Inter Ministerial Committee on Revitalising Distressed Mining Communities update; Compliance with Financial Disclosure Framework: PSC briefing

Meeting report

The Chairperson noted apologies from the Ministers of Public Service and Administration, the Minister for Performance Monitoring and Evaluation and the Director General of the Department of Performance Monitoring and Evaluation (DPME). She noted apologies from Members also.

Briefing by the DPME on the Inter Ministerial Committee on Revitalizing Distressed Mining Communities: Department of Performance Monitoring and Evaluation briefing
Mr Phumla Ndaba, Chief Director Economic Development, Department of Cooperative Governance, representing the Inter-Ministerial Committee, briefed the Committee on the October 2012 Social Accord referred to as the Special Presidential Package (SPP), which made a number of commitments in relation to revitalising of distressed mining communities. These had included:
- restoring confidence in labour market institutions
- addressing income inequalities and building social cohesion
- taking action to combat violence and lawlessness
- addressing socio-economic challenges.

A Framework Agreement was drawn for a sustainable mining industry. The stakeholders included Government, then Labour (in the form of the unions NUM, AMCU, UASA, and Solidarity, supported by their Federations COSATU,NACTU and FEDUSA), and Business, which was represented by the Chamber of Mines (CoM) and South African Mining Development Association(SAMDA).

An action plan was developed and consisted of the following five objectives:
- ensuring the rule of law, peace and stability
- strengthening labour relations
- improving living and working conditions of mineworkers
- providing short to medium term measures to support growth and stability
- identifying long-term measures to support growth and stability.

The Inter-Ministerial Committee (IMC) for the revitalisation of distressed mining communities was focusing on several issues. In its objective to foster integrated and sustainable human settlements, it was led by the Department of Human Settlements (DHS) and supported by its agencies such as the National Housing Finance Corporation, and the Housing Development Agency. The efforts to improve socio-economic conditions were led by Department of Cooperative Governance (DCoG), the Department of Traditional Affairs, the Department of Rural Development and Land Reform (DRDLR) and were also supported by the Departments of Trade and Industry (dti) and the Department of Economic Development (EDD). The efforts to improve the working conditions of mineworkers were led by the Department of Labour (DoL).

She noted that fourteen mining towns in five provinces for the revitalization of distressed mining communities were prioritised. For further details, please see attached presentation.

Discussion

The Chairperson acknowledged the presence of the Director Generals and Directors from the various departments involved in the IMC, at the meeting.

The Chairperson commented that she did not want to see South Africans reduced to being beneficiaries of food parcels; she herself had a serious problem with the strategic project of giving food parcels. She asked about the sustainability of such efforts and how often people got food parcels. She asked for a compilation of a master plan for each and every region, that would address issues related to safety, health and infrastructure. She asked to hear some broad highlights of projects such as modern satellites, clinics, police stations, and other integrated developments, apart from housing.

The IMC representatives responded that the food parcel intervention was an emergency response to the strike by platinum workers, as it was found, at that particular time, that large communities were unable to sustain themselves. This pre-intervention was deemed necessary in the particular circumstances.

The Chairperson asked for a statement on how the Department of Performance Monitoring and Evaluation (DPME) was intervening in areas with illegal mining activities. She wanted to hear more on the relationship with the Department of Home Affairs (DHA) on illegal labour immigrants, and some more detail on the upgrading of infrastructures. She asked if a survey had been done to know if there were enough houses for miners, as most of them were not permanent residents of the communities where they lived, but travelled there merely to access the economic opportunities. For this reason she wondered if those miners needed low cost houses or alternative type of houses; the Committee needed more detail also on the types of houses that it was intended to build, and what would be the contributions of the mining companies and banks. Noting that the qualifying criteria for getting a low-cost house was a salary of R3 500, she asked what would be done for those earning above that amount. She asked how many housing units had been delivered in different areas.

The IMC representatives noted that the departments were aware of the magnitude of the problem and knew how many workers qualified for the low cost houses, and how many workers who qualified for other types of houses or schemes that were provided. The DHS had about 33 programmes that it was administering, and a wide range of programmes existed overall. The majority of mine workers would qualify for community residential units, and also qualified for the rental housing programme. The Department planned to upgrade the provision of rental houses for migrant workers in mining towns. The responsibility to provide housing in mining areas was the responsibility of the mining companies themselves, hence the provision of living-out allowance from companies for people to be able to find accommodation themselves.

