensitivity Analysis on the Accrued Liability on 30 June 2019 




In-service 

Continuation 





members 

members liability 

Total liability 




liability (Rm) 

(Rm) 

(Rm) 


Assumption 






Central Assumptions 


48,757 

89,806 

138,563 


The effect of movements in the assumptions are as follows: 








In-service 

Continuation 





members 

members liability 

Total liability 



Change 

liability (Rm) 

(Rm) 

(Rm) 

% change 

Assumption 






Health care inflation 

1% 

59,074 

99,326 

158,400 

14,00% 

Health care inflation 

-1% 

40,657 

81,716 

122,373 

-12,00% 

Post-retirement mortality 

-1 year 

50,083 

93,108 

143,191 

3,00% 

Average retirement age 

-1 year 

52,179 

89,806 

141,985 

2,00% 

Continuation of membership at retirement 

-10% 

42,962 

89,806 

132,768 

-4,00% 


Sensitivity Analysis on Current-Service and Interest Cost for the year ending 30 June 2019 


Assumption 
Central Assumptions 

The effect of movements in the assumptions are as follows: 


Current 
Service Cost 

(R) Interest Cost (R) Total (R) 

2 755 800 12 135 300 14 891 100 


Assumption 

Health care inflation 

Health care inflation 

Post-retirement mortality 

Average retirement age 

Continuation of membership at retirement 


Experience adjustments were calculated as follows: 
Liabilities: (Gain) / loss 



Current 





Service Cost 




Change 

(R) 

Interest Cost (R) 

Total (R) 

% change 

1% 

3 406 800 

13 858 900 

17 265 700 

16,00% 

-1% 

2 248 500 

10 715 000 

12 963 500 

-13,00% 

-1 year 

2 835 100 

12 566 900 

15 402 000 

3,00% 

-1 year 

2 846 600 

12 498 100 

15 344 700 

3,00% 

-10% 

2 468 400 

11 621 200 

14 089 600 

-5,00% 


2019 2018 

Rm Rm 


0,074 (0,526) 


349 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


The liability in respect of periods commencing prior to the comparative year has been estimated as follows: 

2017 


Rm 


2016 

Rm 


2015 

Rm 


Liabilities: (Gain) / loss 7,037 1,839 6,173 

Assets: Gain / (loss) 


2019 

R 

12.2 Provision for Ex-Gratia Pension Benefits 

The Ex-Gratia Pension Benefit plans are defined benefit plans. As at year end, 10 former employees were eligible for 
Ex-Gratia Benefits. 

There is no Current-service cost as there are no in-service members eligible for ex-gratia pension benefits, whereas 
the Interest- Cost for the next year is estimated to be R 37 053. 


2019 


Key actuarial assumptions used: % 

i) Rate of interest 

Discount rate 7,27% 

General Salary Inflation (long-term) 2,04% 

Net Effective Discount Rate applied to salary-related Long Service Bonuses 5,13% 


The discount rate used is a composite of all government bonds and is calculated using a technique is known as 
"bootstrapping" 

ii) Actuarial Valuation Method 

The Projected Unit Credit Method has been used to value the liabilities. 


2018 

R 


2018 


% 


7,93% 

2,38% 

5,43% 


2019 2018 

R R 

The amounts recognised in the Statement of Financial Position are as follows: 

Present value of fund obligations - Garden Route 132 414 122 168 

Present value of fund obligations - Roads 436 234 414 764 

Net liability/(asset) 568 648 536 932 


Reconciliation of present value of fund obligation: 


2019 

R 


2018 

R 


Present value of fund obligation at the beginning of the year 536 932 632 904 

Total expenses 

Interest Cost 
Benefits Paid 

Actuarial (gains)/losses 

Present value of fund obligation at the end of the year 568 648 536 932 


(81 852) (94 235) 


37 920 


44 048 

(119 772) 


(138 283) 


113 568 (1 737) 


Sensitivity Analysis on the Unfunded Accrued Liability 



Change 

Liability (R) 

% change 

Assumption 




Central assumptions 


568 648 


Pension Increase rate 

+1% 

592 813 

4% 

Pension Increase rate 

-1% 

546 120 

-4% 

Discount Rate 

+1% 

547 375 

-4% 

Discount Rate 

-1% 

591 816 

4% 

Post-retirement mortality 

-1 yr 

597 185 

5% 



2019 

2018 



R 

R 

Experience adjustments were calculated as follows: 




Liabilities: (Gain) / loss 


60 431 

-420 

The liability in respect of periods commencing prior to the comparative year has been estimated as follows: 




2017 

2016 

2015 


R 

R 

R 

Liabilities: (Gain) / loss 

-37 795 

-120 652 

-153 581 


350 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

12.3 Provision for Long Service Bonuses 

The Long Service Bonus plans are defined benefit plans. As at year end. 549 employees were eligible for Long 
Service Bonuses. 

The Current-service Cost for the ensuing year is estimated to be R1 173 332 whereas the Interest Cost for the next 
year is estimated to be R1 154 538. 


2019 2018 

Key actuarial assumptions used: % % 

i) Rate of interest 

Discount rate 8,10% 8,49% 

General Salary Inflation (long-term) 5,53% 6,12% 

Net Effective Discount Rate applied to salary-related Long Service Bonuses 2,44% 2,23% 

2019 2018 

R R 

The amounts recognised in the Statement of Financial Position are as follows: 

Present value of fund obligations - Garden Route 9 079 043 8 351 859 

Present value of fund obligations - Roads 6131 718 6 321 412 

Net liability/(asset) 15 210 761 _14 673 271 


Reconciliation of present value of fund obligation: 

Present value of fund obligation at the beginning of the year 
Total expenses 

Current service cost 
Interest Cost 
Benefits Paid 


Actuarial (gains)/losses 

Present value of fund obligation at the end of the year 15 210 761 14 673 271 


14 673 271 13 390 147 

(92132) 140 459 


898 460 


821 215 

1 156 474 


1 050 069 

(2 147 066) 


(1 730 825) 


629 622 1 142 665 


2019 2018 

R R 

Sensitivity Analysis on the Accrued Liability on 30 June 2019 

Change Liability (Rm) % change 

Assumption 


Central assumptions 




15,211 


General salary inflation 



1% 

16,256 

7% 

General salary inflation 



-1% 

14,273 

-6% 

Average retirement age 



-2 yrs 

13,897 

-9% 

Average retirement age 



2 yrs 

17,139 

13% 

Withdrawal rates 



-50% 

17,252 

13% 

Sensitivity Analysis on Current-Service and Interest Cost for the year ending 30 June 2019 






Current 






Service Cost 






(R) 

Interest Cost (R) 

Total (R) 


Assumption 

Central Assumptions 


898 500 

1 156 500 

2 055 000 


The effect of movements in the assumptions are as follows: 


Current 






Service Cost 





Change 

(R) 

Interest Cost (R) 

Total (R) 

% change 

Assumption 

General Earnings inflation 

1% 

971 700 

1 240 300 

2 212 000 

8% 

General Earnings inflation 

-1% 

833 000 

1 081 000 

1 914 000 

-7% 

Discount rate 

1% 

837 800 

1 206 600 

2 044 400 

-1% 

Discount rate 

-1% 

967 500 

1 096 900 

2 064 400 

0% 

Average retirement age 

-2 yrs 

804 200 

1 048 300 

1 852 500 

-10% 

Average retirement age 

-2 yrs 

995 000 

1 317 300 

2 312 300 

13% 

Withdrawal Rate 

-50% 

1 164 600 

1 353 200 

2 517 800 

23% 


351 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 
R 

Experience adjustments were calculated as follows: 

Liabilities: (Gain) / loss 82,502 1 325,309 


2018 

R 


The liability in respect of periods commencing prior to the comparative year has been estimated as follows: 

2017 2016 2015 

R R R 

Liabilities: (Gain) / loss 864 660 528 031 958 647 

2019 2018 

R R 

12.4 Retirement funds 

The Municipality requested detailed employee and pensioner information as well as information on the Municipality’s 
share of the Pension and Retirement Funds' assets from the fund administrator. The fund administrator confirmed 
that assets of the Pension and Retirement Funds are not split per participating employer. Therefore, the Municipality 
is unable to determine the value of the plan assets as defined in GRAP 25. 


As part of the Municipality's process to value the defined benefit liabilities, the Municipality requested pensioner data 
from the fund administrator. The fund administrator claim that the pensioner data to be confidential and were not 
willing to share the information with the Municipality. Without detailed pensioner data the Municipality was unable to 
calculate a reliable estimate of the accrued liability in respect of pensioners who qualify for a defined benefit pension. 


Therefore, although the Cape Joint Retirement Fund is a Multi Employer fund defined as defined benefit plan, it will 
be accounted for as defined contribution plan. All the required disclosure has been made as defined in GRAP 25.31. 

CAPE JOINT PENSION FUND 

The contribution rate payable is 9%, by the members and 18% by Council. The last actuarial valuation performed for 
the year ended 30 June 2018 revealed that the fund has a funding level of 103,7% (30 June 2016 -102,6%). 


2019 2018 

R R 

CAPE JOINT RETIREMENT FUND 

The contribution rate paid by the members (9,0%) and Council (18,0%). The last actuarial valuation performed for the 
year ended 30 June 2017 revealed that the fund is in a sound financial position with a funding level of 100,3% (30 
June 2016-100,5%). 

DEFINED CONTRIBUTION FUNDS 

Council contribute to the Government Employees Pension Fund, Municipal Council Pension Fund, IMATU Retirement 
Fund and SAMWU National Provident Fund which are defined contribution funds. The retirement benefit fund is 
subject to the Pension Fund Act, 1956, with pension being calculated on the pensionable remuneration paid. Current 
contributions by Council are charged against expenditure on the basis of current service costs. 


12.5 Employee Benefits Receivable 


Department of Transport: Roads - Post Employment Health Care Benefits (Note 12.1) - At amortised cost 
Department of Transport: Roads - Ex-Gratia Pension Benefits (Note 12.2) - At amortised cost 
Department of Transport: Roads - Long Service Awards (Note 12.3) - At amortised cost 

Less: Current portion transferred to current employee benefits receivable 

Department of Transport: Roads - Post Employment Health Care Benefits (Note 12.1) - At amortised cost 
Department of Transport: Roads - Ex-Gratia Pension Benefits (Note 12.2) - At amortised cost 
Department of Transport: Roads - Long Service Awards (Note 12.3) - At amortised cost 

Total 


57 004 161 55105 327 

436 234 414 764 

6131 718 6 321 412 


63 572 113 61 841 503 

3 866 922 4 108 443 


3 126 306 


2 897 594 

94 176 


94 668 

646 440 


1 116181 


59 705 191 57 733 060 


DEPARTMENT OF TRANSPORT: ROADS 

The Employee Benefits: Roads Receivable relates to the provision for post-retirement health benefits, long service 
awards and ex-gratia pension benefits made in respect of employees directly appointed for Roads Function 
performed on an agency basis on behalf of the Provincial Administration: Western Cape. 


In terms of the agreement between the Western Cape Provincial Government and past practice, Provincial 
Government funds will be made available to maintain the approved organogram of the Roads department, including 
all employee post retirement benefits. The future claim for the provision for retirement benefits has therefore been 
raised as a long term debtor. The carrying amount of these assets approximates their fair value. 


A technical query has been lodged with the Office of the Auditor General, National Treasury and Provincial Treasury 
with regards to the ownership of the post employment benefits of the Roads' Agency Function. 


352 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

13. CURRENT EMPLOYEE BENEFITS 


Performance Bonuses 

932 780 

432 599 

Staff Bonuses 

3 601 878 

3 207 620 

Roads - Staff Bonuses 

2 486 699 

2 265 123 

Staff Leave 

13 566 382 

10 425 847 

Roads - Staff Leave 

7 048 752 

6 856 658 

Current Portion of Non-Current Provisions 

9 518 895 

9 224 046 


Current Portion of Post Retirement Benefits - Note 12 

Current Portion of Ex-Gratia Pension Provisions - Note 12 

Current Portion of Long-Service Provisions - Note 12 

7 446 411 
120 072 

1 952 412 


6 957 208 
119 772 

2 147 066 

Total Provisions 

37155 386 

32 411 893 


The movement in current provisions are reconciled as follows: 
13.1 Performance Bonuses 


Balance at beginning of year 432 599 478 536 

Overprovision previous year - (319 387) 

Contribution to current portion 1 202 878 432 599 

Expenditure incurred (702 697) (159 148) 


Balance at end of year 932 780 432 599 


Performance bonuses are being paid to the Municipal Manager and Five Section 57 Executive Managers, who were 
appointed on contract for part of the year, before being permanently appointed (Municipal Manager is appointed on a 
5 year Contract) after an evaluation of performance by the council. 


13.2 Staff Bonuses 


Balance at beginning of year 
Contribution to current portion 
Expenditure incurred 


3 207 620 
6 004 290 
(5 610 032) 


2 844 303 
5 305 225 
(4 941 908) 


Balance at end of year 


3 601 879 3 207 620 


Bonuses are being paid to all municipal staff, excluding section 57 employees, 
the portion of the bonus that have already vested for the current salary 
reimbursement. 


The balance at year end represent 
cycle. There is no possibility of 


13.3 Roads - Staff Bonuses 


Balance at beginning of year 
Contribution to current portion 
Expenditure incurred 

Balance at end of year 

Bonuses are being paid to all municipal staff. The balance at year end represent the portion of the bonus that have 
already vested for the current salary cycle. There is no possibility of reimbursement. 


2 265 123 

3 972 131 
(3 750 555) 

2 486 699 


2 003 271 

3 752 550 
(3 490 698) 

2 265123 


353 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 



2019 

2018 

Staff Leave 

R 

R 

Balance at beginning of year 

10 425 847 

7 810 365 

Contribution to current portion 

3 992 486 

3 921 776 

Expenditure incurred 

(851 952) 

(1 306 294) 

Balance at end of year 

13 566 382 

10 425 847 


Staff leave accrued to employees according to collective agreement. Provision is made for the full cost of accrued 
leave at reporting date. This provision will be realised as employees take leave. There is no possibility of 
reimbursement. 


13.5 Roads - Staff Leave 


Balance at beginning of year 
Contribution to current portion 
Expenditure incurred 


6 856 658 4 256 217 

705123 2 756 625 

(513 029) (156 184) 


Balance at end of year 7 048 752 6 856 658 


Staff leave accrued to employees according to collective agreement. Provision is made for the full cost of accrued 
leave at reporting date. This provision will be realised as employees take leave. There is no possibility of 
reimbursement. 


14. TRADE AND OTHER PAYABLES FROM EXCHANGE TRANSACTIONS 


Trade Payables 

12 811 312 

3 593 926 

Balance previously reported 


3 359 262 

Correction of Creditor Provision - Note 39.3 


234 664 

Advance Payments 

1 051 686 

1 159 066 

Balance previously reported 


2 725 260 

Correction of Camping Fee Deposits - Note 39.3 


(1 566 194) 

Control, Clearing and Interface Accounts 

715 527 

334 434 

Other Payables 

5 958 077 

4 655 873 

Roads - Payment Received in Advance 


960 841 

Roads - Provision for Leave days paid 

208 651 

208 651 

Roads - Other creditors 

9 810 044 

4 620 628 

Total Trade Payables 

30 555 297 

15 533 418 


Payables are being recognised net of any discounts. 

Payables are payable within 30 days as prescribed by the MFMA. This credit period granted is considered to be 
consistent with the terms used in the public sector, through established practices and legislation. Discounting of trade 
and other payables on initial recognition is not deemed necessary. 


The carrying value of trade and other payables approximates its fair value. 
All payables are unsecured. 


15. UNSPENT TRANSFERS AND SUBSIDIES 


Unspent Transfers and Subsidies 

6 893 628 


8 038 509 

National Government Grants 

Balance previously reported 

Correction of Unspent RBIG - Note 39.4 

218 370 


6 373 120 

6 754 408 
(381 288) 

Provincial Government Grants 

6 382 753 


1 180 240 

Other Sources 

292 505 


485 149 

Less: Unpaid Transfers and Subsidies 

- 



National Government Grants 




Provincial Government Grants 




District Municipality 




Other Sources 

- 



Total Unspent Transfers and Subsidies 

6 893 628 


8 038 509 


See Appendix "B" for reconciliation of grants from other spheres of government. The Unspent Grants are cash- 
backed by term deposits. The municipality complied with the conditions attached to all grants received to the extent of 
revenue recognised. No grants were withheld. 

Unspent grants can mainly be attributed to projects that are work in progress on the relevant financial year-ends. 


354 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


16 

TAXES 

2019 

R 

2018 

R 

16.1 

VAT Payable 

VAT Output in Suspense 

Less: Contribution to Provision for Doubtful Debt Impairment 

- 



Total VAT Payable 



16.2 

VAT Receivable 

3 278 029 

279 131 


Balance previously reported 

Correction of incorrect VAT treatment on insurance premium - Note 39.1 

Correction of VAT on Roads Auction Monies - Note 39.1 

Correction of 2017-18 Creditor Provision - Note 39.1 


317 038 
(65 497) 

5 250 
22 340 


VAT Input in Suspense 




Total VAT Receivable 

3 278 029 

279 131 

16.3 

Net VAT (Payable)/Receivable 

3 278 029 

279 131 


VAT is payable on the receipts basis. VAT is paid over to SARS only once payment is received from debtors. 


17 SHORT-TERM BORROWINGS 

The Municipality has no short term borrowings. 

2019 2018 

R R 

18 NET ASSET RESERVES 

RESERVES 

Capital Replacement Reserve 
Total Net Asset Reserve and Liabilities 


18.1 The Capital Replacement Reserve is used to finance future capital expenditure from own funds. 

19 GOVERNMENT GRANTS AND SUBSIDIES 

Government Grants and Subsidies - Operating 165 934 347 154 142 467 

Equitable Share 

Energy Efficiency and Demand Side Management 
Expanded Public Works Programme Integrated Grant 
Rural Road Asset Management Systems Grant 
Local Government Financial Management Grant 
Municipal Disaster Grant 
Greenest Municipality Competition 
Integrated Transport Planning 
LGESTA:Re-imbursements 
Financial Management Support 
Fire Services Capacity Building Grant 


Total Government Grants and Subsidies 


Included in above are the following grants and subsidies received: 
Unconditional 


Equitable Share 

Greenest Municipality Competition 


Conditional 20 343 390 14 415 438 


Local Government Financial Management Grant 

Energy Efficiency and Demand Side Management 

Expanded Public Works Programme Integrated Grant 

Rural Road Asset Management Systems Grant 

Municipal Disaster Grant 

Integrated Transport Planning 

Financial Management Support 

Fire Services Capacity Building Grant 

Safety Plan Implementation - (WOSA) 

LGESTA:Re-imbursements 


Total Government Grants and Subsidies 171 580 510 160 600 438 


1 000 000 


1 250 000 

- 


5 000 000 

1 021 000 


1 280 000 

2 425 000 


2 420 000 

10 000 000 


2 000 000 

900 000 


900 000 

2 090 000 


620 000 

1 483 000 


800 000 

1 200 000 


- 

224 390 


145 438 


151 237 120 146 185 000 


151 237 120 


146 055 000 

- 


130 000 


151 237 120 


146 055 000 

- 


12 880 

1 021 000 


1 280 000 

2 206 630 


2 944 419 

1 000 000 


1 250 001 

7 902 712 


614 000 

- 


130 000 

1 209 513 


- 

77 322 


638 194 

1 280 051 


620 000 

- 


597 973 


165 934 347 154 142 467 


31 325 892 _ 31 704 865 

31 325 892 | [ 31 704 865 

31 325 892 31 704 865 


355 







GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


19.1 


19.2 


19.3 



2019 

2018 

Revenue recognised per vote as required by Section 123 (c) of the MFMA: 

R 

R 

Executive and council 

165 857 025 

152 890 273 

Finance and administration 

77 322 

638 194 

Planning and development 

- 

614 000 

Total Government Grants and Subsidies 

Based on the allocations set out in the Division of Revenue Act (DoRA), no significant changes in the level of 
government funding are expected over the forthcoming 3 financial years. 

165 934 347 

154 142 467 

Equitable Share 

Opening balance 

. 

. 

Grants received 

151 237 120 

146 055 000 

Conditions met - Operating 

(151 237120) 

(146 055 000) 

Conditions still to be met 

The Equitable Share is the unconditional share of the revenue raised nationally and is being allocated in terms of 
Section 214 of the Constitution (Act 108 of 1996) to the municipality by the National Treasury. 

- - = 


Local Government Financial Management Grant 

Opening balance 

(D 

. 

Grants received 

1 000 000 

1 250 000 

VAT on Grants 

- 

(76 050) 

Conditions met - Operating 

(1 000 000) 

(1 173 951) 

Conditions still to be met 

The Financial Management Grant is paid by National Treasury to municipalities to help implement the financial 
reforms required by the Municipal Finance Management Act (MFMA), 2003. The FMG Grant also pays for the cost of 
the Financial Management Internship Programme (e.g. salary costs of the Financial Management Interns). 

(1) 

in 

Energy Efficiency and Demand Side Management 

Opening balance 

4 987 120 

. 

Grants received 


5 000 000 

VAT on Grants 

- 

(1 680) 

Repaid to National Revenue Fund 

(4 987 120) 

- 

Conditions met - Operating 

- 

(11 200) 

Conditions still to be met 

- 

4 987 120 


Grant utilised for energy efficiency investigation within the region. 


356 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


19.4 LGESTA:Re-imbursements 

Opening balance 
Grants received 
Conditions met - Operating 

Conditions still to be met 

Grant is utilised for training purposes of municipal staff. 

19.5 Safety Plan Implementation - (WOSA) 

Opening balance 
Grants received 
VAT on Grants 
Conditions met - Operating 

Conditions still to be met 

Grant utilised for replacing bucket system with VIP toilets. 

19.6 Expanded Public Works Programme Integrated Grant 

Opening balance 
Grants received 
VAT on Grants 
Conditions met - Operating 
Conditions met - Capital 

Conditions still to be met 

The grant is utilised for job creation. 

