Minimum Competency Regulations

MUNICIPAL FINANCE MANAGEMENT ACT

TV PillayMFMA Unit

Minimum Competency Regulations

No. 56 of 2003

BackgroundBackground

The White paper on Local Government - Systematic programme to develop high level management and front-line worker capacities in local government

The Constitution - Section 154(1) - by legislative and other measures must strengthen municipal capacity

Municipal Finance Management Act – meet the objectives and assist implementation

Improving capacity and skills of officials (enhancing current and build new skills)

Address financial management challenges Reinforce sustainable practices Leading to improved delivery of services

ResearchResearch278 Senior municipal managers - levels of qualifications278 Senior municipal managers - levels of qualifications

Qualification EC FS GT KZN LM MP NC NW WC

Natio

nal

Natio

nal

%

No Data 0 2 0 1 0 1 4 1.4

Pre-Matric 0 0 1 0 0 1 0.4

Matric only 0 4 2 1 4 2 2 15 5.4

Matric and Diplomas 8 11 13 7 27 6 7 4 2 85 30.6

Undergraduate degree 8 2 10 8 9 4 5 8 1 55 19.8

Undergraduate degree and Diplomas 2 6 4 1 6 6 7 0 3 35 12.6

Under and post graduate 7 5 14 3 9 5 7 10 6 66 23.7

Under/Post graduate and Diplomas 4 1 0 4 5 1 1 1 0 17 6.1

Total 29 31 44 25 60 24 28 25 12 278 100%

ResearchResearch278 Senior municipal managers - levels of qualifications by sector/type278 Senior municipal managers - levels of qualifications by sector/type

Qualification EC FS GT KZN LM MP NC NW WC

Na

tion

al

Na

tion

al

%

No Data 0 2 0 1 0 0 1 0 0 4 1.4

Teaching 2 11 5 1 5 1 11 0 1 39 14.0

Finance 7 1 5 1 8 0 3 2 0 27 9.7

Legal 4 2 8 4 4 2 2 10 2 38 13.7

Public Admin. 10 6 13 12 34 11 5 8 4 103 37.1

Other 6 9 13 6 9 8 6 5 5 67 24.1

Total 29 31 44 25 60 22 28 25 12 278 100%

BackgroundBackground

MFMA sectionsS 83, 107 - Municipalities/ Entities

accounting officer, senior managers, CFO and other financial officials must meet financial management competency levels

S 119 - Supply Chain Management accounting officer and all other officials of a municipality or municipal entity involved in the implementation of the SCM policy must meet the prescribed competency levels

RegulationsRegulations

Who do the regulations apply to? Accounting Officer / Municipal Manager Chief Financial Officers All other Senior Managers (directly accountable

to AO) Financial Officials at middle management level Supply Chain Management - Heads of SCM

and Senior Managers directly accountable to the AO/MM

Differentiation by category (capacity & budget) Applies to municipalities & entities


Differentiation / Categories:Municipal capacity (High, Medium & Low)Functions performedBudget size:

< R500 million: 250 municipalities

> R500 million: 33 municipalities

Must include the budget of municipal entities

RegulationsRegulations Extensive consultation - dplg, SALGA, provincial

departments, DPSA, municipalities 6 regional workshops (all provinces) – March and

April– All municipalities invited– Total number of 558 participants

470 municipal officials 71 SALGA / dplg / Prov LG / Prov Treasuries 17 educational institutions

Complements other government efforts Consistent with the principles of the Municipal

Systems Act, including the Municipal Performance Regulations


Supports implementation Municipal Manager responsible for MFMA Assists in establishment of Budget and Treasury

Office Strengthen skills of top management team SCM Unit - greater integration Support employment of qualified personnel Improve recruitment processes and adverts for

MM, CFO, senior managers and SCM managers

Transitional ProvisionsTransitional Provisions

All municipalities and entities to commence assessment of officials to identify competency gaps

