MPRDA Bill [B15B-2013]: deliberations on National House of Traditional Leaders comments

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Mineral Resources and Energy

17 May 2016
Chairperson: Mr S Luzipho (ANC)
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Meeting Summary

The Chairperson introduced the Committee to the deliberations, stating that the Committee was dealing with a sensitive industry where there was not much good news and that it was an industry under strain faced with serious challenges. Members were instructed to take responsibility and assist in ensuring that it was a credible process so that all issues are addressed.

The Democratic Alliance raised several points, beginning with the definition on ‘community,’ noting that this should rather include a geographic indicator. Several objections were raised regarding beneficiation, including that it was bad policy (through the use of international examples which do not engage in beneficiation), the recommendation of the World Bank against beneficiation, the overly broad administrative discretion permitted and the possibility that restricting exports could contravene international trade rules. Labour sending areas were also objected to and it was suggested that benefits should rather accrue to those suffering the adverse effects of mining in their area. The suggestion of an independent body to allocate licences was supported, as well of the need to adequately compensate those affected by mining. Overly broad discretion conferred to the Minister was cautioned against.

Mr N Mandela (ANC) agreed that the NHTL’s definition of community fell short of the required definition and that all South Africans should benefit from mining, especially those from labour sending areas.

Mr I Pikinini (ANC) said that Mr Mandela covered many of his concerns. The issue of including the metro and local municipalities should be considered for inclusion in the community definition. The idea of a council which should be independent would be a problem as it conflicts with the idea that resources belong to the state and that the Minister should report periodically to government about the processing of those matters. The council that currently exists should remain and ensure that issues are attended to.

The Chairperson said that the mining crisis was worldwide – the mining industry was on the decline internationally, even in Australia, and it was risky to elevate certain causes over others, as Mr Lorimer had done. The reality of labour sending areas could not be denied and these communities should benefit from mining. The definition of community needed to include a geographic consideration - if it did not, unfair discrimination could occur. The Committee had to address the fact that the NHTL submission did not address all issues raised by the President’s reservations and some comments were completely unrelated to the reservation and the Committee had to determine how these would be dealt with.

The Chairperson raised the options available to the Committee going forward. The first was the Committee prepare its report on the Bill and ensure that it contained issues which they believed were consistent with the reservations of the President dealing with consent and the definition of communities. The Committee agreed that this should include metropolitan and local municipalities. The second approach would be that the Committee request the suspension of Rule 203(2)(a) [The committee must consider, and confine itself to, the President’s reservations] in order for the Committee to accommodate issues raised by the NHTL which may not be consistent with the President’s reservations. If this is done in terms of the motion, the Committee would not be able to finalise its report and the process would be longer.

The Committee agreed to the first option to accommodate the various issues in its report which could be addressed while the Bill was being dealt with by the NCOP, including engagement with the NHTL and obtaining an opinion from an international trade law specialist.

Meeting report

Deliberations on National House of Traditional Leaders comments on MPRD Amendment Bill
The Chairperson said based on discussions of the last meeting, in terms of the NHTL submission and the questions of clarity, the task of the members was to do their job as a Committee. The Committee should try to do justice to the process. He did not want to have long discussions. The Committee did not have time as they had been sitting with the Bill for almost three years. The Committee is dealing with a sensitive industry where there is not much good news; it is an industry under strain faced with serious challenges. Members must take responsibility and assist in ensuring that it is a credible process so that all issues are addressed.

Mr J Lorimer (DA) asked the Chairperson if it was possible to get a roadmap of where the Committee wanted the Bill to be by the time that Parliament rises on 27 May.

The Chairperson outlined the process. There would be Committee deliberations on the comments made by the National House of Traditional Leaders (NHTL) on the Bill. This would be followed by deliberations on the response by the Department. The Committee then needed to decide how they would treat the comments before they went to the National Council of Provinces (NCOP). The third part is what Mr Lorimer was talking about and they would discuss the process of the committee. As soon as the Committee decided on a particular approach, the Bill would find its way through referral processes. The process must not be started before members have had an opportunity to express their opinion on the comments made. An understanding on the presentations made must be understood before speaking about the procedure. If procedure was discussed before the substantive issues, members might be limited in their contributions. The Committee’s agreement on the outline of the meeting was sought.

Members nodded in agreement.

The Chairperson said that the submission from the NHTL and the response had been received by Committee members and in good faith, members were guaranteed that their time was coming and that their time was now here.

Mr Lorimer asked if the Committee should go through the comments one by one.

The Chairperson said that Mr Lorimer was able to raise any issues he felt necessary.

