Indigent Policies in Municipalities: Legislative Framework and Requirements
The legislative framework surrounding indigent policies in municipalities in the Western Cape is outlined, emphasizing the Constitutional provisions, Municipal Systems Act guidelines, and the need for by-laws to grant financial assistance to indigents. The Municipal Finance Management Act mandates the implementation and annual review of an indigent policy, aligning with budgeting and Integrated Development Planning processes.
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Department of Local Government STANDING COMMITTEE ON LOCAL GOVERNMENT Indigent Policies in Municipalities in Western Cape Mr G Paulse 25 April 2023
Legislative Framework Indigent Policies (1) Constitutional Framework Section 156 of the Constitution of the Republic of South Africa, 1996 ( TheConstitution ) provides amongst other for the following: A municipality has Executive Authority in respect of, and has the right to administer Local government responsibilities are defined in part B of Schedule 4 and part B of Schedule 5. These functional areas include water, electricity, sanitation and refuse removal. In terms of Section 227 of the Constitution, Local Government is entitled to an equitable share of nationally raised revenue to enable it to provide basic services and perform the functions allocated to it. The Local Government equitable share is an unconditional transfer that supplements the revenue which municipalities can raise themselves (including revenue raised through property rates and service charges).
Legislative Framework (2) COGTA guidelines issued Section 96 of the Local Government: Municipal Systems Act, 32 of 2000 ( TheAct ) requires a municipality to adopt, maintain and implement a credit control and debt review policy which is consistent with its rates and tariff policies and complies with the provision of the Act. And whereas Section 97 (c) of the Act further requires that such policy must provide for Provision of indigent debtors that is consistent with its rates and tariff policies and any national policies on indigents Purpose of the Indigent Policy Section 62 of the Municipal Finance Management Act, 2003 states that the accounting officer of a municipality is responsible for managing the financial administration of the municipality. This officer must, for this purpose, take all reasonable steps to ensure that the municipality has and implements an indigent policy. The municipalities therefore needs to pass a by-law that indicates that financial assistance may be granted by the municipality to persons that meet the criteria as laid down in the indigent policy. The MFMA, Section 17(3) states that when an annual budget is tabled in terms of Section 16(2), it mut be accompanied by the following documents: , Section E & J. (budget related policies and grant allocations) This policy and by-law must therefore be revised on annual basis as part of the annual budgeting & IDP process.
COGTA Guidelines: 2005 (currently under review by COGTA) The COGTA Guidelines highlights the following: The Municipal Indigent Policy is intended to guide the national initiative to improve the lives of indigents and to improve access to Free Basic services. The policy recognizes the need for intergovernmental co-operation in the process of dealing with indigents but places a specific emphasis on the municipal sphere therefore requires a local understanding. The Municipal Indigent Policy Framework was approved by the Cabinet Social Sector Cluster as part of the social wage package in 2005 and approved by MinMec in 2006. The Indigent Policy Framework provides a basis for the provision of Free Basic Services to the indigent, and as such, enhances current indigent policies applied by municipalities. The guidelines for implementation of the indigent policy provide municipalities with options for the development of their indigent policies. The guidelines apply specifically to Free Basic Services programme within municipalities i.e., Free Basic Water, Free Basic Sanitation, Free Basic Energy/Electricity and Free Basic Refuse Removal. Municipalities are expected to customize the guidelines to suit their specific situations
Matters to be Covered in the Policy Verification Legislative Framework Communication Policy Principles and Background Contact Officer Objective and Scope Council Approval Targeting Approach Qualifying criteria Three Parts to an Indigent Policy as per National Framework: Application Process Penalties and Disqualification Exit Mechanisms Monitoring and Evaluation
Free Basic Service Provision in the Western Cape Province Compliance to National Indigent Framework adopted by Cabinet in 2005: As per the National Indigent Framework, the standard set of free basic services includes: Water Electricity Sanitation Refuse 6kl 50KwH Free Free All municipalities in the WC comply with this standard.