19.7 Financial Management Support 

Opening balance 
Grants received 
VAT on Grants 

Repaid to National Revenue Fund 
Conditions met - Operating 
Conditions still to be met 


19.8 Regional Bulk Infrastructure 

Opening balance 
Correction of Error 
Conditions still to be met 

19.9 Integrated Transport Planning 

Opening balance 
Grants received 
VAT on Grants 
Conditions met - Operating 

Conditions still to be met 


19.10 Municipal Disaster Grant 

Opening balance 
Grants received 
VAT on Grants 

Repaid to National Revenue Fund 
Conditions met - Operating 

Conditions still to be met 


19.11 Fire Services Capacity Building Grant 

Opening balance 
Grants received 
VAT on Grants 
Conditions met - Operating 
Conditions still to be met 


19.12 Rural Road Asset Management Systems Grant 

Opening balance 
Grants received 
VAT on Grants 
Conditions met - Operating 

Conditions still to be met 


2019 

2018 

R 

R 

145 438 

638 194 

224 390 

145 438 

(77 324) 

(638 194) 

292 505 

145 438 

1 200 000 

1 200 000 


1 021 000 1 280 000 


(1 021 000) 

(1 280 000) 


78 213 

78 213 

2 090 000 

620 000 

(82 643) 

(1701) 

(78 213) 

- 

(1 197 407) 

(618 299) 

809 950 

78 213 


381 288 

- 

(381 288) 


900 000 


900 000 

900 000 

(157 763) 


(1 051 750) 


590 488 

900 000 

1 386 000 


10 000 000 

2 000 000 


(39 229) 

(1 386 000) 

- 

(7 902 712) 

(574 771) 

2 097 288 

1 386 000 

202 027 


1 483 000 

800 000 


(597 973) 

1 685 027 

202 027 


524 419 

2 425 000 

2 420 000 

(272 006) 

(348 460) 

(1 934 624) 

(2 595 959) 

218 370 


357 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


19.13 Greenest Municipality Competition 


19.14 


20 


20.1 


20.2 


21 


22 


Opening balance 


Grants received 

- 

130 000 

VAT on Grants 

- 

- 

Conditions met - Operating 

- 

(130 000) 

Conditions still to be met 


- 

Total Grants 

Opening balance 

7 698 797 

1 622 114 

Correction of Error 

- 

(381 288) 

Grants received 

171 580 510 

160 600 438 

VAT on Grants 

(512411) 

(467 120) 

Repaid to National Revenue Fund 

(6 451 333) 

- 

Conditions met - Operating 

(165 421 936) 

(153 675 347) 

Conditions still to be met/(Grant expenditure to be recovered) 

6 893 627 

7 698 797 

Disclosed as follows: 

Unspent Conditional Government Grants and Receipts 

6 893 627 

7 698 797 

Unpaid Conditional Government Grants and Receipts 

- 

- 

Total 

6 893 627 

7 698 797 

PUBLIC CONTRIBUTIONS AND DONATIONS 

Public Contributions - Conditional 

339 711 

700 000 

Public Contributions - Unconditional 

- 

220 850 

Total Public Contributions and Donations 

339 711 

920 850 

Reconciliation of conditional contributions: 



Knvsna Relief Fund 

Opening balance 

339 711 

984 111 

Grants received 

- 

55 600 

Conditions met - Operating 

(339 711) 

(700 000) 

Conditions still to be met 


339 711 

Fund opened for the relief of Knysna Fire victims and funded through donations of the public. 


2019 

2018 


R 

R 

Total Conditional Contributions 

Opening balance 

339 711 

984 111 

Grants received 

- 

55 600 

Conditions met - Operating 

(339 711) 

(700 000) 

Conditions still to be met 

- 

339 711 

LICENCES AND PERMITS 

Health Certificates 

484 416 

213 594 

Total Licences and Permits 

484 416 

213 594 


2019 

2018 


R 

R 

Disclosed as follows: 

Revenue from Non-Exchange Transactions 



Revenue from Exchange Transactions 

484 416 

213 594 

Total Licences and Permits 

484 416 

213 594 

DEPARTMENT OF TRANSPORT - ROADS SERVICE CHARGES 

Department of Transport - Roads Service Charges 

175 079 896 

169 348 246 

Balance previously reported 


189 191 076 

Correction of error - roads integration correction - Note 39.8 


(19 842 830) 

Income for agency services 

17 243 706 

17 372 717 

Total Service Charges 

192 323 602 

186 720 963 


358 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

23 SALES OF GOODS AND RENDERING OF SERVICES 

Camping Fees 8 688 260 8 559 067 


Balance previously reported 6 992 873 

Correction of Camping Fee Deposits - Note 39.3 1 566 194 


Development Charges 1 023 231 188 125 

Entrance Fees 174 925 86 440 

Fire Services 10 615 504 7 155 924 

Health Services 450 297 215 689 

Sale of Goods 620 423 22 472 


Balance previously reported 

Correction of Auction Fee incorrectly included - Note 39.1 and 39.2 


Total Sales of Goods and Rendering of Services 


2019 2018 

R R 

24 RENT ON LAND 

Land 


Undeveloped Land 


Total Rent on Land 


2019 2018 

R R 

25 RENTAL OF FACILITIES AND EQUIPMENT 

Investment Property 963 347 243 221 

Property, Plant and Equipment 14 673 104 364 

Total Rental from Fixed Assets 978 020 347 585 

2019 2018 

R R 

26 INTEREST EARNED - EXTERNAL INVESTMENTS 

Bank 4 439 589 6 160 933 

Balance previously reported 5 500 928 

Correction of error - interest earned recognised in incorrect financial period - Note 39.8 660 005 

Financial assets 7 866 674 5 776 017 

Total Interest Earned - External Investments 12 306 263 11 936 951 


704 013 444 513 

704 013 | | 444 513 | 

704 013 444 513 


59 970 
(37 498) 


21 572 639 16 227 717 


27 INTEREST EARNED - EXCHANGE TRANSACTIONS 

Long-term Receivables 
Trade Receivables 
Other Receivables 

Total Interest Earned - Outstanding Receivables 

28 OPERATIONAL REVENUE 

Administrative Handling Fees 
Commission 

Incidental Cash Surpluses 
Insurance Refund 
Staff Recoveries 

Total Operational Revenue 


2019 2018 

R R 


2 423 660 

1 639 116 

2 423 660 

1 639 116 


295 946 

251 641 

21 100 

17 073 

23 

- 

10517 

40 243 

786 484 

689 627 

1 114 071 

998 584 


359 







GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


29 EMPLOYEE RELATED COSTS 


Roads Function - Employee Related Costs 
Basic Salaries and Wages 
Pension and UIF Contributions 
Medical Aid Contributions 
Overtime 
Bonuses 

Motor Vehicle Allowance 
Balance previously reported 

Correction of error - previously included as Operational Cost - Note 39.8 

Cell Phone Allowance 

Housing Allowances 

Other benefits and allowances 

Payments in lieu of leave 

Workmen's Compensation Fund 

Balance previously reported 

Correction of error - previously included as Operational Cost - Note 39.8 
Post-retirement Benefit Obligations 
Basic Salaries and Wages 
Pension and UIF Contributions 
Medical Aid Contributions 
Overtime 
Bonuses 

Motor Vehicle Allowance 
Cell Phone Allowance 
Housing Allowances 
Other benefits and allowances 
Payments in lieu of leave 
Workmen's Compensation Fund 
Post-retirement Benefit Obligations 


81 270 944 


86 252 770 
15 546 340 
8 376 792 

3 815 620 
6 779 281 
6 950 632 

196 640 
1 286 143 
883 175 

4 217 887 
739 828 

4 483 649 


77 848 736 


77 012 604 
12 443 617 
9 198 436 

3 479 009 

5 469 553 

6 121 406 
224 961 
946 532 

2 197 083 

4 167 815 
685 026 

4 657 704 



Total Employee Related Costs 


KEY MANAGEMENT PERSONNEL 

Key management personnel are appointed permanently, except for the municipal manager who is appointed on a 5 
year fixed contract. There are no post-employment or termination benefits payable at the end of his/her term. 


REMUNERATION OF KEY MANAGEMENT PERSONNEL 


Remuneration of the Municipal Manaqer - Mr MG Stratu 


12 Months 12 Months 


Basic Salary 

Pension and UIF Contributions 
Medical Aid Contributions 
Performance Bonus 
Motor Vehicle Allowance 
Cell Phone Allowance 
Other benefits and allowances 
Payments in lieu of leave 


1 567 764 
137 784 
50 618 
270 740 
312 958 
108 000 
7 800 
100 880 


1 407 252 
131 269 
46 351 
75 306 
312 958 
72 000 
36 099 
93 070 


Total 


Remuneration of Executive Manager Finance - Miss L Hoek 


5 Months 12 Months 


Basic Salary 

Pension and UIF Contributions 
Medical Aid Contributions 
Annual Bonus 
Overtime 

Motor Vehicle Allowance 
Cell Phone Allowance 
Other benefits and allowances 


379 256 840 752 

69 010 153111 

20 847 46 416 

75 851 69 228 

40 382 

54 026 129 662 

5 750 11 040 

3 747 20 187 


Total 


1 270 396 


2019 2018 

R R 

Remuneration of Acting Executive Manager Finance -MrJ Stander 3 Months 

Basic Salary 189 099 

Pension and UIF Contributions 39 745 

Medical Aid Contributions 26 158 

Motor Vehicle Allowance 30 394 

Housing Allowances 26 154 

Other benefits and allowances 26 


Total 311 575 


Remuneration of Executive Manager Finance - Mr JVH de Jaqer 4 Months 

Basic Salary 279 597 

Pension and UIF Contributions 50 922 

Medical Aid Contributions 16 873 

Motor Vehicle Allowance 60 000 

Housing Allowances 40 000 

Other benefits and allowances 2 801 


Total 450 193 


Remuneration of the Executive Manager Corporate Services - Mrs B Holtzhausen 12 Months 12 Months 

Basic Salary 1 068 337 954 866 

Pension and UIF Contributions 209 714 173 680 

Medical Aid Contributions 31 331 

Annual Bonus - 44 000 

Performance Bonus 177 976 

Motor Vehicle Allowance 112 423 112 423 

Other benefits and allowances 19 359 99 

Payments in lieu of leave - 160 536 


Total 1 619139 1445 603 


360 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 



2019 


2018 


R 


R 

Remuneration of the Executive Manager Community Services - Mr C Africa 

12 Months 


12 Months 

Basic Salary 

957 246 


903 400 

Pension and UIF Contributions 

170 737 


133 006 

Medical Aid Contributions 

50 261 


42 118 

Performance Bonus 

174 448 



Motor Vehicle Allowance 

72 600 


72 600 

Housing Allowances 

84 000 


84 000 

Other benefits and allowances 

9 306 


16 552 

Total 

1 518 597 

_ 

1 251 676 

Remuneration of the Executive Manager Roads - Mr JC Ottervanger 

3 Months 


12 Months 

Basic Salary 

202 110 


740 785 

Pension and UIF Contributions 

36 853 


135 126 

Medical Aid Contributions 

78 430 


47 307 

Annual Bonus 

12 655 


61 486 

Motor Vehicle Allowance 

32 416 


129 748 

Cell Phone Allowance 

3 450 


9 600 

Housing Allowances 

2 557 


9 559 

Other benefits and allowances 

1 982 


8 926 

Payments in lieu of leave 

153 034 


- 

Total 

523 487 


1 142 537 

Remuneration of the Executive Manager Roads - Mr JG Daniels 

7 Months 



Basic Salary 

708 979 


- 

Pension and UIF Contributions 

107 854 



Medical Aid Contributions 

21 624 


- 

Motor Vehicle Allowance 

96 000 



Other benefits and allowances 

5 315 


- 

Total 

939 772 


• 

Remuneration of Executive Manager: Planning and Economic Development - L Menze 

12 Months 


6 Months 

Basic Salary 

765 326 


329 909 

Pension and UIF Contributions 

136 366 


60 275 

Medical Aid Contributions 

45 846 


16 850 

Performance Bonus 

79 533 



Motor Vehicle Allowance 

144 000 


72 000 

Housing Allowances 

180 000 


90 000 

Other benefits and allowances 

15 117 


3 765 

Total 

1 366 187 


572 799 


361 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 



2019 

2018 

REMUNERATION OF COUNCILLORS 

R 

R 

Councillor -T Fortuin 

360 601 

345 938 

Councillor - NF Kamte 

363 910 

347 455 

Councillor - MP Mapitza 

363 910 

345 938 

Councillor - CN Lichaba 

452 210 

432 735 

Councillor - T van Rensburg 

114 295 

345 938 

Councillor - RE Spies 

799 445 

766 723 

Councillor -Teysi 

66 380 

- 

Councillor - KS Lose 

801 405 

768 457 

Councillor - D Saayman 

362 991 

345 938 

Councillor - BN van Wyk 

362 978 

347 486 

Councillor - AJ Rossouw 

359 771 

345 938 

Councillor -1 Stemela 

504 291 

486 684 

Councillor - EH Stroebel 

67 001 

72 493 

Councillor - RS Figland 

41 591 

70 123 

Councillor - V Gericke 

150 806 

311 848 

Councillor - BHJ Groenewald 

312 697 

82 145 

Councillor - E Meyer 

513 493 

495 028 

Councillor - RH Ruiters 

563 830 

533 528 

Councillor - JJC Lambaatjeen 

514 756 

496 817 

Councillor - RR Wildschut 

76 861 

82 145 

Councillor - K Windvogel 

77 039 

82 145 

Councillor - L Tyokolo 

77 039 

82 145 

Councillor - MS Willemse 

- 

501 463 

Councillor - MV Molosi 

6 038 

82 145 

Councillor - SM Odendaal 

33135 

82145 

Councillor - IT Mangaliso 

77 039 

82 145 

Councillor - NC Jacob 

77 039 

82 145 

Councillor - M Booysen 

1 059 723 

1 011 932 

Councillor - SF May 

362 991 

343 148 

Councillor - MM Mbali 

- 

4 624 

Councillor - N Ndayi 

- 

6 588 

Councillor - NC Booisen 

- 

4 624 

Councillor - M Fielies 

- 

6 894 

Councillor - SS Mbandezi 

77 039 

82 145 

Councillor - WP Meshoa 

- 

4 646 

Councillor - TTeyisi 

- 

72 493 

Councillor - PJ van der Hoven 

67 001 

72 493 

Councillor - D Xego 

363 717 

347 016 

Councillor - SF de Vries 

454 439 

434 682 

Councillor - JP Johnson 

530 165 

511 059 

Councillor - ASM Windvogel 

72 461 

60 658 

Councillor - JL Hartnick 

271 727 


Councillor - N Tsengwa 

59 127 


Councillor - ERJ Bouw Spies 

234 359 


Total Councillors' Remuneration 

11 053 302 

10 980 692 


Remuneration paid to Councillors can be summarised as follows: 


Travel 



Salary 

Allowance 

Other Allowances 

Contributions 

Total 

Executive Mayor 

238 062 

251 682 

534 270 

35 709 

1 059 723 

Deputy-Mayor 

505 390 

38 040 

20 400 

- 

563 830 

Speaker 

265 390 

- 

11 331 

- 

276 721 

Executive Committee Members 

13615 

- 

4 500 

- 

18 115 

Councillors 

6 693 394 

792 945 

1 255 865 

392 708 

9 134 912 

Total Councillors' Remuneration 

7 715 851 

1 082 667 

1 826 366 

428 418 

11 053 302 


362 







GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


In-kind Benefits 

The Executive Mayor, Executive Deputy Mayor, Speaker, Chief Whip and Executive Committee Members are full¬ 
time Councillors. Each is provided with an office and shared secretarial support at the cost of the Municipality. The 
Executive Mayor may utilise official Council transportation when engaged in official duties. 

The Executive Mayor is entitled to stay at the mayoral residence owned by the Council at no cost. 


31 


32 


33 


34 



2019 

2018 


R 

R 

CONTRACTED SERVICES 



Roads Function: Contracted Services 

4 823 281 

4 304 682 

Outsourced Sen/ices 

696 494 


465 702 

Consultants and Professional Services 

40 550 


- 

Contractors 

4 086 237 


3 838 980 

Outsourced Services 

6 845 002 

11 236 035 

Balance previously reported 


11 180 855 

Correction of provision for creditors 


55 180 

Consultants and Professional Services 

8 716 298 

7 572 282 

Contractors 

12 289 716 

3 864 750 

Total Contracted Services 

32 674 297 

26 977 749 


DEPRECIATION AND AMORTISATION 


Property, Plant and Equipment 

3 682 412 

3 347 411 

Balance previously reported 


3 332 216 

Correction of depreciation on assets identified for the first time 


15 194 

Intangible Assets 

239 030 

514 839 

Investment Property carried at cost 

111 867 

111 867 

Total Depreciation and Amortisation 

4 033 309 

3 974117 


FINANCE COSTS 


Long-term Borrowings 

121 343 

60 487 

Payables 

6 064 

18 886 

Total Finance Costs 

127 408 

79 372 


2019 

2018 


R 

R 

TRANSFERS AND SUBSIDIES 



Roads Function: Transfers and Subsidies 

938 418 

1 769 750 

Operational 



Allocations In-Kind 

938 418 

1 769 750 

Households 

938 418 | 

1 769 750 | 

Operational 

1 417 183 

533 790 

Allocations In-kind 

608 530 

315 699 

Households 

608 530 | 

315 699 | 

Monetary Allocations 

808 653 

218 091 

Higher Educational Institutions 


50 000 

Households 

468 696 

(10 540) 

Non-profit Institutions 

39 958 

37 000 

Private Enterprises 


141 630 

Provincial Government 

300 000 

- 


Total Transfers and Subsidies 2 355 601 2 303 540 


363 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


35 OPERATIONAL COSTS 


2019 

R 


2018 

R 


Roads Function Operational Costs 

Advertising, Publicity and Marketing 

Bank Charges, Facility and Card Fees 

Cleaning Services 

Communication 

Entertainment 

External Computer Service 

Leamerships and Internships 

Licences 

Management Fee 

Balance previously reported 

Correction of error - roads integration correction 

Municipal Services 

Printing, Publications and Books 

Professional Bodies, Membership and Subscription 

Registration Fees 

Repayment of Forfeited Deposits 

Travel and Subsistence 

Balance previously reported 

Correction of error - correct allocation of motor vehicle allowance to employee related cost - Note 39.8 

Uniforms and Protective Clothing 
Workmen Compensation Fund 

Balance previously reported 

Correction of incorrect allocation - reallocated to Employee Related Cost - Note 39.8 

Advertising, Publicity and Marketing 
Assets less than the Capitalisation Threshold 
Audit Fees 

Bank Charges, Facility and Card Fees 
Bursaries (Employees) 

Cleaning Services 

Contribution to Provisions: Alien Vegetation 
Courier and Delivery Sen/ices 
Communication 

Balance previously reported 

Correction of provision for creditors - Note 39.1 and 39.3 


Deeds 

Drivers Licences and Permits 

Entertainment 

External Computer Service 

Fines and Penalties 

Hire Charges 

Insurance Underwriting 

Balance previously reported 

Correction of incorrect VAT treatment on Insurance Premium - Note 39.1 

Leamerships and Internships 
Licences 

Municipal Services 
Balance previously reported 

Correction of provision for creditors - Note 39.1 and 39.3 

Office Decorations 

Printing, Publications and Books 

Professional Bodies, Membership and Subscription 

Registration Fees 

Repayment of Forfeited Deposits 

Rewards Incentives 

Samples and Specimens 

Skills Development Fund Levy 

System Access and Information Fees 

Travel and Subsistence 

Uniform and Protective Clothing 

Vehicle Tracking 

Wet Fuel 

Total Operational Costs 


36 REVERSAL OF IMPAIRMENT LOSS/ (IMPAIRMENT LOSS) ON RECEIVABLES 

Receivables from Exchange Transactions - Note 8 

Roads Function - Receivables from Exchange Transactions - Note 8 

Total Reversal of Impairment Loss/ (Impairment Loss) on Receivables 

37 GAINS/ (LOSS) ON SALE OF FIXED ASSETS 

Property, Plant and Equipment and Intangible Assets 
Investment Property 

Total Gains/ (Loss) on Sale of Fixed Assets 


38 REVERSAL OF IMPAIRMENT LOSS/ (IMPAIRMENT LOSS) ON FIXED ASSETS 

Investment Property 
Property, Plant and Equipment 

Total Reversal of Impairment Loss/ (Impairment Loss) on Fixed Assets 


12 718 744 13 232 463 


262 355 


526 944 

54 719 


94 052 

6 206 


8 241 

775 437 


470 864 

10 364 


11 360 

776 822 


1 494 992 

325 797 


252 509 

29 859 


27 983 



19 842 830 



(19 842 830) 

939 252 


1 262 342 

384 748 


407 318 

700 000 


735 260 

6 178 


3 306 

979 



8 031 418 


7 134 576 



8 309 698 



(1 175 122) 

414 610 


802 717 



456 684 



(456 684) 


036 011 

1 663 293 

135 241 

250 010 

815 773 

2 081 198 

214 348 

161 221 

273 476 

443 666 

309 153 

138 961 


359 023 

28 496 

51 820 

835 187 

2 199 871 


2 054 506 
145 365 


32 104 

1 100 

217 019 

21 878 

20 727 

17 594 

2 327 720 

1 009 957 


1 507 

985 829 

280 391 

896 901 

1 073 388 


1 007 892 


65 497 

5 508 

140 009 

51 254 

27 998 

3 816 048 

3 268 464 


3 256 684 


11 780 


4 636 

139 677 

645 139 

1 286 687 

824 974 

828 667 

576 450 

159 360 


4 884 

29 164 

1 051 218 

918 981 

1 077 354 

1 015 067 


1 995 

5 640 149 

3 757 985 

576 666 

404 297 

2 073 

989 

223 619 

969 665 

40 709 893 

35 573 154 


(8 560 292) 

(7 072 798) 
(227 342) 

(8 560 292) 

(7 300 140) 

517 979 

1 670 789 

(573 997) 

2 188 768 

(573 997) 

4 774 987 

14 054 347 

57 050 

18 829 335 

57 050 


364 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 

R 

39 CORRECTION OF ERROR IN TERMS OF GRAP 3 

The following adjustments were made to amounts previously reported in the annual financial statements of the 
Municipality arising from the implementation of GRAP: 

2019 

R 

39.1 Taxes 

Balance previously reported 

Correction of incorrect VAT treatment on Insurance Premium 

Correction of Output VAT incorrectly declared in previous year on Roads auction fees 

Correction of provision for creditors 

Restated Balance 


39.2 Cash and Cash Equivalents 

Balance previously reported 

Correction of roads auction fees incorrectly received in Garden Route District Municipality's bank account 
Restated Balance 


2019 

R 

39.3 Trade and Other Payables from Exchange Transactions 
Balance previously reported 
Correction of Camping Fees 

Correction of interest recognised in incorrect accounting period 
Correction of provision for creditors 

Restated Balance 


39.4 Unspent Transfers and Subsidies 

Balance previously reported 

Correction of Regional Bulk Infrastructure Grant 

Restated Balance 

39.5 Accumulated Surplus/(Deficit) -1 July 2017 

Correction of Regional Bulk Infrastructure Grant 

Correction of assets identified for the first time - Deemed cost price recognised 

Total 

39.6 Property, Plant and Equipment - Cost 

Balance previously reported 

Correction of assets identified for the first time - Deemed cost price recognised 
Restated Balance 

39.7 Property, Plant and Equipment - Accumulated Depreciation 

Balance previously reported 

Correction of assets identified for the first time - Additional depreciation for the year 
Restated Balance 


2018 

R 


2018 

R 


317 038 
(65 497) 
5 250 
22 340 


279 131 


162 383 670 
(42 748) 

162 340 923 


2018 

R 

16 864 948 
(1 566 194) 
660 005 
234 664 


16 193 423 


8 080 085 
(381 288) 

7 698 797 


(381 288) 
(98 114) 


(479 402) 


345110 860 
98 114 
345 208 974 


199 765 680 
15 194 
199 780 874 


365 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


39.8 Changes to Statement of Financial Performance 


Movement on operating account as a result of GRAP standards not implemented, or not implemented correctly, in prior years: 



Note 

Balance 

previously 

reported 

Adjustments 

Restated Balance 

Revenue 

Government Grants and Subsidies 


154 142 467 


154 142 467 

Public Contributions and Donations 


920 850 


920 850 

Actuarial Gains 


4 173 621 


4 173 621 

Department of Transport - Roads Service Charges 


206 563 793 

(19 842 830) 