It was further stated that DHS catered for people who earned between R0 and R16 000.Those who earned between R0 and R3 500 qualified for free housing under the Reconstruction and Development programme. The majority of mine workers fell within the income bracket of R3v500 to R16 000, hence the DHS had to provide regular accommodation for them, in partnership with the mining companies. Those who earned more than R3 500 would qualify for other forms of housing which were a form of ownership. It was reiterated that the majority of mine workers would qualify for rental housing.

Ms R Lesoma (ANC) said she appreciated the presentation. She asked about the commencement of the building projects in communities. She asked how DCOG would assist in ensuring that municipalities prioritised infrastructure investments, informed by special planning, and how that Department could ensure that funds were used for the intended purpose. She asked for more details on the integrated approach that would be used to link mine workers who had two families, with the programmes of the Ministry of Women. She wondered if municipalities, perhaps with intervention from DCOG, had the power to enforce the compliance with by-laws of town planning schemes in mining and industrial areas.

The IMC responded that the approach that the DPME was taking was called "Back to Basics". Across all the municipalities in the country, five areas had been prioritised as the most fundamental and basic things that municipalities should get right, which were:  putting people first, community oriented service provision, good governance and transparency, financial management, and building capacity of the municipality. These five areas were inter-related in terms of infrastructure delivery. All municipalities must be assisted to develop comprehensive infrastructure plans. These municipalities must prioritise operations and maintenance with a specific 7% of the operational budget being directed to operations and maintenance of decaying infrastructure. There was a targeted focus on assisting municipalities that were spending less than 80% of their Municipal Infrastructure Grants. Skills development in municipalities was also being addressed, and these were the skills that basically focused on infrastructure areas. For example engineers had been deployed to assist these municipalities. In North-West province, the Department had set up a national task team that prioritised a number of municipalities, and this attended to administrative and political aspects.

Ms V Mente (EFF) commented that the presentation was an eye-opener to the activities in the mining industry, and how government could assist with the mining industry and the communities surrounding the mines. She commented that a lot of plans and progresses had been proposed, but was concerned about the lack of time frames attached to them, and thus asked that the DPME must give an indication of those time frames for completion of the plans.

Ms Mente agreed with the view expressed earlier and said that job creation was vital as people could not be living on food parcels only, as it reduced their dignity. She noted that mining communities were provided with financial literacy and training programmes and asked if these, for instance, included training on how miners could buy shares within the mine, for them to enhance their financial status and keep solvent. She commented that South African Police Services (SAPS) and the Department of Labour should be working in collaboration to keep crime in check, and enhance safety and security, She felt that sometimes the police gave too much focus to unrest and protests within the mine. The issue of poor salary often led to unrest, so she asked if government was looking at the minimum wage that would be satisfactory to the miners, pointing out that unrest would always occur until the miners were satisfied.

The IMC representatives responded that the financial literacy programme was a separate programme in respect of participants in employee ownership schemes.

Ms Mente asked if there was any mechanism put in place to address the issue of harassment of female miners underground, and stressed that there should be special safety and security procedures that accommodated such female miners.

The response noted that a directive was issued to all operating mines to improve security checks and measures to protect women working at mines, especially those working underground. Research was conducted aimed at improving health and safety, so that women working at mines could be better protected.

Ms Mente commented on the prioritisation of provinces and asked what informed it. Noting that Western Cape had mines surrounded by informal settlements who lived with sand pollution from the mines, she asked if government was aware of the sand mines, and asked if the people mining the sand subscribed to the same legislation as other mines, and what they were doing for the communities in the areas where sand was mined.

It was said, in response, that the Departments were aware of the sand mines in existence in the country. All mines were regulated by one piece of legislation: the Minerals and Petroleum Resources Development Act (MPRDA) and the majority of sand mining operations were operating using mining permits. The legal requirements and obligations on the holder of the mining permits were different from the holders of the mining rights because of the size of the operation and the mining rights and the kind of environmental management requirements which were different from a large scale mining operation. The government focus in this particular project was on rehabilitation, rather than on new mining.

