THE INDEPENDENT COMMISSION FOR THE REMUNERATION OF PUBLIC OFFICE BEARERS

ANNUAL RECOMMENDATIONS FOR 2011/2012

INDEPENDENT COMMISSION FOR THE REMUNERATION OF PUBLIC OFFICE BEARERS

PART A

ANNUAL REMUNERATION RECOMMENDATION FOR THE PUBLIC OFFICE- BEARERS FOR 2011/2012

1.1 The Independent Commission for the Remuneration of Public Office Bearers (Commission) is statutorily obliged by virtue of section 8 (4) and (5) of the Independent Commission for the Remuneration of Public Office Bearers Act, 1997, to make annual recommendations relating to the salaries, benefits and allowances, and the resources required by public office bearers to enable them to perform their respective duties effectively.

1.2 The Commission in their meeting of the 08th April 2011 resolved to make the annual remuneration recommendations of public office bearers for 2011/2012 financial year. The Commission considered, amongst others, the following factors to be relevant in forming the basis for its decision:

• The Consumer Price Index (CPI) trends
• Affordability
• National market trends including the private and public sector
• Consultation with relevant stakeholders

1.2.1 Economic data has always been used as a guideline in making annual cost of living increase decisions for the employees of an organization(s), whether public or private. The relevant data would normally include the CPI, PPI, quarterly GDP figures released by Statistics South Africa, affordability, general market increases, together with interest rates determined by the South African Reserve Bank (SARB). The most recent forecast of the SA Reserve Bank predicts that inflation is expected to average 4,7% in 2011.

1.2.2 The Commission is obliged by statutory enactment to make recommendations for salary adjustments of public office bearers. After taking into account all relevant factors mentioned here together with applicable legislation, the Commission recommends a 5% salary increase for public office bearers for the year 2011/2012 effective from 0l April 2011.

1.2.3 The Commission attaches its recommendations, which reflect the general percentage increase of 5% in the total remuneration packages of all Public Office-Bearers for the 201 1/2012 fiscal year.

2. ONCE-OFF GRATUITY FOR NON-RETURNING LOCAL COUNCILORS

2.1 The Commission further recommends to the President a once-off gratuity for non-returning Local Councilors who have served the recent full term from 01st March 2006 to 18th May 2011. Non-returning Local Councilors whose term has ended and have served a full five years should be paid a once-off gratuity of three months pensionable salary from the National Fiscus. The Commission consulted with various Ministers and the Minister of Finance in this regard.

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PART B

RECOMMENDATION FOR HEADMEN/HEADWOMEN REMUNERATION

1. PURPOSE

1.1 For some time, the Commission has been working on what recommendations to make in relation to the manner in which Headmen/Headwomen should be remunerated.

1.2 This issue has been investigated by the Subcommittee for Local Government and Traditional Affairs created by the Commission and numerous representations have been received from the Provinces and the traditional leadership institutions.

1.3 Following a consideration of relevant information presented to it, the Commission sets out its recommendations on the remuneration of Headmen/Headwomen in this document.

2. ISSUES OF CONCERN

2.1 In working through the issues it needs to determine in order to make final recommendations, the Commission discovered that:

2.1.1 It was extremely difficult to determine with any certainty the number of Headmen/Headwomen in the Provinces;

2.1.2 Some Provinces paid much higher stipends to Headmen/Headwomen than others;

2.1.3 There would be significant financial implications of implementing any recommendation to increase stipends paid to Headmen/Headwomen because of the increasing number of Headmen/Headwomen.

3. VERIFIED DATA ON HEADMEN/HEADWOMEN

3.1 The Commission received data from the Minister of Co-operative Governance and Traditional Affairs in his letter dated 18 December 2010 on the number of Headmen/Headwomen in the provinces. Below is a table indicating the data supplied to the Commission.

4. APPROPRIATE LEVEL OF STIPEND FOR HEADMENIHEAD WOMEN

4.1 In line with the Commission's grading system, the Commission has determined that Headmen/Headwomen who perform responsibilities over and above those performed ordinarily by Headmen/Headwomen (such as, including but not limited to attending traditional councils), should be paid an upper limit of R71 644.

4.2 This upper limit of remuneration should be paid to the most Senior Headman/Headwomen. The Headmen/Headwomen who has lesser responsibilities should be paid at lower levels.

5. FINANCIAL IMPLICATIONS

5.1 Assuming that all current Headmen/Headwomen are paid at the upper limit recommended, the financial implication would be as follows:

6. RECOMMENDATION

6.1 The Commission noted the following:

6.1.1 The number of Headmen/Headwomen reported by each Province has in general increased since the Commission began considering this issue. This is of concern to the Commission since it is not able to determine with any certainty how many Headmen/Headwomen there are or how such numbers were determined. The number of Headmen/Headwomen who could be remunerated following the Commission's recommendations impacts on the affordability of implementing the Commission's recommendations.

6.1.2 Some Provinces currently pay Headmen/Headwomen more than the amount of the stipend that the Commission believes is appropriate for the size of the functions performed by Headmen/Headwomen.
6.1.3 The Provinces have noted that it will be difficult for most of them to afford to implement the stipend proposed by the Commission and that the Provinces would need to look for some contribution in this regard from the Fiscus.

6.2 In the above circumstances the Commission recommends the following:

6.2.1 In line with the Commission's grading system, Headmen/Headwomen who performs responsibilities over and above those performed ordinarily by Headmen/Headwomen, including attending traditional councils, should be paid an upper limit of R71 644. The Commission recommends that this is the upper limit of remuneration that should be paid to the most Senior Headmen/Headwomen and that Headmen/Headwomen who have lesser responsibilities should be paid at

6.2.2 The amount of R71 644 is in the nature of a stipend and is the total amount that should be paid at an upper limit to Headmen/Headwomen. No other benefits (including pension benefit, medical aid, and motor vehicles) are due to Headmen/Headwomen who receives this stipend.

6.2.3 Headmen/Headwomen who are paid a salary for performing a different public office bearer function are not entitled to be paid both the stipend and the other public officer bearer's salary. This recommendation is made in order to avoid "double dipping".

6.2.4 The implementation of the Commission's recommendations should be left to the Provinces. In this regard:

6.2.4.1 Provinces should determine with certainty how many Headmen/Headwomen are in each Province and what functions are performed by each.

6.2.4.2 Provinces need to consider which Headmen/Headwomen should be paid at/or around the upper limit recommended by the Commission and what should be paid to Head men/Headwomen who have lesser responsibilities.

6.2.4.3 Given the concern regarding the affordability to Provinces of implementing the Commission's upper limit recommendation, the Provinces should consider the manner in which to implement the remuneration ultimately decided by the Province, including the necessity of phasing in the recommendations.

6.2.4.4 Where Headmen/Headwomen are paid above the upper limit recommended by the Commission, the Provinces should determine what steps to take to ensure that, over time, the remuneration paid to Headmen/Headwomen is brought in line with the Commission's recommendations. Provinces should inform the Commission about the said steps and progress made prior to the Commission making recommendations of possible adjustment of salaries of public office bearers in 2011/2012.

6.2.4.5 It should be emphasized that the remuneration herein recommended is closely linked to the numbers of Headmen/Headwomen the Commission received from the relevant structures.

Signed at Pretoria on this 16 day of August 2011-08-26

Judge LW Seriti

Chairperson

Issued by the Presidency, August 26 2011

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