Governing community schemes have become increasingly challenging for trustees who are under pressure to comply with complex legislation, overcome challenges of non-payment, and deal with a growing number of disputes over issues such as alternative energy and water backup systems, according to Thembelihle Mbatha, the Acting Chief Ombud and Chief Financial Officer of the Community Schemes Ombud Service (CSOS).
She says that many common challenges in community schemes can be attributed to poor governance. Good governance starts with registering with CSOS; with less than half the estimated 70 000 plus community schemes in South Africa on their register, CSOS is stepping up efforts to enforce registration, with the support of the NPA.
Good governance also minimises disputes, she says. “Many of the disputes escalated to CSOS relate to poor financial management – for example, homeowners don’t know how levies are calculated, there’s no transparency, and their property values are impacted.” However, she notes that this is not necessarily due to deliberate mismanagement, but rather because many schemes lack the necessary audit and financial management skills among their trustees.
Another common issue arising in recent months is schemes changing their architectural rules around solar panels, generators, and water tanks. “The changes can lead to disputes, which could have been avoided if they followed the proper process. Because of load shedding, trustees are now also expected to make these big financial investments such as generators and inverters for the complex. They are faced with hefty financial decisions on behalf of owners.”
Mbatha says many trustees are unaware that support is available. “We need to ramp up education and training – hence the start of our Indabas. CSOS is not just for dispute resolution – we are also a promoter of good governance. As part of our mandate, we do quality assurance on the scheme governance rules. One of our pillars is education and training – and we can even go to a scheme to deliver training as part of our mandate.”
To further support trustees, CSOS worked with FICA to develop a template for good governance, complete with FAQs.
CSOS is also expanding its footprint countrywide to make in-person support more accessible.
At its upcoming Indaba, free to attend, CSOS case management officers will setup a help desk where homeowners and stakeholders can discuss burning issues and register cases, if necessary.
The CSOS Indaba aims to help trustees and managing agents strengthen community scheme governance, administration, and management, outlining common challenges and solutions, and best practice.