Ms Mente wanted more detail on the compensation of miners from the former Aurora mines, and how their issues had been addressed. She wanted more detail on the programme for informal settlement upgrading and human settlement project implementation, and asked to be provided with the list of settlements, time frames and what type of services would be provided for those informal settlements upgrades.

The IMC representatives responded that the list of projects that were currently running and their status could be provided, such as basic services, basic sanitation and upgrading of the level of services, for instance one household using one sanitation point.

Ms Mente asked if the tripartite Technical Task Team for migrant labour had involved all the unions, in order to avoid unrest.

The IMC responded that the tripartite structure included AMCU, Chamber of miners, NUM and the federations. The study of migrant labour led to a policy recommendation which informed the practical conditions, preparing for a workshop with stakeholders. There had been a 40% increase in employment growth in the mining industry, and this was compared to the 24% population growth and the fact that 33 000 new people moved into the mining municipalities, most of whom were young and educated.

Ms Mente asked which people could be invited to the indaba mining summit.

The IMC responded that the invitations to the indaba mining summit had been extended to MPs, the mining industry stakeholders and Portfolio Committee on Mineral Resources. That summit would address the length of strikes and what created the ability to resolve strikes quickly, would look at how to reduce the level of violence and discuss the minimum wage. National Treasury had introduced tight regulations to protect workers' income, which were being enforced.

Mr S Motau (DA) commented that the study document on the migrant labour system would be useful when it was completed. He commented that a focus should be placed on the unintended consequences of the good intentions behind the housing allowances being provided in informal settlements by the mining houses, which was to provide for alternative living accommodation, but instead led to the mushrooming of informal settlements around the mining towns, but he asked what was being done to ensure that it did not become a mining target. Over two million housing units would be provided. He asked if anything was currently being done to make sure that a census was taken of people in those areas, that they were identified, and what would be done to check that no more people moved into those areas.
Mr Motau asked if the issue of micro-lenders in these communities was being addressed, and asked for the allocation criteria for the housing units, which was most necessary in order to prevent elements of corruption.

Mr J McGluwa (DA) also commented on the mushrooming of informal settlements around mining operations and asked about the role of government in terms of budget for human settlements and the implementation. The Department of Human Settlements had received a substantial increase to render such assistance, but he asked whether the budget addressed the distressed mining communities and who would be held responsible for the spending of that budget, between the DHS itself and the Housing Development Agency.

The response from the IMC representatives stressed that the living–out allowance led to the mushrooming of informal settlements, and hence it was decided that the responsibility as government was to provide services such as informal settlement upgrading programmes, with the provision of basic services before top structures were delivered. The housing allocation process was easy to administer in informal settlements because it was an area based development. A waiting list would be compiled, based on the verification and pre-screening of the beneficiaries, there would be geotechnical evaluations, the professional teams and visitors in the areas would be evaluated, dwellings would be counted and other necessary steps taken.

Mr J McGluwa (DA) asked if IMC was happy with the interventions, in terms of compliance with the rule of law, in respect of unlawful mining. He asked why five provinces were identified, as there were more distressed communities in the Northern Cape. He commented on the high level of indebtedness of the miners and the role of the mining companies in counseling the employees on financial management to avoid indebtedness, which had negative impact on the lives of the miners. He commended the actions so far taken for the miners, in short term and long term measures, to support growth and stability.

Mr McGluwa noted that the President had, on 7 October, in KwaZulu Natal, announced a new Special Economic Zone (SEZ) which had the potential to attract investments. He added that in the future, South Africa had to stay on track with the global world, learning from others' experience.

The representatives from the dti responded that some towns had declined while some areas still had opportunities, which could be built on differently, to ensure there were proper economic opportunities. The IMC was not applying the strategy of revitalisation to every area in exactly the same way. In some areas, the challenges were greater because some of the mining industries were shedding jobs and closing down mines, which also resulted in the communities there equally closing down. The approach was rather to try to properly assess the situation going forward, by looking at alternative economic means by which the community could earn income. These might include training programmes, or service providers would have a three year mentorship programme. Various tools of government were also used to empower small, medium and micro enterprises, through the dti and other departments, and there were, in addition, other tools that supported the infrastructure in those areas, making sure those communities were empowered and informed.