Enrol for SAQA recognised qualifications, registered service providers only (test based)

Attainment of competencies to be included in performance agreements

NQF 4 = matricNQF 5 = diplomaNQF 6 = degreeNQF 7 = honours & postgraduate

Prescribed Unit StandardsPrescribed Unit StandardsNQF

Level 5NQF

Level L6 Title 116339 Apply risk management in municipalities

116341 Conduct performance management to a municipal environment

116342Apply approaches to managing municipal income and expenditure within a multi-year framework

116343 Apply the principles of ethics in a municipal environment

116345 Apply the principles of budgeting within a municipality

116348Conduct stakeholder consultation around municipal finance programmes

116351 Conduct audits, planning and implementation in a municipality

116353 Participate in the design and implementation of municipal SCM

116358 Contribute to the strategic planning process in a municipality

116361Interpret legislation and policy affecting municipal financial management

116362 Manage a municipality's assets and liabilities

Prescribed Unit Standards (cont)Prescribed Unit Standards (cont)NQF

Level 5NQF

Level L6 Title 116363 Prepare and analyse municipal financial reports

116364 Plan a municipal budgeting and reporting cycle

119331Conduct working capital management activities in accordance with sound financial management policy

119334Discuss the selected legislative regulatory framework governing the public sector management and administration environment

119341 Apply cost management information systems in the preparation of management reports

119343 Apply operations research principles and tools in the management of project activities and resources

119348 Apply selected GRAP to periodic accounting reporting process

119350Apply accounting principles and procedures in the preparation of reports and decision making

119351 Apply principles of computerised systems to manage data and reports relevant to the public sector administration

119352Apply principles of information systems to public finance and administration

Recognition of Prior LearningRecognition of Prior Learning

Is the process of recognising and assigning credit values to the learning that a person has undertaken on an informal basis, for example, in the form of work experience or the attendance of short courses

1. Identify what the official knows and can do2. Match the official’s skills, knowledge and experience to

specific unit standards and strategic priorities3. Assess the official against unit standards4. Credit official according to assessment

These are activities carried out by an assessor (subject matter expert) accredited by SETA-ETQA

GuidelinesGuidelines

Competency

REGULATIONS

MFMA

CompetencyGUIDELINES

Accounting Officer


ChiefFinancial Officer


FinanceOfficials

MiddleManagement


SeniorManagers


Head SCM &

SCM Senior Managers


Municipal Regulations on Minimum

Competency levels

Chief Financial Officer

No. 56 of 2003

Chief Financial OfficerChief Financial Officer

Qualification Municipal capacity and budget

At least NQF level 6, or

Certificate in Municipal Financial Management (SAQA No. 48965)

All Low capacity municipalities;Medium capacity municipalities with annual budgets of a value below R500 million for the current year;

Municipal entities with annual budgets of a value below R500 million for the current year.

At least NQF level 7, or

Chartered Accountant (SA)

All High capacity municipalities;Medium capacity municipalities with annual budgets of a value equal to or above R500 million for the current year;

Municipal entities with annual budgets of a value equal to or above R500 million for the current year.

Higher education qualification

DefinitionsDefinitions

Calculation of the value of the annual budget includes:

Total operating and capital expenditure

In the case of a parent municipality, the aggregated value of the annual budget of the municipality + its municipal entity(s)

Chief Financial OfficerChief Financial OfficerWork related experience:

Work-Related Experience

Municipal capacity and budget

5 years at middle

management level

All Low capacity municipalities;Medium capacity municipalities with annual budgets of a value below R500 million for the current year;

Municipal entities with annual budgets of a value below R500 million for the current year.

7 years at senior & middle management level (2 of the 7 years must be at senior management level)

All High capacity municipalities;Medium capacity municipalities with annual budgets of a value equal to or above R500 million for the current year;

Municipal entities with annual budgets of a value equal to or above R500 million for the current year.


