KNYSNA NEWS - Depending on the outcome of a Knysna council decision on Monday 30 July, the Western Cape government's investment and tourism marketing branch (Wesgro), could step in to take over the local tourism function in what would be a three-year deal with the local municipality.
On Thursday 19 July, during a feedback session held at the Conrad Pezula Hotel, members of Knysna Tourism and the Knysna Accommodation Association (KAA) gave their overwhelming support for a plan to partner with Wesgro. The plan is dependent on council's approval for Knysna Municipality to enter into a service level agreement (SLA) with the organisation, which has said that it would not get involved with the municipality if there is no buy-in from the industry and community itself.
'Put personal agendas aside'
This, said tourism chairperson Elmay Bouwer, follows the search for a method in which the municipality can legally fulfil its mandate to the tourism industry following the nonrenewal of the SLA between the municipality and tourism.
“Today we have to put personal agendas aside and do what is in the best interests of Knysna,” she said before giving feedback on discussions held with Wesgro on 18 July.
But, said Chris Gould of the Knysna Ratepayers Association, this process would not be legal. “Although the municipal systems act exempts the outsourcing of a municipal function to an organ of state such as Wesgro from the competitive bidding process, it nevertheless sets a number of hurdles that must first be cleared. These include public notice and participation, assessment of the impact on human health and the environment, the likely impact on jobs and employment patterns, the use of organised labour, and a feasibility study among other things. There are about 25 hurdles in all. This is not something that can be done overnight. It will take time,” said Gould.
Long way coming
This is not the first time the tourism function has been under the spotlight.
The legality of the funding for tourism was first questioned by blogger Mike Hampton in 2013, who then subsequently reported it to the National Council of Provinces (NCOP), which in turn instructed the national office of the public protector to investigate Hampton’s allegations and the funding of Knysna Tourism earlier this year. At the time (2013) Lauren Waring was municipal manager and Greg Vogt chairperson of Knysna & Partners.
The latest SLA between the municipality and tourism was set for a year (which expired at the end of June this year) in order to start the procurement process, which has not been done. At that point, Kam Chetty was municipal manager and Greg Vogt the chairperson of what was known as Knysna & Partners.
When the renewal of the SLA came up in council during August 2017, DA councillor and then deputy mayor Peter Myers refused to vote.
Myers in the mix
At this meeting, Myers made his position clear – that signing the R4-million contract with Knysna & Partners for another year was illegal in terms of the Municipal Management Financial Act section 173 and that it should have been put out to tender.
At a meeting on 11 August last year, when the DA caucus voted for the SLA to be granted, Myers walked out of the meeting, thus absenting himself from voting.
The DA subsequently passed a motion of no confidence in Meyers and he was ousted as deputy mayor.
The latest set of woes pertaining to the beleaguered office culminated on 19 June, when the retrenchment process of nine Knysna Tourism staff members commenced. Their employment is set to terminate on Tuesday 31 July this year. The news also followed shortly on the heels of a new proposed bylaw in Bitou that could remove the area's external tourism function, currently performed by Plett Tourism, completely and move it in-house.
'Time to reexamine our role'
“It was high time that we reexamined our role, looked at international best practice, and found new, technology-driven strategies for the future,” she said.
According to Knysna Tourism board member Clive Bennet, any other alternatives to save the tourism body would have taken too long. “The tender process, for example, should have gone out nine months ago if the municipality wanted to go that way, but it didn’t,” he said.
Bouwers said the board had earlier commissioned a report on the way forward from auditors Grant Thornton, which is considered "the country’s most respected, independent, and credible tourism consulting firm".
"This was vital as we prepared ourselves for the termination of the SLA between the municipality and Knysna Tourism NPC,” said Bouwer.
“It was at the suggestion of the then municipal manager Kam Chetty that the municipality approach Wesgro as a possible service provider to perform the tourism function,” she added.
'Win-win for everyone'
The meetings held with Wesgro’s CEO Tim Harris and their chief marketing officer Judy Laine assisted with developing the foundations for a possible agreement, which Bouwer described as “an incredible win-win-win for everyone”.“During our discussions they stressed that their most important priority was that the local tourism industry must fully support their involvement and that they wouldn’t consider the task without the industry’s buy-in,” she said.