Mr M Cardo (DA) required clarification on the R2.1 billion made available for the medium term housing project implementation and the R2.19 million for the upgrading of housing settlements from the Department of Human Settlements. He expressed concern over the high level of indebtedness amongst miners and the impact of social violence amongst the mining communities. He called for elaboration on the garnishee orders, and the extent of reckless lending in these areas.

Mr Cardo asked about the inspections of dti, and the number of illegal miners closed down. He asked for more detail of the plans in place for government to inform its spending on mining royalties, in order to improve the lives of mining communities. One of the three cornerstones of the strategy was to combat violence with a focus on law enforcement agencies such as SAPS and Department of Justice. He asked for the plans in place to address the social drivers of violence, such as substance abuse. He asked for the recommendations regarding improving family cohesion on migrant legal system. He commented on occupational health issues, such as TB which was a national emergency, and asked if studies had been done in the 14 targeted mining towns and what were the details in each instance.

The IMC representatives noted that the budget was placed with the Department of Human Settlements and administered by the Provinces. It would be the DHS that would account for the budget to the Portfolio Committee.

Mr A Van der Weshuizen (DA) commented on the regulations for offering housing provisions, and asked to what extent these regulations could be applied to distressed communities, and to what extent could the occupiers be assisted to become owners of properties.

Mr M Dirk (ANC) commented that the Special Presidential Project to revitalise the distressed mining communities by way of confirmatory processes should become the plan of the community.  Engagement was very important, not only with the unions, but there was also a need to engage the community leaders and councillors. This should be made a community centered plan known by and to the people in those informal settlements. He also suggested that the participating departments must meet each other on black economic empowerment opportunities, and on the issue of ownership of mines, as there were many downstream opportunities within the mines that should be investigated in the longer term, while food parcels interventions were provided short-term.

Mr Dirk commented on the previous remarks about the mushrooming of informal settlements, and said that it basically amounted to land invasion; and he asked for the plans in place to prevent land invasion, which he did not believe could be tolerated by government.

The Chairperson commented on the need to reposition the people and make them participate in the economic downstream opportunities, while agreeing that perhaps food parcels could be provided as a temporary intervention.

Ms Lesoma commented on the local economic development (LED) plan in relation to the rural areas and mining areas. She noted that an integrated approach was needed, that took account of SMMEs, sought cooperation between relevant departments, and addressed social ills. She asked how far, at the moment, energy was being put into civil education in educating the people instead of creating boundaries between the government and business, and the communities, and said that there needed to be reliance on the stakeholders making sure that the people driven programme had better understanding. She asked for the role of DCOG in community education, particularly for addressing social ills. She added that the target set up by the collective departments should be a reflection of the performance agreements with top management, so that everybody was held accountable.

The IMC representatives responded that the IMC took responsibility for coordinating the implementation of outcomes, in order to improve the socio-economic conditions of the mining areas. Coordination was done between the dti, EDD, DRDLR and other economic sector departments. LED plans were regarded as municipal plans rather than overarching government plans, but they would assist in improving on socio-economic impacts.

The representatives agreed that there was need to assist the cooperatives to be more competitive. Ideally, the IMC wanted departments to offer an integrated development service towards the SMMEs and cooperatives. This would cover issues such as market access, competitiveness and after-care, empowering them to render a complete service. Nobody should attempt to force SMMEs to accept products that were of low quality, hence the need to ensure that these cooperatives were empowered.

The Chairperson commented that any outstanding responses should be submitted in writing.

Monitoring compliance with the financial disclosure framework: Public Service Commission briefing
Before the briefing was given, the Chairperson read out the letter from the President addressed to the Speaker of Parliament, on the designation of Mr RZ Sizani as the Deputy Chairperson of the Public Service Commission (PSC) and congratulated him on his appointment.

She noted that the nominations for Chairperson of the PSC would close on 7 November. Short-listing would start immediately, and the interviews would be held between 21 and 26 November. 52 applications had been received so far.

Mr RK Sizani, Deputy Chairperson, PSC, thanked the Chairperson for pursuing the vacancy for the PSC Chairperson, and introduced the team from the PSC.

