COUNCIL MEETING: 25 APRIL 2019 - ANNEXURE A.1 - City of Tshwane
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COUNCIL MEETING: 25 APRIL 2019
ANNEXURE A.1
PAGES
RESOLUTION OF THE MAYORAL COMMITTEE:
20 MARCH 2019 ……………………………………………………… 1 - 57
HIS WORSHIP THE EXECUTIVE MAYOR
S MOKGALAPA
2
A. MAYORAL COMMITTEE MEETING: 20 MARCH 2019: ANNEXURE A.1
INDEX
Pages
I. APPLICATIONS FOR LEAVE OF ABSENCE ……………………….. 3
II. APPROVAL OF THE MINUTES OF THE MAYORAL
COMMITTEE MEETING: 14 MARCH 2019 ……………..….……….. 3
III. MATTERS CONSIDERED
1. Ref. no. 49182/1
Group Financial Services Department
Progress on the Implementation of the centralised warehousing
model
(From the Executive Committee: 25 February 2019) ……………. 4-16
2. Ref. no. 43034/1
Group Human Capital Management Department
Progress report on the Business Process Re-engineering
(BPR) for key service delivery and municipal Standard Chart
of Accounts compliant areas
(From the Executive Committee: 11 March 2019) ……………..… 17-24
3. Economic Development and Spatial Planning Department
Proposed development on the remainder extent of Portion 279
and 285 of the Farm Garsfontein 374-JR …………………………….. 25-33
4. Office of the Governance and Support Officer
Establishment of an In-House Asset Protection Service for
the City of Tshwane Municipality …………………………..………….. 34-57
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A. MAYORAL COMMITTEE MEETING: 20 MARCH 2019: ANNEXURE A.1
I. APPLICATIONS FOR LEAVE OF ABSENCE
NOTED:
That the Leader of Executive Business would arrive late.
RESOLVED:
That the following applications for leave of absence be ACCEPTED:
• Member of the Mayoral Committee: Corporate and Shared Services; and
• Chief Operations Officer.
II. APPROVAL OF THE MINUTES OF THE MAYORAL COMMITTEE MEETING:
14 MARCH 2019
RESOLVED:
That the minutes of the Mayoral Committee of 14 March 2019 be approved and
confirmed subject to the following amendment:
Page 57, item 5.1.3 OFFICE OF THE EXECUTIVE MAYOR: PROPOSED
MEMORANDUM OF AGREEMENT (MOA) WITH THE C40 CITIES CLIMATE
LEADERSHIP GROUP INC (C40) AND THE DEUTSCHE GESELLSCHAFT FUR
INTERNATIONAL ZUSAMMENARBEIT (GIZ) GMBH
That the recommendations be amended to read as follows:
1. That the report on the request for approval of Memorandum of Agreement
between the City of Tshwane and both C40 Cities Climate Leadership Group
Inc. and Deutsche Gesallschaft fur Internationale Zusammenarbeit (GIZ) GmbH
be noted;
2. That approval be granted for the City of Tshwane to enter into a Memorandum
of Agreement with both the C40 Cities Climate Leadership Group Inc and the
Deustsche Gesellschaft fur Internationale Zusammenarbeit (GIZ) GmbH in
order to implement the technical support programme of the C40 Cities Finance
Facility; and
3. That the City Manager signs the Memorandum of Agreement in line with this
delegated powers.
4
A. MAYORAL COMMITTEE MEETING: 20 MARCH 2019: ANNEXURE A.1
III. MATTERS CONSIDERED
Reference No 49182/1
Umar Banda (8110)
MAYORAL COMMITTEE: 20 March 2019
1. GROUP FINANCIAL SERVICES DEPARTMENT
PROGRESS ON THE IMPLEMENTATION OF THE CENTRALISED
WAREHOUSING MODEL
(From the Executive Committee: 25 February 2019)
1. PURPOSE
The purpose of the report is to provide progress on the implementation of operating
model for the rationalization of the City’s Stores and Warehouses.
2. STRATEGIC PILLARS
2.1 A City that facilitates economic growth and job creation;
2.2 A City that delivers excellent services and protects the environment; and
2.3 A City that is open, honest and responsive.
3. BACKGROUND
City engaged the services of Regiments Capital to conduct a high-level review of the
City’s stores. The review was conducted and findings with recommendations were
tabled at Mayoral Committee (MAYCO) in March 2018. MAYCO resolved as follows:
• A solution in which the City centralizes buying decisions and create a central
infrastructure and general store be approved;
• Detailed operating model review be conducted and a report be submitted back to
Executive Committee (EXCO) and MAYCO within a period of three months;
• Implementation of quick wins as identified in the high- level review report;
• Review and upgrade of SAP, e-Procurement;
• Management of centralized warehouse be done internally;
• Supply Chain Management Policy be updated accordingly;
• A follow up report be submitted with information on:
o Feasibility of centralized infrastructure and general stores
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o Location of the warehouse;
o Need for satellite stores;
o Logistics or fleet element;
o Resource allocation;
o Implementation Plan with milestones;
o Hours of operation and availability after hours;
o Proposed skills necessary to implement centralization; and
o The warehouse model personnel be sourced in–house.
Services of Regiments were then subsequently procured to ensure that a Supply
Chain Management system is designed to be more efficient, cost effective and agile.
Problem Statement and Project Objectives:
• The main objective of this project is to design a more efficient supply chain
management system that achieves the following goals:
o Guarantee a high standard of client service and experience;
o Optimise operational costs and reduces financial risk;
o Optimise its asset utilisation [warehouses and fleet]; and
o Optimise staff productivity.
Implementation Plan
• The first deliverable for this project is to develop a detailed implementation plan
outlining the key activities to be performed at each stage, the key benefits and
possible costs;
• The envisaged implementation plan will outline the following five sections:
o Value chain analysis;
o Cost modelling and price review;
o Hub and spoke model design;
o Implementation planning; and
o Project management office (PMO).
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4. DISCUSSION
The City requires the service provider to assist in designing a more efficient, cost
effective and agile supply chain management system.