186 720 963 

Sales of Goods and Rendering of Services 


14 699 021 

1 528 696 

16 227 717 

Rent on Land 


444 513 

- 

444 513 

Rental of Facilities and Equipment 


347 585 

- 

347 585 

Interest Earned - External Investments 


11 276 945 

660 005 

11 936 951 

Interest Earned - Exchange Transactions 


1 639 116 

- 

1 639 116 

Licences and Permits from Exchange Transactions 


213 594 

- 

213 594 

Operational Revenue 


998 584 

- 

998 584 

Total 


395 420 090 

(17 654 129) 

377 765 961 

Expenditure 

Employee related costs 


(202 820 676) 

(1 631 806) 

(204 452 482) 

Remuneration of Councillors 


(10 980 692) 

- 

(10 980 692) 

Bad Debts Written Off 


(3 527 609) 

- 

(3 527 609) 

Contracted Services 


(26 922 569) 

(55 180) 

(26 977 749) 

Depreciation and Amortisation 


(3 958 922) 

(15 194) 

(3 974 117) 

Finance Costs 


(79 372) 

- 

(79 372) 

Inventory Consumed 


(73 172 033) 

- 

(73 172 033) 

Operating Leases 


(975 205) 

- 

(975 205) 

Transfers and Subsidies 


(2 303 540) 

- 

(2 303 540) 

Operational Costs 


(56 825 148) 

21 251 994 

(35 573 154) 

Total 


(381 565 766) 

19 549 814 

(362 015 952) 

Gains and Losses 

Inventories: (Write-down)/Reversal of Write-down to Net Realisable Value 


(50 064) 

- 

(50 064) 

Reversal of Impairment Loss/(lmpairment Loss) on Receivables 


(7 300 140) 

- 

(7 300 140) 

Gains/(Loss) on Sale of Fixed Assets 


(573 997) 

- 

(573 997) 

Reversal of Impairment Loss/(lmpairment Loss) on Fixed Assets 


57 050 


57 050 

Total 


(7 867 151) 

- 

(7 867 151) 

Net Surplus/(Deficit) for the year 


5 987 172 

1 895 686 

7 882 858 


366 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


40 RECONCILIATION BETWEEN NET SURPLUS/(DEFICIT) FOR THE YEAR AND CASH 

GENERATED/(ABSORBED) BY OPERATIONS 

Surplus/(Deficit) for the year 
Adjustments for: 

Depreciation and Amortisation 
Loss/(Gain) on Sale of Fixed Assets 
Impairment Loss/(Reversal of Impairment Loss) 

Government Grants and Subsidies received 

Government Grants and Subsidies repaid to National Revenue Fund 

Government Grants and Subsidies recognised as revenue 

Public Contributions received 

Public Contributions recognised as revenue 

Contribution from/to provisions - Non-Current Employee Benefits 

Contribution from/to provisions - Non-Current Employee Benefits - Actuarial losses 

Contribution from/to provisions - Non-Current Employee Benefits - Actuarial gains 

Contribution from/to - Current Employee Benefits 

Contribution to provisions - Bad Debt 

Operating Surplus/(Deficit) before changes in working capital 
Changes in working capital 

lncrease/(Decrease) in Operating Lease Liability 
lncrease/(Decrease) in Trade and Other Payables 
lncrease/(Decrease) in Taxes 
(lncrease)/Decrease in Inventory 

(lncrease)/Decrease in Trade Receivables from Exchange Transactions 
(lncrease)/Decrease in Operating Lease Asset 

Cash generated/(absorbed) by operations 


41 CASH AND CASH EQUIVALENTS 

Cash and cash equivalents included in the cash flow statement comprise the following: 

Current Accounts - Note 10 

Call Deposits and Investments - Note 10 

Cash Floats - Note 10 

Total cash and cash equivalents 

42 RECONCILIATION OF AVAILABLE CASH AND INVESTMENT RESOURCES 

Cash and Cash Equivalents - Note 41 
Less: 

Unspent Transfers and Subsidies - Note 15 

Net cash resources available for internal distribution 
Allocated to: 

Capital Replacement Reserve 
Resources available for working capital requirements 

43 UTILISATION OF LONG-TERM LIABILITIES RECONCILIATION 

Long-term Liabilities - Note 11 

Used to finance property, plant and equipment - at cost 

Cash invested for repayment of long-term liabilities 

Long-term liabilities have been utilized in accordance with the Municipal Finance Management Act. 


2019 2018 

R R 


14 684 130 7 882 858 


4 033 309 
(2 188 768) 
(18 829 335) 
171 580 510 
(6 451 333) 
(165 934 347) 

(339 711) 
7 759 898 
743 190 
(780 401) 
4 448 644 
9 657 790 


3 974 117 
573 997 
(57 050) 
160 600 438 

(154 142 467) 
55 600 
(700 000) 
8 307 708 

(7 323 810) 
5 795 156 
8 398 773 


18 383 576 
(5 059 063) 

33 365 319 
(9 367 475) 

(13 658) 


13 658 

15 021 879 


1 965 637 

(2 998 899) 


292 746 

(162 981) 


563 666 

(16 854 287) 


(12 216 793) 

(51 117) 


13612 


13 324 513 23 997 843 


2019 

2018 

R 

R 


174 222 203 

161 826 433 

- 

498 607 

15 883 

15 883 

174 238 085 

162 340 923 


174 238 085 

(6 893 628) 

162 340 923 

(8 038 509) 

(6 893 628) | | 

(8 038 609) | 

167 344 458 

154 302 413 

(31 325 892) 

(31 704 865) 

136 018 565 

122 597 548 

726 702 
(726 702) 

1 448 088 
(1 448 088) 


367 





GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


44 BUDGET INFORMATION 

44.1 Explanation of variances between approved and final budget amounts 

The reasons for the variances between the approved and final budgets are mainly due to increased expenditure on 
Roads due to exceptional performance from the applicable deparment, as well as differences in the split between 
current and non-current assets and liabilities when comparing budgeted to actual results. 

Explanation of variances greater than 10% and R500.000: Final Budget and Actual Amounts 

44.2 Statement of Financial Position 

44.2.1 Current Assets Variance 

Other Debtors 69,11% 

Overspending of Roads operational budget resulting in large debtor which was not budgeted for. Also, payments 
made in advance relating to the acquisition of assets over two financial years. 

44.2.2 Non-Current Assets 

Intangible Assets 56,9% 

Additions of R1 000 000 (refer note 4.1) was budgeted for under PPE, which resulted in a mismatch between the 
actual and budgeted amount - hence the variance shown above. The capital budget was not overspent in the 2018/19 
financial year (refer to Appendix C, Table A5). 

44.2.3 Current Liabilities 

Trade and Other Payables -47,87% 

Municipality over budgeted for Trade and Other Payables as the amount budgeted was substantially higher in the 
prior year. 

Provisions 25,13% 

Split in budgeted provisions between current liabilities and non-current liabilities differs from the actuals, but when 
these two line items are compared jointly, the actual variance is only 8.9%, which is within the allowable limits set out 
in the Accounting Policy. 

44.2.4 Non-Current Liabilities 

Borrowing -95,18% 

Difference in long term and short term portion of finance leases relating to cellphones and tablets net each other off. 

44.2.5 Net Assets 

Reserves 10,67% 

Transfer was made to the CRR which was not budgeted for. Additional cash was available to make the transfer. 
Accumulated Surplus/(Deficit) 12,50% 

Unexpected gain relating to the reversal of impairment of assets following an updated property valuation process. 
Statement of Financial Performance 

44.2.6 Revenue 

Rental of Facilities and Equipment -56,26% 

Expected increase in rentals budgeted for was not achieved. 

Interest Earned - External Investments -21.69% 

The interest rate during the 2018/19 financial year was lower than anticipated at the time of compilation of the budget. 
Interest Earned - Outstanding Debtors 170,32% 

Major fire outbreaks in the year resulted in an increase in debtors in this regard, which in turn caused the interest on 
such accounts to be substantially higher than what was anticipated at the time of compilation of the budget. 

Agency Services -18,13% 

Budgeted for additional agency services due to history of overspending. 

Gain on disposal of PPE -45,28% 

Actual gain realised from disposal of PPE was less than budgeted for due to lower than expected sale prices realised. 


368 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


44.2.7 Expenditure 

Employee Related Costs 57,11 % 

The variance of 57.11% is due to an R80 000 000 difference between the budgeted and actual amount. The reason 
relates to the employee related costs of the Roads function that is budgeted for under "Other Expenditure" (refer to 
note 29) 

Debt Impairment 684,39% 

Due to outstanding fire fighting accounts outstanding for one year and impaired 100% in 18/19, reason for non 
payment of fire fighting accounts is dispute regarding the origin of fire. 

Depreciation and Asset Impairment -566,52% 

The budget included a marginal loss on impairment of assets, but a valuation exercise realised a gain of R18m on 
reversal of impairment losses of assets. 

If this is taken into account, the remainder of the variance is within the limits set out in the Accounting Policy 
Finance Charges 100,00% 

Interest paid by Roads to GRDM on advances in the period. 

Contracted Services -35,11 % 

Roads expenditure reported in actual on other lines also, such as employee related costs etc. 

Other Expenditure -35,38% 

The variance is mainly due to the fact that the employee related costs of the Roads function is budgeted for under 
"Other Expenditure", but reported in actuals under "Employee related costs (refer to note 29). 

If this is taken into account, the remainder of the variance is within the limits set out in the Accounting Policy 

44.2.8 Cash Flow Statement 

Interest -21,69% 

Split between interest receipts and movement in receivables according to the budget differs from actual, but nets off 
in total. 

Finance cost -100,00% 

Interest paid by Roads to GRDM on advances in the period. 

Decrease^Increase) in Non-Current Debtors -100,00% 

Budget included under Other Non-Cyurrent Receivables 

Decrease^Increase) in Other Non-Current Receivables 100,00% 

Actual included under Non-Current Debtors 

Capital Assets -50,03% 

Variance included in actual of Other Debtors as pre-payments on multi year capital projects. 

Repayment of Borrowing -100,00% 

Municipality did not budget for cellphone and tablet contracts to be classified as finance leases. 


369 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

UNAUTHORISED, IRREGULAR, FRUITLESS AND WASTEFUL EXPENDITURE DISALLOWED 


Unauthorised expenditure 
Reconciliation of unauthorised expenditure: 


Opening balance 

29177 263 

876 692 

Unauthorised expenditure current year - operational 

18 014 649 

26 180 203 

Unauthorised expenditure current year - capital 

594 754 

2 120 369 

Approved by Council or condoned 

(28 073 230) 


Unauthorised expenditure awaiting authorisation 

19 713 436 

29 177 263 


At a Council meeting of 23 July 2019, Council resolved to write off R28 073 230 unauthorised expenditure as 
irrecoverable after following the prescribed MFMA section 32 process. 



2019 

2019 

2019 

2019 


Actual 

Final Budget 

Variance 

Unauthorised 

Unauthorised expenditure current vear - operatinq 

R 

R 

R 

R 

Vote 1 - Executive and Council 

49 105 530 

46 981 360 

(2 124 170) 

(2 124 170) 

Vote 2 - Budget and Treasury Office 

21 464 934 

24 519 318 

3 054 384 

- 

Vote 3 - Corporate Services 

40 019 685 

41 209 717 

1 190 032 

- 

Vote 4 - Planning and Development 

6 204 065 

22 738 673 

16 534 608 


Vote 5 - Public Safety 

36 420 968 

41 369 252 

4 948 284 

- 

Vote 6 - Health 

34 548 046 

33 580 866 

(967 180) 

(967 180) 

Vote 7 - Community and Social Services 


- 

- 

- 

Vote 8 - Sport and Recreation 

13186 948 

12 766 613 

(420 334) 

(420 334) 

Vote 9 - Waste Management 

1 372 540 

5 007 678 

3 635 138 

- 

Vote 10 - Roads Transport 

2 865 124 

4 225 000 

1 359 876 


Vote 11 - Waste Water Management 


10 324 

10 324 

- 

Vote 12 - Water 

- 

- 

- 

- 

Vote 13 - Environment Protection 

5417644 

3 584 576 

(1 833 069) 

(1 833 069) 

Vote 14 - Roads Agency Function 

175 079 896 

162 410 000 

(12 669 896) 

(12 669 896) 


385 685 379 

398 403 376 

12 717 998 

(18 014 649) 



2019 

2019 

2019 

2019 


Actual 

Final Budqet 

Variance 

Unauthorised 

Unauthorised expenditure current vear - capital 

R 

R 

R 

R 

Vote 1 - Executive and Council 

161 525 

29 800 

(131 725) 

(131 725) 

Vote 2 - Budget and Treasury Office 

135 294 

42 000 

(93 294) 

(93 294) 

Vote 3 - Corporate Services 

2 579 820 

2 428 300 

(151 520) 

(151 520) 

Vote 4 - Planning and Development 

218 214 

- 

(218 214) 

(218 214) 

Vote 5 - Public Safety 

1 570 731 

4 750 200 

3 179 469 


Vote 6 - Health 

125 536 

2 343 079 

2 217 543 

- 

Vote 7 - Community and Social Services 



- 

- 

Vote 8 - Sport and Recreation 

516 895 

1 000 000 

483 105 

- 

Vote 9 - Waste Management 


- 

- 


Vote 10 - Roads Transport 



- 


Vote 11 - Waste Water Management 



- 


Vote 12-Water 



- 

- 

Vote 13 - Environment Protection 


30 000 

30 000 


Vote 14 - Roads Agency Function 



- 



5 308 015 10 623 379 5 315 364 (594 754) 


2019 2018 

R R 

Fruitless and wasteful expenditure 
Reconciliation of fruitless and wasteful expenditure: 

Opening balance 1 857 935 1 882 155 

Interest: Creditors 6 064 18 886 

Fruitless and wasteful expenditure current year 42 404 

Condoned or written off by Council (1 131 892) (43106) 


Fruitless and wasteful expenditure awaiting condonement 


774 511 


1 857 935 



GARDEN ROUTE DISTRICT MUMCIRAIJTY 
MOTES ON THE FMANCIAL STATEMENTS FOR THE YEAR ENOED 30 JUNE SOTS 


AlaCcusclmaa«rgef23 Jtrty20l6. Coutc* rmclvad Id «*1i off RT 131 6U2 flutist* a*d aastefU 
yracosaabis srta- falasrrg P* z*a*cnbad IFUA soeden S3 »acm 


20 IB 

R 


45 J 


RacorcdaMen of Inagdar aipsndriira 
Opaisng bMnn 
inagutoi a^rdlu* cu-ont yaa 
Oar atom im dactasura bslow) 

ii-M kag »aI Compostlen * :*• 8 d Adywd cotton CamNlM Isas dscusu*s bolsai - curianf ft« 
5LM ftsg 2S(2| Compostlen of !*• EM Adyudicatton C uir fl o i |tm toroiut balowi • pAor yea 
SCM Rag 32 Co*iects secured try oRai organs of Mate |taa dtcaua baloe) • curia* yea 
SCM Rag S3 Co*fasts sacued Or aRai organa of state |aaa d scasu-s batoa) - pno» yea' 
irraguMi sxpa-dtu*# artnr-ofT aa aacovaaMe supon-tod by counal l| o sector 32 of MFMA 


Al a Courct maatrg of 23 -uy 2016. Coined imcdsed to ala off ft* 406 47* sragutoi axpe*«Mu* aa neeoratoie 
Mte* totaMfng tha p<asu bad MFMA sac*Of 32 proems 


66 062 717 
40 60S 316 
5 336 660 
66 763 £30 
40 321 666 
♦ -- - 
3506 664 
•S6 4U3 471; 

167 73 7 041/ 


52 736 301 
3U -36 429 
17 676667 


1*3 466 «I67| 


•6 062 717 


The rregutoi expendtu* cf 20*6/2016 ra *os mostly to (ha fotaatog 

NorxtanpAafca adh Local Contort Ptocuramar* reainarnsnls to lha value of R46i 506 (2016 R2 685 666) 
P arterman c e borusm a^inna: by Councl bU paid to Ra U.ncpa Manager a* Uaragars Dswdly Arxnuilabte to 
he Muacgisl Marugsr prtot to Heptni atfra2017716AnauMReport R702 667i2016 R0| 

Contacts au»« RIOnMoa nol ad*e*aed as praaaibad to 2014/2015 * 20160017 Inane al yaa* R36 152671 
(201* R36 053 07*) 

Long term con t acts ucaadng am yea ml advertised lor a imnn portal aa praeerhed rf R172 142 
A payment aas motto to Leftothe a (arms of a saft•—••( agreement ameurtteg to R * 620 000 (VAT poto» on Rl 3 
000 000) tor tha cumrd franca: yaa and Rl3 COO 000 (exaueNe of VAT) a «a t>w<xa frerca <•« Comet fas 



Tha -anas to non- c an e tar e s rdh Susp y Ctan Management Regulator l3(ci Rat recuses Rat Ra Mtonasaily 
steud a declarator of rtaaat fto— sasen ptin dors ofa* cabng fa ar San sucMcn and bds Tha 

Oflca of Re Audio Ltonara atari audMrg our devtMnn procuemart proems a 2017716, rurtod Ral 9>a 
mu-actzaRy dd ml oomph wfe Rsa laguoOun fto were of tw apt rto n hd str wa had .aad SCM Regiistion 36 
efsch a Ra damtoton hom normal procu emeit p«o o a ee es amnd reoured to oerrpty •<** SCM isjutoo* I3(e| 
dafi-g a dovwtton proems & nee ntsvn; Ra Inal AG&A tudt opno* en 30 Nova-tier 2016 aa amended air 
pr o c a s o as to congay atR Ra i^jUMion - tha devatms decoaed m >*-ajiia- a tta 2016/16 yaa oecuad prior to 30 
Novenha 2016 


L cf ?»■ fc«d 4S|^3cat<j~ L — 

Fa lha 2016/16 stoblot audi tha OHea of Ra A.«lta Clarara's tacfmsai d a t a t * a i t *>■•: a ca*toa(tori 
•agaatog fia r«a * ra ta lsan a* ap e *c to on of SCM Rag 26(2| ragardng Ra etanpoaMen of Ra tod adpjdeato* 
m -mBaa iEiACi Mar P atsto to Ra comr*«aa ragurm. arengat oRiara lha CEO, assatna Saraor 8CM 
Fnactttonar to Ra pmt d.a to capasty camtants. ha CFO ana lagarttod to also fuftl tha ‘aquia-w! sf Ra Sam 
fet W RraetUonai ma aara- tha e tor lfca tn* sttoad Rial tiaaa mutt £a tore dflaran! oflcato it am tiaafoa 
conctodad Rad to BAC am mt oonaMuiad aa par 'ag 26(2) rd 61s non-aonp6anca raauta to Ml tona: lanaars to 
ba comidaiad to ba rragtoar aapandlura 


R stoJi ba -clad thto Ra •or-comc d nrga did not na*lt to a*y tom to Caunei m tha award would mt hara ban 
yanad to a Mflara* toddar Tha Ma-nga' SCM dd attend Ra BAC -aatnga to ar> ato-aory sapacty t*n*afrra tha 
nputs ton tha *San« SCM P*actU»*a' wm gr»a- to Ra BAC -na tng T»a rraguat axpaM tua a pirafy basad on 
Ra tad to! Rw Ma*nga> SCM ahotod hava Paan a mambar of R«a BAC, not ordy an adiacr 

L>jm to tha ir*damanialton of a nan ftoamai systa- an 1 Jifr 2017 to corrpry «4t* Ra “fiCOA Ragutofeora It is 
meratdm to auardfy toa irragua* aapandtora dua to nen-cor-ptonea wfr SCM Rag 26|2) tor fra*c« ymis andng 
pro* to Rsa data At lapodrg data, iud magylar atpandtoira is sill undar rosa/gaf n» 

C-ariPacts tacuad ty uha« o>asia =1 ttola 

Mtocral Tiaaaury muad Crc*to 661n Juy 2016 to imraapaMaa stosch atoboratos on Ra prtnaM** captorad to 
raguadon 32 of Ra SCM Raguailons ahan pro cu m g goods or tavea 6oan astoracts sac.>ad by othar orgara of 
Mtoa In addMon Bar hm Paan too cout Mdg*"tonts, nfach prostda an uadanaandtog of tagtoadan 32 and MFMA 
sactor 110C2) T‘*» wa s dalvarad n tia ngh Court of ScMfi Afca > <a7J^«da dnsson i Lu«fea* i aa 6 JUy 2016 
|p waD.tuda; and h ha Hgh Court of SoJfi Af'ca (Eaatom Capa arcult coir*. East London | on 24 Navnrtoar 2015 
(Amtohoto) wficft wan basad an tha rdsrpntatcn of ragudiai 32 


Appdcaban of Rw irfor-ation Mau d to abesra coneudas Rat *ha nsmcspalty canrol s.bsltms ts mt n ptaca cf lha 
alhar aigan of aMa* QROM hm uanRacto procurad mdst Ra auspeas of (agnate- S3, but oordractad dlracty wdh 
Ra aspdai Al ospandh^a on ctnbacto procbrad undar SCM RagJtoion 32 Rwraf ia a a d as n a d to ba Inagitor 
mpardtura d jm to ha ncn-co r-pt a n ca d sn»ad from Ra naw appdeaton 


Rsoosarmtty of all lagda arpandSua atf bs avauslod by Could a tarim of aacSen 32 of MFMA Mo stapa hara 
baa* tsfwn at tha aitoga to laoovar ary m or na 

46 AOOfTlONAi. DISCLOSURES M TERMS Of MUMCRAL. FRtANCE MANAGEMENT ACT 
46.1 Coibibubons to oigarsaad local gosarnwiant - (MFMA 126 UMbM -ISALQA CONTR^UTiONSl 


Qpanng tatoica 

Council aubaeftpbona 62 Hi 57 577 

Amount pad • canard yaar (62151 ) ($7 5771 

Amou* pad - prastous yaars 


462 Ainat^i-iMMiAiania 

OpaNrg tames 
Cun art yaai ajdt Isa 
Amourt pad - c.rrart yaar 
Amou* pad • praslout yaa 


366 3 723 3 336 667 

|366S 723 1 (3336 6671 


371 
























GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

46.3 VAT - rMFMA 125 (1)(c)l 

VAT input receivables and VAT outputs payable are shown in note 18. 

All VAT returns have been submitted by the due date throughout the year. 

46.4 PAYE and UIF - fMFMA 125 (IKc)l 

Opening balance 
Current year payroll deductions 
Amount paid - current year 

Balance unpaid (included in creditors) 


46.5 Pension and Medical Aid Deductions - [MFMA 125 (1)(c)1 
Opening balance 

Current year payroll deductions and Council Contributions 
Amount paid - current year 
Amount paid - previous year 

Balance unpaid (included in creditors) 


46.6 Councillor's arrear consumer accounts - fMFMA 124 (1t(b)1 

The following Councillor had a arrear account outstanding for more than 90 days during the year. 