Free Basic Services Quantum provided by WC Municipalities LEVEL OF FREE BASIC SERVICES PROVIDED BY MUNICIPALITIES IN THE WC: 2021/22 Source: Municipal Annual Reports MUNICIPALITY WATER (kl) ELECTRICITY (kwh) SANITATION REFUSE REMOVAL NATIONAL STANDARD 6 50 Free Free WESTERN CAPE City Of Cape Town Witzenberg 15kl 6kl 60kwh 50kwh Free Free Free Free Drakenstein 6kl 10kl 6kl 10kl 6kl 6kl 6kl 6kl 6kl 6kl 6kl 10kl 6kl 6kl 6kl 6kl 6kl 6kl 6kl 6kl 6kl 6kl 6kl 50kwh 100kwh 50kwh 50kwh 50kwh 50kwh 50kwh Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Free Stellenbosch Langeberg Breede Valley Hessequa Oudtshoorn Knysna George Bitou Kannaland Mossel Bay Matzikama Bergrivier Cederberg Saldanha Bay Swartland Theewaterskloof Overstrand Cape Agulhas Swellendam Laingsburg Prince Albert Beaufort West 70kwh 50kwh 50kwh 50kwh 50kwh 50kwh 50kwh 50kwh 50kwh 70kwh 50kwh 50kwh 50kwh 50kwh 50kwh 50kwH
Qualifying Thresholds: Qualification Baseline MUNICIPALITY Qualifying Thresholds: Combined Households Income 2021/2022 Thresholds are not prescribed City Of Cape Town Not exceeding R4 500 May not exceed R3 000. However, two individual government pension (old age or disability) that exceeds the threshold (R3 000) may qualify if it is the only household income. Income based on combined government pension grant the decisions rests with Councils, Witzenberg however the definition of an Drakenstein Stellenbosch Langeberg Breede Valley Hessequa Oudtshoorn Knysna George Bitou Kannaland Not exceeding R6 500 R3 500 Total monthly income of not more than two (2) times the monthly Government old age pension Equaling two state pension grants per indigent household Total monthly income of not more than two (2) times the monthly Government old age pension Total monthly income of not more than two (2) times the monthly Government old age pension Total household income may not exceed, two times state pension (SASSA) per month A combined gross income equivalent to or less than two times of Old age pension Not exceeding R6 000 Indigent Household should be guided by definitions provided in the Constitution Source: Municipal Indigent Policies Mossel Bay Total monthly household income must not be more than twice (2x) the monthly State old age pension Matzikama Bergrivier Cederberg Saldanha Bay Swartland Theewaterskloof Not exceed an amount equal to the 2x monthly government pension grant Total HH income of R5 000 Does not exceed an amount equal to twice the monthly government pension grant R4 600 R4 515 Less than twice the monthly pension grant Indigent household with income less than four times the Government State Old Age Pension and electricity consumption less than 400 kWh Not exceed 2x All Pay Pension The value of 2 x state social grants R3 500 R4 000 The household income may not exceed the total of 2x All Pay Pension Overstrand Swellendam Cape Agulhas Laingsburg Prince Albert Beaufort West
INDIGENT HOUSEHOLD DATA Registered Indigent Households in Western Cape 2018 2019 2020 2021 2022 Western Cape Province 373 197 372 303 346 759 355 246 349 056 City of Cape Town 225 217 220796 197224 201707 201 707 West Coast District 22 165 23 631 24 779 24 199 25 529 Bergrivier 1 753 1992 1 862 2 128 1 920 Matzikama 3 052 3 291 3 147 2 868 2 977 Note: Universal approach to indigent support in some areas Swartland 8 738 8 923 9 027 8 836 9 223 Saldanha Bay 6 517 7 384 8 481 7 880 9 390 Cederberg 2 105 2 041 2 262 2 487 2 019 In some areas, a blanket approach is used whereby all Cape Winelands District 46 639 48 621 49 268 51 940 47 842 Drakenstein 19 030 19 805 20 837 21 588 19 437 households receive FBS by virtue of their geographical Langeberg 7 556 6 665 6 738 6 685 5 848 location (e.g The City of Cape Town) Stellenbosch 6 453 6 813 7 012 7 283 4 982 Witzenberg 4 591 6 742 5 790 6 828 7 755 Breede Valley 9 009 8 596 8 891 9 556 9 820 Overberg District 16 885 19 554 18 377 18 822 19 387 Overstrand 7 385 7 630 7 595 7 278 7 367 Swellendam 1 975 2 217 1 967 2 041 2 010 COVID-19 and ensuing lock-down also impacted on the Theewaterskloof 4 248 6 706 5 435 5 792 6 442 Cape Agulhas 3 277 3 001 3 380 3 711 3 568 registration and verification of Indigent Households. Garden Route District 53 635 51 491 48 279 50 062 46 173 Bitou 4 381 1 891 2 357 3 931 3 404 Re-registration hampered by restricted movement of people George 15 749 15 832 19 730 19 220 16 856 Hessequa 5 179 5 359 5 471 5 375 4 820 Trend: Municipalities retaining previously registered numbers Kannaland 2 192 2 572 2 497 2 560 2 279 on their registers Knysna 8 357 8 780 1 924 1 689 1 485 Mossel Bay 11 677 10 858 9 063 9 714 9 714 Oudtshoorn 6 100 6 199 7 237 7 573 7 615 Central Karoo District 8 656 8 210 8 832 8 516 8 418 Source: Municipal Annual Reports Beaufort West 7 150 6 433 6 990 6 607 6 673 Prince Albert 893 1 092 1 210 1 166 1 208 Laingsburg 613 685 632 743 537
Registration and Maintenance of Indigent Registers: In Practice
Registration and maintenance of Indigent Registers Households must apply annually to be considered for the indigent subsidy as provided for in the Indigent Policy. (Part of the budget & IDP process) Some systems are designed to automatically refresh registers at the beginning of each year which necessitates re- registration/application The applications are registered and considered in line with policy and then captured on the Indigent Register Indigent registers, together with the applications and required documentation (proof of income or unemployment, etc.) are maintained with due consideration of the Protection of Personal Information Act, 4 of 2013. Municipalities may conduct audits to verify the authenticity of the information furnished or possible changes in the status of applicants. DLG sCDW s plays a critical part in the door-to-door campaigns to assist with the identification and registration of qualifying households
Thank you Mr G Paulse DEPARTMENT OF LOCAL GOVERNMENT Tel: +27 21 438 4997 Graham.Paulse@westerncape.gov.za www.westerncape.gov.za
