COOPERATIVE GOVERNANCE AND LOCAL ECONOMIC DEVELOPMENT IN SOUTH AFRICA

1. COOPERATIVE GOVERNANCE AND LOCAL ECONOMIC DEVELOPMENT IN SOUTH AFRICA Presentation by the Department of Cooperative Governance to the Portfolio Committee on Cooperative Governance and Traditional affairs 15 November 2011

2. Background • LED is not new and at first concentrated on urban centres • Since then LED has been elevated from isolated local development intervention, mainly in cities, to an obligatory intervention for all local authorities in terms of the Constitution and the Municipal Systems Act. • Period Post-2005 represents an evolution in terms of both a new policy maturity as well as greater involvement of a range of different stakeholders in supporting LED – from national departments, through provinces, the private sector, local governments and civil society

3. Background 2 • Post -2005 release and finalisation of a draft of national policy initiatives linked to LED: • Policy Guidelines 2005 • National Framework Document 2006 • 5 year Local Government Strategic Agenda and Implementation Plan 2006 • 2006 RIDS • 2006 NSDP • 2009 Local Government Turnaround Strategy • 2010 New Assessments on LED – Policy Shift?

4. The LED Framework • Developed through a long process of negotiation and discussions with key central stakeholders (the Presidency, DTI,…) • Contestations about the role of DPLG in guiding economic development • The Framework tried to accommodate aspects of both pro-market and pro-poor approaches

5. The LED Framework 2 • Developed around 4 strategies identified as essential for the successful achievement of the overall goals of the Framework: • First, to improve good governance, service delivery, public and market confidence in municipalities; • Second, to identify and exploit the competitive advantage of municipal regions; • Third, to intensify enterprise support in local area; and • Four, to introduce Community Investment Programming.

6. Key Findings of 2010 LED Review • The Framework is not widely used at local level by LED related stakeholders • LED commitment seems to have decreased throughout the years (reflected in budgetary allocations) • Need to increase coordination between sector departments, provinces, municipalities and stakeholders • Very few lasting partnerships have been created between municipalities and the private sector as well as other stakeholders • LED projects do not have sufficient scale • LED still remains a priority

7. Broad Definition of LED “Refers to the approach … to encourage investment by big business, small local business development, tourist industries or large-sector economy management in mining, manufacturing or farming.” [Local Government Turnaround Strategy 2009 – 2014]

8. Principles for Accelerating LED Implementation • Critical component of LGTAS and Outcome 9 • Department of Cooperative Governance to serve as single window of coordination for LED • Alignment with New Growth Path, IPAP II and Comprehensive Rural Development Programme • Creating functional partnerships between municipalities and the local private sector as well as civil society • Facilitate the unlocking of local investment opportunities of scale that will lead to sustainable private sector job creation • Leverage local procurement

9. Key Levers of LED • Good governance and democratic participation • The availability of economic infrastructure at local level • Municipal land and property • Reducing red tape • Local competitive and competitive advantage • Skills development

10. Progress to Date Strategic Goal: To facilitate Economic Development at local level. Strategic Objective: To create jobs through a system supportive of Private Sectors Sustainable Employment at local level in all District Municipalities.

11. DCoG’S COOPERATIVES DEVELOPMENT AND SUPPORT PROGRAMME

12. Background to the Project Emerged as one of DCoG’s Flagship Projects from the LGTAS and Outcome 9 Outcome 9 • Ward-based programmes to sustain livelihoods • As a ward-based programme – 30% of work opportunities created through CWP to be linked to functional cooperatives by 2014 • LGTAS • Facilitation and implementation of ward-based economic planning • Each ward to have at least one economic development product • Enhance the municipal contribution to job creation and sustainable livelihoods through Local Economic Development. • Ward Based Cooperatives Programme: • Driven by the objectives of economic empowerment, inclusivity and participation primarily targeted at the under-privileged, unemployed citizens at a grassroots (hence ‘ward’) level • Empowerment (social mobilisation) of communities with knowledge and information on cooperatives; training; access to markets and finances; mentoring and coaching until independent of state support • Partnership based approach: Working through an Implementing Agent

13. Progress-to-date • Project is being implemented through the services of the South African National Apex Cooperative (SANACO) - a registered apex co-operative, in terms of the Co-operatives Act, Act No. 14 of 2005. A member of NEDLAC representing all co-operatives • Providing the following services on behalf of the Dept: Social mobilisation; assistance with registration; facilitation of training; facilitation of access to markets and to finance. • To date, 520 cooperatives have been supported • Against an annual target of 6 317 job opportunities created through cooperatives, to date, implementing agent reports 4 480 – note, ‘job opportunities’ relates to assistance provided to cooperatives to help them become functional and seize opportunities available in the market • Challenges presently relate to capacity constraints in relation to the vastness of this projects: i.e. funding

14. Thanks You!!