State Property Agency: briefing

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Meeting report

PORTFOLIO COMMITTEE ON PUBLIC WORKS

PUBLIC WORKS PORTFOLIO COMMITTEE
14 November 2001
STATE PROPERTY AGENCY: BRIEFING

Chairperson:
Mr M W Hlengwa

Documents handed out:
Towards Operational Efficiency

SUMMARY
Department of Public Works presented on the State Property Management Company. It is envisaged that this would be fully established as a state owned company and operated on a commercial basis.

MINUTES
The Director General of the Department of Public Works Mr Tami Sokutu made a presentation on the Department and the State Property Management Company (SPMC).

Please refer to attached document.

Discussion
Mr E Sigwela (ANC) said he had seen Dr Mogoba on television launching Letsima which was also the proposed name for the State Property Management company. What is the relationship between the two?

Mr S Opperman (DP) enquired if this was the first advertisement for closing down the Department of Public Works.

Mr N Middleton (IFP) needed clarity as to whom the proposals are directed to, the Portfolio Committee or the Ministry?

Mr T Sokutu said there were four different organisations using the name Letsima. The
Department was being restructured in order to operate on a commercial basis. The Property Management Company will report to the Ministry. The National Department of Public Works would still be responsible for policy formulation and regulation. The intention of government to privatise was to promote profit and efficiency.

Mr Sigwela said he anticipated that the State Property Agency would be responsible for selling redundant State Property but in the presentation there was more emphasis on maintenance and leasing.

Mr B Radebe (ANC) said the State Property Agency is coming at the right time. It would be appreciated as it will be hundred percent state owned. He asked if it would be listed in the JSE.

The Chairperson asked if the agency would be a Juristic person.

Mr Sokutu said indeed the State Property Agency would deal with the disposal of State property but that had to be approved by the Minister. Listing was not part of the agenda. They were creating a Juristic person and an Act would be coming up soon.

Mr Moonsamy (ANC) said the approach of the Department was informative. There were huge problems within the country and referred to the statement made by the President which was critical of government on how interaction took place with the general population. It was hoped that the Department would not rush the bill in Parliament.

Mr M Chikane (ANC) said he understood that this was an attempt to eliminate delays however he wondered if this was the only alternative. Government should not be run by private individuals.

Mr Sokutu said he understood the time issue but they needed to workshop the bill.
Clients would not have to pay exorbitant charges which were not market related. The majority of people on the board of directors would be from government. The composition would be guided by the board which would be appointed by Cabinet. He said that trade unions have raised the issue and they are not trying to privatise.

Mr Radebe said the company needs to address the population.

Mr Sokutu said that around 1999 Government Departments were up in arms because they said Public Works did not deliver. They have been arguing against this perspective and wanted to run to the private sector which would have led to the closing down of the Department of Public Works. This would also have lead to corruption. They should be granted this monopoly period. However, the problem they were encountering a capacity problem in dealing with property management.

The Chairperson asked if Departments were going to be clustered.

The DG said that they were looking at the segmentation of functions .

Mr Hlengwa said they were going to ask a researcher to look at other options.

The meeting was adjourned.

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