Ms Sellinah Nkosi, Commissioner, PSC, briefed the Committee on the fact sheet on monitoring compliance with the financial disclosure framework, for 2012/13. She noted that Chapter 10 of the Constitution provided that a high standard of professional ethics must be promoted and maintained in the Public Service. All members of the Senior Management Service (SMS) were, in terms of the Public Service Regulations (PSR), required to disclose to their respective Executive Authorities (EAs) particulars of all their registrable interests, by not later than 30 April each year, covering the period from 1 April of the previous year to 31 March of the current year. PSR further required that the EAs must submit copies of the forms on which the designated employees disclosed their financial interests to the PSC, by not later than 31 May each year. EAs were required to submit such forms to the PSC, within a period of 30 days after they had been submitted.

Upon compilation of the fact sheet, the PSC would then bring the state compliance with the financial disclosure framework (FDF) to the attention of the EAs.

Ms Nkosi noted the efforts that were being made to ensure compliance with the FDF requirements and to get the required information. These included:

·         Letters were sent to the EAs to remind them of their responsibility to ensure that the forms were submitted on time.

·         The short messaging system (SMS) was used to remind Directors General and Heads of Department (HODs) to assist EAs in ensuring that the forms were submitted on time.

·         An advertisement was posted in the printed media in order to attract the attention of a wider spectrum of relevant stakeholders, including SMS members.

The 2012/13 reporting period showed a significant improvement in the submission of financial disclosure forms. However, some departments, both at national and provincial level, did not submit a single financial disclosure form to the PSC by the due date of 31 May 2013.

PSC had the following recommendations to make to counter the problem:
- EAs must take appropriate disciplinary action against all SMS members who, without valid reason, failed to submit their financial disclosure forms on time
- Departments must devise some means to enable SMS members who were on leave or suspension to complete and submit their financial disclosure forms
- The ethical infrastructure in the offices of the EAs should assist the EAs with the management of the FDF
- Departments must indicate the names of the SMS members who could not submit their financial disclosure forms

It was hoped that the Portfolio Committee could assist in ensuring that recommendations made by the PSC were implemented.

Discussion

The Chairperson noted the recommendations made to the Committee by PSC, and asked if executive authorities had the capacity and support to help them insist on senior management declaring their business interests. She asked if PSC often came across people who carried out business with government, and commented that ethical issues must be enforced in this regard, and booklets developed on ethics. She expressed displeasure about national departments that failed to comply, in particular, and said a decision must be taken on how to make them comply.

Mr M Booi(ANC) commented that the if the Department and Commission did not get support for the work they were doing, then the issue of managers' non-compliance was a problem that had to be addressed. He asked what the Committee could do to assist PSC.

Ms Lesoma commented on the performance decline between 2013 and 2014.She asked for the recommendations that had already been implemented or that were in place, and what exactly was being done to ensure compliance and consistency. There was a need to look at the possibility of entering into more specific performance agreements with the senior management and to specify when they were expected to bring their quarterly reports. She asked for the reason why the authorities in KwaZulu Natal did not comply. She also asked for more elaboration on e-disclosure and hard-copy disclosure.

The representatives of the PSC responded that there had in fact been a huge improvement in the Provincial departments, when the 2012/13 statistics and 2013/14 statistics were compared. Commissioners in the Provinces had regular discussion with the EAs, and they were going the extra miles to ensure compliance.

Mr Dovhani Mamphiswane, Deputy Director General, PSC, replied that the state of preparedness for e-disclosures in the departments was high. This year, both e-disclosure and manual disclosure were applied. Some departments did not have the infrastructure, and in some, officials were not aware that they could supply e-disclosure. Most forms were submitted through e-disclosure. If the update was high now, then it would be higher still with e-disclosure usage, which would contribute towards compliance. Speaking to the issue in KwaZulu Natal, he noted that there had been a transition period in the premiership, and this contributed to the non compliance amongst leadership, accounting officers and EAs. He suggested that the Portfolio Committee should engage the EAs and ask for the actions taken against EAs who did not comply.

The Chairperson commented on the national department that failed to submit forms on due date, and she asked if it had submitted now. She asked what the Portfolio Committee should do to assist about the lack of support from Parliament, which was alluded to by the PSC. She also asked why senior managers did not declare their business interests.

Ms Nkosi replied that the Director Generals who did not declare for two consecutive years were listed in the presentation document. She made the point that what was presented was just a fact sheet on compliance only, and after receiving the forms, compliance would be considered, then forms would be scrutinised for potential interest or conflict of interest. The overview of the financial disclosure would indicate individuals who had potential interests.