4.1 Problem Statement and Project Objectives
• Due to the amalgamation of the City into a metropolis, Tshwane inherited stores
that may have resulted in lower optimisation of the stores network as well as a
fragmented supply chain management system
• A review of the current supply chain management system is therefore required to
design and implement a cost effective, agile and efficient system
• The main objective of this project is to design a more efficient supply chain
management system that achieves the following goals:
o Guarantee a high standard of client service and experience;
o Optimise operational costs and reduces financial risk;
o Optimise its asset utilisation [warehouses and fleet]; and
o Optimise staff productivity.
4.2 Implementation Plan
• The first deliverable for this project is to develop a detailed implementation plan
outlining the key activities to be performed at each stage, the key benefits and
possible costs;
• The envisaged implementation plan will outline the following five sections;
o Value chain analysis;
o Cost modelling and price review;
o Hub and spoke model design;
o Implementation planning;
o Project management office (PMO); and
o Project Phase Breakdown.
The objectives will be implemented through the 3 main phases of the business
improvement journey.
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4.2.1 PHASE 1 - Value Chain Analysis
SCM requires vital short-term interventions, structural adjustments and reengineered
processes.
SCM has taken steps to address its challenges in both the short-term and long term.
8 There will be various interventions targeted at improving efficiencies across the Supply Chain Management Value Chain Analysis
9 One of the targeted interventions must be capacitating of the organisational structure which is stretched due to capacity gaps SCM structure has critical vacancies and is not fit for purpose. The value chain analysis process will assists in solving logistics problems such as overstocking and high procurement cost among other benefits.
10
4.2.2 PHASE 1 - Cost Modelling and Price Review
The cost modelling and price review phase will involve determining the cost drivers
across the value chain, variance analysis and developing a pricing framework.
Training/hiring specialists’ buyers and the use of risk transfer contracts will help the
City reduce the cost of procurement on its key inventory items.11
4.2.3 PHASE 2 - Hub and Spoke Model Design
Using the inputs from the first two phases the hub and spoke model design will assist
in determining the most effective solution on how to run each store going forward
The hub and spoke model design will help the City to strategically determine which
stores and stock to close, consolidate or keep as is, whilst mindful of costs.12
4.2.4 PHASE 3 - Implementation Planning
Implementation planning will help identify and eradicate implementation risks over
the duration of the project.13
5.1 Process Re-Engineering
SCM will follow a modular approach to process improvement programmes
Implementation planning will help outline each stakeholder’s responsibilities and
ensure clear communication over the duration of the project14
5.2 Project Management Office/Project Management
Project Management Office/Project Management will assist in ensuring that all
relevant stakeholders are informed and engaged from project initiation to close.
PMO will ensure the smooth running of the project from initiation to close.
6. COMMENTS OF THE STAKEHOLDER DEPARTMENTS
6.1 COMMENTS OF THE CHIEF FINANCIAL OFFICER
Cognisance is taken of the contents of the report.
The purpose of this report is to provide the Mayoral Committee an update on the
progress of the implementation of an operating model for the rationalization of the
City’s Stores and Warehouses.
There are no financial implications emanating as a result of this report for the City of
Tshwane.
6.2 COMMENTS OF THE GROUP HEAD: GROUP LEGAL AND SECRETARIAT
SERVICES
Note is taken of the progress report.
It transpires from the report that the project is progressing well and continuous
monitoring will be maintained to ensure that the project is finalized by end of March
2019 and a report is to be tabled at the Mayoral Committee of April 2019.15
There are no legal implications emanating from the report at this conjunction and
cognizance may be taken thereof as recommended.
7. IMPLICATIONS
7.1 HUMAN RESOURCES
None.
7.2 FINANCES
No additional implications on finance.
7.3 CONSTITUTIONAL AND LEGAL FACTORS
As outlined in the comments from legal.
7.4 COMMUNICATION
On implementation of the model, the community will be notified.
7.5 PREVIOUS COUNCIL OR MAYORAL COMMITTEE RESOLUTIONS
Mayoral Committee (MAYCO) resolved as follows:
• A solution in which the City centralizes buying decisions and create a central
infrastructure and general store be approved;
• Detailed operating model review be conducted and a report be submitted back to
Exco and Mayco within a period of three months;
• Implementation of quick wins as identified in the high- level review report;
• Review and upgrade of SAP, e-Procurement;
• Management of centralized warehouse be done internally;
• Supply Chain Management Policy be updated accordingly;
• A follow up report be submitted with information on
o Feasibility of centralized infrastructure and general stores
o Location of the warehouse;
o Need for satellite stores;
o Logistics or fleet element;
o Resource allocation;
o Implementation Plan with milestones;16
o Hours of operation and availability after hours;
o Proposed skills necessary to implement centralization; and
o The warehouse model personnel be sourced in –house.
8. CONCLUSION
The project is progressing well and continuous monitoring will be maintained to
ensure that the project is finalized by end of March 2019 and a report is to be tabled
in the Mayoral Committee of April 2019. In summary the progress is summarised
below:
Project Phase Percentage of work completed
Implementation planning 25%
Value chain analysis 4%
Cost modelling and price review 2%
Hub and spoke model design 3%
Project management office 15%
IT WAS RECOMMENDED (TO THE MAYORAL COMMITTEE: 20 MARCH 2019):
That cognisance be taken of the progress on the implementation of the centralisation of the
warehouse.
During consideration of the report, it was agreed that the following additional
recommendation be made:
“That the Chief Financial Officer submits a quarterly report on the progress on the
implementation of the centralised warehousing model to the Mayoral Committee”.
In view of the above, it was:
RESOLVED:
1. That cognisance be taken of the progress on the implementation of the centralisation
of the warehouse; and
2. That the Chief Financial Officer submits a quarterly report on progress on the
implementation of the centralised warehousing model to the Mayoral Committee.17
Reference No 43034/1
Luckie Sihlangu (4052)
MAYORAL COMMITTEE: 20 March 2019
2. GROUP HUMAN CAPITAL MANAGEMENT DEPARTMENT
PROGRESS REPORT ON THE BUSINESS PROCESS RE-ENGINEERING (BPR)
FOR KEY SERVICE DELIVERY AND MUNICIPAL STANDARD CHART OF
ACCOUNTS COMPLIANT AREAS
(From the Executive Committee: 11 March 2019)
1. PURPOSE
To submit progress made thus far on Business Process Re-engineering (BPR) of key
service delivery and Municipal Standard Chart of Accounts (mSCOA) compliant
areas in the City of Tshwane.