Bouwer said this falls in line with the government’s 1996 White Paper on tourism, which states that tourism should be government-led, industry-driven, and community-based. “It also means that the board of Knysna Tourism will be in a position to direct the strategy for marketing Knysna and Sedgefield,” she said.
“We believe that Wesgro is in a position to deliver what Knysna Tourism never could in all the years that we’ve been working basically in isolation – and this is one of the reasons we’re so excited about the prospect of working with them.”
What next?
After receiving input by its members at the meeting, the Knysna Tourism board drafted a memorandum of understanding that will form the basis of the negotiated agreement between Knysna Tourism and Wesgro, including the marketing model.
The financial funding model and other key elements will be covered by an SLA between Knysna Municipality and Wesgro. This SLA is yet to be drafted.
“Knysna Tourism and Wesgro working together will create a marketing strategy for the town that is built on the needs of the local tourism industry, that fits in with – and builds upon – provincial and regional marketing strategies, and that fulfils the needs of the tourism businesses and the people of Knysna and Sedgefield,” Bouwer explained.
She concluded that it is important for the 300 businesses that are members of Knysna Tourism to be aware that, should council fail to ratify the proposal, the process to close down Knysna Tourism as the town's tourism organisation and point of reference and vacate the offices in Main Street, will commence and be completed by 31 July. “There is no doubt that the adverse effects on businesses in Knysna and Sedgefield will be felt by the whole the town,” she said.
Municipal systems act says
Below is an excerpt from the municipal systems act that applies directly to the procurement of an external mechanism or a national or provincial organ of state to fulfil a municipal function. (Verbatim)
Section 78: Criteria and process for deciding on mechanisms to provide municipal services
(3) If a municipality decides in terms of subsection (2) (b) to explore the possibility of providing the municipal service through an external mechanism it must -
(a) give notice to the local community of its intention to explore the provision of the municipal service through an external mechanism;
(b) assess the different service delivery options in terms of section 76 (b), taking into account:
i.the direct and indirect costs and benefits associated with the project, including the expected effect of any service delivery mechanism on the environment and on human health, well-being and safety;
ii.the capacity and potential future capacity of prospective service providers to furnish the skills, expertise and resources necessary for the provision of the service;
iii.the views of the local community;
iv.the likely impact on development, job creation and employment patterns in the municipality; and
v.the views of organised labour; and
(c) conduct or commission a feasibility study which must be taken into account and which must include -
i.a clear identification of the municipal service for which the municipality intends to consider an external mechanism;
ii.an indication of the number of years for which the provision of the municipal service through an external mechanism might be considered;
iii.the projected outputs which the provision of the municipal service through an external mechanism might be expected to produce;
iv.an assessment as to the extent to which the provision of the municipal service through an external mechanism will –
aa. provide value for money;
bb. address the needs of the poor;
cc. be affordable for the municipality and residents; and
dd. transfer appropriate technical, operational and financial risk;
v.the projected impact on the municipality's staff, assets and liabilities;
vi.the projected impact on the municipality's integrated development plan;
vii.the projected impact on the municipality's budgets for the period for which an external mechanism might be used, including impacts on revenue, expenditure, borrowing, debt and tariffs; and
viii.any other matter that may be prescribed.
(4) After having applied subsection (3), a municipality must decide on an appropriate internal or external mechanism, taking into account the requirements of section 73(2) in achieving the best outcome.
(5) When applying this section a municipality must comply with –
(a) any applicable legislation relating to the appointment of a service provider other than the municipality; and
(b) any additional requirements that may be prescribed by regulation.
(6) The national government or relevant provincial government may, in accordance with an agreement, assist municipalities in carrying out a feasibility study referred to in subsection (3) (c), or in preparing service delivery agreements.
Section 80: Provision of services through service delivery agreements with external mechanisms
(1) If a municipality decides to provide a municipal service through a service delivery agreement in terms of section 76 (b) with- (aA)a national or provincial organ of state, it may enter into such an agreement with the relevant organ of state without applying Part 3 of this Chapter;
(2) Before a municipality enters into a service delivery agreement with an external service provider it must establish a programme for community consultation and information dissemination regarding the appointment of the external service provider and the contents of the service delivery agreement. The contents of a service delivery agreement must be communicated to the local community through the media.
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