Municipal Finance Management Act, 2003 (Act No. 56 of 2003) Chapter 1 : Interpretation, Object, Application and Amendment of Act 1. Definitions

 

 

"accounting officer"

and includes a person acting as the accounting officer;

 

"allocation"

in relation to a municipality, means—

 

"annual Division of Revenue Act"

means the Act of Parliament which must be enacted annually in terms of section 214(1) of the Constitution;

 

"annual report"

in relation to a municipality or municipal entity means an annual report contemplated in section 121 ;

 

"approved budget"

means an annual budget—

and includes such an annual budget as revised by an adjustments budget in terms of section 28;

 

"Auditor-General"

means the person appointed as Auditor-General in terms of section 193 of the Constitution, and includes a person—

 

"basic municipal service"

means a municipal service that is necessary to ensure an acceptable and reasonable quality of life and which, if not provided, would endanger public health or safety or the environment;

 

"board of directors"

in relation to a municipal entity, has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"Budget Forum"

has the meaning assigned in section 1 of the Intergovernmental Fiscal Relations Act, 1997 (Act No. 97 of 1997);

 

"budget-related policy"

means a policy of a municipality affecting or affected by the annual budget of the municipality, including—

 

"budget year"

means the financial year for which an annual budget is to be approved in terms of section 16(1);

 

"category"

in relation to municipalities, means a category A, B or C municipality referred to in section 155(1) of the Constitution;

 

"chief financial officer"

means a person designated in terms of section 80(2)(a);

 

"councillor"

means a member of a municipal council;

 

"creditor"

in relation to a municipality, means a person to whom money is owing by the municipality;

 

"current year"

means the financial year which has already commenced, but not yet ended;

 

"debt"

means—

 

"delegation"

in relation to a duty, includes an instruction or request to perform or to assist in performing the duty;

 

"district municipality"

means a municipality that has municipal executive and legislative authority in an area that includes more than one municipality, and which is described in section 155(1) of the Constitution as a category C municipality;

 

"financial recovery plan"

means a plan prepared in terms of section 141;

 

"financial statements"

in relation to municipality or municipal entity, means statements consisting of at least—

 

"financial year"

means a year ending on 30 June;

 

"financing agreement"

includes any loan agreement, lease, instalment purchase contract or hire purchase arrangement under which a municipality undertakes to repay a long-term debt over a period of time;

 

"fruitless and wasteful expenditure"

means expenditure that was made in vain and would have been avoided had reasonable care been exercised;

 

"Head"

in relation to the Municipal Finance Recovery Service, means a person—

 

"irregular expenditure"

in relation to a municipality or municipal entity, means—

but excludes expenditure by a municipality which falls within the definition of "unauthorised expenditure";

 

"investment"

in relation to funds of a municipality, means—

 

"lender"

in relation to a municipality, means a person who provides debt finance to a municipality;

 

"local community"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"local municipality"

means a municipality that shares municipal executive and legislative authority in its area with a district municipality within whose area it falls, and which is described in section 155(1) of the Constitution as a category B municipality;

 

"long-term debt"

means debt repayable over a period exceeding one year;

 

"mayor"

in relation to—

 

"MEC for finance"

means the member of the Executive Council of a province who is responsible for finance in that province;

 

"MEC for local government"

means the member of the Executive Council of a province who is responsible for local government in that province;

 

"Minister"

means the Cabinet member responsible for finance;

 

"month"

means one of the 12 months of a calendar year;

 

"multi-jurisdictional service utility"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"municipal council"

or "council" means the council of a municipality referred to in section 18 of the Municipal Structures Act;

 

"municipal debt instrument"

means any note, bond, debenture or other evidence of indebtedness issued by a municipality, including dematerialised or electronic evidence of indebtedness intended to be used in trade;

 

"municipal entity"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"Municipal Financial Recovery Service"

means the Municipal Financial Recovery Service established by section 157;

 

"municipality"

 

"municipal manager"

means a person appointed in terms of section 82(1)(a) or (b) of the Municipal Structures Act;

 

"municipal service"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"Municipal Structures Act"

means the Local Government: Municipal Structures Act, 1998 (Act No. 117 of 1998);

 

"Municipal Systems Act"

means the Local Government: Municipal Systems Act, 2000 (Act No. 32 of 2000);

 

"municipal tariff"

means a tariff for services which a municipality may set for the provision of a service to the local community, and includes a surcharge on such tariff;

 

"municipal tax"

means property rates or other taxes, levies or duties that a municipality may impose;

 

"National Treasury"

means the National Treasury established by section 5 of the Public Finance Management Act;

 

"official"

in relation to a municipality or municipal entity, means—

 

"organised local government"

means an organisation recognised in terms of section 2(1) of the Organised Local Government Act, 1997 (Act No. 52 of 1997), to represent local government nationally or provincially;

 

"overspending"

 

"parent municipality"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"past financial year"

means the financial year preceding the current year;

 

"political office-bearer"

in relation to a municipality, means—

 

"political structure"

in relation to a municipality, means—

 

"prescribe"

means prescribe by regulation in terms of section 168;

 

"primary bank account"

means a bank account referred to in section 8(1);

 

"private company"

means a company referred to in sections 19 and 20 of the Companies Act, 1973 (Act No. 61 of 1973);

 

"provincial department"

means a department listed in Schedule 2 of the Public Service Act, 1994 (Proclamation No. 103 of 1994), which falls within a provincial administration listed in Schedule 1 to that Act;

 

"provincial treasury"

means a treasury established in terms of section 17 of the Public Finance Management Act;

 

"Public Finance Management Act"

means the Public Finance Management Act, 1999 (Act No. 1 of 1999);

 

"quarter"

means any of the following periods in a financial year:

 

"senior manager"

 

"security"

means any mechanism intended to secure the interest of a lender or investor, and includes any of the mechanisms mentioned in section 48(2);

 

"service delivery agreement"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"service delivery and budget implementation plan"

means a detailed plan approved by the mayor of a municipality in terms of section 53(1)(c)(ii) for implementing the municipality‘s delivery of municipal services and its annual budget, and which must indicate—

and includes any revisions of such plan by the mayor in terms of section 54(1)(c);

 

"service utility"

has the meaning assigned to it in section 1 of the Municipal Systems Act;

 

"shared control"

in relation to a municipal entity, means the rights and powers a municipality has over a municipal entity which is—

 

"short-term debt"

means debt repayable over a period not exceeding one year;

 

"sole control"

in relation to a municipal entity, means the rights and powers a municipality has over a municipal entity which is—

 

"standards of generally recognised accounting practice"

means an accounting practice complying with standards applicable to municipalities or municipal entities and issued in terms of Chapter 11 of the Public Finance Management Act;

 

"this Act"

includes regulations made in terms of section 168 or 175;

 

"unauthorised expenditure"

in relation to a municipality, means any expenditure incurred by a municipality otherwise than in accordance with section 15 or 11(3), and includes—

 

"vote"

means—