Another official added that a once off notice only should not be given to the departments, but financial disclosure forms should be submitted. Numerous measures had been implemented to counter non-compliance. After the initial notice, reminders were sent to all executive authorities to ensure they complied with the due date. Advertisements were also placed in newspapers to ensure compliance.

Mr Dirk commented that non-complying officials should be summoned by the Committee, and disciplined.

Mr Booi commented that he hoped that the information provided by PSC was accurate.

Ms Lesoma commented on the role of the Committee in assisting the PSC. Some commissioners were from Provinces. She asked for the implications of suspension on a person.

The Chairperson commented that the PSC investigated those who were doing business with government. She suggested that perhaps the turnaround time for payment should be checked and perhaps also the lifestyle of government workers. People who had not declared for the last two to three years should be summoned by the Committee.

The meeting was adjourned.The Chairperson noted the recommendations made to the Committee by PSC, and asked if executive authorities had the capacity and support to help them insist on senior management declaring their business interests. She asked if PSC often came across people who carried out business with government, and commented that ethical issues must be enforced in this regard, and booklets developed on ethics. She expressed displeasure about national departments that failed to comply, in particular, and said a decision must be taken on how to make them comply.

Mr M Booi(ANC) commented that the if the Department and Commission did not get support for the work they were doing, then the issue of managers' non-compliance was a problem that had to be addressed. He asked what the Committee could do to assist PSC.

Ms Lesoma commented on the performance decline between 2013 and 2014.She asked for the recommendations that had already been implemented or that were in place, and what exactly was being done to ensure compliance and consistency. There was a need to look at the possibility of entering into more specific performance agreements withthe senior management and to specify when they were expected to bring their quarterly reports. She asked for the reason why the authorities in KwaZulu Natal did not comply. She also asked for more elaboration on e-disclosure and hard-copy disclosure.

The representatives of the PSC responded that there had in fact been a huge improvement in the 0Provincial departments, when the 2012/13 statistics and 2013/14 statistics were compared. Commissioners in the Provinces had regular discussion with the EAs, and they were going the extra miles to ensure compliance.

Mr Dovhani Mamphiswane, Deputy Director General, PSC, replied that the state of preparedness for e-disclosures in the departments was high. This year, both e-disclosure and manual disclosure were applied. Some departments did not have the infrastructure, and in some, officials were not aware that they could supply e-disclosure. Most forms were submitted through e-disclosure. If the update was high now, then it would be higher still with e-disclosure usage, which would contribute towards compliance. Speaking to the issue in KwaZulu Natal, he noted that there had been a transition period in the premiership, and this contributed to the non compliance amongst leadership, accounting officers and EAs. He suggested that the Portfolio Committee should engage the EAs and ask for the actions taken against EAs who did not comply.

The Chairperson commented on the national department that failed to submit forms on due date, and she asked if it had submitted now. She asked what the Portfolio Committee should do to assist about the lack of support from Parliament, which was alluded to by the PSC. She also asked why senior managers did not declare their business interests.

Ms Nkosi replied that the Director Generals who did not declare for two consecutive years were listed in the presentation document. She made the point that what was presented was just a fact sheet on compliance only, and after receiving the forms, compliance would be considered, then forms would be scrutinised for potential interest or conflict of interest. The overview of the financial disclosure would indicate individuals who had potential interests.

Another official added that a once off notice only should not be given to the departments, but financial disclosure forms should be submitted. Numerous measures had been implemented to counter non-compliance. After the initial notice, reminders were sent to all executive authorities to ensure they complied with the due date. Advertisements were also placed in newspapers to ensure compliance.

Mr Dirk commented that non-complying officials should be summoned by the Committee, and disciplined.

Mr Booi commented that he hoped that the information provided by PSC was accurate.

Ms Lesoma commented on the role of the Committee in assisting the PSC. Some commissioners were from Provinces. She asked for the implications of suspension on a person.

The Chairperson commented that the PSC investigated those who were doing business with government. She suggested that perhaps the turnaround time for payment should be checked and perhaps also the lifestyle of government workers. People who had not declared for the last two to three years should be summoned by the Committee.

The meeting was adjourned.