Competency areas: Unit Standards1. Strategic leadership and management - 2

2. Strategic financial management - 3

3. Operational financial management - 6

4. Governance, ethics & values in financial management-1

5. Financial and performance reporting - 4

6. Risk and change management - 1

7. Project management - 1

8. Legislation, policy and implementation -1

9. Stakeholder relations - 1

10. Supply Chain Management - 1

11. Audit and Assurance - 1


Example - Unit Standards

Strategic financial management CFO required to be competent in unit

standard 116342 “Apply approaches to managing municipal

income and expenditure in a multi-year framework”


Unit Standards include –

Specific outcomes and assessment criteria e.g.:

Develop approaches to managing a municipality's revenue in a sustainable manner

Apply the different approaches to forecasting municipal income and expenditure over the medium term

Contribute to the design of rates, tariffs and user charges


Supporting Guideline: “Guideline for Municipal Competency levels:

Chief Financial Officers” Contains table of 11 competency areas

(pages 6 – 18) Each competency area in table linked to:

– specific competencies required

– detail of knowledge & skills required


Guidelines example: Strategic Financial Management

(competency area 2) – page 7

“The ability to guide the management of an effective, economic and efficient finance function, supported by effective financial management policies and practices.”

Chief Financial OfficerChief Financial OfficerStrategic Financial management (cont):

Examples of knowledge & skills required: Formulating and implementing finance strategies,

which enhance good financial management and decision making practices across the finance function

Developing and implementing financial policies and systems to ensure efficient and effective financial administration

Developing, implementing and maintaining financial management guidelines, financial instructions, credit control procedures, debt collection and related financial policies

M F M A25National Treasury

ConsultationConsultation

Consider similar competency regs for other sectors

Apply higher levels for SCM officials

Support training initiatives from SETA and SAMDI

Further resources may be required for roll out

Explore possibility for further exemptions



Competency levels

Monitoring and

Support

No. 56 of 2003

Monitoring & ReportingMonitoring & Reporting Municipal Manager/ Chief Executive Officer

responsible to monitor & ensure compliance Report twice yearly on compliance, as at

30 June & 31 December (using supporting schedule)

Submit copy to National and Provincial government within one month

Municipalities to include consolidated information on all entities

Disclosure - copy of 30 June report to be included in the municipal Annual Report

Monitoring & ReportingMonitoring & Reporting

Report to show the number of financial & SCM officials:

employed that have undergone assessmentwho’s performance agreements include

competency attainmentthat meet the competency levels

CommencementCommencement

Effective date: 1 July 2007

Fully operational: 1 January 2013

Phase-in

5 ½ years implementation

Guiding Implementation Guiding Implementation Steps for MMSteps for MM

1. Establish steering committee, reporting to the Municipal Manager

2. Staff competency assessment to identify gaps (assessor to be LGSETA accredited)

3. Prepare training strategy and budget up to 1/1/2013

4. Staff to undertake SAQA recognised training to address identified gaps

5. Performance agreements must incorporate attainment of competencies

6. Recruitment procedures to include new competency requirements

National Treasury SupportNational Treasury Support

Ongoing guidance and support towards effective implementation

Issuance of Circulars Review training provider material Engagement with service providers

– (WBS, Afrec, TuT) other universities MFMA Internship programme MFMA Foundation Interactive DVD Learning Workshops, seminars, events Finance Management Grant (partial support)

Training ProvidersTraining ProvidersSAQA recognised qualifications

– Certificate in Municipal Financial Management (SAQA ID No. 48965)

– National Diploma: Public Finance Management and Administration (SAQA ID No. 49554)

NT validated training courses– refer www.treasury.gov.za/mfma

under “Training & Validation”

http://www.treasury.gov.za/mfma



Competency levels

Thank You Website:

www.treasury.gov.za/mfmaEmail: [email protected]

No. 56 of 2003

Minimum Competency Regulations

Documents

Transcript of Minimum Competency Regulations