Space Affairs Act: Proposed Amendments: SA Council for Space Affairs briefing; Budget Report deliberations

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Trade and Industry

12 May 2015
Chairperson: Ms J Fubbs (ANC)
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Meeting Summary

The South African Council for Space Affairs (SACSA) gave a briefing on the review of the Space Affairs Act, which currently governed space affairs in South Africa. The Act was passed in 1993 and amended in 1995. There had been significant developments since then in the national space arena, including changes to institutional mandates and responsibilities, embodied in the SA National Space Agency Act of 2008, the  National Space Policy (2008), National Space Science and Technology Strategy (2007), and the ratification of the Liability and Registration conventions by South Africa in 2011 and 2012. There were many more and increasingly diverse space actors and a concomitant increase in their levels of activity. South Africa was also a party to various treaties, entered into since 1967, and it had obligations under some of these to bring national legislation in line with international obligations.

The Department of Trade and Industry (dti) had commissioned a study in 2012, to review the current legislation, scope international best practices for the regulation of space activities, benchmark South Africa's legislation and implementation against other countries and determine whether the current provisions were adequate and in line with recent developments. Consultations with relevant stakeholders took place in 203 and 2014. An ad hoc committee was established, later to be replaced by a working group comprising representatives from the dti, Department of Science and Technology, Telecommunications, International Relations and Cooperation, Defence, Justice and Constitutional Development, and the South African National Space Agency and the Aerospace Maritime and Defence Industries Association.

The review made recommendations to the effect that space activities should encompass the launch, operation, guidance and re-entry of space objects into, in and from outer space. Separation between implementation and supervision of space activities was a current strength that should be maintained. A revised framework should reflect that, and new legislation should be aimed at supporting the development of a local space industry, that was high-tech and capital intensive, effective, responsive, with good licensing procedures. The legislation should also streamline and strengthen the interface with other relevant government departments, agencies and legislation. Some of the current provisions of the Act to which particular attention must be paid were then set out. These included the definitions, scope of the Act, licensing activities to be amplified, and a failure to obtain prior authorisation would be made an offence. The SACSA would be entitled to impose conditions, with considerations that it must take into account being set out. Licensees would be required to submit information on launches, commissioning plans, routine operations, orbital changes and loss and disposal plans. Any activities must also comply with the international obligations. Some issues - such as safety standards - would be dealt with in regulations. Accident procedures would be set out and provision made for Boards of Inquiry. Duties and liabilities of licensed parties would be set out in more detail. Provision would also be made for registration of space objects, with the Registry to be maintained by the SACSA and open to the public for inspection. It would also deal with transfer of ownership of objects in orbit.

Members commented that this would be a very technical Bill and looked forward to receiving full support from technical advisors, and commented that public education would be needed. They questioned why SACSA and this Bill would fall under the Department of Trade and Industry rather than under Department of Science and Technology and asked the difference between SACSA and the SANSA. They were interested in how military applications might be affected, and asked about transformational issues, costs involved in strengthening the Secretariat, whether other major players were not party to the treaties, a comparison of spending on space activities by other countries in Africa, how SACSA would ensure watertight clauses on penalties, and whether the new Bill would be based on international best practice, and targeted at relevant individuals and companies dealing in space products. They were pleased to see the multi-disciplinary approach.

Members considered, briefly, the draft Report on the budget vote, which would be further amended and voted upon on the following day. Matters not included in this Report could be addressed in the Budgetary Review and Recommendations Report. The Minister would be addressing the Committee on 19 May.

 

Meeting report

Space Affairs Act review: South African Council for Space Affairs (SACSA) briefing
Dr Peter Martinez, Chairperson, South African Council for Space Affairs, said that the purpose of this meeting was to provide the Committee with an update on the process of reviewing the legislation in the space arena, identifying the review process, any shortcomings identified, consideration of matters in the present or revised legislation, and other issues.