Total 90+ Days 


33 646 534 29 922127 

(33 646 534) (29 922 127) 


29 915 467 27 139 747 

(29 915 467) (27 139 747) 


30 June 2019 

The following amount is outstanding for overpayment of Councillor remuneration: 

V Gericke 164 213 164 213 


30 June 2018 

The following amount is outstanding for overpayment of Councillor remuneration: 

V Gericke 158 278 158 278 


372 




GARDEN ROUTE DISTRICT MUNICIPALITY 


46.7 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Disclosures in terms of the Municipal Supply Chain Management Regulations - Promulgated by Government 
Gazette 27636 dated 30 May 2005 

In terms of section 36 of the Municipal Supply Chain Management Regulations any deviation from the 
Supply Chain Management Policy needs to be approved/condoned by the Municipal Manager and 


2019 

R 


2018 

R 


noted by Council. Deviations for the amount of R12,818,294.12 has been condoned by council. 



Deviations per deviation tvpe can be summarised as follows: 





Emergency 



6 936 513 

5 077 077 

Impractical 



4 340 992 

15 543 019 

Single Supplier 



1 540 789 

2 221 577 




12 818 294 

22 841 673 

Deviations from procurement processes in terms of section 36 of the Supply Chain Management 



Regulations were identified on the following categories: 





30 June 2019 

Up to 
R30.000 

Between R30.001 
and R200.000 

Between 
R200,001 and 

R2,000,000 

More than 

R2,000,001 

Community Services 

761 920 

1 320 842.56 

1 588 771,03 

4 119 134,80 

Corporate/Strategic Services 

281 841 

284 106,24 


- 

Financial Services 

152 262 



- 

Office of the Municipal Manager 

94 417 

105 265,65 


- 

Office of the Political Staff 

3 568 



- 

Planning and Economic Development Services 

410 510 

262 303,35 



Roads Services 

1 850 632 

1 582 719,62 




3 555 151 

3 555 237 

1 588 771 

4119 135 


The major deviations were as follows: 


Awarded to 

Reason/Explanation 


Amount 

South Cape Fire Protection Ass - NPC 

Emergency 

2 082 262 

Working on Fire (PTY) Ltd 

Emergency 

2 036 873 

Working on Fire (PTY) LTD 

Emergency 

1 341 521 

Savannah Helicopters 

Emergency 

247 250 

World Travel Market - Africa Show 2019 

Single Supplier 

185 096 

llita Lodge 

Impractical Procurement Process 

184 000 

Mosselbay Helicopters 

Emergency 

166 106 

Savannah Helicopters 

Emergency 

130 410 

Pine Lake Marina Waterfront Resort 

Impractical Procurement Process 

127 988 

Savannah Helicopters 

Emergency 

125 580 

llita Lodge 

Single Supplier 

121 440 

Incident working Group 

Emergency 

120 922 

AAN DE KANAAL 

Impractical Procurement Process 

116461 



Total 

6 985 908 

30 June 2018 

Up to 
R30.000 

Between R30.001 
and R200.000 

Between 
R200.001 and 

R2,000,000 

Community Services 

1 222 668 

3 933 080 

2 904 939 

Corporate/Strategic Services 

812 360 

1 270 442 

2 782 857 

Financial Services 

161 886 

120 075 


Office of the Municipal Manager 


103 441 


Office of the Political Staff 

80 768 

342 474 

798 068 

Planning and Economic Development Services 

- 

120 433 


Roads Services 

1 745 445 

4 089 567 

2 353 169 


4 023128 

9 979 512 

8 839 033 

The major deviations were as follows: 




Awarded to 

Reason/Explanation 



Savannah Helicopters 

Emergency 

280 098 

Vehicle - (Halfway Toyota) 

Emergency 

540 718 

Southern Cape Fire Protection Association 

Impractical Procurement Process 

349 040 

Savannah Helicopters 

Impractical Procurement Process 

245 100 

Savannah Helicopters 

Impractical Procurement Process 

347 707 

Workinq on Fire 

Impractical Procurement Process 

926 942 

Schroter & Associate Attorneys 

Impractical Procurement Process 

232 450 

UBERTECH IT Consulting & Services 

Impractical Procurement Process 

459 802 

Southern Cape Fire Protection Association 

Emergency 

336 660 

Vesta Technical Services 

Impractical Procurement Process 

270 605 

Vesta Technical Services 

Emergency 

246 005 

Vesta Technical Services 

Impractical Procurement Process 

1 494 992 

Working on Fire 

Impractical Procurement Process 

1 820 000 



Total 

7 550 118 


373 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


46.8 Trading with Employees in Service of the State 

The following purchases were made from close family members of persons in the service of the state: 


2018/2019 Financial Year 



Actual 

Awarded 




Expenditure 

Amount 

Supplier 

Name 

State Department 

R 

R 

IGB Trading 

NM 

NM Boumeester’s (Administrative 

11 702 

11 702 


Boumeester 

Assistant Garden Route District 
Municipality) husband owns IGB 

Trading 



Shabby to Chick - Zingfontein Estates 

J Stander 

J Standees (Manager Finance Garden 
Route District Municipality) brother-in- 
law owns Shappy to Chick 

9 809 

9 809 

Piston Power Chemicals CC 

Ujush Andhee 

Nadira Andhee (wife) - teacher at KZN 
Department of Education 

518 255 

Rate Based 

Imvusa Trading 

Angel ine 

Harold Lekay (Husband) - Oudtshoom 

2 647 

Rate Based 


Lekay 

Municipality (Community Services - 
Cleaning) 



R & S Communications 

NW Jacobs 

NW Jacobs's (Disaster Management 

521 987 

Rate Based 


and JG Otto 

Coordinator - Community Service - 
Garden Route District Municipality) and 

JG Otto's (Manager Disaster 

Management Community Service - 
Garden Route District Municipality), 
both their spouses works for R & S 
Communications. 



2 Brothers Enterprise 

AY Miles 

AY Miles’s (Admistrative Assistant - 
Garden Route District Municipality) 
uncle owns 2 Brothers Enterprise. 

53100 

Rate Based 

GIBB (Pty) Ltd 

Diane 

Eastern Cape Department of 




Alderman 

Education 



GIBB (Pty) Ltd 

Alan Moon 

City of Cape Town 



GIBB (Pty) Ltd 

Thando 

Gqobo 

Ethekweni Municipality 



GIBB (Pty) Ltd 

Sonnika 

Cilliers 

Department of Education 



GIBB (Pty) Ltd 

Nokuthula 

National Department of Water Affairs 




Mkhize 

& Forestry 

810 750 

Rate Based 

GIBB (Pty) Ltd 

Jacqueline 

Department of Transport & Public 




Gooch 

Works 



GIBB (Pty) Ltd 

Douglas 

Department of Water Affairs & 




Kiewiet 

Forestry 



GIBB (Pty) Ltd 

Rajiv Beharie 

Eskom 



GIBB (Pty) Ltd 

Unati 

Lekonvana 

Department of National Treasury 



GIBB (Pty) Ltd 

K Naidoo 

Gauteng Department of Education 




Spouse of H 

Western Cape Department of 



Mubesko Africa (Pty) Ltd 

Niehaus 

Education 

3 377 681 

Rate Based 

Spouse of B 
Saaiman 

Northen Cape Department of Health 







5 305 931 


2017/2018 Financial Year 



Actual 

Awarded 

The following purchases were made from close family members of persons i 

n the service of the state: 

Expenditure 

Amount 




R 

R 

Supplier 

Name 

State Department 



IGB Trading 

NM 

NM Boumeester's (Administrative 

6 661 

6 661 


Boumeester 

Assistant Garden Route District 





Municipality) husband owns IGB 

Trading 



Shabby to Chick - Zingfontein Estates 

J Stander 

J Standees (Manager Finance Garden 
Route District Municipality) brother-in- 
law owns Shappy to Chick 

5 740 

5740 

Piston Power Chemicals CC 

Ujush Andhee 

Nadira Andhee (wife) - teacher at KZN 
Department of Education 

502 973 

Rate Based 

Imvusa Trading 

Angeline 

Harold Lekay (Husband) - Oudtshoom 

11923 

Rate Based 


Lekay 

Municipality (Community Services - 
Cleaning) 



RJL General Trading (Pty) Ltd 

Marilyn 

Fredericks Swartzs (Husband) - works 

138 729 

Rate Based 


Swartzs 

for Department of Health 



Mubesko Africa (Pty) Ltd and MooreStephens MO Inc 

B Engelbrecht 

B Holtzhausen (Mother) - Executive 

2 660 411 

Rate Based 

- Consortium 


Manager Corporate Services Garden 
Route District Municipality 




3 326 437 


The municipality is not exposed to price risk. 

(c) Interest Rate Risk 

As the municipality has significant interest-bearing liabilities, the entity's income and operating cash flows are 
substantially dependent on changes in market interest rates. 

The municipality analyses its potential exposure to interest rate changes on a continuous basis. Different 
scenarios are simulated which include refinancing, renewal of current positions, alternative financing and 
hedging. Based on these scenarios, the entity calculates the impact that a change in interest rates will have on 
the surplus/deficit for the year. These scenarios are only simulated for liabilities which constitute the majority of 
interest bearinq liabilities. 

The municipality did not hedge against any interest rate risks during the current year. 

The potential impact on the entity’s surplus/(deficit) for the year due to changes in 
interest rates were as follow; 

1 459 340 1 293 313 

(1 459 340) (1 293 313) 

(d) Credit Risk 


1% (2018: 1%) Increase in interest rates 
1% (2018: 1%) Decrease in interest rates 


374 



GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


Credit risk is the risk that a counter party to a financial or non-financial asset will fail to discharge an obligation 
and cause the Municipality to incur financial loss. 

Credit risk arises mainly of cash deposits, cash equivalents, trade and other receivables and unpaid conditional 
grants and subsidies. 

Trade and other receivables are disclosed net after provisions are made for impairment and bad debts. Trade 
receivables comprise of a large number of ratepayers, dispersed across different sectors and geographical 
areas. Ongoing credit evaluations are performed on the financial condition of these debtors. Credit risk pertaining 
to trade and other receivables is considered to be moderate due the diversified nature of receivables and 
immaterial nature of individual balances. In the case of consumer debtors the municipality effectively has the 
right to terminate services to customers but in practice this is difficult to apply. In the case of debtors whose 
accounts become in arrears, Council endeavours to collect such accounts by "levying of penalty charges”, 
"demand for payment", "restriction of services" and, as a last resort, "handed over for collection", whichever 
procedure is applicable in terms of Council's Credit Control and Debt Collection Policy. 

The credit quality of receivables are further assessed by grouping individual debtors into different categories with 
similar risk profiles. The categories include the following: Bad Debt. Deceased. Good payers. Slow Payers, 
Government Departments, Debtors with Arrangements, Indigents, Municipal Workers, Handed over to Attorneys 
and Untraceable account. These categories are then impaired on a group basis based on the risk profile/credit 
quality associated with the group. 


2019 

% 


The provision for bad debts could be allocated between the different classes of debtors as follows: 


2019 

R 


2018 


% 


Rental Agreements 
Ambulance and Fire Fighting Fees 
Other Arrears 


6,19% 1 817 332 6,34% 

89,62% 26 313 850 82,93% 

4,19% 1 230 229 10,73% 


Total 


100,00% 29 361 411 100,00% 


No receivables are pledged as security for financial liabilities. 

Due to short term nature of trade and other receivables the carrying value disclosed in note 8 and 9 of the 
financial statements is an approximation of its fair value. Interest on overdue balances are included at prime 
lending rate plus 1% where applicable. 


Ageing of amounts past due but not impaired are as follow: 
2019 

1 month past due 
2+ months past due 


Exchange 

Receivables 


130 409 
3 629 949 


3 760 357 


2018 

R 


1 249 947 
16 340 036 

2 113 638 


19 703 621 


Non-exchange 

Receivables 


2018 

1 month past due 
2+ months past due 


134 812 
1 146 150 


1 280 962 


The entity only deposits cash with major banks with high quality credit standing. No cash and cash equivalents 
were pledged as security for financial liabilities and no restrictions were placed on the use of any cash and cash 
equivalents for the period under review. Although the credit risk pertaining to cash and cash equivalents are 
considered to be low, the maximum exposure are disclosed below. 

The banks utilised by the municipality for current and non-current investments are all listed on the JSE (Investec, 
Nedbank, ABSA, First National Bank and Standard Bank). The credit quality of these institutions are evaluated 
based on their required SENS releases as well as other media reports. Based on all public communications, the 
financial sustainability is evaluated to be of high quality and the credit risk pertaining to these institutions are 
considered to be low. 

The risk pertaining to unpaid conditional grants and subsidies are considered to be very low. Amounts are 
receivable from national and provincial government and there are no expectation of counter party default. 

Long-term Receivables and Other Debtors are individually evaluated annually at Balance Sheet date for 
impairment or discounting. A report on the various categories of debtors is drafted to substantiate such 
evaluation and subsequent impairment / discounting, where applicable. 


375 



GARDEN ROUTE DISTRICT MUNICIPALITY 


48 


48.1 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 



2019 

2018 

Financial assets exposed to credit risk at year end are as follows: 

R 

R 

Non-Current Receivables from Exchange Transactions 

. 


Non-Current Receivables from Non-Exchange Transactions 

- 


Receivables from exchange transactions 

53 317 466 

36 690 521 

Receivables from non-exchange transactions 

100 556 

100 556 

Cash and Cash Equivalents 

145 935 030 

129 896 036 


199 353 052 

166 687 113 


(e) Liquidity Risk 

Prudent liquidity risk management includes maintaining sufficient cash and the availability of funding through an 
adequate amount of committed credit facilities. Due to the dynamic nature of the underlying business, the 
treasury maintains flexibility in funding by maintaining availability under credit lines. 

The entity's risk to liquidity is a result of the funds available to cover future commitments. The entity manages 
liquidity risk through an ongoing review of future commitments and credit facilities. 

The table below analyses the entity's financial liabilities into relevant maturity groupings based on the remaining 
period at the financial year end to the contractual maturity date. The amounts disclosed in the table are the 
contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact 
of discounting is not significant. 



Less than 1 

Between 1 and 5 

Between 5 and 10 

More than 10 

2019 

year 

years 

years 

years 

Long-term Liabilities 

Trade and Other Payables 

729 307 

30 555 297 

29 335 

_ 



31 284 603 

29 335 




Less than 1 

Between 1 and 5 

Between 5 and 10 

More than 10 

2018 

year 

years 

years 

years 

Long-term Liabilities 

Trade and Other Payables 

965 467 

15 533 418 

613 201 




16 498 885 

613 201 

- 



2019 2018 

R R 

FINANCIAL INSTRUMENTS 

In accordance with GRAP104.45 the financial liabilities and assets of the municipality are classified as follows: 

Financial Assets Classification 

Investments 


Unlisted Shares 

Financial Instruments at fair value 

27 445 

26 027 



2019 

2018 



R 

R 

Non-Current Receivables 




Receivables with repay arrangements 

Financial Instruments at amortised cost 



Sport Club Loans 

Financial Instruments at amortised cost 



Housing Loans 

Financial Instruments at amortised cost 

- 




2019 

2018 



R 

R 

Receivables from Exchange Transactions 




Property Rentals 

Financial Instruments at amortised cost 

2 085 198 

1 669 235 

Ambulance and Fire Fighting Fees 

Financial Instruments at amortised cost 

28 188 847 

18 349 695 

Other Arrears 

Financial Instruments at amortised cost 

18 039 893 

16 671 591 



2019 

2018 



R 

R 

Cash and Cash Equivalents 




Bank Balances 

Financial Instruments at amortised cost 

174 222 203 

161 826 433 

Call Deposits 

Financial Instruments at amortised cost 

- 

498 607 

Total Financial Assets 


222 563 586 

199 041 587 


376 



GARDEN ROUTE DISTRICT MUNICIPALITY 


48.2 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 

SUMMARY OF FINANCIAL ASSETS 
Financial Instruments at cost: 


Investments 

Unlisted shares 

27 445 

26 027 



27 445 

26 027 



2019 

2018 



R 

R 

Financial Instruments at amortised cost: 




Receivables from Exchange Transactions 

Property Rentals 

2 085 198 

1 669 235 

Receivables from Exchange Transactions 

Ambulance and Fire Fighting Fees 

28 188 847 

18 349 695 

Receivables from Exchange Transactions 

Other Arrears 

18 039 893 

16 671 591 

Cash and Cash Equivalents 

Bank Balances 

174 222 203 

161 826 433 

Cash and Cash Equivalents 

Call Deposits 

- 

498 607 



222 536 141 

199 015 560 

Financial Instruments at fair value: 




Investments 

Listed Investments 

27 445 

26 027 



27 445 

26 027 

Total Financial Assets 


222 591 031 

199 067 614 

Financial Liabilities 

Classification 



Long-term Liabilities 




Capitalised Lease Liability 

Financial Instruments at amortised cost 

726 702 

1 448 088 

Trade and Other Payables 




Trade Payables 

Financial Instruments at amortised cost 

12 811 312 

3 593 926 

Advance Payments 

Financial Instruments at amortised cost 

1 051 686 

2 119 907 

Control, Clearing and Interface Accounts 

Financial Instruments at amortised cost 

715 527 

334 434 

Other Payables 

Financial Instruments at amortised cost 

15 768 121 

9 276 501 

Cash and Cash Equivalents 




Bank Overdraft 

Financial Instruments at amortised cost 

* 

- 


31 073 348 16 772 855 


SUMMARY OF FINANCIAL LIABILITIES 




Financial instruments at amortised cost: 

Long-term Liabilities 

Capitalised Lease Liability 

726 702 

1 448 088 

Trade and Other Payables 

Trade Payables 

12 811 312 

3 593 926 

Trade and Other Payables 

Advance Payments 

1 051 686 

2119 907 

Trade and Other Payables 

Control, Clearing and Interface Accounts 

715 527 

334 434 

Trade and Other Payables 

Other Payables 

15 768 121 

31 073 348 

9 276 501 

16 772 855 


377 



GARDEN ROUTE DISTRICT MUNICIPALITY 
NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


49 STATUTORY RECEIVABLES 

In accordance with the principles of GRAP 108, Statutory Receivables of the municipality are classified as follows: 


50 


Taxes 

VAT Receivable 

Receivables from Non-Exchanqe Transactions 
Rates 

Insurance Claims 
Fines 

Total Statutory Receivables (before provision) 

Less: Provision for Debt Impairment 
Total Statutory Receivables (after provision) 

IN-KIND DONATIONS AND ASSISTANCE 

The municipality received the following in-kind donations and assistance: 
SALGA Assistance 

Miss. Elandie Terblanche (Intern from Western Cape Provincial Treasury) 
Smart City development trip to Indonesia 

Total In-kind Donations and Assistance 

PRIVATE PUBLIC PARTNERSHIPS 


3 278 029 279 131 

100 556 100 556 



2019 2018 


725 937 

132 190 

135 980 

861 917 132 190 


Garden Route District Municipality is in the process to enter into a Public Private Partnership (PPP) with Eden Waste 
Management, the Preferred Bidder, for a period of ten (10) years to build and operated a Regional Waste 
Management Facility. The PPP Agreement will include the build and operation of a domestic and hazardous disposal 
facility as well as the availability of a rotating mobile chipper and crusher to the participating local municipalities. The 
participating local municipalities that will make use of the facility will be Bitou, Knysna, George, Mossel Bay and 
Hessequa (Gouritzmond and Albertinia). 

The due diligens process initiated by the Development Bank of South Africa that is the financier of the Private 
Partner was completed and can the final PPP process be concluded. The preparation of the Treasury Views and 
Recommendation III documentations as well as the Section 33 in terms of the MFMA (contract longer than three 
years) process documentation are nearly finalised to be submitted to Nasional and provincial Treasury for their 
comments as well as to the Nasional and Provincial Sector Department for their comments. The comments timeline 
for their comments are thirty (30) days. 

As soon as the comments are received the PPP Agreement will be finalised and submitted to Council for approval 
and signature of the Municipal Manager. 

It is anticipated that the above mentioned processes will be finalised at the end of November 2019 and construction 
can proceed from 20 January 2020. The private Partner, Eden Waste Management, will set up camp during the first 
two (2) weeks of December 2019. 

All participating local municipalities have made provision in their existing multi-year budgets for their individual 
operating cost contribution from date of in operation of the regional Waste Management Facility. 


52 CONTINGENT LIABILITY 

52.1 Theunis Barnard / Garden Route DM / September January 

We received a summons from Calmanz Incorporated, with regards to an accident that happened on 5 February 2010. 
The driver of the vehicle was September January and at the time of the accident employed at Garden Route District 
Municipality. The vehicle had the registration number PA 175 129. This matter was referred to their Insurance 
company. Notice of intention to defend was issued. The matter is currently not resolved. 


52.2 I Gerber N.O and others / Garden Route DM and P McKenzie 


The Cape Town High Court issued a court order against Garden Route District Municipality. In terms of the said order 
each party is liable for its own costs in respect of the said Application. In addition the court ordered the Applicant to 
bring a court application on or before the 31st of July 2013, in order to review Garden Route DM's decision to lease 
Part 4 of the farm Woodville 172, Division George to Peter McKenzie (the second Respondent), which will have 
further cost implications for Garden Route DM. Lastly instructions were issued that a lease be drafted in the interim 
between the relevant parties. Garden Route District Municipality obtained an eviction order against Gerber. Gerber 
did not vacate the premises on the due date and awaiting court date from attorneys 

52.3 Possible Dispute with B-Municipalities Regarding Properties Registered in Garden Route District 
No property disputes with B Municipalities as at 30 June 2019 


21 840 21 840 


17 400 000 


378 




GARDEN ROUTE DISTRICT MUNICIPALITY 


NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


2019 2018 

R R 


52.4 Andrew de Wet vs Garden Route District Municipality 

Mr De Wet instituted a claim against Garden Route District Municipality. He drove through a pothole with his bicycle. 

He sustained serious head and facial injuries and damage to his bicycle. This matter was referred to the Insurance 614 675 614 675 

Company and to Province - awaiting feedback. 

52.5 Barry Louis Rae Trust / Farm Uitvlugt 269 Fire 


Claim for damages as a result of the fire that spread (29 August until 1 September 2016). The matter is in process. 


4 500 000 4 500 000 


52.6 Combined Summons: Laurington Sithemile Stone vs Garden Route DM 

Car accident that occurred. This matter was referred to Province. Roads Department settled claim of R48 423,10 - 
finalised. 


52.7 Combined Summons: Banger Car Hire vs Garden Route DM 

Car accident that occurred. This matter was referred to Province. 18 800 18 800 


52.8 Combined Summons between George Municipality, Garden Route District Municipality and D Stoffels 

On 12 July 2017 the combined summons was received. On or about 1 September 2016 on the Jonkrus / De Vlugt 
Road a collision occurred between the Plaintiffs vehicle and CAW64439 driven by the second defendant in the 
course and scope of his employment with the First Defendant. 

52.9 Combined Summons between G Brown and Garden Route District Municipality 

On 1 August 2017 we received the combined summons. On or about 16 August 2015, at or near Rheenendal Road, 
Phantom Acres damage occurred to the Plaintiffs Vehicle while driving through a pothole. This matter with the 
municipality's Insurance Company - in process. 

52.10 Combined Summons between Brenda Kraft and Garden Route District Municipality 

This matter was referred to the Insurance Company and it appears that the municipality are not responsible for the 
maintenance of that road - in process. 