2. STRATEGIC PILLARS
Strategic Pillar 3: A City that delivers excellent services and protects the environment;
Strategic Pillar 4: A City that keeps residents safe; and
Strategic Pillar 5: A City that is open, honest and responsive.
3. BACKGROUND
Subsequent to the approval of the review of business processes within specific
business units in the City, the first Steering Committee meeting for the project was
held on 5 November 2018, followed by others, with the primary purpose of kick-
starting the project.
One of the foundational decisions taken at the Steering Committee meeting was the
adoption of an accepted methodology that would be used to map processes and
prioritise those processes to be attended to first. The business units were identified
as Supply Chain Management, Corporate Fleet Management, Utility Services,
Regional Operations Centre and Group Property.
The Steering Committee further resolved that As-Is processes should be mapped
initially for these prioritised business units and be presented for sign off and indicate
gaps and shortfalls, where applicable, for improvement purposes. These processes
would be mapped, documented and analysed by the Technical Team as approved
on the governance structures of the project and would also be responsible for
presenting such to the Steering Committee.
4. DISCUSSION
4.1 BPR METHODOLOGY
As indicated above, it was crucial to identify and adopt a common and market
accepted methodology that the team would utilize in mapping processes. There are
a number of methodologies in the market, however since the City of Tshwane is a18 sphere of government, the team proposed to adopt the methodology as endorsed by the Department of Public Service Administration (DPSA). This methodology is based primarily on the Operations Management Framework which revolves around the Batho Pele principles. The methodology comprises five main elements or pillars which are the activation, discovery, improvement, implementation and maintenance stages and these will be briefly explained below for purposes of clarification and common understanding. The activation phase seeks to obtain and secure buy in from all role players and stakeholders of the business unit. It primarily involves an official kick-off meeting, change management, information sessions, the nomination of a management representative, explaining the policies and legislative provisions, discussing the tools and techniques to be used, how the project will generally be managed and indicating benefits. The discovery phase delves into the appointment of a management representative and Business Process Management (BPM) champions, developing the business models and process inventory in preparation of ensuring that all processes mapped are properly documented and analysed, and that proper process performance measures are put in place. This is then followed by the process improvement phase. At this juncture, the As-Is processes would have been mapped, documented and analysed leading to the compilation of an As-Is analysis report. Normally a determination is made whether to follow the incremental improvement or the radical improvement approach depending on the type and nature of short falls and gaps identified. This involves intensive problem-solving techniques and weighing alternatives with the view of developing an improved process design. The improved process design comes in the form of the To- be solution report, including the To-Be business process maps and standard operating procedures. During the improvement phase the project team will also incorporate the principles of performance management and risk management, which will ensure that all business processes have the key performance indicator that will be measured, as well as risk and opportunity registers that will show the risk and opportunity per the individual processes, if any. The fourth phase is the implementation stage where the improved process is adopted and a mandate to implement it is obtained. It is crucial that an implementation plan is developed and adopted on the improved architecture. It is generally advisable to start by implementing quick wins first before areas where long-term results can be achieved. Lastly, in the maintenance phase the improved processes need to be monitored continuously through process audits. The intention is to verify the implementation of the To-be solution and verify the effectiveness of the solutions implemented. Over and above the methodology, the team further agreed on the utilisation of the vision tool as a standard platform to map processes. There will also be a centrally run repository for all adopted and approved processes under the wing of Knowledge Management in order to facilitate control of and easy access to the processes at various levels within the City of Tshwane.
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4.2 DISCUSSION ON PROGRESS
The Technical Team comprises employees from Group Human Capital Management
and City Strategies and Organisational Performance Department and has had
several engagements and meetings where the methodology as discussed above was
dealt with in detail to ensure that all team members are of the same understanding
and practice levels. The team was then split into two groups. One group was to focus
on Supply Chain Management (SCM) and the other on Corporate Fleet Management
(CFM).
The spilt was based on the fact that the skill levels within the team varied in terms of
knowledge and experience, so the aim was to balance these groups in such a way
that the element of learning and upskilling is incorporated in the process. Consultation
sessions were held with the management teams of both business units as part of
Phase 1 of the project, as indicated above. These yielded positive results in that on
both occasions Corporate Fleet Management identified vehicle workshop processes
(operations) as a priority and as a possible quick win in turning around operations
within the division. Dedicated senior officials from Corporate Fleet Management were
nominated to be part of the project and drive it from within.
The team met with Supply Chain Management senior managers and officials who
presented how they are currently structured to the team, as well as the challenges
they are facing, especially in areas such as demand management which is a priority
from a process re-engineering perspective.
It was also resolved to incorporate the basic principles of quality management,
auditing and ISO standards where possible in order to ensure that the processes
comply with industry standards and are easy to evaluate and improve upon.
4.2.1 CORPORATE FLEET MANAGEMENT
It should be acknowledged that there were a number of business process mapping
exercises that were undertaken within Corporate Fleet Management during the
previous years, and more specifically as recent as during the 2015/16 financial year.
These cannot be overlooked to form the basis from which the team would make
accelerated inroads and progress in the mapping of As-Is processes. This, especially
taking into consideration that the commencement of the project has been drastically
delayed due to various challenges, would contribute to accelerating progress.
The mandate and purpose of the project was explained and discussed at length.
Copies of the Mayoral Committee report dated 20 June 2018 and the Mayoral
Committee minutes of the same date were furnished to Corporate Fleet Management.