Dr Martinez said that the South African Council for Space Affairs (SACSA or the Council) saw space as a cooperative governance issue. In terms of current legislation, space affairs in South Africa were currently governed by the Space Affairs Act No. 84 of 1993, amended in 1995. The main objectives of the Act had been to establish the National Space Policy, establish the SACSA to regulate space affairs, advise the Minister of Trade and Industry on international obligations and related matters; to authorise and supervise space activities carried out within South Africa and set up and maintain a register, as well as ensure safety in space activities.

The Department of Trade and Industry (dti) had embarked on a review of the current legislative and regulatory prescripts governing space activities in South Africa. There had been many developments in the space arena since the Act came into force, as well as changes to institutional mandates and responsibilities. Examples included the SA National Space Agency (SANSA) Act (2008), National Space Policy of 2008, National Space Science and Technology Strategy (2007), and the ratification of the Liability and Registration conventions by South Africa in 2011 and 2012, respectively. There were many more space actors and an increase in the level of activities - including commercial and academic entities, both domestic and international. New developments in international space governance needed to be taken into account, in addition to the national obligations under the UN Treaties. He gave examples of the new guiding principles and guidelines on contents of national legislation, guidelines for space debris mitigation, guidelines for safe uses of nuclear power sources in outer space, guidelines for the long-term sustainability of outer space activities, and the need to put in place practical steps to promote industry participation in space activities. South Africa was now required to align its regulatory framework to the UN treaties on outer space that it had signed.

Dr Martinez said that South Africa is party to the following treaties
- The Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies (the "Outer Space Treaty"), entered into force on 10 October 1967
- The Agreement on the Rescue of Astronauts, the Return of Astronauts and the Return of Objects Launched into Outer Space (the "Rescue Agreement"), entered into force on 3 December 1968
- The Convention on International Liability for Damage Caused by Space Objects (the "Liability Convention"), entered into force on 1 September 1972
- The Convention on Registration of Objects Launched into Outer Space (the "Registration Convention"), entered into force on 15 September 1976

He added that there are also eleven United Nations Principles on various aspects of space activities which are not legally binding, but are  persuasive when considering international space law norms and regulations. South Africa is a member of the United Nations Committee on the Peaceful Uses of Outer Space (UN COPUOS), a subsidiary body of the General Assembly of the United Nations. This Committee is the focal point for international co-operation in civilian space activities and has a membership of 77 countries, which included developing countries.

The process of considering the current legislation involved analyses of the suitability of the current legislative framework. In 2012, a study was commissioned to advise the dti, which was asked to scope the international best practices for the regulation of space activities and implementation of the current legislation and benchmark the current South African scenario with other countries. That would be used to determine whether the enabling provisions are adequate to ensure the objectives of the Act could be met and were in line with the recent space developments in the country. In addition, the study would provide recommendations relating to possible amendments to strengthen the provisions of the Act and to add provisions where gaps had been identified, so that the dti could take action on them.

SACSA established an Ad Hoc Committee for the Review of the Act. Members of the Ad Hoc Committee for the Review are: Ms N Majaja (the dti), Adv PP Sekhula (Adv of the High Court), Mr L Petzer (DTPS), Adv L Makapela (CSIR), Dr V Munsami (DST), and Mr I Tshweza (SANSA).

Consultations with relevant stakeholders took place in 2013/14. Members were nominated from various Departments / state agencies and an industry association, to form part of the Departmental Working Group for the Review of the Act: Department of Science and Technology (DST); Department of International Relations and Cooperation (DIRCO); Department of Defence (DoD); Department of Justice and Constitutional Development (DoJ & CD); South African National Space Agency(SANSA); Department of Telecommunications and Postal Services (DTPS); and Aerospace Maritime & Defence Industries Association (AMD).

The first meeting of the Working Group took place on 28 April 2015, which effectively decided to dissolve the previous ad hoc committee and so that the Working Group would continue to guide the process. The drafting team included two legal practitioners, who are members of the Space Council, and a designated official from the dti.

