Western Cape Branch Annual Seminar Monday, 5 June 2017 AT 09:00 Goudini Spa CIGFARO (CHARTERED INSTITUTE OF GOVERNMENT FINANCE, AUDIT & RISK OFFICERS) Welcoming Address “Promoting sustainable and compliant governance” Presented by: Alderman (Dr) Elna Von Schlicht (Executive Mayor: Cape Winelands District Municipality)
CONTENT Introduction Sustainable Governance Sustainable Compliance mSCOA Conclusion
INTRODUCTION Inadequate funding undoubtedly undermines the notion of developmental local government. Western Cape municipalities experience challenges similar to other municipalities in the country that are centred around inadequate funding and limited budgets. However, municipalities must learn that through good governance and excellent performance how to master balancing the needs of the community and managing its limited financial resources. Long-term planning provides strategic direction and support the objectives of municipalities. This planning includes a 10-year viability forecast linked to business plans for delivery over the medium term. This aims to realise revenue in order to accomplish budgeting in a viable, sustainable and credible manner.
SUSTAINABLE GOVERNANCE The President of CIGFARO indicated that benchmarking with other municipalities and ensuring value for money will be one of his key focuses of his term as president. In addition, he indicated that CFOs have an important role to play in driving and implementing value for money. Benchmarking will ensure greater transparency and accountability to our ratepayers / stakeholders. This we owe to them. Effectiveness, Efficiency and Economy are the key elements of value for money. Lastly, cost–benefit and return on investment are the principles that underpin the concept of value for money – we must ensure that our decisions are supported by these principles.
SUSTAINABLE GOVERNANCE What the District Municipalities in the Western Cape recently learned through a District Funding Research Project is that we must adopt a more pragmatic approach to ensure optimal utilization of resources. Thus, in the absence of any source of own revenue, the only tool available to districts is the ability to decide how to meet the prescribed outcomes. Knowing what the revenue gap of your municipality is and how to access more revenue is the core to a feasible revenue strategy. Key to revenue enhancement is to assess what opportunities is available to your municipality to enable access to other revenue sources.
SUSTAINABLE COMPLIANCE Good governance is build by promoting and enforcing compliance. King IV builds on King III and it has been revised to shift the focus from profit to sustainability. The increased compliance requirements as well as the new governance structures (e.g. Social and Ethics Committee) will be the principles to strengthen good governance in the near future. Never compromise your values and principles. Respect and appreciate local government legislation that support the principles of our Constitution as this will enable you to “walk the talk”.
mSCOA With the 1 July implementation date of the mSCOA (Municipal Standard Chart of Accounts) approaching fast, the successes to date reflect what the CFOs in the Western Cape are made of – LEADING AND LEARNING. THE COMBINATION OF THE SAID TWO CHARACTERISTICS CONTRIBUTED TO THE CURRENT SUCCESSES ACHIEVED. In the ever changing environment of implementing yet another reform – Embrace change by bringing new ideas into your municipality and grow your relational base; Regard risks as opportunities so that you not only manage and mitigate it, but also finds the opportunities in it.
CONCLUSION As was stated by the former Minister of Finance that we as public servants, serving South Africans from all sorts of backgrounds with all sorts of needs, are very important guardians of the future and the well-being of these South Africans. It is the responsibility of each of us how we spend our budgets in an accountable manner; how we make our decisions; and how we ensure the values in our Constitution are promoted. I bid you all a sincere welcome to this event, and specifically to our wonderful and beautiful winelands region.
Best wishes to all the presenters and may this event really contribute to better understanding and roll out of the very scarce resource namely money!! I congratulate all municipalities who achieved clean audit opinions and wish them well with the new audit season.
THANK YOU DANKIE ENKOSI