| (a) | regulate the provision of the service, in accordance with section 41; |
| (b) | monitor and assess the implementation of the agreement, including the performance of the service provider in accordance with section 41; |
| (c) | perform its functions and exercise its powers in terms of Chapters 5 and 6 if the municipal service in question falls within a development priority or objective in terms of the municipality's integrated development plan; |
| (d) | within a tariff policy determined by the municipal council in terms of section 74, control the setting and adjustment of tariffs by the service provider for the municipal service in question; and |
| (e) | generally exercise its service authority so as to ensure uninterrupted delivery of the service in the best interest of the local community. |
| (2) | A municipality, through a service delivery agreement— |
| (a) | may assign to a service provider responsibility for— |
| (i) | developing and implementing detailed service delivery plans within the framework of the municipality's integrated development plan; |
| (ii) | the operational planning, management and provision of the municipal service |
| (iii) | undertaking social and economic development that is directly related to the provision of the service; |
| (iv) | customer management; |
| (v) | managing its own accounting, financial management, budgeting, investment and borrowing activities within a framework of transparency, accountability, reporting and financial control determined by the municipality, subject to the Municipal Finance Management Act; |
[Section 81(2)(v) substituted by section 13(a) of Act No. 44 of 2003]
| (vi) | the collection of service fees for its own account from users of services in accordance with the municipal council's tariff policy in accordance with the credit control measures established in terms of Chapter 9; |
| (b) | may pass on to the service provider, through a transparent system that must be subject to performance monitoring and audit, funds for the subsidisation of services to the poor; |
| (bA) | must ensure that the agreement provides for a dispute- resolution mechanism to settle disputes between the municipality and the service provider; |
[Section 81(2)(bA) inserted by section 13(b) of Act No. 44 of 2003]
| (c) | may in accordance with applicable labour legislation, transfer or second any of its staff members to the service provider, with the concurrence of the staff member concerned; |
| (d) | must ensure continuity of the service if the service provider is placed under judicial management, becomes insolvent, is liquidated or is for any reason unable to continue performing its functions in terms of the service delivery agreement; and |
| (e) | must, where applicable, take over the municipal service, including all assets, when the service delivery agreement expires or is terminated. |
| (3) | The municipal council has the right to set, review or adjust the tariffs within its tariff policy. The service delivery agreement may provide for the adjustment of tariffs by the service provider within the limitations set by the municipal council. |
| (4) | A service delivery agreement may be amended by agreement between the parties, except where an agreement has been concluded following a competitive bidding process, in which case an amendment can only be made after the local community has been given— |
| (a) | reasonable notice of the intention to amend the agreement and the reasons for the proposed amendment; and |
| (b) | sufficient opportunity to make representations to the municipality. |
| (5) | No councillor or staff member of a municipality may share in any profits or improperly receive any benefits from a service provider providing a municipal service in terms of a service delivery agreement. |