Dr Martinez summarised the findings of the review process. It had, amongst others, observed that:
- South Africa’s current space programme has outgrown the legislative framework foreseen in the SASAA
- The current regulatory framework does not adequately address national developments and needs
- The current legislation does not cover the regulation of space applications such as Earth observation, communications or navigation or the use of satellite derived information
- Regulations are needed to clarify certain aspects of implementation of the Act.

The recommendations were, in summary, that:
- Space activities should encompass the launch, operation, guidance and re-entry of space objects into, in and from outer space
- Separation between implementation and supervision of space activities is a current strength that should be maintained
- A revised framework should reflect domestic space priorities and policy objectives; commercialisation and industrialisation; linkages with other relevant legislation, (e.g. Electronic Communications Act, Non-Proliferation Act)
- The SACSA Secretariat should be strengthened to enable it to meet the increased demands for regulation and oversight of space activities
- The review process should clarify issues that need to be addressed in the Act, and those that need to be addressed through regulations issued under the Act.

Dr Martinez then moved on to detail some of the current provisions of the Act where shortcomings had already been identified. Firstly, definitions would have to be given attention, with definitions either needed to be reconsidered for Dual-purpose technologies; Launching; License; Outer space; Space activities; Spacecraft; Space industry; Space-related technologies; Suborbital trajectory and Weapons of mass destruction.

There is no actual provision on the scope and application of the Act and this will need to be included. The general scope has to be deduced from Section 11 of the current Act which deals with licensing, which includes the launch of objects into outer space and operation and control of space objects in orbit. However, other points to be considered also include the design and manufacture of space objects, operation of a launch facility and re-entry sites and re-entry of space objects.

Section 4 of the current Act had established the South African Council for Space Affairs (SACSA) as the national competent authority for the authorisation and supervision of space activities. Sections 11-15 provide for licensing processes. All space activities can only be performed under the authority of a space license issued by the Council. Conducting of any space activities without obtaining prior authorisation in accordance with the new Act will constitute an offence punishable by law. An authorisation to conduct space activities will be issued subject to such conditions as the Council may determine for that particular authorisation, taking into account (a) the objects of the Act; (b) the national interests of the Republic; (c) the international obligations and responsibilities of the Republic.

Issues for consideration will include the possible differentiation of licensing requirements, according to the nature of the application and/or applicants who may be Government, industry, and academic/research entities. Types of licences envisaged might include (a) Space Launch License, (b) Space Facility License, and Re-entry Permit.