The project team will draft a project plan, including the scope of the project with time
lines and reporting lines. This will be discussed at an extended meeting during the
week of 11 to 15 February 2019 at Corporate Fleet Management. A few Standard
Operating Procedures (SOPs) and corresponding process maps dating back from
2016/17 were provided to Corporate Fleet Management. It was agreed that all the
SOPs and process maps that were done in 2016/17 will be sent to Corporate Fleet
Management in order for them to review such processes. These reviewed processes
will form the basis when the project team and the champions/subject experts
formulate the As-Is processes.20
The project team has started to gather relevant information pertaining to the re-
engineering of business processes at Corporate Fleet Management. However,
Corporate Fleet Management was further requested to provide the most recent
management reports, performance reports and any applicable information that might
be of relevance to the project and the project team.
4.2.2 SUPPLY CHAIN MANAGEMENT DIVISION
The kick-off meeting for the project was held with top management of Supply Chain
Management on 14 December 2018. In the meeting, top management was requested
to nominate the management representative who would be responsible for monitoring
the execution of mapping and improving the business processes project within the
division as well as the scoping of the project.
The purpose of the scoping session was to fully understand the organisational
structure of the division, challenges facing the division, as well as the legislative
requirements governing the operations of the division.
The project team is currently in the process of compiling the project plan while parallel
to that they have also commenced with the mapping of the As-Is business processes.
This is due to the realisation by the project team of the importance of mapping and
improving supply chain management processes since the processes play a critical
role in ensuring the delivery of quality services to the communities of Tshwane.
On 2 February 2019, the project team mapped the four As-Is business processes for
the Demand Management Section, namely tenders, quotations, administration of
procurement plans and the management of supplier databases.
On 13 February 2019, the project team also mapped five As-Is business processes
for the Acquisition Section, namely quotations below R30 000,00, quotation above
R30 000,00 but below R200 000,00, tenders, the Bid Evaluation Committee and the
Bid Adjudication Committee.
4.3 PARALLEL PROJECTS THAT WERE ALREADY UNDERWAY
Prior to the approval of the BPR project as discussed above, there were already a
number of exercises that had been initiated, specifically from the City Strategy and
Organisational Performance Department from a process mapping and improvement
perspective. These cannot be overlooked as they form part of the entire service
delivery value chain which is largely impacted by the key service delivery areas as
well as the mSCOA processes identified for the current project.
As per the Steering Committee resolution, these projects were not to be abandoned
midway, however, some had to be reprioritised while others, owing to their advanced
stages, would be completed parallel to the newly identified urgent priorities. These
will also be detailed below in order to ring appreciation of the work that has been done
and the progress thereof.
4.3.1 CUSTOMER RELATIONS MANAGEMENT21
This work started as a crucial element of the Operations Performance Task Team
(OPTT) that was launched in 2018. The focus on the Customer Relations
Management Department (CRM) was primarily to understand who performs which
task between the Regional Operations and Coordination Department (ROC) and the
Utility Services Department (USD), with specific reference to water and sanitation,
and energy and electricity. CRM engaged in this task during the review of norms and
standards for the City. During the execution of the task, it was difficult for CRM to fully
understand or differentiate between which department attends to which water and
sanitation, and energy and electricity tasks, hence CRM identified the need to map
and improve business processes aligned to norms and standards for water and
sanitation, and energy and electricity at USD and ROC level.
The project of mapping and improving business processes at USD and ROC officially
commenced in June 2018. The two project teams were established from the
Continuous Improvement Section within the City Strategy and Organisational
Performance Department. One project team was focusing on water and sanitation at
USD and ROC level and the other project team was focusing on energy and electricity
at USD and ROC level.
Both project teams mapped the As-Is business processes where gaps were identified
which led to the recommendation of the solutions to close the identified gaps, hence
the development of the To-Be processes. The recommended solution was in an
incremental and radical form. These solutions were also shared with process owners
to ensure proper implementation.
The To-be solutions proposed were presented at the OPTT and the solutions were
well received. Since the solutions recommended require the development of an IT
system, the ICT Division was also engaged on the solutions proposed, who also
welcome the proposed solution.
The top management of USD and ROC still need to be formally engaged on the
solutions proposed although the regional executive directors and directors from USD
were made aware of the solutions proposed through the OPTT since they are
standing members of the OPTT.
In a nutshell, the radical solution proposed requires the City to roll out the gadget
system that will ensure that the call logged by the customer goes directly to the
foreman or technician that needs to attend to the call, instead of the call going to the
admin officer who just creates the task. The technician will also use the gadget to
take a picture of the situation before and after the repair as well as record the type
and quantity of material used to fix the problem. This will assist with forecasting the
material that will be required in the new financial year. The same system will also
ensure that the customer receives timeous feedback of when the call was received
by the technician and when the repair was done. This will assist in changing the
customer’s perception about the City’s response to service delivery calls.
4.3.2 GROUP PROPERTY
The mapping of business processes within Group Property was initiated by a request
that Group Property sent to ICT for the development of an IT system.22
The Continuous Improvement Section within the City Strategy and Organisational
Performance Department commenced with the project in September 2018.
The project team mapped the As-Is business processes, which led to the
identification of gaps that necessitated the development of the To-Be business
processes. Both the AS-Is business processes and To-Be business processes were
shared with ICT for the development of an IT system
Some of the solutions proposed to Group Property need to have a standardised
business process for office accommodation to be used across the City, and not only
limited to Tshwane House, have an automatic reminder for the expiry of the lease
agreement through the electronic system that will be developed by ICT, appoint office
accommodation inspectors that will conduct inspections on a monthly basis to verify
compliance to office rules and regulations by officials.
4.3.3 OFFICE OF THE SPEAKER
The group head of the Office of the Speaker approached the Continuous
Improvement Section to assist the office with the implementation of ISO 9001:2015-
Quality Management System requirements. The project commenced in June 2018
when the official top management meeting was held to brief top management on the
journey for the implementation of the quality management system, including the
quality management principles and the methodology to be followed during the
implementation of the quality management system requirements.
A gap analysis to determine the misalignment of the current practices within the office
with the quality management system requirements was conducted in July 2018 and
a gap analysis report was generated to this effect; 64% of employees within the office
were also taken through the first awareness session of ISO 9001:2015-Quality
Management System requirements.