52.11 Isivuno Auctioneers: Summons 

A summons was served on Isivuno for the outstanding amount of R223 574,84. Discovery Affidavit served on us for 
the MM's signature. Isivuno defending this matter - in process. 

52.12 Possible Property Dispute: Calitzdorp Spa - Prins Family 

The Regional Land Claims Commissioner received a land-claim during 1998, just before the cut-off date of 31 
December 1998 by the Prins family. Preliminary research conducted could not show any ownership rights for the 
family on the claimed properties. A site visit was conducted and subsequent thereto, the office (RLLC:WC) roped in 
the services of the NGI to assist in plotting the identified properties on a map. The map indicated the exact properties 
under claim. However, the nature of rights lost by the Prins family could not be ascertain from this process. Currently, 
the land claim is at research stage. 

52.13 Portion of Portion 2 of Farm 238, Hooggekraal 

Possible transfer to Mossel Bay Municipality as per Council Resolution and subject to transfer agreement being 
entered into between the Parties. 

52.14 Erf 99, Glentana 

Possible transfer to Mossel Bay Municipality as per Council Resolution and subject to transfer agreement being 
entered into between the Parties. 


20 836 


31 032 


415 264 


223 575 


431 400 


4 021 781 


20 836 


31 032 


52.15 Labour disputes 

The Labour Relations Section has the following disputes lodged for the financial year ended 30 June 2019. All 
disputes have not yet been finalised and only an estimation is made based on the claims put forth by the applicants 
and the possible outcomes as per the Code of Good Practice of the Labour Relations Act as amended. 


V Blom & Roode 

350 000 

500 000 

L Janse van Rensburg & A Grobler 

B Ntozini 

70 000 

300 000 

N Ndabeni 

50 000 


IMATU obo Du Plessis & others 

868 490 



11 675 924 

23 488 685 


379 



GARDEN ROUTE DISTRICT MUNICIPALITY 
NOTES ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019 


53 RELATED PARTIES 

Key Management and Councillors receive and pay for services on the same terms and conditions as other ratepayers 
/ residents. 


2019 

R 


53.1 Related Party Transactions 

The following purchases were made during the year where Councillors or staff have an interest: 

Year ended 30 June 2019 
IGB Trading 

NM Boumeester's (Administrative Assistant Garden Route District Municipality) husband 
owns IGB Trading. 

Shabby to Chick -Zingfontein Estates 

J Stander (Garden Route District Municipality's Manager Finance) brother-in-law owns 
Shabby to Chick. Garden Route District Municipality received Property, plant and equipment 
from Shabby to Chick. 

R & S Communications 

NW Jacobs's (Disaster Management Coordinator - Community Service - Garden Route 
District Municipality) and JG Otto's (Manager Disaster Management Community Service - 
Garden Route District Municipality), both their spouses works for R & S Communications. 


Transaction(s) 

value 


11 702 


2 000 


521 987 


2018 

R 


Outstanding 

Balance 


7 809 


2 Brothers Enterprise 

AY Miles's (Admistrative Assistant - Garden Route District Municipality) uncle owns 2 __ 1f)n 

Brothers Enterprise. 

588 789 7 809 


Transaction(s) Outstanding 

value Balance 

Year ended 30 June 2018 
Mubesko Africa Pty (Ltd) 

B Holtzhausen (Garden Route District Municipality's Executive Manager Corporate Services) 

daughter works for Mubesko Africa (Pty) Ltd. Garden Route District Municipality received 949 856 486 643 

GRAP and mSCOA support services from Mubesko Africa. 

Shabby to Chick - Zingfontein Estates 

J Stander (Garden Route District Municipality's Manager Finance) brother-in-law owns 

Shabby to Chick. Garden Route District Municipality received Property, plant and equipment 5 740 

from Shabby to Chick. 

_ 955 596 _ 486 643 

53.2 Related Party Loans 

Since 1 July 2004 loans to councillors and senior management employees are not permitted. Loans granted prior to 
this date, together with the conditions, are disclosed in note 8 to the Annual Financial Statements. 

53.3 Compensation of key management personnel 

The compensation of key management personnel is set out in note 31 to the Annual Financial Statements. 


380 



APPENDIX A 

GARDEN ROUTE DISTRICT MUNICIPALITY 
SCHEDULE OF EXTERNAL LOANS AS AT 30 JUNE 2019 


































APPENDIX B 

GARDEN ROUTE DISTRICT MUNICIPALITY 

DISCLOSURES OF GRANTS AND SUBSIDIES IN TERMS OF SECTION 123 OF MFMA, 5$ OF 2003 


Grant Description 

Balance 

Correction 

Restated 

Contributions Interest 

Repaid 

Operating 

Capital 

VAT on 

Balance 


Unspent 

Unpaid 


30 June 2018 

of Error 

Balance 

during the year on Investments 

to 

Expenditure 

Expenditure 

Grants 

30 June 2019 


30 June 2019 

30 June 2019 




30 June 2018 


National 

during the year 

dunng the year 




(Creditor) 

(Debtor) 






Revenue 

T ransferred 

Transferred 











Fund 

to Revenue 

to Revenue 






National Government Grants 













Equitable Share 




151 237 120 


(151 237 120) 







Local Government Financial Management Grant 

(D 


(1) 

1 000 000 


(1 000 000) 



{11 



(D 

Municipal System Improvement Grant 













Expanded Public Works Programme Integrated Grant 




1 021 000 


(1 021 000) 







Energy Efficiency and Demand Side Management 

4 987 120 


4 987 120 


(4 987 120) 








Regional Bulk Infrastructure Grant 

381 288 

(381 288) 











Rural Road Asset Management Systems Grant 




2 425 000 


(1 934 624) 


(272 006) 

218 370 


218 370 


Total National Government Grants 

5 368 407 

(381 288) 

4 987 119 

155 683 120 

(4 987120) 

(155 192 744) 


(272 006) 

218 369 


218 370 

(1) 

Greenest Municipality Competition 













Municipal Disaster Grant 

1 388 000 


1 3B8 000 

10 000 000 

(1 388 000) 

(7 902 712) 



2 097 288 


2 097 288 


Bucket system Elimination Schools/Clinic 













Integrated Transport Planning 

900 000 


900 000 

900 000 


(1 051 750) 


(157 763) 

590 488 


590 488 


Mandela Memorial Celebrations 













Braille Project 














78 213 


78 213 

2 090 000 

(78 213) 

(1 197 407) 


(82 643) 

809 950 


809 950 


DWA: Abstraction Validation on Bitou 













Fire Services Capacity Building Grant 

202 027 


202 027 

1 483 000 





1 685 027 


1 685 027 


Safety Plan Implementation - (WOSA) 




1 200 000 





1 200 000 


1 200 000 


Total Provincial Government Grants 

2 566 240 


2 566 240 

15 673 000 

(1 464 213) 

(10 151 869) 


(240 405) 

6 382 753 


6 382 753 

Other Grant Providers 













Regional Bulk Infrastructure - Regional Landfill Site 













LGESTA: Reimbursements 

145 438 


145 438 

224 390 


(77 324) 



292 505 


292 505 


Nelson Mandela Biosphere Reserve Project 













Total Other Grant Providers 

145 438 


145 438 

224 390 


(77 324) 



292 505 


292 505 













Total Grants 

8 080 085 

(381 288) 

7 698 797 

171 580 510 

(6 451 333) 

(165 421 936) 


(512 411) 

6 893 627 


6 893 628 

(D 

Public Contributions 













Knysna Relief Fund 

339 711 


339 711 



(339 711) 







Total Public Contributions 

339 711 


339 711 



(339 711) 



















The Unspent Grants are cash-backed by term deposits. The municipality complied with the conditions attached to all grants received. No grants were withheld. 


MUN • Reconciliation of T>ble A1 Budget Summary 


Description 

2018/19 

2017/18 


Original Budget 

Budget 

Final Actual 

Unauthorised 

Variance 

Actual Outcome 

Actual Outcome as 

Reported 

Expenditure 

Balance to be 

Restated Audited 



Adjustments 

adjustments Outcome 

expenditure 


as % of Final 

% of Original 

unauthorised 

authorised in terms 

recovered 

Outcome 



(i.to. MFMA s28) 

budget 



Budget 

Budget 

expenditure 

of section 32 of 












MFMA 




1 2 

3 4 

5 

6 

7 8 

9 

10 

« 

12 

Financial Performance 












Property rates 

- 

- 

- 


- 

0,0% 

0,0% 




- 

Service charges 

- 

- 

- 


- 

0,0% 

0,0% 



0 

- 

Investment revenue 

15715 

0 

15715 14 730 


- 

0,0% 

0,0% 




13576 

Transfers recogrtsed - operations; 

158885 

13550 

172 435 166 274 


- 

0.0% 

0.0% 




154 142 

Other own revenue 

215515 

(1020) 

214 495 217177 



0,0% 

0,0% 




210 047 

Total Revenue (excluding capital transfers and contributions) 

390 115 

12 530 

402 645 399 181 


- 

0,0% 

0,0% 




377 766 

Employee costs 

133669 

6865 

140 534 220 830 



0,0% 

0.0% 

- 



204 452 

Remuneration ot councillors 

11572 

361 

11933 11053 

- 

- 

0,0% 

0.0% 

- 


- 

10981 

Deb! impairment 


- 

12555 

- 

- 

0.0% 

0.0% 

- 

- 

- 

10 828 

Depreciation 8 asset impairment 

3272 

(100) 

3172 (14 7961 

- 

- 

0.0% 

0,0% 

- 

- 

- 

3917 

Finance charges 


- 

127 

- 

- 

0,0% 

0,0% 

- 

- 

- 

79 

Materials and buk purchases 

185 

(149! 

36 

- 

- 

0,0% 

0,0% 

- 

- 

- 

- 

Transfers and grants 


- 

2 356 

- 

- 

0.0% 

0.0% 

- 

- 

- 

23C4 

Other expenditure 

239139 

3590 

242 729 153 590 



0,0% 

0.0% 




137322 

Total Expenditure 

387 838 

10 566 

398 403 385 685 


- 

0,0% 

0,0% 

- 

- 

- 

369 883 

Surplusi(Deficit) 

2 278 

1964 

4242 12495 


- 

0,0% 

0,0% 




7 883 

Transfers recognised - capita/ 





- 

0,0% 

0,0% 





Contributions recognised - capital & contributed assets 

- 

- 

- 


- 






- 

Surplus/(Deficit) after capital transfers & contributions 

2 278 

1964 

4242 12495 


- 

0,0% 

0,0% 




7883 

Share of surplus. 1 (deficit) of associate 


- 

- 


- 






- 

Surplus/(Doficlt) for the year 

2 278 

1964 

4 242 12 495 


- 

0,0% 

0,0% 




7 883 

Capital expenditure 












Transfers recognised - capital 

- 

3483 

3483 


- 

0,0% 

0,0% 





Pubic conlnbutcra & donations 

- 




- 

0,0% 

0,0% 




- 

Borrowing 

- 

- 



- 

0.0% 

0.0% 




- 

Internally generated funds 

9 303 

(2163! 

7140 



0,0% 

0,0% 





Total sources of capital funds 

9 303 

1320 

10 623 


- 

0,0% 

0,0% 




- 

Cash flows 












Net cash from (used) opeiatng 

3097 

10698 

13793 13325 


- 

0,0% 

0,0% 




23 998 

Net cash from (used) investing 

(7938) 

(1 320) 

(9258) (706) 



0,0% 

0.0% 




(5824) 

Net cash from (used) financing 

- 

- 

(721) 


- 

0,0% 

0.0% 




1448 

Cash'cash equivalents at the year end 

164927 

9 376 

174 303 174 238 


- 

0,0% 

0.0% 




162 341 


382 































































MUN - Reconciliation of Table A2 Budgeted Financial Performance (revenue and expenditure by standard classification) 


Description 

R thousand 

2018/19 

2017/18 

Original Budget 

( 

Budget 

Adjustments 

to MFMAs28) 

Final 

adjustments 

budget 

Actual 

Outcome 

Unauthorised 

expenditure 

Variance of 
Actual Outcome 
against 
Adjustments 
Budget 

Actual Outcome Actual Outcome 
as % of Final as % of Original 
Budget Budget 

Reported 

unauthorised 

expenditure 

Expenditure 
authorised in 
terms of section 

32 of MFMA 

Balance to be 

recovered 

Restated 

Audited 

Outcome 


1 2 3 

4 

5 

6 

7 8 

9 10 

11 

12 

Revenue - Standard 













Governance and administration 

211 013 

21 258 

232 271 

212 305 


- 

0,0% 

0,0% 




198 054 

Executive and council 

209 608 

21993 

231 601 

212048 


- 

0,0% 

0,0% 




197164 

Finance and administration 

1405 

(735) 

671 

257 


- 

0,0% 

0,0% 




890 

Internal audit 


- 


- 


- 

0,0% 

0,0% 




- 

Community and public safety 

8 041 

(0) 

8 041 

9 993 


- 

0,0% 

0,0% 




8 836 

Community and social services 


- 


- 


- 

0,0% 

0,0% 




- 

Sport and recreation 

7 821 

0) 

7 820 

8896 


- 

0,0% 

0,0% 




8620 

Public safely 


- 


658 


- 

0,0% 

0,0% 




- 

Housing 


- 


- 


- 

0,0% 

0,0% 




- 

Health 

221 

1 

221 

439 


- 

0,0% 

0,0% 




216 

Economic and environmental services 

145 333 

17 000 

162 333 

177236 


- 

0,0% 

0,0% 




828 

Planning and development 


- 


1672 


- 

0.0% 

0,0% 




614 

Road transport 

145 000 

17000 

162 000 

175080 


- 

0,0% 

0,0% 




- 

Environmental protection 

333 

- 

333 

484 


- 

0.0% 

0,0% 




214 

Trading services 

25 728 

(25728) 

- 

835 


- 

0,0% 

0,0% 




- 

Electricity 


- 


- 


- 

0,0% 

0,0% 




- 

Water 


- 


- 


- 

0,0% 

0,0% 




- 

Waste water management 


- 


- 


- 

0,0% 

0,0% 




- 

Waste management 

25 728 

(25 728) 


835 


- 

0.0% 

0,0% 




- 

Other 


- 


- 


- 

0,0% 

0,0% 




- 

Total Revenue - Standard 

390 115 

12 530 

402 645 

400 370 


- 

0,0% 

0,0% 




207 718 


MUN - Reconciliation of Table A2 Budgeted Financial Performance (revenue and expenditure by standard classification) 


Description 

R thousand 

Original Budget 

Budget 

Adjustments 

(i.to. MFMA s28) 

Final 

adjustments 

budget 

201 

Actual 

Outcome 

8/19 

Unauthorised 

expenditure 

Variance of 
Actual Outcome 
against 
Adjustments 
Budget 

Actual Outcome 
as % of Final 
Budget 

Actual Outcome 
as % of Original 
Budget 

Reported 

unauthorised 

expenditure 

2017/18 

Expenditure Balance to be 

authorised in recovered 

terms of section 

32 of MFMA 

Restated 

Audited 

Outcome 


1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

Exoenditure - Standard 

Governance and administration 

121 256 

2 298 

123 554 

110 590 

_ 

_ 

0,0% 

0,0% 

_ 

_ 

_ 

100 667 

Executive and council 

49677 

(5533) 

44144 

46 605 

- 

- 

0.0% 

0,0% 

- 

- 

- 

44 637 1 

Finance and administration 

69 211 

7 648 

76 860 

61485 

- 

- 

0,0% 

0,0% 

- 

- 

- 

53336 

Internal audit 

2 368 

182 

2550 

2500 


- 

0,0% 

0,0% 

- 

- 


2694 | 

Community and public safety 

78 374 

11 924 

90 298 

84156 

- 

- 

0,0% 

0,0% 

- 

- 

- 

73 365 

Community and social services 

8 5% 

3807 

12403 

- 


- 

0,0% 

0,0% 

- 

- 


- 

Sport and recreation 

13677 

(910) 

12 767 

13187 

- 

- 

0,0% 

0,0% 

- 

- 

- 

11610 

Public safety 

29149 

6139 

35 288 

36 421 

- 

- 

0,0% 

0,0% 

- 

- 

- 

29761 

Housing 

_ 

_ 

_ 

- 

- 

- 

0.0% 

0,0% 

_ 

_ 

- 

- 

Health 

26 953 

2 888 

29 841 

34 548 

- 

- 

0,0% 

0,0% 

- 

- 

- 

31995 

Economic and environmental services 

161 155 

17 704 

178 859 

210 331 

- 

- 

0,0% 

0,0% 

- 

- 

- 

23 748 

Planning and development 

9 236 

(596) 

8 640 

6204 

- 

- 

00% 

0.0% 

- 

- 

- 

18765 1 

Road transport 

148 325 

18310 

166 635 

198 709 

- 

- 

00% 

0,0% 

- 

- 

- 

2 489 

Environmental protection 

3 595 

(10) 

3585 

5418 

- 

- 

0,0% 

0,0% 

- 

- 

- 

2 494 | 

Trading services 

25 738 

(20 720) 

5 018 

1373 

- 

- 

0,0% 

0,0% 

- 

- 

- 

2 055 

Electricity 

18 

(7) 

10 

- 

- 

- 

0.0% 

0,0% 

- 

- 

- 

- 

Water 

25 720 

(20 713) 

5 007 

- 

- 

- 

0,0% 

0,0% 

- 

- 

- 

- 

Waste water management 

- 

- 

- 

- 

- 

- 

0,0% 

0,0% 

- 

- 

- 

- 

Waste management 

- 

- 

- 

1373 

- 

- 

0.0% 

0,0% 

- 

- 

- 

2055 

Other 

1314 

(640) 

674 

- 

- 

- 

0,0% 

0,0% 

- 

- 

- 

- 

Total Expenditure - Standard 

387 837 

10 566 

398 403 

406 449 

- 

- 

0,0% 

0,0% 

- 

- 

- 

199 835 

Surplus/(Deficit) for the year 

2 278 

1964 

4 242 

(6 080) 

- 

- 

0,0% 

0,0% 

- 

- 

- 

7883 


383 





































MUN - Reconciliation of Table A3 Budgeted Financial Performance (revenue and expenditure by municipal vote) 


Vote Description 

R thousand 

2018/19 

2017/18 

Original Budget 

Budget 

Adjustments 

(i.to. MFMA s28) 

Final 

adjustments 

budget 

Actual 

Outcome 

Unauthorised 

expenditure 

Variance of 
Actual Outcome 
against 
Adjustments 

Actual Outcome 

as % of Final 
Budget 

Actual Outcome 
as % of Original 
Budget 

Reported 

unauthorised 

expenditure 

Expenditure 
authorised in 
terms of section 

32 of MFMA 

Balance to be 

recovered 

Restated 

Audited 

Outcome 


1 

2 3 

4 

5 

6 7 

8 

9 

10 

11 

12 

Revenue by Vote 












Vote 1 - Executive and Council 

210080 

21993 

232074 

212 048 



0.0% 

0.0% 




197164 

Vote 2 - Budget and Treasury Office 


- 


(11) 


- 

0.0% 

0,0% 




- 

Vote 3 - Corporate Services 

933 

(735) 

198 

268 


- 

0.0% 

0,0% 




890 

Vote 4 Planning and Development 


- 


1672 


- 

0.0% 

0,0% 




614 

Vote 5 - Public Safety 


- 


658 


- 

0,0% 

0,0% 




- 

Vote 6-Health 

221 

1 

221 

439 


- 

0.0% 

0,0% 




216 

Vote 7 - Community and Social Services 


- 


- 


- 

0,0% 

0,0% 




- 

Vote 8 - Sport and Recreation 

7821 

(1) 

7 820 

8896 


- 

0.0% 

0,0% 




8620 

Vote 9 - Waste Management 

25728 

(25 728) 

- 

835 


- 

0.0% 

0,0% 




- 

Vote 10 - Roads Transport 


- 


- 


- 

0.0% 

0,0% 




- 

Vote 11 - Waste Water Management 


- 


- 


- 

0.0% 

0,0% 




- 

Vote 12-Water 


- 


- 


- 

0.0% 

0,0% 




- 

Vote 13 - Environment Protection 

333 

- 

333 

484 


- 

0.0% 

0,0% 




214 

Vote 14 - Roads Agency Function 

145000 

17 000 

162000 

175080 


- 

0.0% 

0,0% 




- 

Vote 15 - Electricity 


- 


- 


- 

0,0% 

0,0% 




- 

Total Revenue by Vote 

390115 

12 530 

402 645 

400 370 


- 

0,0% 

0,0% 




207 718 

Expenditure by Vote to be appropriated 













Vote 1 - Executive and Council 

48 199 

(1 218) 

46 981 

49106 

- 

- 

0,0% 

0,0% 

- 

- 

- 

47 331 

Vote 2 - Budget and Treasury Office 

19830 

4690 

24 519 

21465 

- 

- 

0.0% 

0,0% 

- 

- 

- 

18933 

Vote 3 - Corporate Services 

42 835 

(1625) 

41 210 

40020 

- 

- 

0.0% 

0,0% 

- 

- 

- 

34407 

Vote 4 - Planning and Development 

19357 

3 381 

22739 

6204 

- 

- 

0,0% 

0,0% 

- 

- 

- 

18765 

Vote 5 - Public Safety 

34 829 

6 541 

41 369 

36421 

- 

- 

0.0% 

0,0% 

- 

- 

- 

29 756 

Vote 6-Health 

31 454 

2127 

33 581 

34 548 

- 

- 

0.0% 

0,0% 

- 

- 


31995 

Vote 7 - Community and Social Services 

- 

- 

- 

- 

- 

- 

0,0% 

0,0% 

- 

- 

- 

- 

Vote 8 - Sport and Recreation 

13677 

(910) 

12767 

13187 

- 

- 

0,0% 

0,0% 

- 

- 

- 

11610 

Vote 9 - Waste Management 

25720 

(20 713) 

5 008 

1 373 

- 

- 

0.0% 

0,0% 

- 

- 

- 

2055 

Vote 10 - Roads Transport 

3325 

900 

4 225 

2865 

- 

- 

0.0% 

0,0% 

- 

- 


2489 

Vote 11 - Waste Water Management 

18 

(7) 

10 

- 

- 

- 

0.0% 

0,0% 

- 

- 

- 

- 

Vote 12-Water 

- 

- 

- 

- 

- 

- 

0.0% 

0,0% 

- 

- 


- 

Vote 13 - Environment Protection 

3 595 

(10) 

3 585 

5418 

- 

- 

0.0% 

0,0% 

- 

- 


2494 

Vote 14 - Roads Agency Function 

145000 

17410 

162410 

175080 

- 

- 

0.0% 

0,0% 

- 

- 

- 

- 

Vote 15 - Electricity 

- 

- 

- 

- 

- 

- 

0.0% 

0,0% 

- 

- 

- 

- 

Total Expenditure by Vote 





- 

- 



- 

- 

- 


Surplus/(Defieit) for the year 

2 278 

1964 

4 242 

14 684 


- 

0,0% 

0,0% 




7 883 


MUN - Reconciliation of Table A4 Budgeted Financial Performance (revenue and expenditure) 


Description 

R thousand 

2018/19 

2017/18 

Original Budget 

Budget 

Adjustments 

(i.t o. MFMAs28) 