Dr Martinez continued that section 10 of the current Act provided for appointment, duties and powers of Inspectors, in relation to continuing activities. The new legislation is intended to require licensees to submit information concerning: the launch and placement in orbit of the licensed space object; the on-orbit commissioning plan and progress towards achieving this plan; date of commencement of routine operations; any orbital changes; information regarding changes in the operational status of the space object or any loss of operational control; the end-of-life disposal plan. The licensee must ensure that the licence is carried out in compliance with international obligations and responsibilities arising out of international conventions, treaties and international agreements signed by South Africa. The licensee should notify the Council of: any deviation, accidental or planned, from the conditions of a license; any information which may affect the conditions of the license; any changes in the ownership of the licensee, including changes in the composition and citizenship of the body corporate. Dr Martinez said that these measures are intended to strengthen the continued supervision of licensees (as required by international obligations) to ensure that any licence is used in accordance with the stipulated conditions.
Dr Martinez said that in terms of Safety and Environmental Considerations, the current sections 11 and 15 refer to safety standards, but are not sufficiently detailed for effective clarity. These were left to be included in Regulations. These also provide for conditions arising out of international obligations, such as Outer Space Treaty and the Liability Convention, and provide for the role of SACSA in case of accidents, while Section 9 provides for establishment of Boards of Inquiry.
The new legislation to be introduced would also address the role of Boards of Inquiry, safety inspectors and investigators with ongoing functions of investigating and avoiding accidents and ensuring compliance with conditions of licences issued by SACSA. Considerations relating to the implementation of voluntary UN guidelines recommended to States as good practice, such as UN COPUOS Space Debris Mitigation Guidelines and the UN/IAEA Safety Framework for Nuclear Power Sources in Outer Space would also be mentioned. 
Section 14 of the current Act provided for the duties and liabilities of licensees, and for insurance as conditions of a license. However, it used general language -“liability arising out of Treaties” - without a specific third-party liability expressed as a requirement. Security may be required to meet obligations incurred. The new Bill envisaged explicit inclusion of : Insurance requirements for authorised activities, including third party liability and the determination of the amount of insurance in consultation with National Treasury; Recourse against Licensee and Insurer; and Limit on Liability (to encourage industrial development)
The current legislation made no provision for the registration of space objects. The new Bill will include: provision for a National Registry of Space Objects, maintained by the Council and the mandatory nature of this registration, in alignment with obligations under the Registration Convention and other relevant international agreements. Specific information will be required for all space objects, including their general function, date and facility of the launch. The Council will, in turn, issue a unique registration number for each registered space object, for identification purposes. The Register will be available for inspection by the public, for purposes of transparency.
The current legislation made no provision for transfer of ownership of space objects in orbit. The new Bill will address issues of transfer of ownership in orbit and spell out the conditions and process for notifying the regulator of changes in ownership and other changes of status that should be reflected in the national registry of space objects.
Dr Martinez then outlined the next steps to be taken. The public consultations would continue. The Bill would be drafted with relevant stakeholders, who would include the State Law Advisors, the dti, DIRCO and DOJ. The Bill would continue to be tabled to relevant bodies, and regulations would also be drafted.

A first meeting of the Working Group had been on 28 April 2015, followed by today's presentation.

Dr Martinez concluded that the review of the space legislation is critical for South Africa, in order to support development of a local space industry (high tech and capital Intensive), which will be effective and responsive to licensing procedure. It will streamline and strengthen the interface with other relevant government departments, agencies and legislation. It will expand and clarify the scope of the Act and encompass provisions for dual use technology; and civil and military applications. A new Bill will be better able to safeguard public/national interests and give improved regulatory and administrative support.

Discussion
Dr B Goqwana (ANC), Chairperson: Portfolio Committee on Science and Technology said that it was very helpful that both Committees could engage with the presentation from SACSA together. Whilst all Members of Parliament were used to making laws for the benefit of the country, he commented that it was sometimes difficult to follow the highly technical words in the presentation, and will need assistance from the technical staff when dealing with the legislation, and the Members would have to rely on the technical staff to be honest and show integrity. The decisions that Members would be taking would affect the country not so much in the short term but in the longer term and thus would have to be considered very carefully. Although South Africa is a developing country it is playing in a global space, which requires both knowledge and resources to compete with other countries on an even footing and without being left behind.

Ms L Maseko (ANC) (DST) asked why SACSA reported to the dti and not to the Department of Science and Technology (DST) because all the indications in terms of the acts and treaties showed that it was more closely aligned to the DST. She asked if this arrangement did not cause tensions between dti and DST.

Ms Maseko welcomed the announcement of proposed amendments to the Act; the areas that were highlighted were very interesting. She suggested that there should be a provision for public education when public hearings were held.

Mr A Williams (ANC) asked what the difference was between the SACSA and the South African National Space Agency (SANSA).

Mr Williams noted the reference to the military application of space technologies, and asked for a definition of military applications - whether offensive or defensive. He thought that some of the offensive applications could be, for instance, real time images, territorial images, and whether the proposed application would have a bearing on that.

Mr Williams asked if the Council had looked into transformation when it gave out licenses to the private sector. In the long term it would be ideal if the industry around space in South Africa was transformed to be black-owned. He asked what direction the Council was taking in that regard.