The project team is currently busy with mapping and reviewing the As-Is business
processes.
5. COMMENTS OF THE STAKEHOLDER DEPARTMENTS
5.1 COMMENTS OF THE CHIEF FINANCIAL OFFICER
Cognisance is taken of the contents of the report.
There are no financial implications emanating as a result of this report for the City of
Tshwane as the purpose of the report is to submit progress made thus far on
Business Process Re-engineering (BPR) of key service delivery and Municipal
Standard Chart of Accounts (mSCOA) compliant areas in the City of Tshwane.
5.2 COMMENTS OF THE GROUP HEAD: GROUP LEGAL AND SECRETARIAT
SERVICES
The purpose of this report is to submit progress made thus far on Business Process
Re-engineering (BPR) of key service delivery and Municipal Standards Chart of
Accounts (mSCOA) compliant areas in the City of Tshwane.23
In terms of Section 11 (3) (a) (j) & (n) of the Local Government: Municipal Systems
Act, 2000 (Act No. 32 of 2000) (hereafter referred to as the “MSA”), a municipality
exercises its legislative or executive authority by developing and adopting policies,
plans, strategies and programs, including setting of targets for delivery, monitoring
the impact and effectiveness of any services, policies, programmes or plans and also
by doing anything else within its legislative and executive competence.
This report is in compliance with the provisions of Regulation 13 of the Local
Government: Municipal Planning and Performance Management Regulations, 2001
published in terms of the “MSA” and the Performance Management Policy and
Procedure developed by the City of Tshwane (dated 28 August 2008), whereby the
purpose of reporting or giving feedback is to assist in monitoring, which aims to
provide Managers, decision makers and other stakeholders with a regular feedback
on the progress made with implementation so that corrective measures may be put
in place, where necessary.
Having taken regard to the aforesaid and with specific reference to the contents of
the report, Group Legal and Secretariat Services Department supports the approval
of the report and the recommendations.
5.3 COMMENTS OF THE GROUP HEAD: GROUP HUMAN CAPITAL MANAGEMENT
Group Human Capital Management note progress made and support the report.
5.4 COMMENTS OF THE GROUP HEAD: SHARED SERVICES
Information and Communication Technology division within Group Shared Service
does acknowledge progress made, specifically the progress made on Business
Processes Reengineering (BPR). The BPR output will surely be the building blocks
for systems rationalization; systems consolidation, especially with new improved
unbroken business processes born from the initiative.
It is therefore unavoidable to praise this initiative and to also add points of emphasize
with the aim of aiding the BPR team. The traditional methods for improving
performance through process rationalization and automation haven’t yielded the
dramatic improvements the city needed or hoped for. In particular, heavy investments
in Information and Communication Technology (ICT) have delivered disappointing
results largely because City of Tshwane (City) tend to use technology to automate
old ways of doing business. The City like most of the organizations leave the existing
processes intact and use ICT simply to speed them up yet speeding up those
processes cannot address their fundamental performance deficiencies. Many of our
job designs, work flows, control mechanisms, and organizational structures came of
age in a different competitive environment and possibly before the arrival of the
processes oriented systems like SAP ERP. They are geared toward efficiency and
control. Yet the catchphrases of the new decade are innovation and speed, service,
quality and customer satisfaction.
The City does have the tools to do what we need to do. Information technology offers
many options for rearranging work. But our imaginations must guide our decisions
about technology, not the other way around. We must have the boldness to imagine
taking 68 days out of an 80-day turnaround time, cutting 75% of overhead, and
eliminating 80% of errors. These are not unrealistic goals. If City’s executives and
employees share the vision, BPR will provide a way. Group Shared Services is does24
acknowledges progress made this far and it will provide necessary assistance to
insure success of this initiatives.
6. IMPLICATIONS
6.1 HUMAN RESOURCES
None.
6.2 FINANCES
None.
6.3 CONSTITUTIONAL AND LEGAL FACTORS
None.
6.4 COMMUNICATION
None.
6.5 PREVIOUS COUNCIL OR MAYORAL COMMITTEE RESOLUTIONS
Approved report on the business Process Re-Engineering of key service delivery and
MSCOA compliant areas approved on 20 June 2018.
7. CONCLUSION
It is recommended to the Mayoral Committee that:
The Mayoral Committee take cognisance of the report as well as the progress made
thus far.
RESOLVED:
That cognisance be taken of the report as well as the progress made thus far.25
Reference No 86646/1
Makgomoretje Makgata (0940)
MAYORAL COMMITTEE: 20 March 2019
3. ECONOMIC DEVELOPMENT AND SPATIAL PLANNING DEPARTMENT
PROPOSED DEVELOPMENT ON THE REMAINDER EXTENT OF PORTION 279
AND 285 OF THE FARM GARSFONTEIN 374-JR
1. PURPOSE
The purpose of the report is:
(a) To appraise the Mayoral Committee on the proposal received by the City for
the development of the remainder extend of portion 279 and 285 of the Farm
Garsfontein 374-JR; and
(b) To recommend the way forward on the proposed development.
2. STRATEGIC PILLARS
This report addresses the following Strategic objectives:
• Pillar 3: A city that delivers excellent services and protects the environment
• Pillar 4: A city that keeps residents safe
• Pillar 5: A city that is open, honest and responsive
3. BACKGROUND
The City of Tshwane, as part of its Spatial Vision, developed Regional Spatial
Development Framework for Region six, and incorporated Local Spatial
Development Framework for Garsfontein Local Area. The following farm portions
were included in the study area because of its strategic nature: The Remainder of
Portion 285 (measuring 106.3608 ha); and the Remainder of Portion 279 (measuring
110.3709 ha) - of the Farm Garsfontein 374 JR, the total size of the properties in
question is 216 ha.26
Given the strategic nature of the land parcels, various land uses were proposed to
complement the socio-economic trends of the area. The following land use budget
was proposed:
• Low Density housing 38.7 ha 550 m² per erf 700
• Medium Density Housing 73,9 ha 60 units per ha 4500
• Commercial Value Mart 9.8 ha 40000 m²
• Offices 6.9 ha 41000 m²
• Public Open Space 60.2 ha
• Education 9.4 ha 2 school / collage sites
• Streets 14 ha
4. HISTORICAL BACKGROUND
4.1 TENDER PROCESS
The City of Tshwane advertised a Request for Proposals (“RFPs”) for 12 strategic
land parcels ("land portions" or "properties") following the approval of the Strategic
Land Report by the Municipal Council on 1 October 2009 as well as the approval of
the Section 14 Alienation Report on 24 June 2010.