Final 

adjustments 

budget 

Actual 

Outcome 

Unauthorised 

expenditure 

Variance 

Actual Outcome 
as % of Final 
Budget 

Actual Outcome 
as % of Original 
Budget 

Reported 

unauthorised 

expenditure 

Expenditure Balance to be 
authorised in recovered 

terms of section 

32 of MFMA 

Restated 

Audited 

Outcome 


1 

2 

3 4 

5 

6 

7 

8 

9 10 11 

12 

Revenue By Source 











Property rates 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Property rates - penalties & collection charges 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Service charges - electricity revenue 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Service charges - water revenue 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Service charges sanitation revenue 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Service charges - refuse revenue 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Service charges - olher 

- 

- 

- 

- 


- 

0,0% 

0,0% 



- 

Rental of facilities and equipment 

2718 

1128 

3 846 

1682 


- 

0.0% 

0,0% 



792 

Interest earned - external investments 

15715 

0 

15715 

12 306 



0.0% 

0,0% 



11937 

Interest earned - outstanding debtors 

897 

0 

897 

2424 


- 

0,0% 

0,0% 



1639 

Dividends received 


- 


- 


- 

0,0% 

0.0% 



- 

Fines 


- 


- 


- 

0,0% 

0,0% 



- 

Licences and permits 

333 

- 

333 

484 


- 

0,0% 

0,0% 



214 

Agency services 

19 022 

2 040 

21 062 

17 244 


- 

0,0% 

0,0% 



- 

Transfers recognised - operational 

158 885 

13 550 

172435 

166274 


- 

0.0% 

0,0% 



155063 

Other revenue 

189 390 

(5032) 

184358 

197767 


- 

0.0% 

0,0% 



208121 

Gains on disposal of PPE 

3156 

844 

4 000 

2189 


- 

0,0% 

0,0% 



- 

Total Revenue (excluding capital transfers and 

390 115 

12 530 

402 645 

400 370 


- 

0,0% 

0,0% 



377 766 

contributions) 












Employee related costs 

133669 

6865 

140 534 

220800 



0,0% 

0,0% 



204452 

Remuneration of councillors 

11572 

361 

11933 

11053 

- 

- 

0.0% 

0,0% 

- 

- 

10981 

Debt impairment 

1601 

(0) 

1601 

12555 

- 

- 

0.0% 

0,0% 

- 

- 

10828 

Depreciation & asset impairment 

3 272 

(100) 

3172 

(14 796) 

- 

- 

0,0% 

0,0% 

- 


3 917 

Finance charges 


- 


127 

- 

- 

0,0% 

0,0% 

- 

- 

79 

Bulk purchases 


- 


- 

- 

- 

0,0% 

0,0% 

- 

- 

- 

Other materials 

185 

(149) 

36 

- 

- 

- 

0,0% 

0,0% 

- 

- 

- 

Contracted services 

60 636 

(10282) 

50 354 

32674 

- 

- 

0.0% 

0,0% 

- 

- 

26978 

Transfers and grants 

- 

- 

- 

- 

- 

- 

0,0% 

0,0% 

- 

- 

2 304 

Other expenditure 

176903 

13871 

190 774 

123272 

- 

- 

0,0% 

0.0% 

- 

- 

109 770 

Loss on disposal of PPE 


- 

- 1 

- 

- 

- 

0,0% 

0,0% 

HI 

H 

574 

Total Expenditure 

387 838 

10 566 

398403 

385 685 

- 

- 

0,0% 

0,0% 

- 

- 

369 883 


i----i---1 


384 











































MUN - Reconciliation of Table A4 Budgeted Financial Performance (revenue and expenditure) 



385 


























MUN - Reconciliation of Table A5 Budgeted Capital Expenditure by vote, standard classification and funding 


Vote Description 

R thousand 

2018/19 

2017/18 

Original Budget 

Total Budget Final 

Adjustments adjustments 

{i.t.o. MFMA s28) budget 

Actual 

Outcome 

Unauthorised 

expenditure 

Variance 

Actual Outcome Actual Outcome 
as % of Final as % of Original 
Budget Budget 

Reported 

unauthorised 

expenditure 

Expenditure 
authorised in 

terms of section 
32 Of MFMA 

Balance to be 

recovered 

Restated Audited 

Outcome 


12 3 4 

5 

6 7 8 

9 

10 

11 

12 

Capital expenditure - Vote 












Multi-vear expenditure 












Vote 1 - Executive and Cornell 

30 

30 1 

162 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 2 - Budget and Treasury Office 

42 

42 

135 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 3 - Corporate Services 

1368 

1 060 2428 

2 580 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 4 - Planning and Development 


- 

218 

- 


0% 

0% 

- 

- 


- 

Vote 5 - Public Safety 

5790 

(1 040) 4 750 

1571 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 6 - Health 

43 

2 300 2 343 

126 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 7 - Community and Social Services 


- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 8 - Sport and Recreation 

2 000 

(1 000) 1 000 

517 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 9 - Waste Management 


- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 10 - Roads Transport 


- 

- 

- 

- 

0% 

0% 

- 

- 


- 

Vote 11 Waste Water Management 


- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 12 - Water 


- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 13 - Environment Protection 

30 

30 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 14 - Roads Agency Function 


- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 15 - Electricity 


- 

- 

- 

- 

0% 

0% 

- 

- 


- 





- 

- 



- 

- 

- 

- 

Sinale-vear expenditure 












Vote 1 - Executive and Council 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

3199 

Vote 2 - Budget and Treasury Office 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

69 

Vote 3 - Corporate Services 

- 

- 


- 


0% 

0% 

- 

- 


1276 

Vote 4 - Planning and Development 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

12 

Vote 5 - Public Safety 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

507 

Vote 6-Health 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

253 

Vote 7 - Community and Social Services 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

2 

Vote 8 - Sport and Recreation 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

489 

Vote 9 - Waste Management 

- 

- 


- 


0% 

0% 

- 

- 

- 

373 

Vote 10 Roads Transport 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 1 1 - Waste Water Management 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 12-Water 

- 

- I 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 13 - Environment Protection 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Vote 14 - Roads Agency Function 

- 

- 

- 

- 


0% 

0% 

- 

- 


- 

Vote 15 - Electricity 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Capital single-year expenditure 



- 





Total Capital Expenditure - Vote 

9 303 

1 320 10 623 

5 308 

- 

- 

0% 

0% 

- 

- 

- 

6181 


MUN - Reconciliation of Table A5 Budgeted Capital Expenditure by vote, standard classification and funding 


Vote Description 

2018/19 

2017/18 


Original Budget 

Total Budget 

Final 

Actual 

Unauthorised 

Variance 

Actual Outcome 

Actual Outcome 

Reported 

Expenditure 

Balance to be 

Restated Audited 



Adjustments 

adjustments 

Outcome 

expenditure 


as % of Final 

as % of Original 

unauthorised 

authorised in 

recovered 

Outcome 

R thousand 


(i.t.o. MFMA s28) 

budget 




Budget 

Budget 

expenditure 

terms of section 













32 of MFMA 




1 2 

3 4 

5 

6 

7 8 

9 

10 

11 

12 














Governance and administration 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

4 544 

Executive and council 

- 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

3199 1 

Finance and administration 

- 

- 

- 1 


- 


0% 

0% 

- 

- 

- 

1345 

Internal audit 

- 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

- 

Community and public safety 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

1251 

Community and social services 


- 

- 


- 

- 

0% 

0% 

- 

- 

- 

2 

Sport and recreation 

- 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

489 

Public safety 

- 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

507 

Housing 


- 

- 


- 

- 

0% 

0% 

- 

- 

- 

- 

Health 

- 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

253 

Economic and environmental services 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

12 

Planning and development 


- 

- 


- 

- 

0% 

0% 

- 

- 

- 

12 

Road transport 


- 

- 


- 

- 

0% 

0% 

- 

- 

- 

- 

Environmental protection 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Trading services 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

373 

Electricity 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Water 

- 

- 

- 

- 

- 


0% 

0% 

- 



- 

Waste water management 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Waste management 

- 

- 

- 


- 

- 

0% 

0% 

- 

- 

- 

373 

Other 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Total Capital Expenditure - Standard 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

6181 

Funded by: 











National Government 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Provincial Government 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

District Municipality 

- 

- 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Other transfers and grants 

- 

800 

- 1 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Transfers recognised - capital 

- 

800 

- 

- 

- 

- 

0% 

0% 

- 

- 

- 

- 

Public contributions & donations 

Borrowing 

” 

: 

: 

: 

: 

" 

0% 

0% 

0% 

0% 

: 

: 

: 

: 

Internally generated funds 

- 

- 

- 

5 308 

- 

- 

0% 

0% 

- 

- 

- 

6181 | 

Total Capital Funding 

- 

800 

- 

5308 

- 

- 

0% 

0% 

- 

- 

- 

6181 


386 



































MUN - Reconciliation of Table A7 Budgeted Cash Flows 


Description 

R thousand 

2018/19 

2017/18 

Original Budget 

Budget 

Adjustments 

(i.to. s28) 

Final 

adjustments 

budget 

Actual 

Outcome 

Variance 

Actual Outcome 
as % of Final 
Budget 

Actual Outcome 
as % of Original 
Budget 

Restated 

Audited 

Outcome 


1 

2 

3 

4 

5 

6 

7 

8 

CASH FLOW FROM OPERATING ACTIVITIES 









Receipts 




377132 




371 669 

Property rates, peanalties and collection charges 

- 

- 

- 

- 

- 

0 , 0 % 

0 , 0 % 

- 

Service charges 

- 

- 

- 

- 

- 

0 , 0 % 

0 , 0 % 

- 

Other revenue 

211462 

3 033 

214 495 

198 891 

- 

0 , 0 % 

0 , 0 % 

205 590 

Government - operating 

158 885 

13 550 

172 435 

165 934 

- 

0 , 0 % 

0 , 0 % 

154142 

Government - capital 

- 

- 

- 

- 

- 

0 , 0 % 

0 , 0 % 

- 

Interest 

15 715 

0 

15 715 

12 306 

- 

0 , 0 % 

0 , 0 % 

11937 

Dividends 


- 


- 

- 

0 , 0 % 

0 , 0 % 

- 

Payments 




(363 807) 




(347 671) 

Suppliers and employees 

(382 965) 

(5 887) 

(388 852) 

(361 324) 

- 

0 , 0 % 

0 , 0 % 

(345 288) 

Finance charges 

- 

- 

- 

(127) 

- 

0 , 0 % 

0 , 0 % 

(79) 

Transfers and Grants 

- 

- 

- 

(2 356) 

- 

0 , 0 % 

0 , 0 % 

(2 304) 

NET CASH FROM/(USED) OPERATING ACTIVITIES 

3 097 

10 696 

13 793 

13 325 


0 ,0% 

0 ,0% 

23 998 

CASH FLOWS FROM INVESTING ACTIVITIES 









Receipts 




4 602 




(500) 

Proceeds on disposal of PPE 

3156 

- 

3156 

6 334 

- 

0 , 0 % 

0 , 0 % 

- 

Decrease (Increase) in non-current debtors 

- 

- 


(1731) 

- 

0 , 0 % 

0 , 0 % 

(500) 

Decrease (increase) other non-current receivables 

(1 791) 

- 

(1 791) 

- 

- 

0 , 0 % 

0 , 0 % 

- 

Decrease (increase) in non-cunrent investments 

- 

- 

- 

( 1 ) 

- 

0 , 0 % 

0 , 0 % 

- 

Payments 




(5 308) 




(5 324) 

Capital assets 

(9 303) 

(1 320) 

(10 623) 

(5308) 

- 

0 , 0 % 

0 , 0 % 

(5 324) 

NET CASH FROM/(USED) INVESTING ACTIVITIES 

(9 303) 

(1 320) 

(10 623) 

(706) 

. 

0 ,0% 

0 ,0% 

(5 824) 

CASH FLOWS FROM FINANCING ACTIVITIES 









Receipts 




212 




1749 

Short term loans 

- 

- 

- 

- 

- 

0 , 0 % 

0 , 0 % 

- 

Borrowing long term/refinancing 

- 

- 

- 

212 

- 

0 , 0 % 

0 , 0 % 

1749 

Increase (decrease) in consumer deposits 

- 

- 

- 

- 

- 

0 , 0 % 

0 , 0 % 

- 

Payments 




(933) 




(301) 

Repayment of borrowing 

- 

- 


(933) 

- 

0 , 0 % 

0 , 0 % 

( 301 ) 

NET CASH FROMZ(USED) FINANCING ACTIVITIES 



_ 

(721) 

_ 

0 ,0% 

0 ,0% 

1448 

NET INCREASE/ (DECREASE) IN CASH HELD 

(6 206) 

9 376 

3170 

11 897 




19 622 

Cash/cash equivalents at the year begin: 

169 768 


169 768 

162 341 




142 719 1 

Cash/cash equivalents at the year end: 

164 927 

9 376 

174 303 

174 238 

- 

0 , 0 % 

0 , 0 % 

162 341 | 


99 


387 




























APPENDIX A: COUNCILLORS, COMMITTEE 
ALLOCATION AND COUNCIL ATTENDANCE 


Party 

P 

R 

Part 

Councillor 

28 August 
2018 

01 October 
2018 

30 October 
2019 

05 

December 

2019 

13 

Decmber 

2018 

09 january 

2019 

21 January 

2019 

11 february 

2019 

27 February 

2019 

26 March 

2019 

23 April 

2019 

28 May 

2019 

27 June 

2019 

ANC 

X 


CN Lichaba 


Y 

Y 

Y 


y 

A 

A 

Y 

Y 

A 

Y 

Y 

ANC 

X 


D Xego 

y 

Y 

A 

Y 


Y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

ANC 

X 


S De Vries 

y 

Y 

Y 

A 

Y 

A 

Y 

A 

A 

Y 

Y 

Y 

A 

ANC 

X 


NF Kamte 

y 

A 

Y 

Y 

Y 

A 

Y 

Y 

Y 


Y 

A 

Y 

ANC 

X 


MP Mapitiza 

y 

A 

A 

Y 

y 

Y 

Y 

A 

Y 

Y 

Y 

Y 


DA 



D Saayman 

y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 


Y 

Y 

Y 

DA 

X 


BN Van Wyk 

y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

DA 

X 


RE Spies 

y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

DA 

X 


T Van Rensburg 

y 

N/A 

N/A 

N/A 

N/A 

Y 

A 

Y 

A 

Y 

Y 

Y 

Y 

DA 

X 


Cll M Booysen 

y 

Y 

Y 

A 

Y 

y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

DA 

X 


AJ Rossouw 

y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

A 

A 

Y 

Y 

A 

DA 

X 


KS Lose 

y 

Y 

Y 

A 


Y 

Y 

A 

A 

Y 

Y 

Y 

Y 

DA 



SF May 

y 

Y 

Y 

Y 

Y 

Y 

y 

Y 

Y 

Y 

A 

Y 

Y 

ICOSA 

X 


T Fortuin 

y 

Y 

Y 



Y 

A 

Y 

Y 


Y 

Y 

A 

George 


X 

1 Stemela 

y 

A 

Y 

A 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

George 


X 

EH Stroebel 

y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

A 

George 


X 

PJ Van der Hoven 

y 

Y 

Y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

Y 

Y 

Y 

George 


X 

RGS Figland 

y 

Y 

Y 

Y 


Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

George 


X 

TTeyisi 

y 

Y 

Y 

Y 


Y 

Y 

A 

Y 

A 

Y 

Y 

Y 

George 


X 

V Gericke 

A 

Y 

Y 



Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Hessequ 

a 


X 

IT Mangaliso 

Y 

Y 

Y 

Y 


Y 

Y 

A 

A 

Y 

A 

Y 

Y 

Hessequ 

a 


X 

J Hartnick 

N/A 

N/A 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Kannala 

nd 


X 

JP Johnson 

Y 

y 

Y 

Y 

Y 

Y 

y 

A 

Y 

Y 

Y 

Y 



388 












































Party 

P 

R 

Part 

Councillor 

28 August 

2018 

01 October 

2018 

30 October 

2019 

05 

December 

2019 

13 

Decmber 

2018 

09 january 

2019 

21 January 

2019 

11 february 

2019 

27 February 

2019 

26 March 

2019 

23 April 

2019 

28 May 

2019 

27 June 

2019 

Knysna 


X 

NAThengwa 


Y 

Y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

A 

Y 


Knysna 


X 

MS Willemse 

A 

A 

A 

A 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

Knysna 


X 

ERJ Spies 

N/A 

N/A 

N/A 

N/A 

y 

y 

y 

y 

y 

y 

y 

N/A 

N/A 

Knysna 


X 

L Tyokolo 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Mossel 

Bay 


X 

SS Mbandezi 



Y 

Y 


Y 


Y 

A 

Y 

A 

A 

Y 

Mossel 

Bay 


X 

BHJ Groenewald 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Mossel 

Bay 


X 

E Meyer 

Y 

Y 

A 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

A 

Mossel 

Bay 


X 

RH Ruiters 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

Oudtsho 

orn 


X 

K Windvogel 

Y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Oudtsho 

orn 


X 

JC Lambaatjeen 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

Y 

y 

Oudtsho 

orn 


X 

RR Wildschut 

Y 

Y 

Y 

Y 

Y 

Y 

A 

Y 

A 

Y 

A 

Y 


Bitou 


X 

NC Jacob 

Y 

Y 

Y 

Y 


A 

Y 

A 

Y 

Y 

Y 

Y 

Y 

Bitou 


X 

ASM Windvogel 

Y 

y 

y 

Y 

Y 

Y 

Y 

A 

Y 

Y 

Y 

y 

y 


MAYORAL COMMITTEE MEETINGS: 31 AUGUST 2018 UNTIL 30 JUNE 2019 


Councillors 

28 May 
2019 

17 May 
2019 

17 April 

2019 

26 March 
2019 

29 October 
2018 

30 Julie 
2018 



Cllr Memory Booysen 

Y 

Y 

Y 

Y 

Y 

Y 



Cllr Rosina Ruiters 

Y 

A 

Y 

Y 

Y 

Y 



Cllr Khayalethu Lose 

Y 

A 

Y 

Y 

Y 

Y 



Cllrlsaya Stemela 

Y 

A 


Y 

Y 

Y 



Cllr Joslyn Johnson 

Y 

a 

A 

Y 

Y 

Y 



Cllr Erica Meyer 

Y 

A 

Y 

Y 

Y 

Y 



Cllr Jerome Lambaatjeen 

Y 

A 

Y 

Y 

A 

Y 



Cllr RE Spies 

y 

A 

Y 

Y 

Y 

Y 




389 





















































APPENDIX B: THIRD TIER ADMINISTRATIVE 
STRUCTURE 



APPENDIX C: FUNCTIONS OF GARDEN ROUTE 

DM 


2018/19 Functions of Garden Route DM 

Municipal Functions 

Function Applicable to 
Municipality (Yes / No)* 

Function Applicable to Entity 
(Yes / No) 

According to the Constitution, Schedule 4, Part B. 

Air Pollution 

Yes 

Department: Community 
Services 

Child Care Facilities 

Yes 

Department: Community 
Services 

Electricity and Gas Reticulation 

No 

N/A 

Firefighting Services 

Yes 

Department: Community 
Services 


390 






























2018/19 Functions of Garden Route DM 

Municipal Functions 

Function Applicable to 
Municipality (Yes / No)* 

Function Applicable to Entity 
(Yes / No) 

Local Tourism 

Yes 

Department: Corporate- 
/Strategic Services 

Municipal Planning 

Yes 

Department: Corporate- 
/Strategic Services 

Municipal Health Services 

Yes 

Department: Community 
Services 

Municipal Public Transport 

Yes 

Department: Roads Services 

Municipal Public Works only in respect of the 
needs of municipalities in the discharge of their 
responsibilities to administer functions specifically 
assigned to them under this Constitution or any 
other law 

Yes 

Department: Roads Services 

Storm water Management Systems in built-up 
areas 

No 

N/A 

Pontoons, ferries, jetties, piers and harbours, 
excluding the regulation of international and 
national shipping and matters related thereto 

No 

N/A 

Municipal Airports 

No 

N/A 

Trading Regulations 

No 

N/A 

Building Regulations 

No 

N/A 

Water and sanitation services limited to potable 
water supply systems and domestic waste-water 
and sewage disposal systems 

No 

N/A 

Constitution Schedule 5, part B functions 

Licensing and control of undertakings that sell 
food to the public 

Yes 

Department: Community 
Services 

Municipal roads 

Yes 

Garden Route DM, however, 
only upgrade and maintain 
provincial roads 

Beaches and amusement facilities 

No 

N/A 

Billboards and the display of advertisements in 
public places 

No 

N/A 

Cemeteries, funeral parlours and crematoria 

No 

N/A 

Cleansing 

No 

N/A 


391 



























2018/19 Functions of Garden Route DM 

Municipal Functions 

Function Applicable to 
Municipality (Yes / No)* 

Function Applicable to Entity 
(Yes / No) 

Control of public nuisances 

No 

N/A 

Control of undertakings that sell liquor to the 
public 

No 

N/A 

Facilities for the accommodation, care and 
burial of animals 

No 

N/A 

Fencing and fences 

No 

N/A 

Licensing of dogs 

No 

N/A 

Local amenities 

No 

N/A 

Local sport facilities 

No 

N/A 

Markets 

No 

N/A 

Municipal abattoirs 

No 

N/A 

Municipal parks and recreation 

No 

N/A 

Noise pollution 

No 

N/A 

Pounds 

No 

N/A 

Public places 

No 

N/A 

Refuse removal, refuse dumps and solid waste 
disposal 

No 

N/A 

Street trading 

No 

N/A 

Street lighting 

No 

N/A 

Traffic and parking 

No 

N/A 


392 
























APPENDIX D: MUNICIPAL AUDIT AND 
PERFORMANCE AUDIT COMMITTEE 
RECOMMENDATIONS 


Date of 

Meeting 

Committee recommendations during year 2017/18 

Recommendations 
adopted (enter Yes) 

If not adopted 
(provide 
explanation) 

APAC: 30 August 2018 

That Mr Stenekamp will give detailed feedback of review at 
APAC meeting of 31 August 2018 and obtain input from MM on 
certain aspects, as applicable. 

(ITEM: REVIEW OF THE ANNUAL FINANCIAL STATEMENTS FOR THE 
YEAR ENDING 30 JUNE 2018) 

Yes 

APAC: 31 August 2018 

That the following reports be submitted to the next APAC 

meeting: 

1. The MM submit a report to APAC regarding the 
agreement with the Department of Transport 
regarding post-retirement benefits payable to Roads 
officials; 

2. The Communications Policy: 

3. Ms Holtzhausen submit an updated report regarding 
the Skills Summit that took place; 

4. The Economic Growth Strategy; 

5. Ms N Davids prepare a progress report on the land 
disclosed as “under dispute” in the 2016/17 annual 
financial statements; and 

6. An updated Tourism Strategy. 

Yes 


That the MM ensures that the Section 32 process regarding 
irregular expenditure be expedited in order to reduce the 
outstanding balance of this expenditure (either through 
recovery or write-off) that is included in the notes to the AFS. 

That the MM will forward any agreement/letters to APAC 
regarding property discussions with B municipalities as 
applicable following the joint meeting between CFO's and 

MM's regarding properties on Monday 03 September 2018. 