Mr N Koornhof (ANC) asked if the strengthening of the Secretariat would involve costs or if the SACSA was likely to recover the costs through licensing fees.

Mr Koornhof noted the four treaties to which South Africa was a signatory and wondered if there were other major countries - such as Russia, Britain, India - who were not party to those treaties.

Mr Koornhof said that British Prime Minister David Cameron, earlier this year, had said that Britain needed legislation to close down the safe spaces where people could talk to each other without being picked up. He asked if there was anything in the new legislation to look at that concern in South Africa.

Mr M Kalako (ANC) asked for clarity on whether the current Act would be amended, or replaced completely, and the reasons for the decision.

Mr Kalako followed up on Mr Williams' question and asked if there were development programmes for transformation, to assist those entering the space arena for the first time.

Mr Kalako asked the size of the budget of the Council, for funding received from the dti and DST and how this might compare to that in other African countries like Nigeria and Algeria.

Dr Goqwana commented that the main reason for amending the legislation was that life in South Africa was dynamic. However, despite this, South Africa could not, unfortunately, ignore the history that there was little involvement in science and technology, with many of the population actively fearing it. He suggested that any new legislation had to look into dynamism in the future, and had to ensure that those who had not been involved in these areas in the past would be brought in to the space arena. Government involved laws made by the people, for the people, rather than individual ideas, and the public who might not be aware of or understand the laws must be educated to be able to understand them.

Ms P Mantashe (ANC) asked how the Council would ensure that that the legislation was watertight, particularly when imposing penalties against entities and companies for non-compliance, as set out on page 11 of the report.

Adv A Alberts (FF+) asked if the new Bill was based on international best practice, and what type of model legislation, if any, had been used. He asked how the Bill would deal with the issue of the international trends so as to ensure that commercialisation of space activities was given enough space and became an integral part of economic growth.

Adv Alberts noted that the Bill will be tabled to "relevant bodies" and asked for further elaboration as to who they were, and whether the few companies that dealt with space products would also be contacted directly. He also asked if there would be a public consultation process.

The Chairperson said that there was a reference to the Liability Treaty for ratification and the issue of insurance and the respectability of the goods. It was important for the Members to have those issues further summarised. One of the Committee's concerns related to the possibly enormous cost, and how that cost would be managed.

The Chairperson said that the other issue of note was that, in 2009 and 2010, it was mentioned that it would be useful to have a multi-disciplinary approach. She noted the involvement of not only DST and dti, but also DIRCO, DOT and other departments that were and should be directly involved. She was pleased with this achievement and commented that more Committees should emulate this, and move to involvement of more than one committee on appropriate issues.

Dr Martinez firstly dealt with the questions around the difference between the SACSA and SANSA and their placement. Put very simply, the SANSA is the national implementing entity for space activities in South Africa. It is a full agency of government, with a large complement of staff, and with several operational centres. The agency fell under DST and is funded by DST.

Space activities, according to international obligations, must be subject to authorisation and supervision. SACSA filled that role. It is statutory body comprised of members appointed under the current legislation by the Minister of Trade and Industry. It is not an agency of Government, but merely a statutory council which considers questions of licensing and similar issues.

Dr Martinez said that it was important to understand that space activities are not carried out by the SANSA itself. As already stated, the space arena was growing and becoming increasingly diverse in terms of space actors, companies, universities, and in some cases private individuals. It was important that the Regulator (SACSA) now have a more encompassing role, rather than merely licensing the activities of the state entity SANSA.

The dti had considered the question of where the entities would be most appropriately placed. It believed that bringing SACSA under dti was appropriate, because of the various issues spoken about, in terms of technology safeguards, technology transfer and use, and other issues which were much broader than pure science and technology. The dti had extensive regulatory experience in these domains.