Rakohe Investments (Pty) Ltd, a “DEVCO” formed for purposes of responding to the
RFP advertised by the Consultant, purportedly submitted a Stage 1 Development
Proposal in response to the said RFP advertised by the consultant. Rakohe was27
notified that it had been short-listed for a Stage 2 of the tender for the planning and
development of the strategic land parcel.
Thereafter Rakohe submitted its Development Proposal for Stage 2 of the tender
process; on, or about 27 February 2012 Rakohe was notified that its proposal was
accepted as the preferred bidder which acceptance was provisional. The notification
was the first step in the negotiation process; the award was clearly subject to
conditions specified therein, as well as the successful negotiation of the development
agreement within a maximum period of 90 days.
4.2 THE NEGOTIATION PROCESS
On or about 12 March 2012 negotiations between the parties commenced. A clear
condition of the tender acceptance was that a satisfactory development agreement
had to be negotiated and concluded (in line with Rakohe’s development proposal)
within a maximum period of 90 days from the date of this provisional award. The
parties were unable to successfully conclude a development lease agreement within
the provided period.
Notwithstanding the failure to negotiate a satisfactory development lease agreement
within the required 90 days, the City continued with bona fide ‘talks’ with Rakohe
(through various meetings and communication exchanges) with a view of reaching a
possible resolution to the impasse between the parties. Despite such talks and
revisions to the development proposal, the contents of the revised development
agreement remained substantially different from Rakohe’s original proposal as well
as the RFD specifications and it was therefore irreconcilable.
4.3 THE CANCELLATION PROCESS
The City of Tshwane Municipality, for reason referred to above, then made a decision
to cancel the tender on 22 October 2013. It should also be noted that subsequent to
the decision to cancel the tender with Rakohe, the City also took a policy decision on
4 November 2014 to cancel the tender altogether and sell the parcels of land, along
with other strategic land parcels identified, by means of public auction in order to raise
funds for the City of Tshwane Municipality.
4.4 SUBSEQUENT LITIGATION
On or about 22 August 2014 Rakohe instituted a review application against the City’s
decision to cancel Stage 2 of the tender (reference: CB175/2011) for the planning
and development of the remainder of portion 279 and 285 of the farm Garstfontein
374 JR. Due to administrative problems experienced within the ranks of the
Municipality at the time, the City failed to instruct its attorneys in order to oppose the
review application.
Rakohe proceeded to obtain an order in its favour, which order was granted by the
Honourable Judge JW Louw on 16 October 2014. It should be stressed that the order
was not based on the merits of the application but due to the City’s failure to oppose
the application.
Immediately after becoming aware of court order (on or about 22 November 2014)
the necessary preparation began in order to obtain a rescission of the said court
order. The Municipality's application for rescission was successful.28
It should also be noted that another unsuccessful application was brought by Rakohe
subsequent to the City of Tshwane Metropolitan Municipality’s Council decision on/or
about 4 November 2014 to cancel the tender and that various land parcels, including
the Garstfontein land parcels, be sold by means of public auction. Rakohe served an
urgent application on the City's attorney of record on 10 March 2015 to prevent the
selling of the properties by way of public auction pending the conclusion of settlement
negotiations between itself and the City in respect of the Development Lease
Agreement emanating from the 2010 tender process. The court dismissed this
application both on urgency and on merits.
At present, the review application brought by Rakhohe to set aside the cancellation
of the City's decision taken to cancel the stage 2 tender process is being opposed
the City. All the relevant papers have been filed and all that remains is that the matter
must be set down for hearing.
4.5 CURRENT LITIGATION WITH RAKOHE (REVIEW APPLICATION)
Rakohe launched the current review application on 22 August 2014 against the City
of Tshwane Metropolitan Municipality's decision to cancel stage 2 of the tender
(reference CB175/2011) for the planning and development of the remainder of portion
297 and 285 of the farm Garstfontein 374 JR and ancillary relief.
The former city Manager, Mr Jason Ngobeni, on 23 May 2016 reaffirmed the
existence of the tender process and/or development agreement through a letter
addressed to Rakohe. On or about 5 September 2016, a letter emerged dated 23
March 2016, written by the Office of the City Manager in which it advised Rakohe that
the City of Tshwane would not proceed with the rescission application and the letter
cancelling the tender was duly withdrawn.
The arguments that the City put forward in defending the case, can be summarised
as follows:
• The tender, or the expression of interest to contract with Rakohe, automatically
lapsed after the expiration of the 90 day period.
• Rakohe’s behaviour essentially prevented the parties from reaching agreement
on material aspects and from satisfactorily concluding a development agreement.
Rakohe continued to incorporate material changes into the proposed
development lease agreement which changes were not only irreconcilable with
the original proposal submitted on their behalf - it was therefore impossible for
the City and Rakohe to reach an agreement.
• The “right to withdraw at any stage from the process” and reject all tender offers
before the formation of the contract was specifically reserved and available to the
CTMM through the conditions specified in the Request for Proposal (“RFP”)
document.
• Not only was the process with Rakohe cancelled, but that the Municipal Council
also took a policy decision on 4 November 2014, more than a year after the said
cancellation, that the tender process be cancelled in its entirety - this decision
taken by the Municipal Council is not an administrative decision but the exercise
of executive authority of the Municipality and therefore not susceptible to review
under Promotion of Administrative Justice Act, 2000 (“PAJA”). It must be noted
that the entire premise of Rakohe’s application, if there was any, is no longer
available to them as a result of such a policy decision. The cancellation of the
tender process with Rakohe was as a result of contractual conditions and/or29
obligations created and that it does not fall within the parameters of administrative
action as contemplated by PAJA.
