FINANCE DIRECTORATE
SHAREHOLDING MANAGEMENT DEPARTMENT
MUNICIPAL ENTITY
QUARTERLY NEWSLETTER
Analyst
2010/2011 Quarter 4: April 2011 – 30 June 2011, ISSUE NO. 17
As parent municipality to the municipal entities we aim to keep our municipal entity boards of directors
and staff abreast of all current news, legislation and policies directly affecting the municipal entities.
This will enable directors to be continuously informed as well as ensuring that we meet the legislative
requirement as parent municipality to ensure that both the municipality and the municipal entity
comply with the Municipal Systems Act, the Local Government: Municipal Finance Management Act and
any other applicable legislation.
Contents
The newsletter’s intend to convey information relating to the Local Government: Municipal Finance
Management Act, Local Government: Systems Act, Companies Act, Corporate Governance and any
information relevant to municipal entities.
THE LOCAL GOVERNMENT LEGISLATION:
Relinquishing of Effective Control: Khayelithsa Community Trust
The Council of the City of Cape Town has resolved to relinquish effective control in the Khayelithsa
Community Trust. This means that the Trust is no longer a municipal entity and the City is no longer a
parent municipality.
The Shareholding Management Department, on behalf of all the City, would like to thank the Trustees
and the staff of the Trust for dedication in running the Trust as a municipal entity, especially in respect
of the constant battle to meet the onerous requirements of local government legislation compliance.
We look forward to our new working relationship as partners in the upgrading of Khayelithsa.
THE MUNICIPAL FINANCE MANAGEMENT ACT
Local Government Budgets 2010/11 Financial Year
Third Quarter Local Government Section 71 Report
National Treasury has released local government’s budget statement for the third quarter of the
2010/11 financial year. This statement received some negative media coverage in respect of the capital
spend of all municipalities. It is available at:
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http://mfma.treasury.gov.za/68B4816A-BF41-4B44-892C-DF277B3AAB22/FinalDownload/DownloadIdA8BE779CC0EB93BB7E951AAAE2162FEB/68B4816A-BF41-4B44-892CDF277B3AAB22/Media_Releases/s71/1011/3rd_1011/Documents/00.%20Press%20Release%20%203rd%20Q%20S71%20Publication%20-%2010%20June%202011%20(final).pdf
NEW LEGISLATION:
Basic Conditions of Employment Act
Increase in Earnings Threshold
The Minister of Labour increased the Earning Threshold contained in the Basic Conditions of
Employment Act 75 of 1997 (the BCEA) on Friday, 13 May 2011, from R149,736.00 to R172,000.00 per
year. The amendment is effective as from 1 July 2011.
The effect of this increase is that employees earning below the new threshold are entitled to be
remunerated for overtime, work on public holidays and Sundays in terms of the BCEA.
Employers with staff earning above the previous threshold but less than the new one should be
aware of the right of their employees to the payments for overtime and work on Sundays.
Source: “Employment Matters”, a Cliffe Dekker Hofmeyr Attorneys newsletter
Safety at Sports and Recreational Events Act, 2010
Draft Regulations
The Minister of Sport and Recreation intends to promulgate the Safety
at Sports and Recreational Events Regulations.
The Regulations are intended to cover:
requirements of and applications for safety certificates relative to
existing stadiums or venues to local authorities;
requirements of and applications for high risk event grading
certificates to local authorities in respect of stadium or venue
owners;
criteria to qualify for stadium or venue safety and grading
certificates;
requirements of and applications for new stadium or venue safety
certificates, including stadium or venue design safety certificates;
requirements of and applications for certificates for alteration or
extensions to stadiums or venues;
contents of the safety certificates;
amendments to and replacement of safety certificates;
appeal procedures; and
fees applicable in the above regard.
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A copy of the draft Regulations are available at: www.srsa.gov.za
Role players as well as the public at large are hereby invited to
submit its inputs on the Regulations not later than 5th August 2011 to- Adv. Nkosana Mehlomakulu at nkosana@srsa.gov.za or
legalservices@srsa.gov.za
- SRSA, Private Bag X896, PRETORIA, 0001 (marked for the attention of
Legal Services); or
The following fax no: 0866449707 (Attention: Legal Services)
Revised Preferential Procurement Regulations
The National Treasury has released the revised Preferential Procurement Regulations, which have been
aligned with the aims of the Broad-based Black Economic Empowerment Act and its associated Codes
of Good Practice. The revised regulations are also in line with government’s Industrial Policy Action
Plan. They can be found on the National Treasury website on this link:
http://www.treasury.gov.za/divisions/sf/sc/PPPFA/1-34350%208-6%20NatTreas.pdf
The main changes contained in the revised regulations are as follows:
• Previously bidders scored a maximum of 80 or 90 points for price, and 20 or 10 points for black
ownership and for promoting specified RDP goals. The points for price will remain unchanged, while
bidders will now score up to 20 or 10 points for their B-BBEE status level of contribution.
• All bidders will have to submit BEE rating certificates, issued by either verification agencies accredited
by the South African Accreditation System (SANAS) or by registered auditors approved by the
Independent Regulatory Board for Auditors (IRBA).
• Previously, the threshold value for the distinction between the 80/20 and 90/10 preference point
system was R500 000. This has now been increased to R1 million to stimulate the development of
small enterprises.
The new regulations become effective from 7 December 2011 to allow enterprises to become BEE
rated. This will also allow time to train all supply chain practitioners on the implementation of the
revised regulations.
GENERAL:
National Treasury Strategic Plan 2011/14: Presentation National Finance
Portfolio Committee
The National Treasury presented its three year plan to the Finance Portfolio Committee on 31 May
2011. It is an interesting presentation as it gives a concise overview of what the National government
is trying to achieve.
The presentation is available at:
http://www.treasury.gov.za/comm_media/presentations/2011%20STRAT%20PLAN%20PRESENTATION%2020110531
.pdf
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THANK YOU:
On behalf of the City, the Shareholding Management Department would like to thank all the staff and board
members of all the City’s municipal entities for their contribution and commitment during 2010. We look
forward to working with you in 2011.
Please contact Louise Muller (021 4003940) or Richard Wootton (021 4002701) if you have any queries
in respect of this newsletter.
Although every effort is made to check the accuracy and quality of the information supplied, The City
cannot be held responsible for any errors that may arise.
Copyright(c) City of Cape Town 20011. All rights reserved. No part of this newsletter may be reproduced or transmitted in any form
without written permission from the City of Cape Town, Finance Directorate, Shareholding Management Department.
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