Dr Martinez conceded that this did create some complexity of relationships, similar to any other cooperative governance issue, where one area of activity might cut across the functions and mandates of several departments. However, the dti believed that the cooperative governance approach was a productive way forward. On the international level, South Africa sometimes was held up as an example that other developing space nations could consider, rather than following the traditional Cold War model of space activities a were demonstrated by the United States, the European countries, and the Soviet Union in the early days. Last year, the dti and DST negotiated a protocol on cooperative space governance, which could also be used as a model to bring in other departments, such as defence, communication, or transport. Space is a cross-cutting issue and the cooperative governance approach is considered appropriate.

Dr Martinez then addressed the questions on transformation. He noted that initiatives by both dti and DST were attempting to address issues of transformation. It was a very good question how to link that to the current legislation. At the moment, there was no immediate answer, but he appreciated the guidance from the Committee and said that it would be considered as the process moved forward.

Dr Martinez then spoke to the costing and the Secretariat. A business plan had been drawn by the Council, with the necessary costing on strengthening of the Secretariat. He reiterated that the regulatory function was not a government entity or agency, but rather something at the level of a directorate, with a fairly small structure. SACSA believed that a well staffed, well resourced Directorate would be capable of dealing with all regulatory demands for the foreseeable future.

Dr Martinez conceded that a comparison of South Africa and other major space players would show South Africa very far down in the ranking, whilst it did not appear at all in the OECD chart on space budgets. The  United States invested more in space that the rest of the world put together. South Africa was a minor player in comparison to that. However, on the African continent it was a significant player, as were others, particularly in Nigeria, Algeria, Egypt and Kenya, but the difference was that the capability of South Africa was largely home grown. It had not acquired its satellites by purchasing them from overseas providers, but had its own industry that was capable of supplying much of the technology, and that should be nurtured.

Dr Martinez said that the question of safe space, and its connection with space legislation, was a concern, because it touched on cyber security which was, increasingly, an issue to be taken into consideration. This was, again, a cooperative governance issue.

Dr Martinez appreciated that the issues were complex and said the SACSA would be happy to engage on the substance and offer seminars or information sessions to explain the issues in a more relaxed environment, to enhance Members' understanding.

Dr Martinez said that the current legislation already does provide for penalties, but it was 20 years old, and so the new legislation needed to provide for effective and deterrent sanctions that would not merely be ignored by those with sufficient funding to pay the fines.

He was happy to say that the amendments were indeed based on international best practices. By coincidence, the UN had recently completed a study on international legislation, and that had provided a rich fund of references to inform the new legislation.

Mr Humbulani Mudau, Chief Director, DST, assured the Chairperson that the technical advisors and engineers at the DST would indeed provide the Committee with honest, unbiased advice and technical inputs. This was a critical point because whatever decisions and inputs were made would have a far reaching and significant impact to the future of the country. Technical inputs had been made into the Working Group of the Ad Hoc Committee, looking at the best interests of the country. South Africa, as a developing country, had to be sure of the aspects to be considered for use of technology. This was done in close cooperation with the Department of Defence. All space programmes anywhere in the world originated from military applications.

Nowithstanding this, Mr Mudau said that it was very critical that the Committee should not only see space applications in relation to military defensive or offensive purposes. He cited the example of the global positioning system, which was built by the US military purely for defence purposes, but its benefits for commercial opportunities were proven later.

Mr Mudau also added to the earlier points about where SACSA and SANSA should fall, whether as a dti or DST responsibility. This point had come up on previous occasions, and discussions on the differences had been held in the past, along with where they should be hosted and whether they should be separated. Dr Martinez had indicated that the model to be used might be one that other upcoming space nations could look to, but he suggested that Members should consider the budget, commercialisation of space technologies, and transformation of human capital development, and how they might be accommodated or dealt with in an appropriate model. All of these points would become relevant when finalising the legislation.