The proposed development approach and concept envisaged by the tenderer
include:
• The provision of affordable housing integrated within a broader urban context of
a sustainable and balanced development
• The township be a “mixed use lifestyle development”, comprising single
residential stands, higher density residential development, a town centre, and
office development.
• Communal and sporting facilities.
• The area identified as public open space, would need to be within the confines of
the township. While the area itself would not be diminished, it would be
redesigned to extend into the township itself. This would need to be approved by
the environmental authorities.
5. STATUS OF COUNCIL RESOLUTIONS
The Council Resolution of 2014 did not specifically rescind the alleged 2009
resolution and, thus, the 2009 resolution and partial implementation thereof are still
legally effective. The implementation of the 2014 Council Resolution, in respect of
the properties in question, would have conflicted with the 2009 resolution, which
resulted in the properties been awarded to Rakohe for development; unless the court
finally decided in favour of the Municipality.
The said conflict of the two Council Resolutions and the issue of outstanding court
battle relating to the awarded tender, form the legal basis on which to vary (and not
to rescind) the 2014 Council Resolution, in terms of the said provisions of section
59(3)(a) of the Municipal Systems Act, 2000, however, only in respect of the
Remainder of Portion 279 and 285 of the Farm Garsfontein No. 374-JR.
The rescission of the whole of the 2014 Council Resolution will be inappropriate in
that it has already been partly implemented. Therefore, a variation of the 2014
resolution to the extent that it does not affect any other rights accrued to any third
party, and to the extent that the variation affects the properties in the report only can
be pursued, subject to the fact that the variation or alteration of the Council Resolution
does not affect any rights that may have accrued to any third person in terms of such
2014 Council Resolution, in respect of the properties in question.
6. ADDITIONAL LITIGATION ON THE PROPERTY
There was an informal settlement located on Portion 645 of the farm Garsfontein 374-
JR which was subdivided from the remaining extent of Portion 285 374-JR. An
application was received on the 15th April 2008 for the eviction of the Illegal occupiers
from CoT’s property by the neigbours. The CoT was joined in the Application and the
City was requested to demolish all structures on the land and relocate the occupiers.
The Court granted an order on the 10th November 2008 which inter alia ordered that:
1. the CoT to identify a portion of land to reallocate the illegal occupiers too.30
2. to provide a viable plan with a long term solution to the housing needs of the
Applicants.
3. that the illegal occupiers be remove within one year of the date of the Court
Order
The Applicant then brought an application for a Contempt of Court. The CoT is
opposing the Application, as the CoT has complied with the Court Order with the
exception of reallocating the illegal occupiers.
Currently, there have been four contempt of court applications brought against the
City. In the meanwhile, settlement negotiations have been ongoing with the Lawyers
for Human Rights (“LHR”) with a view to relocating the occupiers to land belonging to
the CoT across the road. One of the disputed points are that LHR are demanding that
the relocation also include foreign nationals. The CoT made a comprehensive
proposal to LHR. LHR had to take the proposal to its clients for a mandate to either
accept or reject the proposal. A certain part of its clientele was not willing to give LHR
the mandate to settle unless there was an indication of the position of those occupiers
who do not qualify.
The legal team is also now exploring the prospects of filing an opposing affidavit to
the main review. In the main the CoT should take a decision on whether to proceed
with the sale of the property by auction. The CoT has now received an application by
Meadow Glen seeking for the case to be managed by the judiciary. CoT’s attorneys
have been instructed to make a proposal of a scaled down judicial oversite. The CoT
is now in the process of developing a project plan to be considered by the other side.
7. PROPOSED WAY FORWARD
The City has two possible solutions to the current impasse:
1. Enrol the review application brought by Rakohe on the High Court Roll for
judicial conclusion. The biggest challenge will be to defend the letter issued by
the previous City Manager who informed Rakohe that the litigation is
withdrawn and that the project can proceed. Not only did this action create a
legitimate expectation about the status of the agreement between the City and
the tenderer; it was an instruction to the legal team to withdraw the litigation.
It may be true that the previous City Manager acted ultra vires, but it is within
the delegated authority of the City Manager to decide on legal strategy and
settle matters. Another factor to be considered is the current backlog in the
High Court, which means that this matter may only be heard in 2020.
2. Explore potential settlement proposals which will encompass the issue about
the tender process whilst holistically addressing the informal settlement and
the relocation of the foreign nationals. The “weakness” in the tender process
does weigh heavily against any settlement proposals. However, this must be
weighed against the timeframe for the judicial review, new tender process, and
actual construction. A very serious consideration is also the non-compliance
to court rulings granted to Meadow Glen and the required relocation or
formalisation of the informal settlement that is outstanding since 2008 (already
11 years).31
Depending which option is mandated by the Mayoral Committee, this may require the
report to be submitted to Council to amend or rescind certain Council resolutions
already taken in this regard.
8. COMMENTS OF THE STAKEHOLDER DEPARTMENTS
8.1 COMMENTS OF THE CHIEF FINANCIAL OFFICER
The purpose of this report is to appraise the City Manager on the proposal received
by the City for the development on the remainder extent of portion 279 and 285 of
the Farm Garsfontein 374-JR and to also recommend the wayward on the proposed
development.
It is recommended in the report that an independent legal opinion be obtained on the
current litigation with Rakohe and an appropriate legal route to be followed and that
the City initiate meaningful negotiations with Rakohe for possible out of court
settlement.
It is not clear in the report on the cost implications associated with the sourcing of
independent legal opinion which is requested on the current litigation between the
City and Rakohe Investments.
It is difficult for Group Financial Services to render meaningful financial comments
and confirm availability of the budget in the absence of the full financial implications
in this regard.
Furthermore, the report recommends that a report to Council must be prepared to
rescind the Council resolution dated 04 November 2014 and exclude the remainder
extend of portion 279 and 285 of the Farm Garsfontein 374-JR from the properties to
be auctioned.