That material/significant findings raised by AGSA during their 
audit be communicated to APAC immediately. 

(ITEM: REVIEW OF THE ANNUAL FINANCIAL STATEMENT FOR THE 
YEAR ENDING 30 JUNE 2018) 

Yes 


That the deadlines for implementation of the action plans be 
included in the OPCAR report tabled to APAC in future 

That OPCAR be a standing item on the APAC agenda 

(ITEM: REPORT ON MONITORING OF IMPLEMENTATION OF THE AG 
MANAGEMENT REPORT FINDINGS OF THE 2014/15, 2015/16 AND 
2016/17 FINANCIAL YEARS) 

Yes 


That Mr Loliwe submit an action plan at the next meeting to 
address the repeat findings raised by Internal Audit. 

That a bi-annual report be submitted to Council for notification 
or action if deemed necessary. 

(ITEM: REPORT ON PERFORMANCE MANAGEMENT FOR QUARTER 4 

Yes 


393 












(APRIL-JUNE 2018)) 


That the Executive Manager: Financial Services submit a report Yes 

to APAC by the end of October indicating the plan of action to 
address problems experienced with the financial system to 
ensure accurate, complete and timely financial reporting. 

(ITEM: GENERAL DISCUSSION) 

APAC: 05 October That it is noted that Dr A Potgieter has been appointed as Yes 

2018 Chairperson of the Risk Committee 

(ITEM: REPORT ON THE MINUTES OF THE RISK MANAGEMENT 
COMMITTEE MEETING) 

That the APAC approved the submission of the draft report to Yes 

AGSA by 15 October 2018. 

That the draft APAC report be submitted to AGSA and 
thereafter to Council. 

(ITEM: DRAFT APAC REPORT FOR THE 2017/18 ANNUAL REPORT) 

That Mr G Stenekamp be invited to Financial Services Portfolio Yes 

Committee meeting. 

(ITEM: SECTION 71 REPORT-AUGUST2018) 

That a comprehensive progress report be submitted to the Yes 

Committee. 

(ITEM: PWC REVENUE ENHANCEMENT REPORT) 

APAC: 29 November That the outcome of COMAF 15 be distributed to APAC Yes 

2018 members after the AG have received their technical opinion 

and concluded on the specific COMAF. 

That the APAC report for the 2017/18 Annual Report will be 
finalised and approved via e-mail in time for the MPAC meeting 
scheduled for 6 December 2018. 

(ITEM: AGSA MANAGEMENT REPORT ON THE 2017/18 AUDIT) 

Council: 05 December That Council approves the commencement of the recruitment Yes 

2019 process in order to fill the one APAC member position that will 

become vacant on 1 April 2019. 

(ITEM: RECRUTIMENT OF MEMBER FOR THE APAC) 

Council: 11 December That Council be advised to exhaust all internal avenues with Yes 

2018 National and Provincial Treasury before approaching the courts 

with regards to challenging COMAF 15 (declaration of interest 
on deviations) 

(ITEM: AGSA AUDIT RPORT AND MANAGEMENT REPORT 2017/18) 

That progress on Action Plan report be a standing item at the Yes 

Management meeting. 

That Plead of Departments and officials be workshopped on 
procurement process. 

(ITEM: REPORT ON THE MONITORING OF IMPLEMENTATION OF THE 
AG MANAGEMENT REPORT FINDINGS OF THE 2014/15, 2015/16 
AND 2016/17 FINANCIAL YEARS) 

That a professional property valuer be appointed to determine Yes 

the market value of Council property. 

That a report of all Council properties with the end lease date 
be submitted to this Committee. 


394 





























That a report on outstanding debt of Erf 195 from Vodacom and 
MTN be submitted at the next meeting. 

(ITEM: REVENUE ENHANCEMENT PROPERTY PROPOSALS AND 
PROGRESS PER LOCAL MUNICIPALITY BASED ON THE PWC 
REVENUE ENCHANCEMENT FINDINGS) 


That a possibility of a fire levy account paid on a monthly basis Yes 

for fire disaster be considered. 

That a report on the collection of the R19 million debt incurred 
from the fire disaster be submitted to this meeting. 

That Mr G Otto be invited to this Committee to give feedback 
on the OPCAR report. 

(ITEM: DEBTOR IMPAIRMENT: FIRE ACCOUNTS) 

Council: 26 March That Council approves the appointment of Dr A Potgieter as an Yes 

2019 APAC member, effective 1 April 2019 to 31 March 2022. 

(ITEM: RECRUITMENT FOR THE AUDIT AND PERFORMANCE AUDIT 
COMMITTEE MEMBER) 


APAC: 29 March 2019 Ms Holtzhausen perform skills gap analysis for the entire Not yet 

organisation. 

Internal Audit schedule more time on SCM findings, if not 
possible due to capacity constraints, a proposal be tabled to Y e s 

the MM to appoint personnel to assist in that regard. 

(ITEM: MATTERS ARISING FROM MINUTES) 

That this report be referred back to Management Committee Yes 

(MANCOM) for deliberation and thereafter an updated report 
be submitted to this Committee. 

(ITEM: REPORT ON OVERTIME, STANDBY AND ACTING 
ALLOWANCE) 


APAC: 19 June 2019 That APAC approved the revised APAC Charter and Internal Yes 

Audit Charter. 

That APAC recommends the revised APAC Charter for approval 
by Council. 

(ITEM: APAC CHARTER AND INTERNAL AUDIT CHARTER) 

That the APAC approves the Internal Audit Methodology for Yes 

implementation. 

(ITEM: INTERNAL AUDIT METHODOLOGY) 

That the APAC reviews the content of the Strategic Internal Yes 

Audit Plan and approves the plan for implementation. 

(ITEM: STRATEGIC INTERNAL AUDT PLAN FOR THE PERIOD 01 JULY 
2019-30 JUNE 2022) 


Council: 27 June 2019 That Council approves the revised APAC Charter Yes 

(ITEM: AUDIT AND PERFORMANCE AUDIT COMMITTEE CHARTER) 


395 

























APPENDIX E: LONG TERM CONTRACTS AND 
PUBLIC/PRIVATE PARTNERSHIPS 


Council has not entered into any long term contracts or Public Private Partnerships in 
the financial year 2018/19. The procurement process for the appointment of a PPP 
entity for the establishment and running of the Regional Landfill Site for the region is at 
an advanced stage. 


APPENDIX F: DISCLOSURES OF FINANCIAL 
INTERESTS 


Declaration of interest is undertaken by all personnel in the employ of Council 
including Political staff and the council. There are various control measures put in place 
to allow employees to disclose any financial interest before any matters are discussed 
that may be of relevance to them, this would be in any of the Supply Chain 
Management Committee meetings or any of the council meetings. Any matters where 
there is conflict of interest identified is addressed through the office of the Municipal 
Manager and disclosed accordingly in the Annual Financial Statements. 


396 



APPENDIX G(l): REVENUE COLLECTION 
PERFORMANCE BY VOTE 


Revenue Collection Performance by Vote (R'000) 


2017/18 


2018/19 


2018/19 

Description 

Actual 

Original 

Budget 

Adjustment 

Budget 

Actual 

Adjustment 

Budget 

(55) 

Executive and council 

222 701 

210 080 

232 074 

212 179 

-8.57% 

Corporate Services 

880 

933 

198 

268 

35.35% 

Sport and Recreation 

6 713 

7 821 

7 820 

8 896 

13.76% 

Health 

208 

221 

221 

439 

98.64% 

Road Transport 

145 000 

145 000 

162 000 

175 080 

8.07% 

Waste Management 

1 950 

25 728 

- 

835 

100.0% 

Environmental Protection 

314 

333 

333 

484 

45.7% 

Total Revenue by Vote (including revenue 
from Roads Agency function) 

377 766 

390 115 

402 645 

398 181 

-0.74% 


APPENDIX G (II): REVENUE COLLECTION 
PERFORMANCE BY SOURCE 


Revenue Collection Performance by Source (R’000) 


Description 

2017/18 

2018/19 

2018/19 

Actual 

Original 

Budget 

Adjustment 

Budget 

Actual 

Adjustment 

Budget 

(55) 

Rentals of facilities and equipment 

792 

2 718 

3 846 

1 682 

-56.27% 

Interest earned - external investments 

11 937 

15715 

15 715 

12 306 

-21.69% 

Interest earned - outstanding debtors 

1 639 

897 

897 

2 424 

1 70.23% 

Dividends received 






Licenses and permits 

214 

333 

333 

484 

45.35% 

Agency services 

15 300 

19 022 

21 062 

17 244 

-18.13% 


397 




































Revenue Collection Performance by Source (R'000) 


2017/18 

2018/19 

2018/19 

Description 

Actual 

Original 

Budget 

Adjustment 

Budget 

Actual 

Adjustment 

Budget 

(%) 

Transfers recognised 

155 063 

158 885 

172 435 

171 356 

-1% 

Other revenue 

192 821 

189 390 

184 358 

192 685 

4.52% 

Gains on disposal of PPE 

- 

- 

- 

- 

- 

Total Revenue (excluding capital transfers 
and contributions and income from roads 
agency) 

377 766 

390 115 

402 645 

398 181 

4.52% 


APPENDIX H: CONDITIONAL GRANTS RECEIVED 
EXCLUDING MIG 


Conditional Grants: Excluding MIG (R'000) 

Description 

2017/18 

2018/19 

2018/19 

Variance 


Actual 

Budget 

Adjustment 

Budget 

Actual 

Adjustments 
Budget (%) 

FMG 

1 250 

1 000 

1 000 

1 000 

- 

WC FMG 

620 

2 090 

2 090 

2 090 

- 

LGSETA 

145 

- 

- 

- 

- 

EPWP 

1 280 

1 021 

1 021 

1 021 

- 

Integrated transport 

900 

900 

900 

900 

- 

Rural Road Asset Management Systems 

2 420 

2 425 

2 425 

2 425 

- 

Fire Services Capacity Building 

800 

1 483 

1 483 

1 483 

- 


398 





























Conditional Grants: Excluding MIG (R'000) 


Description 

2017/18 


2018/19 


2018/19 

Variance 


Actual 

Budget 

Adjustment 

Budget 

Actual 

Adjustments 
Budget (%) 

Municipal Disaster Recovery 

2 000 

- 

- 

- 

- 

Safety Plan Implementation 

- 

1 200 

1 200 

1 200 

- 

Greenest Municipality 

130 

- 

- 

- 

- 

Disaster Management 

- 

10 000 

10 000 

10 000 

- 

Knysna Relief Fund 

56 

- 

- 

- 

- 

Energy Efficiency and Demand Side 
Management Grant 

5 000 

- 

- 

- 

- 

Total Operating Transfers and Grants 

14 601 

20 119 

20119 

20 119 

- 


APPENDIX I: CAPITAL EXPENDITURE - NEW AND 
UPGRADE / RENEWAL PROGRAMMES 

N/a 


APPENDIX J (I): CAPITAL EXPENDITURE - NEW 
ASSETS PROGRAMME 

APPENDIX J (I): CAPITAL EXPENDITURE - NEW 
ASSETS PROGRAMME 

The capital expenditure was spent on: 


399 

















1 . 


Purchase of an office building for fhe Environmental Health section in 
Plettenberg Bay 

2. Purchase of fire fighting vehicles and equipment 

3. Purchase of IT equipment 

4. Purchase of risk management and internal audit software 


Major capital projects for the year included the following: 


Project 

Amount 

New Water Tankers for Fire Fighting 

R3 523 000 

Purchase of office building in Plettenberg Bay 

R2 300 000 

New LDV Skid Unit for Fire Fighting 

R515 000 

Risk Management aind Internal Audit software 

R500 000 

Plazmat Rescue & Fire Equipment Equipment 

R250 000 


APPENDIX J (II) CAPITAL EXPENDITURE - 
UPGRADE / RENEWAL PROGRAMME 

Not applicable, no expenditure incurred for the renewal or upgrade. The capital 
expenditure was spent on: 

1. Purchase of an office building for the Environmental Health section in 
Plettenberg Bay 

2. Purchase of fire fighting vehicles and equipment 

3. Purchase of IT equipment 

4. Purchase of risk management and internal audit software 


APPENDIX K: DECLARATION AND GRANTS MADE 
BY GARDEN ROUTE DM 


No loans or grants have been made by District Municipality for the year under review. 
Due to the financial constraints, there is no available funding to make available as 
loans or grants to other institutions. 


400 











APPENDIX L : DECLARATION OF LOANS AND 
GRANTS MADE BY THE MUNICIPALITY 


No loans or grants have been made by District Municipality for the year under review. 
Due to the financial constraints, there is no available funding to make available as 
loans or grants to other institutions. 


APPENDIX M: DECLARATION OF RETURNS NOT 
MADE IN DUE TIME UNDER THE MFMA S71 


MFMA Section 71 Returns not made during year 1 according to reporting requirements 


Return 


N/a 


APPENDIX N: CAPITAL PROGRAM BY PROJECT 
YEAR 1 


Limited funding is available for capital projects. The major project that is currently in 
progress is the establishment of a regional landfill site in Mossel Bay. A PPP process will 
be followed to obtain the necessary funding for this project. 

CAPITAL: BULK SERVICES 

No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL: WASTE DISPOSAL 

No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE: ROADS 

No capital expenditures incurred for the 2018/19 financial year. 


401 







CAPITAL: REGIONAL DEVELOPMENT AND PLANNING 



2018/19 (R'000) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
budget 

Total 

Project 

Value 

Regional Development and 
Planning 

12 

12 

10 

2 

12 


Total project value represents the estimated cost of the project on approval by Council (including past and 
future expenditure as appropriate) 


CAPITAL: LED 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - COMMUNITY SERVICES 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - TOURISM 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - EPWP 



2018/19 (R'000) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 

EPWP 

37 

37 

36 

1 

37 


402 






















2018/19 (R'000) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 


Total project value represents the estimated cost of the project on approval by Council (including past and 
future expenditure as appropriate) 


CAPITAL EXPENDITURE - MUNICIPAL RESORTS 



2018/19 (R’000) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
budget 

Total 

Project 

Value 

Municipal Resorts 

804 

804 

506 

298 

804 


Total project value represents the estimated cost of the project on approval by Council (including past and future 
expenditure as appropriate) 


CAPITAL EXPENDITURE - SOCIAL DEVELOPMENT 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - AIR QUALITY CONTROL 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - ENVIRONMENTAL MANAGEMENT 


2018/19 (R'000) 


Capital Projects 


Budget 


Adjustment 

Actual 

Variance from 

Total 

Project 

Value 

Budget 

Expenditure 

budget 


403 



















2018/19 (R’OOO) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
budget 

Total 

Project 

Value 

Environmental Management 

2 367 

2 367 

2312 

55 

2 367 


Total project value represents the estimated cost of the project on approval by Council (including past and future 
expenditure as appropriate) 


CAPITAL EXPENDITURE - NATURAL RESOURCE MANAGEMENT SERVICES 

No capital expenditures incurred for the 2018/19 financial year. 


CAPITAL EXPENDITURE - FIRE SERVICES 



2018/19 (R’OOO) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 

Fire Services 

4 563 

4 563 

4 363 

200 

4 563 


Total project value represents the estimated cost of the project on approval by Council (including past and 
future expenditure as appropriate) 


CAPITAL EXPENDITURE - DISASTER MANAGEMENT 


Capital Projects 


2018/19 (R'OOO) 


404 

























Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 

Disaster Management 

20 

20 

17 

3 

20 

Total project value represents the estimated cost of the project on approval by Council (including past and 
future expenditure as appropriate) 


CAPITAL EXPENDITURE - EXECUTIVE AND COUNCIL 



2018/19 (R'000) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 

Equipment 

10 

10 

10 

0 

10 


Total project value represents the estimated cost of the project on approval by Council (including past and 

future expenditure as appropriate) 


CAPITAL EXPENDITURE - FINANCIAL PERFORMANCE 



2018/19 (R'000) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 

Budget and Treasury Office 
and Corporate Services 

169 

169 

140 

28 

169 


Total project value represents the estimated cost of the project on approval by Council (including past and 
future expenditure as appropriate) 


405 
































CAPITAL EXPENDITURE-HUMAN RESOURCES 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - CORPORATE SERVICES 


See financial performance expenditure 


CAPITAL EXPENDITURE - LEGAL SERVICES 



2018/19 (R'OOO) 

Capital Projects 

Budget 

Adjustment 

Budget 

Actual 

Expenditure 

Variance from 
original 
budget 

Total 

Project 

Value 

Legal Services 

5 

5 

3 

2 

5 


Total project value represents the estimated cost of the project on approval by Council (including past and 
future expenditure as appropriate) 


CAPITAL EXPENDITURE - PROPERTY SERVICES 


No capital expenditures incurred for the 2018/19 financial year. 

CAPITAL EXPENDITURE - SPORT AND RECREATION 


Refer to capital expenditure of municipal resorts 

CAPITAL EXPENDITURE - SHARED SERVICES 


No capital expenditures incurred for the 2018/19 financial year. 


406 












APPENDIX O: AUDIT REPORT 2018/2019 


Report of the auditor-general to the Western Cape Provincial Parliament 
and the council on the Garden Route District Municipality 


Report on the audit of the financial statements 


Opinion 

1 I have audited the financial statements of the Garden Route Distnct Municipality set out on 
pages 6 to 88, which comprise of the statement of financial position as at 30 June 2019, the 
statement of financial performance, statement of changes in net assets, cash flow statement 
and the statement of comparison of budget information with actual information for the year 
ended, as well as the notes to the financial statements, including a summary of significant 
accounting policies. 

2. In my opinion, the financial statements present fairly, in all material respects, the financial 
position of the Garden Route District Municipality as at 30 June 2019, and its financial 
performance and cash flows for the year then ended, in accordance with the South African 
Standards of Generally Recognised Accounting Practice (SA Standards of GRAP) and the 
requirements of the Municipal Finance Management Act of South Africa, 2003 (Act no. 56 of 
2003) (MFMA) and the Division of Revenue Act of South Africa, 2018 (Act no 1 of 2018) 
(Dora). 

Basis for opinion 

3 I conducted my audit in accordance with the International Standards on Auditing (ISAs) My 
responsibilities under those standards are further described in the auditor-general's 
responsibilities for the audit of the financial statements section of this auditor s report. 

4 I am independent of the municipality in accordance with sections 290 and 291 of the 
International Ethics Standards Board for Accountants’ Code of ethics for professional 
accountants, and parts 1 and 3 of the International Ethics Standards Board for Accountants’ 
International code of ethics for professional accountants (including International Independence 
Standards) (IESBA codes), as well as the ethical requirements that are relevant to my audit in 
South Afnca I have fulfilled my other ethical responsibilities m accordance with these 
requirements and the IESBA codes 

5 I believe that the audit evidence I have obtained is sufficient and appropriate to provide a 
basis for my opinion. 

Emphasis of matters 

6 I draw attention to the matters below My opinion is not modified in respect of these matters. 


407 










Material impairments - receivables from exchange transactions 

7 As disclosed in note 8 to the financial statements, receivables from exchange transactions 
were significantly impaired The impairment allowance amounted to R29 361 411 

(2018: R19 930 964). 

Unauthorised expenditure 

8 As disclosed in note 45.1 to the financial statements, the municipality incurred unauthorised 
expenditure of R18 609 403 as the approved budget for votes 1,2, 3, 4, 6, 8, 13 and 14 has 
been exceeded 

Material underspending 

9 As disclosed in note 45.1 to the financial statements, the municipality matenally underspent 
the capital budget by R5 315 364 (50%). 

Restatement of corresponding figure 

10. As disclosed in note 39 to the financial statements, the corresponding figures for 

30 June 2018 were restated as a result of errors of the financial statements of the municipality 
at. and for year ended. 30 June 2019. 

Other matters 

11 I draw attention to the matters below. My opinion is not modified in respect of these matters 

Unaudited supplementary schedules 

12 The supplementary information set out on pages 89 to 99 does not form part of the financial 
statements and is presented as additional information I have not audited these schedules 
and. accordingly, I do not express an opinion on them 

Unaudited disclosure note 

13 In terms of section 125(2)(e) of the MFMA the municipality is required to disclose particulars 
of non-compliance with the MFMA in the financial statements. This disclosure requirement did 
not form part of the audit of the financial statements and. accordingly, I do not express an 
opinion on it. 

Responsibilities of the accounting officer for the financial statements 

14. The accounting officer is responsible for the preparation and fair presentation of the financial 
statements in accordance with the SA Standards of GRAP and the requirements of the MFMA 
and Dora, and for such internal control as the accounting officer determines is necessary to 
enable the preparation of financial statements that are free from material misstatement, 
whether due to fraud or error 


408 


15 In preparing the financial statements, the accounting officer is responsible for assessing the 
Garden Route District Municipality s ability to continue as a going concern, disclosing, as 
applicable matters relating to going concern and using the going concern basis of accounting 
unless the appropriate governance structure either intends to liquidate the municipality or to 
cease operations, or has no realistic alternative but to do so 

Auditor-general’s responsibilities for the audit of the financial statements 

16. My objectives are to obtain reasonable assurance about whether the financial statements as a 
whole are free from material misstatement, whether due to fraud or error, and to issue an 
auditor's report that includes my opinion. Reasonable assurance is a high level of assurance, 
but is not a guarantee that an audit conducted in accordance with the ISAs will always detect 
a material misstatement when it exists. Misstatements can arise from fraud or error and are 
considered material if. individually or in aggregate, they could reasonably be expected to 
influence the economic decisions of users taken on the basis of these financial statements. 

17 A further description of my responsibilities for the audit of the financial statements is included 
in the annexure to this auditor's report. 


Report on the audit of the annual performance report 


Introduction and scope 

18 In accordance with the Public Audit Act of South Africa, 2004 (Act no. 25 of 2004) (PAA) and 
the general notice issued in terms thereof, I have a responsibility to report matenal findings on 
the reported performance information against predetermined objective for the selected 
objective presented in the annual performance report. I performed procedures to identify 
findings but not to gather evidence to express assurance. 

19. My procedures address the reported performance information, which must be based on the 
approved performance planning documents of the municipality. I have not evaluated the 
completeness and appropriateness of the performance indicators or measures included in the 
planning documents My procedures also did not extend to any disclosures or assertions 
relating to planned performance strategies and information in respect of future periods that 
may be included as part of the reported performance information Accordingly, my findings do 
not extend to these matters 

20 I evaluated the usefulness and reliability of the reported performance information in 
accordance with the criteria developed from the performance management and reporting 
framework, as defined in the general notice, for the following selected objective presented in 
the annual performance report of the municipality for the year ended 30 June 2019: 


409 



Objective 

Pages in the annual 
performance report 

Objective 2 - bulk infrastructure coordination 

123-124 


21. I performed procedures to determine whether the reported performance information was 
property presented and whether performance was consistent with the approved performance 
planning documents I performed further procedures to determine whether the indicators and 
related targets were measurable and relevant, and assessed the reliability of the reported 
performance information to determine whether it was valid, accurate and complete. 

22. The material findings in respect of the reliability of the selected objective are as follows: 

Repair 5 000 m 3 of black top patching by 30 June 2019 

23 The achievement for target repair 5 000 m ? of black top patching by 30 June 2019, reported in 
the annual performance report, was 2 S86 m'. However the supporting evidence provided did 
not agree with the reported achievement and indicated an achievement of 2 588m J . 