Mr Mudau also dealt with relative amounts of investment and agreed that Algeria and Nigeria were investing in the space arena quite a lot more than South Africa. Nigeria had a communications satellite and two operational satellites. Algeria had just launched Algerian Set 2. South Africa was in discussion with Algeria on the satellite for African Resource Constellation Monitoring. He agreed that in terms of its indigenous technological capability, South Africa was way ahead of some of its other African counterparts, and that was something that could be used as a competitive advantage, so that the South African industries could capture an African niche market, and further stimulate these industries in South Africa 

Report of the Portfolio Committee on Trade and Industry on Budget Vote 34: dated May 2015
The Chairperson asked Members now to deal with the draft Committee Report on Budget Vote 34 (the Report). She asked the Committee Secretary whether any correspondence on the Report had been received from Members.

Mr Andre Hermans, Committee Secretary, said that Mr McPherson had sent an email but he would raise the issues as the Committee went through the Report.

Mr F Shivambu (EFF) said that the Report should closely consider the impact of industrial incentives programmes and subsidies, specifying the various sectors, how much money Government was spending on the automotive industry and on other subsidised sectors, and whether this was driving value for the money being spent, which would enable the Committee to give guidance on what amounts would be appropriate for those sectors. He was not sure whether this was captured previously, but the Report might also need to set out what the dti was subsidising, and what value was obtained from that, how many jobs were being created, and a variety of other indications from sectors.

The Chairperson said that the Report had referred to "major incentives", because they accounted for more than 65%. There had been expansion and there might be a need, as the Committee moved through the Report, to have a matrix as to what amount went to what projects, and track that.

Mr B Mkhongi (ANC) noted that page 9 of the Report spoke about the comparative expenditure per programme for 2014/15 and 2015/16 financial years. He suggested that a graph could be inserted underneath that, to explain incentives and the trend increments, setting out the numbers and amounts.

Mr Mkhongi also noted that page 13 of the report talked about the budget allocations for the 2015/16 financial year. He suggested that explanatory notes be included underneath that point, on what had been achieved in terms of the incentives or what they intend to achieve, to be able to quickly isolate the issues in the following years.

The Chairperson pointed out that this would be relevant not only for future years, but also for the BRRR process later this year. She agreed that the two should be linked together. She suggested that a graph could be included, which would be very clear, since this would deal with the bulk of the programme, and the Report did recognise that point.

The Chairperson noted on page 12 of the Report dealt with verification of BEE compliance, and said that the dti remained in the same position as in the previous term.

Mr Mkhongi questioned whether the Committee might want to review some of the proposals on this Report, for instance, the BBBEE assessment process, because there were lot of suggestions around the issue of verification. The dti stated that it was dealing with unscrupulous party agents that were defrauding the process. The dti had said that it was intending to do other things also, and he questioned whether the Committee needed to have all the answers now, or get them later. There was an outcry from BEE companies about the new guidelines.

The Chairperson said that she had spoken to the Minister, who had confirmed that he would deal with both issues when he came to the Committee on 19 May. The reality was that this was related to fronting, although there had been attempts to stop this. However, further clarification was required, but she suggested that the Committee could go with the Report as it was currently worded, in the absence of any further information at this point. The Act had not changed.

Mr McPherson noted that there were some glaring omissions from the points raised and deliberated on by the Committee during the process of formalising the Report. For instance, there was no mention of the Empowerment Fund. One of the key recommendations from the last oversight visit was that there must be engagement between the National Treasury and the dti to formulate that investment fund. However, it was not included in this Report.

He added that another omission related to the National Gambling Board and its problems, including the engagement with the MEC for Finance in KwaZulu Natal. This should also be in the Report.

The Chairperson said that the Committee would carry through some of the issues in the Oversight Report, and that all matters would be fully dealt with in the Budgetary Review and Recommendations Report (BRRR).

She noted that the Report would be corrected by the Committee Secretary and Members would be asked to adopt it on the following day.

The meeting was adjourned.

 

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