Group Financial Services will render further financial comments on the proposed
report to rescind the Council resolution dated 04 November 2014 and exclude the
remainder extend of portion 279 and 285 of the Farm Garsfontein 374-JR from the
properties to be auctioned.
8.2 COMMENTS OF THE GROUP HEAD: GROUP LEGAL AND SECRETARIAT
SERVICES
The purpose of this report is:
1. To appraise the Mayoral Committee on the proposal received by the City for
the development of the remainder extend of portion 279 and 285 of the Farm
Garsfontein 374-JR.
2. To recommend the wayward on the proposed development.
The Group Legal and Secretarial Services have been very engaged with the Rakohe
and Meadow Glen litigation. As the implementing agent for litigation, the Group will
implement the direction as provided by the Mayoral Committee in these matters.32
8.3 COMMENTS OF THE GROUP HEAD: HUMAN SETTLEMENT
The proposed development on the Remaining extent of Portion 279 and 285 of the
farm Garsfontein 374-JR is supported subject to the following:
1. The Economic Development and Spatial Planning Department take note of the
informal settlement currently located on Portion 645 of the farm Garsfontein
374-JR which was subdivided from the remaining extent of Portion 285 374-
JR and ensure that it is incorporated within the proposed development; and
2. Region 6 which currently has a housing backlog of approximately 40 000 units,
is land locked. It is proposed that the proposed development concept on the
Remaining extent of Portion 279 and 285 of the farm Garsfontein 374-JR be
revised to accommodate the low cost residential units in order to reduce the
existing backlog in the region.
9. IMPLICATIONS
9.1 HUMAN RESOURCES
None.
9.2 FINANCES
None.
9.3 CONSTITUTIONAL AND LEGAL FACTORS
None.
9.4 COMMUNICATION
None.
10. PREVIOUS COUNCIL OR MAYORAL COMMITTEE RESOLUTIONS
• Municipal Council Resolution on 1 October 2009
• Municipal Council Resolution on 24 June 2010
• Municipal Council Resolution on 04 November 2014
11. CONCLUSION
The envisaged development is in line with the Local Spatial Development Framework
as approved in the Regional Spatial Development framework for Region 6. The
proposal will also assist the City to deal with the Plastic View Informal Settlement
located on the property. The City is currently offering free services to the
establishment as per the court settlement reached with the Lawyers for Human
Rights.33
IT WAS RECOMMENDED (TO THE MAYORAL COMMITTEE: 20 MARCH 2019):
1. That the contents of the report be noted;
2. That the Mayoral Committee provide guidance on whether:
(a) The City continue with the review litigation against Rakohe Investments (Pty)
Ltd; or
(b) The City Manager be authorised to engage with Rakohe Investments (Pty) Ltd
with the intention to settle the matter.
3. That a progress report be presented to the Mayoral Committee for the implementation
of recommendation 2(a) or 2(b) within a reasonable time.
During consideration of the report, it was agreed that recommendation 2(a) be
deleted.
In view of the above, it was:
RESOLVED:
1. That the contents of the report be noted;
2. That the City Manager be authorised to engage with Rakohe Investments (Pty)Ltd
with the intention to settle the matter; and
3. That the City Manager submits a progress report to the Mayoral Committee within a
reasonable time with regards to the engagement between the City and Rakohe
Investments (Pty) Ltd.34
Lorette Tredoux (4050)
MAYORAL COMMITTEE: 20 March 2019
4. OFFICE OF THE GOVERNANCE AND SUPPORT OFFICER
ESTABLISHMENT OF AN IN-HOUSE ASSET PROTECTION SERVICE FOR THE
CITY OF TSHWANE MUNICIPALITY
1. PURPOSE
The purpose of the report is to obtain approval for the establishment of an In-House
Asset Protection Service for the City of Tshwane Metropolitan Municipality.
2. STRATEGIC PILLARS
The Strategic Pillars of the City’s five-year plan to be addressed include:
Strategic Pillar 1
A City that facilitates economic growth and job creation
Strategic Pillar 2
A City that cares for residents and promotes inclusivity
Strategic Pillar 3
A City that delivers excellent services and protects the environment
Strategic Pillar 4
A City that keeps residents safe
Strategic Pillar 5
A City that is open, honest and responsive
3. BACKGROUND
The Council, at its meeting held on 30 August 2018, considered a report
recommending the in-principle approval for the establishment of an in-house security
guarding service for the safeguarding of municipal facilities and assets.
The report stated that the City would conduct a benchmarking exercise, determining
the best option for the implementation of an In-House Protection Services at the
following municipalities:
• eThekwini
• Cape Town
• Johannesburg35
The purpose of the benchmarking exercise was further to determine the cost
implications of the proposed unit and to take cognisance of lessons learned by other
metropolitan municipalities in the establishment of similar services.
4. DISCUSSION
As part of the benchmarking exercise, the Office of the Chief of Police requested the
following information from the Chiefs of Police from other Metros:
• Organisational structure
• Job descriptions
• Salary scales and total cost to company
• Job requirements – for instance, are the security officers expected to ensure
that they maintain their PSIRA registration at their own costs
• Uniform specifications
• Any other relevant information
Limited information was received from Nelson Mandela Bay. The City of Cape Town
indicated that they do not have an in-house security service and that the function is
performed by external security service providers contracted to the City, who are
overseen by their Facilities Management within the Safety and Security Department.
The City Manager and Governance and Support Officer met with the City Manager
of the City of Johannesburg and the officials that were responsible for the
implementation of the service in the City of Johannesburg. They were open about the
lessons learned and the challenges experienced, but requested that the information
provided be dealt with in confidence. It is included in the report to provide the Mayoral
Committee with a full picture, but the report might need to be amended before
submission thereof to Council, in order to protect the interests of the City of
Johannesburg.
4.1 Salary scale benchmarking
4.1.1 Private Security Sector
There have been delays in the promulgation of the minimum wages for private
security which have now been resolved. As per Government Gazette notice Vol. 640,
No. 41974, 12 October 2018, the Minimum wages for the Private Security Sector are
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