Innovation in governance

Speech by Dr Ivan Meyer, Minister of Finance

Professor in Public Leadership, Professor Erwin Schwella

Members of the faculty of the School of Public Leadership

Associates of the Leadership INDABA

Colleagues

Ladies and gentlemen

Good evening.

Thank you so much for inviting me to address you this evening. 

In particular I wish to express my gratitude to each one of you for the role you are playing in developing and building our understanding and application of the principles of good governance.

My role as Western Cape Minister of Finance makes me acutely aware of the challenges facing South Africa.  Corruption is a key concern and as government we need to constantly reassess the effectiveness of our current governance arrangements.

It is against this background that South Africa’s Chief Procurement Officer, for example, recently announced the launch of a new e-tender portal publication and central supplier database.

This innovation will certainly simplify, standardise and automate government’s procurement process. 

I am however, also aware that at the heart of the many other challenges we face as a nation, such as the energy crisis, rests the lack of governance.  

A key aspect of my work as the provincial executive authority for finance is to improve the level of financial governance within the provincial departments and municipalities of the Western Cape.

In terms of section 155(6) of the Constitution of South Africa, Provincial Government in the province must provide for the monitoring and support of local government in the province; and promote the development of local government capacity to enable municipalities to perform their functions and manage their own affairs.

In terms of section 5(3) of the Municipal Finance Management Act (MFMA), (No 56 of 2003) [MFMA], Provincial Treasuries are obliged to assist, guide and monitor municipalities in terms of compliance with the MFMA and its related regulations.

Section 34 of the MFMA requires Provincial Treasury to monitor, assist and support municipalities in building the capacity of municipalities for effective, efficient and transparent financial management.

Furthermore Provincial Treasury must support the municipality’s efforts to identify and resolve their financial problems, share with the municipality its results of its monitoring to the extent that those results might assist the municipality in improving its financial management and inform the municipality of emerging or impending financial problems.

It is in response to the above that the Western Cape Government introduced the innovative Municipal Financial Governance Review and Outlook (MGR&O) in 2012.

The MGRO and in the case of Provincial Departments CGRO strategies were and still are fundamentally based on entrenching good governance.  These strategies aim to promote good governance by driving a single minded focus on overall or organisational-wide governance.

Importantly, a key ingredient of the success is collaboration. This collaboration occurs, firstly, between the various units within the Provincial Treasury; secondly, between Treasury and the Department of Local Government and; thirdly between provincial Treasury and municipalities as well as the Department of Local Government when required.  

The engagements with municipalities take place on an individual and/or group level.   The great benefit of collaboration is that it encourages a team approach and team learning. It also creates the platform for the development of innovative solutions.

Our understanding of innovation in this instance would be to what extent are the Western Cape Government and Provincial Treasury able to spread good or promising practices to other organizations, such as other provincial departments and municipalities. 

Innovation, after all as, described by Mark Moore “is driven to achieve widespread improvements in governance and service performance, including efficiencies, in order to increase public value”.

Ownership of the MGRO and CGRO processes lies with Accounting Officers and their executive management teams who share our commitment to addressing governance deficiencies with available resources, improving financial management and service delivery to communities and achieving of clean audit outcomes.

Are we succeeding? Well, based on the annual reports of the Auditor General of SA we certainly are showing a year on year improvement in the area of financial governance.

In the 2014/15 financial year we achieved eighteen MFMA clean audits (this includes Cape Town International Convention Centre) as opposed to the eleven in the 2013/14 financial year, while in respect of the PFMA, eleven departments achieved clean audits in the current (2013/14) year as opposed to five in the 2012/13 financial year.

 I believe that this is a great achievement and a demonstration of the quality of the leadership provided by Provincial Heads of Department as well as Municipal Managers and their respective management teams. The achievement is in fact remarkable when compared to the general performance of provincial departments and municipalities in the rest of South Africa.

Western Cape provincial and municipal officials increasingly understand the value of the shared vision of excellent financial governance, team learning, developing financial skills and the doing away of bad practises has certainly translated into this great set of audit outcomes.

The MGRO process has also taught us that municipalities:

•  Have different capacities
• Are faced with different social and economic challenges
• Some have leadership challenges – long acting arrangements etc.
• Inadequate human resource capital
• Experience Governance deficiency - instability

Does our response, namely, MGRO speak to governance innovation?

Governance innovation is defined amongst others as “that which happens when the control that an organization has over a given complex problem is broken.”  This insight informed our understanding that in order to improve governance, Provincial Treasury had to relinquish control and adopt and attitude of shared responsibility.

Furthermore it also contextualized our view that it is only once control over a problem is relinquished that one is able to break the reliance that others have on you to solve the problem. This reliance is in fact an obstacle to finding of the solution to the problem

The decision to invite other role-players into the solution of the problem created the possibility that important changes could be made. It created the conditions for innovation to take place.

In the Western Cape we have also seen that governance innovation has also resulted in the establishment of   new forms of citizen engagement and democratic institutions the most recent being the Western Cape Police Ombudsman. Established in terms of the Western Cape Community Safety Act, No. 3 of 2013 the Police Ombudsman aims to deal with complaints of communities.

The Western Cape Government shares the view that innovation in the public service must increase public value in the quality, efficiency or the appropriateness of governance or services.

Governance innovation must lead to the enhancement of public goals through collaborative arrangements which create, share, transfer, adapt and embed good practice.

Let me conclude with the words of Mark Moore:

“Those changes worth recognizing as innovation should be…..new to the organization, be large enough, general enough and durable enough to appreciably affect the operations or character of the organization.”

As indicated the the Western Cape Government, also believes that governance innovation must create public value.  We are therefore currently working feverishly on a service interface initiative that will lead to the redesign of services and information as well as access thereto from the perspective of the citizen.

The objective will be to amongst others to improve the responsiveness of government towards service delivery needs of citizens; provide, provide electronic services and solutions which are simple and tailor made to citizens’ needs and made available on the platforms and channels that they require; improve the reliability, quality and speed at which services and information are delivered at our frontline services delivery channels and; finally, create an enabling environment whereby the majority of citizens have easy access to government services through any service/information channels and are suitably skilled and equipped to engage government through its digital channels.

Ladies and gentlemen, I do hope that that there will be an appropriate time in the future when I will be able to share some of the learnings, we will no doubt gain from our service interface initiative. 

Once again thank you for inviting me to share this evening with you.

Dr Ivan Meyer, Minister of Finance, Western Cape Government

Media Enquiries:  Daniel Johnson

Media Liaison Officer/Spokesperson to Dr Ivan Meyer Minister of Finance

E-mail: daniel.johnson@westerncape.gov.za

Cell: 079 990 4231