Blade 10 000 km of roads by 30 June 2019 

24. The achievement for target blade 10 000 km of roads by 30 June 2019. reported in the annual 
performance report, was 9 041,02 km However, the supporting evidence provided did not 
agree with the reported achievement and indicated an achievement of 6 223 km 

Other matter 

25 I draw attention to the matter below 

Achievement of planned targets 

26 Refer to the annual performance report on pages 123- 124 for information on the 
achievement of planned targets for the year This information should be considered in the 
context of the material findings on the usefulness and reliability of the reported performance 
information in paragraph 23 and 24 of this report. 


Report on the audit of compliance with legislation 


Introduction and scope 

27 In accordance with the PAA and the general notice issued in terms thereof, I have a 

responsibility to report material findings on the compliance of the municipality with specific 
matters in key legislation I performed procedures to identify findings but not to gather 
evidence to express assurance 


410 







28 The material findings on compliance with specific matters in key legislation are as follows 

Procurement and contract management 

29. Competitive bids were adjudicated by a bid adjudication committee that was not composed in 
accordance with supply chain management (SCM) regulation 29(2). 

Human resource management 

30 Bonuses were paid to the municipal manager and senior managers before the annual report 
for the applicable performance year was adopted by council, in contravention with the 
municipal performance regulations for municipal managers and managers directly accountable 
to municipal managers 8(1). 

Expenditure management 

31 Reasonable steps were not taken to prevent unauthorised expenditure of R18 609 403 
disclosed in note 45 1 to the financial statements, in contravention of section 62(1)(d) of the 
MFMA The unauthorised expenditure was caused by overspending of the approved budget 
Unauthorised expenditure of R12 669 896 was incurred on the roads function 

32. Reasonable steps were not taken to prevent irregular expenditure of R160 189 803 disclosed 
in note 45 3 to the annual financial statements, as required by section 62(1 )(d) of the MFMA 
The majority of the irregular expenditure was caused by non-compliance with SCM regulation 
29(2) as the bid adjudication committee was not correctly constituted 


Other information 


33. The accounting officer is responsible for the other information The other information 
comprises the information included in the annual report. The other information does not 
include the financial statements, the auditor's report and the selected objective presented in 
the annual performance report that has been specifically reported in this auditor s report. 

34 My opinion on the financial statements and findings on the reported performance information 
and compliance with legislation do not cover the other information and I do not express an 
audit opinion or any form of assurance conclusion thereon 

35 In connection with my audit my responsibility is to read the other information and, in doing so, 
consider whether the other information is materially inconsistent with the financial statements 
and the selected objectives presented in the annual performance report, or my knowledge 
obtained in the audit, or otherwise appears to be matenally misstated. 

36. If based on the work I have performed. I conclude that there is a matenal misstatement in this 
other information, I am required to report that fact. 

37 I have nothing to report in this regard 


411 



Internal control deficiencies 


38. I considered internal control relevant to my audit of the financial statements, reported 
performance information and compliance with applicable legislation; however, my objective 
was not to express any form of assurance on it. The matters reported below are limited to the 
significant internal control deficiencies that resulted in the findings on the annual performance 
report and the findings on compliance with legislation included in this report 

39 As the captunng of the source documents were inaccurate and incomplete, material 
misstatements were presented in the annual performance report No reviews of captured 
information were performed The system for capturing does not allow for reviews and 
incorrectly converts the input data into units that are different to those measured in the annual 
performance report 

40 Management did not appropriately interpret the requirements of regulation 29(2) of the MFMA 
SCM regulations when constituting the bid adjudication committee 

41. Management did not adequately monitor compliance with the requirements of the Municipal 
Performance Regulations for Municipal Managers and Managers directly accountable to 
Municipal Managers 2006 by ensuring that performance bonuses are paid out after the 
annual report has been tabled and adopted by council 

42. Management did not put reasonable controls in place to ensure that future expenditure for the 
roads function is estimated and submitted to council for approval before it is incurred. 

43 Management did not put reasonable controls in place to ensure that irregular expenditure is 
prevented by obtaining declarations of interest for all deviations from supply chain 
management processes 



Cape Town 


30 November 2019 



412 




APPENDIX P: APAC REPORT FOR ANNUAL 
REPORT 2018/2019 


REPORT FROM THE AUDIT AND PERFORMANCE AUDIT COMMITTEE 


It is with great pleasure that we present our report for the financial year ended 30 
June 2019. 

1. RESPONSIBILITY 

The GARDEN ROUTE DISTRICT MUNICIPALITY (hereinafter referred to as GRDM) has 
constituted its Audit and Performance Audit Committee (hereafter referred to as 
the Audit Committee) to function in terms of the provisions of Section 166 of the 
Municipal Finance Management Act, 2003 (MFMA). 


The audit committee is an independent advisory body to the council, accounting 
officer, management and staff of the municipality on matters relating to internal 
financial control and internal audits, risk management, accounting policies, the 
adequacy, reliability and accuracy of financial reporting and information, 
performance management, effective governance, the MFMA and any other 
applicable legislation and issues. 


The role of the audit committee is to promote accountability and service delivery 
through evaluating and monitoring responses to risks and overseeing the 
effectiveness of the internal control environment, including financial and 
performance reporting and compliance with legislation. 


The audit committee is also expected to review the annual financial statements 
to provide an authoritative and credible view of the municipality, its efficiency 
and effectiveness and its overall level of compliance with applicable legislation. 


2. TERMS OF REFERENCE 

The Audit Committee is constituted in terms of the requirements of sound 
corporate governance practices and operates in accordance with a written 
charter that incorporates the specific requirements of section 166 of the MFMA. 
The Committee reviewed the charter to include latest legislation and guidelines 
published by National Treasury and was subsequently approved by Council. 


413 



3. COMPOSITION OF THE AUDIT COMMITTEE 

At the end of the financial year ended 30 June 2019, the audit committee 
comprised of four independent members (including the Chairperson). Both the 
internal and external auditors had unrestricted access to the audit committee 
during the year under review. 

Audit Committee Members : 

1. Dr A. Potgieter (Independent Member and Chairperson) 

2. Adv D. Block (Independent Member) 

3. Ms N. Bulabula (Independent Member) 

4. Mr G. Stenekamp (Independent Member) 

The following audit committee meetings were held during the year under review : 



Attendance 

Date of 
meeting 

Chairp 

erson: 

Dr A 
Potgiet 

er 

Memb 

er: 

Adv D 

Block 

Member: 

Mr G 

Steneka 

mp 

Memb 

er: 

Ms N 

Bulabu 

la 

31 August 2018 

✓ 

Apology 



05 October 

2018 

s/ 

✓ 

✓ 

Apology 

29 November 

2018 

✓ 

Apology 


V 

11 December 

2018 

s/ 

✓ 

✓ 

V 

29 March 2019 

✓ 

✓ 

V 

V 

19 June 2019 

✓ 

✓ 

V 

✓ 


4. ACTIVITIES 

The audit committee carried out the following functions in terms of the charter: 


414 






1. Reviewed and amended the Audit and Performance Audit Committee 
Charter. 

2. Reviewed and commented on GRDM's annual reports within the stipulated 
time frame; 

3. Reviewed and approved the risk-based internal audit plan, including the 
definition of audit units, audit universe, and prioritisation of audit areas - taking 
into account the outcomes of the municipality's annual formal risk assessment 
process. 

4. Reviewed executive summaries of all internal audit reports issued. 

5. Reviewed the reporting by internal audit on performance management and 
performance information. 

6. Issued reports and recommendations to Council on performance 
management and performance information. 

7. Reviewed the annual financial statements as at 30 June 2019, the final 
management report of the Auditor General of South Africa (AGSA), as well as 
the audit report of the AGSA on the annual financial statements. 

8. Reviewed the finding reported by the AGSA on predetermined objectives, the 
annual financial statements and compliance with certain laws and 
regulations. 

9. Considered other matters as deemed appropriate. 

5. AGSA AUDIT OPINION AND MANAGEMENT REPORT 

5.1. Report on the Auditor General Management Report 

The municipality maintained the audit opinion of “unqualified with findings” for 

the 2018/19 financial year, similar to the 2017/18 outcome. 


GRDM's audit outcomes were maintained in 2018/19 due to identified material 
non-compliance. Key risk areas exist that management needs to address to 
improve compliance and performance management. In order to prevent a 
further regression in the audit outcome the municipality should continue to 
monitor corrective actions implemented to address instances of non-compliance 
and reliability of performance indicators identified during the audit. 


We do not wish to restate the pertinent issues highlighted in the AGSA 
Management Report for the year 2018/19 issued on 30 November 2019. However, 
we want to draw Council's attention to the following issues of concern 
highlighted in the AGSA documents: 

Material Impairments - receivables from exchange transactions 


415 



The impairment allowance has increased from R19 930 964 (2018) to R29 361 411 
(2019) due to debtor collection periods. 


Unauthorised expenditure 

As disclosed in note 45.1 to the financial statements, the municipality incurred 
unauthorized expenditure of R18 609 403 as the approved budget. Unauthorised 
expenditure amounting to R12 669 896 was incurred on the roads function. 


Although we concur with the AG's finding of unauthorises expenditure on the 
roads function, we understanding the difficulty that GRDM entails with the budget 
of the roads function. For the budget to be credible, GRDM cannot include more 
revenue/expenditure relating to the Road function, than what had been 
allocated to the municipality in formal writing by 28 February 2019 of each year. 

In addition, the revenue payment for over-expenditure is only received in the 
subsequent financial year (e.g. the 2017/18 over-expenditure was paid to GRDM 
in October 2018), which means that the revenue (and therefore related 
expenditure) could not be budgeted for in the current financial year. We urge 
management to continue discussions regarding the timeous allocation of funds 
for the roads function with the relevant parties. 


Material underspending 

As disclosed in note 45.1 to the financial statements, the municipality materially 
underspend the capital budget by R5 315 364 (50%). The financial statements 
were updated with the changes as per audit finding. 

The Municipality spent the money; an amount of R2.4 million was used to 
purchase a building in Plettenburg Bay. Flowever, the Deeds Office has not yet 
processed the transfer of the asset and for that reason; the municipality could not 
classify it as an asset in terms of the accounting principles. 

A further amount of R3 million was also spent to purchase two fire trucks that were 
also not yet received by the time of the audit. The trucks are expected to be 
delivered in December before closure of office. Flowever, due to accounting 
rules, the municipality could not classify these as an asset in the AFS until the 
transfer of assets is done. 

Restatement of corresponding figure 

The corresponding figures for 30 June 2018 were restated as a result of errors of 
the financial statements of the municipality at, and for year ended, 30 June 2019. 


416 



There were no significant corrections of error. When the municipality was 
preparing the Annual Financial Statements (AFS) there were few accounting 
entries from the previous year's AFS that were restated and corrected to comply 
with accounting rules. This did not in any way affect the audit or the presentation 
of the AFS, the corrections made to the previous year's AFS just needed to be 
disclosed. 

It is recommended that the emerging risks pertaining to debt collection, 
compliance to SCM legislation and accounting principles as identified in the 
management report of the AGSA should be included in the action plan for the 
2019/2020 financial year developed by the municipality to mitigate any 
recurrence of matters of emphasis. This should include actions to ensure that the 
appropriate processes are followed and managed throughout this period 


6. INTERNAL CONTROL 

Paragraphs 46-60 on pages 15-16 of the AGSA Management Report provides a 
detailed breakdown of the deficiencies in Internal Control at GRDM. These 
matters, as they relate to the detailed assessments of the implementation of the 
drivers of internal control in the areas of financial statements, performance 
reporting and compliance with legislation and are summarised in the auditor's 
report as follows: 


Regular , accurate and complete financial and performance reports 

During the audit of Predetermined Objectives, it was established that two KPI's 
within the roads department that relates to blading and black topping were 
reported incorrectly. This has resulted in a qualification of performance 
information; these errors were mainly due to incorrect capturing of the log sheets 
to the system. 

We have noted that, due to this finding, all data captures were sent to a log 
sheet training. It is further recommended that a senior independent person 
review the captured information going forward. We also recommend a detailed 
review of captured information in order to quantify this error and avoid a repeat 
finding. 

Compliance monitoring 

• The AG stated that management did not appropriately interpret the 
requirements of Regulation 29(2) of the MFMA SCM regulations, when 
constituting the bid adjudication committee (BAC). 


417 



This issue was raised because a senior SCM practitioner was not a member of 
the BAC, therefore the AG deemed that all bids awarded for the period of the 
past 14 years as irregular. Management only disclosed irregular expenditure 
for the past two years, which amounts to approximately R1 lOmillion, as it was 
deemed impractical to go back 14 years, given the fact that there was a 
change of financial system. 

Management was of the view that they complied with the intention of the 
legislation as the SCM expertise (SCM Manager) was always at the BAC 
meetings to provide technical advice. In addition, all the BAC members have 
successfully completed the competency assessments in SCM through the 
MMC training. 

The SCM Manager was subsequently appointed as a member of the BAC to 
avoid future deliberations on this matter. 

• According to the AG, management did not adequately monitor compliance 
with the requirements of the Municipal Performance Regulations for Municipal 
Managers and Managers directly accountable to Municipal Managers , 2006 
by ensuring that performance bonuses are paid out after the annual report 
has been adopted by council. 

An item for the payment of bonuses was tabled to Council on 05 th December 
2018 after the performance evaluations were conducted and the item was 
approved subject to the tabling of the Annual Report. 

The Annual Report was tabled to Council on 13 th December 2018, whereby 
the meeting could not be concluded prior to resolving on the matter. The 
meeting reconvened on 19 th December 2018 where the annual report was 
adopted. 

However, due to the closure of offices and the last day of payment of salaries 
scheduled for the 14 th , the performance bonuses were also paid on 
December 14, 2019. 

We recommend that the tabling of the item for payment of bonuses should 
be tabled simultaneously with the tabling of the Annual Report, to avoid any 
future occurrence of this nature. 


418 



• Management did not put reasonable controls in place to ensure that irregular 
expenditure is prevented by obtaining declaration of interest for all deviations 
from supply chain management processes 

The declarations were obtained after the services were rendered. This was 
due to reluctance of the suppliers to provide such information. Some of the 
deviation were emergency and single supplier. The committee argues 
management to make every effort, under circumstances, to ensure 
compliance with this particular regulation. 

It is our understanding that, similar to the outcome of the 2017/18 audit, non- 
compliance with supply chain management (SCM) legislation remains a 
challenge for GRDM. Matters such as those that causes irregular expenditure - 
regulation 29(2) concerning bid adjudication committee, regulation 32 
concerning piggy back of contracts, regulation 13 (c) concerning declaration of 
interest and local content. 

Council should therefore focus on addressing control deficiencies in the SCM 
area - this will hopefully ensure that GRDM reclaims the clean audit status 
enjoyed for the periods 2013/14-2015/16. 

A breakdown in controls in any area makes for extremely disquieting reading, 
and Council should give this matter top priority through the Operation Clean 
Audit Report (OPCAR) process. 

7. SPECIFIC FOCUS AREAS 

7.1. Financial Viability 

The AGSA audit included a high-level overview of the financial viability of GRDM 
as at 30 June 2019. This assessment provides useful information for accountability 
and decision-making purposes and complements the financial statements by 
providing insights and perspectives thereon. A table of this assessment is included 
on pages 22 - 23 and highlights the following: 

• The table indicates that the municipality is in good financial health evidenced 
by asset, liability and cash management. 

• It is concerning that the creditor payment period has more than doubled to 
76 days. The municipality is legislatively required to pay its creditors within 30 
days. 


419 



• The municipality is commended for increasing its net surplus, however a 
decrease in the net cash inflows from operating activities indicates that all of 
this surplus has yet to be realised in cash. 

• The municipality is encouraged to find ways to improve the debtor collection 
period and decrease the debtors' impairment provision as far as possible. 


7.2. Procurement and Contract Management 

The audit included an assessment of procurement processes, contract 
management and the related controls in place. 

• 18% of the awards to close family members, amounting to R4 962 600 were not 

disclosed in the financial statements. 


• The AG is of the opinion that 19 contracts with a value of R8 239 333 was 
entered into without following prescribed process stipulated in regulation 32. 


Management disagrees with the finding, as there is no non-compliance 
evident in terms of the four components of Regulation 32. The AG based their 
finding in terms of two court rulings, namely: 

o Blue Nightingale Trading 397 (Pty) Ltd t/a Siyenza Group v Amathole District 
Municipality [2016] 1 All SA 721 (ELC) 

o Kwadukuza Municipality v Skilful 1169 CC and Another (11060/2017) [2018] 
ZAKZDHC 35 

These judgements were not tested by the Supreme Court of Appeal or the 
Constitutional Court; meaning that its application of the stated judgements to 
the country as a whole is not allowed. 


Therefore we do not regard any of the expenditure incurred under regulation 
32 by council in this financial year as irregular in any manner. However, 
management has corrected the financial statements and recognised the 
related expenditure as Irregular expenditure in order to avoid further 
deliberation on the matter as the Auditor General did not withdraw the 
finding and considered it material in nature. 

• Specifications for one award with a total value of R145 167 did not stipulate the 
minimum threshold for local production and content. 


420 



The issue was as a result of late publication of the advertisement in the regional 
newspaper (George Herald). The advert was published for 14 days instead of 21 
days due to delays in the approval process. 


The advert was submitted to registry on the 20th of March 2018 and placed on 
our notice boards on the 22nd March 2018, after the Council meeting and the 
2018/19 IDP was also loaded on the website within reasonable period of time. 
However, the advert was only forwarded to the newspaper on the 23 rd of March 
2019. 

We recommend that Council refers the matters relating to irregular expenditure to 
the MPAC for further investigation. 

8. CONCLUSION 

We would like to thank the municipal manager Mr Stratu and his staff for the 
cooperation, support and goodwill that they showed towards the Audit and 
Performance Audit Committee. 

We wish to congratulate management for submitting the annual financial 
statements by the due date of 31 August and for obtaining an unqualified audit 
outcome. 



DR A POTGIETER - CHAIRPERSON 


(On behalf of the Audit and Performance Audit Committee) 


03 December 2019 


421 



ACRONYMS 


AG: 

Auditor-General 

IGR: 

Intergovernmental Relations 

ARMS: 

Audit & Risk Management Solutions 

IMFO: 

Institute for Municipal Finance Officers 

BEE: 

Black Economic Empowerment 

IPWT: 

Infrastructure, Public Works and Transport 

BIMP: 

Bulk Infrastructure Master Plan 

ITP: 

Integrated Transport Plan 

BSD: 

Basic Service Delivery 

JOC: 

Joint Operational Centre 

BVM: 

Garden Route District Municipality 

KPA 

Key Performance Area 

CAPEX: 

Capital Expenditure 

KPI 

Key Performance Indicator 

CBD: 

Central Business District 

LED: 

Local Economic Development 

CBP: 

Community Based Planning 

LGSETA: 

Local Government Sector Education and 

CFO: 

Chief Financial Officer 


Training Authority 

CRDP: 

Comprehensive Rural Development Programme 

LTO: 

Local Tourism Office 

CRR: 

Cash Reserve Ratio 

LTA: 

Local Tourism Association 

CSD: 

Central Supplier Database 

LM 

Local Municipality 

CTRU: 

Cape Town Routes Unlimited 

MAYCO: 

Executive Mayoral Committee 

DBSA: 

Development Bank of South Africa 

MDMC: 

Municipal Disaster Management Centre 

DCF: 

District Coordinating Forum 

MFMA: 

Municipal Finance Management Act 

DMA: 

District Management Area 

MFVM: 

Municipal Financial Viability and 

DMC: 

Disaster Management Centre 


Management 

DWAE: 

Department of Water Affairs and Environment 

MIG: 

Municipal Infrastructure Grant 

DWAF: 

Department of Water Affairs and Forestry 

MM: 

Municipal Manager 

DPLG: 

Department of Local Government 

MMC: 

Member of the Mayoral Committee 

DRR: 

Disaster Risk Reduction 

MMMTTs: 

Municipal Mitigation Monitoring Task Teams 

ECC: 

Emergency Control Centre 

MSA: 

Municipal Systems Act No. 32 of 2000 

ECDC: 

Early Childhood Development Centre 

MPRA: 

Municipal Property Rates Act 

GARDEN ROUTE DM: Garden Route District Municipality 

MTECH: 

Medium Term Expenditure Committee 

EDAC: 

Garden Route District AIDS Council 

NGO: 

Non-governmental organisation 

EDYC: 

Garden Route District Youth Council 

NQF: 

National Qualifications Framework 

GRDMAF: 

Garden Route Disaster Management Advisory Forum 

NSDP: 

National Spatial Development Perspective 

GRDMMF: 

Garden Route District Municipal Managers Forum 

NT: 

National Treasury 

EE: 

Employment Equity 

NToD: 

National Department of Transport 

EHP: 

Environmental Health Practitioner 

OPEX: 

Operating expenditure 

EIA: 

Environmental Impact Assessment 

PAYE: 

Pay As you Earn 

EMF: 

Environmental Management Framework 

PEC: 

Provincial Executive Committee 

EMP: 

Environmental Management Policy 

PCF: 

Premier's Coordinating Forum 

EMS: 

Emergency Medical Services 

PDMC: 

Provincial Disaster Management Centre 

EMSDP: 

Environmental Management and Spatial 

PGWC: 

Provincial Government of the Western Cape 


Development and Planning 

PMS: 

Performance Management System 

EOC: 

Emergency Operations Centre 

PP: 

Public Participation 

EPWP: 

Extended Public Works Programme 

PPP: 

Public Private Partnership 

EQM: 

Environmental Quality Management 

PT: 

Provincial Treasury 

ESS: 

Early Warning System 

RSDF: 

Regional Spatial Development Framework 

ETD: 

Economic and Tourism Development 

SALGA: 

South African Local Government Organisation 

EWD: 

Early Warning Display 

SAMDI: 

South African Management Development 

FRM: 

Finance and Resource Mobilization 


Institute 

FPA: 

Fire Protection Associations 

SAPS: 

South African Police Services 

GAMAP: 

Generally Accepted Municipal Accounting 

SCFPA: 

Southern Cape Fire Protection Association 


Practice 

SCM: 

Supply Chain Management 


422 






GDP: 

Gross Domestic Product 

SDBIP: 

Service Delivery and Budget 

GIS: 

Geographic Information System 


Implementation Plan 

GIZ: 

German International Corporation 

SDF: 

Spatial Development Framework 

GGID: 

Good Governance and Institutional Development 

SITA: 

State Information Technology Agency 

GGPP: 

Good Governance and Public Participation 

SLA: 

Service Level Agreement 

GR: 

Garden Route 

TAS: 

Turn Around Strategy 

GRAP: 

General Recognised Accounting Practices 

WED: 

World Environmental Day 

GSC: 

Council for Geosciences 

WESSA: 

Wildlife and Environmental Society of South Africa 

HR: 

Human Resources 

WIT: 

Wage Incentive Teams 

ICT: 

Information Communication Technology 

WOF: 

Working On Fire 

ICS: 

Incident Command System 

WWF: 

World Wildlife Fund 

IDASA: 

Institute for Democracy in South Africa 

UIF: 

Unemployment Insurance Fund 

IDP: 

Integrated Development Plan 



IFRS: 

International Financial Reporting Standards 




423