5.7 Objective 4: Understand the implementation of the pro-poor LED initiatives in the
5.7.2 Responses from community members and cooperatives with regard to objective
The participants, particularly cooperatives, outlined their disappointment with the municipality to take action pertaining to LED implementation which include the following,
No action has been taken by the municipality in terms of giving grants to cooperatives as capital to start their projects.
There is high level of inequality where some projects are being supported and others are not.
Some of the implementation decisions taken have been challenged.
There is lack of provision of support from the stakeholders or drivers of Local Economic Development including the municipality.
Some community members indicated that the municipality is failing to give cooperatives money to start their businesses. The participants also outlined that there is a problem with implementing the decisions and the programmes that the community and municipality had agreed to adhere to as a way of supporting SMMEs and cooperatives. The participants stated that the effectiveness of LED is hindered by the lack of support from the municipality. Cooperatives indicated that they end up being assisted by other stakeholders such as NYDA, the Department of Agriculture etc.
167 It was noted by the participants, that community participation in government’s affairs is one of the objectives of local government in a democratic state. LED implementation processes lack community participation and that is a challenge because community members end up not knowing what is happening within their municipality. The implementation of LED was (presumably) introduced to develop the local economy and uplift the standard of living of the local people. If this is indeed the case, the municipality must find ways of involving community members and community organisations in the affairs of the government.It was noted by the participants that there is lack of community participation in issues regarding development within both municipalities. When communities participate in the development process and decision making, they will become aware of how to negotiate and interact with their local municipalities for available opportunities. It should be noted that the success of the LED strategy depends on proper planning and the effectiveness of citizens’ participation. Participants further outlined the reasons for involving community members in the LED process, which include the following:
Community members are the main stakeholders within a local municipality.
Community members need to be knowledgeable about LED initiatives.
Involving community members will improve communication between the municipality and the community.
If community members are involved it will be easy for them to take part in decision-making.
Participants also mentioned that it is the responsibility of local government, as the tier of government that is closest to the people, to ensure that municipalities have adequate capacity to ensure that people are aware of what is happening within their municipality and what (economic) opportunities they can benefit from. It was also indicated by the participants that citizens should elect community leaders who understand the dynamics and the importance of the Integrated Development Plan and Local Economic Development. Not all LED initiatives will positively benefit the community, therefore relevant knowledge about progressive initiatives must be applied by the parties that are involved.
Participants mentioned that maladministration and poor financial management are the main challenges that hinder the implementation of pro-poor LED. However, these
168 challenges are contrary to the principles of good governance which are guaranteed by the Constitution in respect of elected and appointed officials. Furthermore, participants also alluded to ethical behaviour, integrity and good governance as the cornerstones of responsible governance. They further revealed that most of the LED projects do not reach the implementation stage and other projects collapse, and the possible reasons for this are not only the misuse of funds and corruption by the municipality but also the lack of necessary skills possessed by stakeholders to run such initiatives.
The retention of skilled labour is very low because the people initiating business migrate to urban areas in order to sustain their markets, with the result that there is a lack of skills development in these initiatives and people without the necessary business knowledge and financial management skills to ensure project sustainability are left to run projects. Participants indicated that within both municipalities (uMfolozi and uMhlathuze) they have a list of projects that are assisting community members to eradicate poverty, which include agricultural projects, brick-making projects, manufacturing projects, road maintenance projects, craft or beadwork projects, chicken farming projects and vegetable planting projects. Participants indicated that these projects were initiated by the municipality and if they want to start their own projects it would be difficult to get support and funding from the municipality.
These projects are also stipulated in the municipality’s LED strategic plan in order to fight poverty and create job opportunities. Participants further indicated that the dominant projects that are sometimes long-term or sustainable projects are small gardens facilitated by women and the Department of Agriculture has assisted these women by giving them seeds and the municipality has provided these women with tools and uniforms.Participants further mentioned that if SMMEs could also get support they could reduce the socio-economic challenges that are affecting the municipality such as unemployment, income generation for local participants, skills development empowerment and crime reduction; however, this can only be achieved if there is ongoing support from the different stakeholders including the municipality. Participants further stated that there is growing friction between foreigners and South African entrepreneurs because South African citizens perceive that foreigners are in South Africa to take their jobs and opportunities that belong to them. They also think that foreigners have come to steal resources. However, participants also conceded that some South African entrepreneurs do not have the necessary skills and competences that foreigners have, for
169 example, these people from other African countries come to South Africa with previous experience in managing businesses in their countries, and they agreed that South African entrepreneurs are not unified in terms of working together and buying stock in bulk which would prevent stock shortages or running out of stock.
They further revealed that there are ways of creating jobs in this municipality such as spaza shops but they are mostly owned by foreigners. These shops are regarded as being
“survivalist” and part of the informal sector that is not registered. Furthermore, most of the people within the uMhlathuze municipality believe that LED units exist to support and initiate cooperatives, support small businesses and create job opportunities.
However, as much as pro-poor initiatives exist they are not yet serving the purpose of creating permanent jobs that generate a sustainable income. People are employed on a short-term basis and after the completion of the project people remain unemployed.
Moreover, participants mentioned that LED initiatives operating within these municipalities are not exceptional, or significant, in that they do not have access to markets to sell the goods produced and they are also vulnerable to strong competition.
Most of Local Economic Development initiatives focus more on activities and common sectors of the economy with low growth potential and only have the capacity to accept limited returns. Participants both community members and municipal officials further stated that the uMhlathuze municipality is known as a city that has different industries which include but are not limited to the following companies: Rio Tinto, Richards Bay Minerals, BHP Billiton’s South 32, Bell Equipment, Foskor, Mondi, Tongaat Hulett, and Tronox mining operations. Yet there is still a high rate of unemployment and people who are most affected are poor people and include women, young people and the disabled.
Participants also indicated that it is important to prioritise and match industry skill requirements with academia because it will assist in reducing the rate of unemployment and improve the economic participation of youth in the economy. Participants in both municipalities also mentioned that there are other fundamental economic challenges within these municipalities such as receiving low income and that affects mostly young people because they still need to improve their standard of living and businesses closing down is a challenge but this has mostly happened when young entrepreneurs lack support and the necessary skills to grow their businesses.
170 According to the participants, LED exists to build and strengthen the economic capacity of a local area in order to improve its economic future and the quality of life of the citizens. However, local development can only occur when there is economic development, meaning that since it is the aim of LED to develop the economy of the local area, the citizens will also benefit because there will be job creation, and small businesses within the local community will improve and employ local people. The participants also explained that the main purpose of LED is to provide good governance to the people, and requires that a government will prioritize benefits to the general public rather than benefits directed to selected individuals. The municipality has an important role to play in improving the local economy through ensuring the provision of infrastructure and quality services. Participants further mentioned that crime, unemployment and HIV and AIDS still remain the dominant factors contributing to poverty in the rural areas of both municipalities. When people are unemployed they commit crime in order to get something to eat, and they are also vulnerable to HIV and AIDS as they have limited access to primary healthcare and methods of contraception including condoms and hence (generally) do not practise safe sexual intercourse.
5.8 Objective 5: Determine how the implementation and sustainability of pro-