Mr J Lorimer (DA) thanked the Chairperson and said that he would begin with a few general remarks. The comments from the NHTL were a mixed bag. Attempts to clear up confusion were made but did not succeed. Some proposals were made by the Committee and disagreed with by Mr Lorimer and these refer to beneficiation. It is a difficult area to deal with – beneficiation includes the rules surrounding the designation of strategic minerals and restrictions on exports. The Committee needs to determine whether or not the Bill contravenes international trade agreements. One intriguing proposal was made – that an independent body is set up with a number of duties, including independent decision-making on the allocation of mineral rights.

Mr Lorimer addressed the comments of the traditional leaders in detail, starting with the definition of ‘community’. Responses from the Department appeared to disagree with the traditional leaders. The definition still seemed wide open and it could be taken to mean almost anything, which was not envisaged by the Bill. ‘Community’ suggested by the by NHTL was an ‘inherent social group under the jurisdiction of a local or government traditional council’. Fitting that description would be the Belfast and Mafikizolo fan club – that would be community. The definition is not adequately dealt with.

The definition of ‘beneficiation’ opens a whole field of objection. These fall broadly into three groups – the idea of beneficiation is bad policy. Many people in government believe that beneficiation is the only way to advance the economy. Two points can be made on this, looking at international examples. Three of the richest regions of the developed world in Australia, Canada and America’s Midwest have become rich by producing minerals or agriculture and exporting without beneficiation. Australia and Canada did a great deal of mining and exported goods without beneficiation. South Africans should not be constrained by the belief that beneficiation is the only way to develop the economy. Beneficiation is a ‘nice to have’ but it needs to make economic sense.

In support of the argument against beneficiation as dealt with in the Bill, the Committee cannot ignore the strong recommendation of the World Bank. The problem with beneficiation is that mining costs are increased, which decreases the tax take. Even if people do invest in mining, companies will be less profitable and pay less tax revenue. Beneficiation done in this way bears costs of business lost and less tax brought into the fiscus.

The second point on beneficiation is the overly broad administrative discretion. The definition suggested by the NHTL centres around baselines to be determined by the Minister. That is an example of the wide interpretive powers and discretion given to the Minister. The Bill does not provide guidance on the discretion conferred on the Minister and this may contradict section 1(c) of the Constitution which requires legal certainty.

Thirdly, the other substantive issue mentioned by the President was that the entire concept of restricting exports, which is what beneficiation deals with, is in violation of World Trade Organisations articles 11 and 20, to which South Africa is a signatory. Broadly, those restrict signatories from imposing quantitative restrictions on exports. In dealing with the WTO and other international organisations, the Committee needs heavyweight legal advice and it should think about suggesting getting opinion of senior counsel or international opinion because this is an issue which will be fought out in international trade arenas.

On the definition and concept of ‘labour-sending areas’ and the rough way in which it was treated by the traditional leaders, this approach was agreed with. It is anomalous that certain areas of the county are given special protection by the Bill – special benefits are received by becoming beneficiaries because they are labour sending areas. This does not happen in any other industry. Why should an area that sends labourers to a mine benefit greater that the area with a mine in it? This is a principle which is felt strongly about. Members of communities with a mine on their doorstep should benefit. Mines can interfere with grazing, water and members are forced to live with dust and noise. Members of that community should draw some of those benefits. Labour sending areas would still benefit from the mine. Those mines would be paying taxes and it was up to central government to send tax back to the labour-sending area. It should not be up to the mine. The NHTL was agreed with in terms of this.

The NHTL proposed amendments to sections 9, 10 and 11 were that application for licences and related matters should be taken on by an independent body. This was to eliminate future conflicts of interest which may arise in those vested to take such decisions. This was praised as a very good idea. One of the problems of overly broad administration discretion is that things are left to the whim of the Minister in the Bill to decide who does and does not get licences. This was a huge disincentive to investment. If companies could not be sure that they would get a licence, they would be wary of investing as there was uncertainty whether a licence would be granted. The Bill needs to ensure that all the rules are clear and upfront – if a company meets the criteria, they would get a licence. That was not the situation at the moment. When the NHTL team were at the previous meeting, Mr Lorimer said that he had asked them why they thought there needed to be a body independent of vested interests. They did not answer. He thought they were being polite. Clearly, they have come up against what they regard as unfair licence allocations as a result of vested interests. There are some good international examples of this - Ghana has an independent body which allocates mining licences. The NHTL then suggested a Mining and Minerals Development Council wthout having agreed to the make-up of the body, Mr Lorimer stated that the principle of an independent body that allocates licences would add huge credibility to South Africa’s mining jurisdiction.

Mr Lorimer commented on the NHTL proposed amendment to section 11(3) dealing with black economic empowerment and the controversy over the ‘once empowered always empowered’ issue. In terms of the response of the mining industry to similar proposals contained in Mining Charter III, it would be difficult to argue this was not a disincentive to mining investment. He was not the first to call Mining Charter III a suicide note for the mining industry. That may sound like inflated language but, if one hears what mining houses are saying, a mining house representative stated that it was a declaration of war on the mining industry. This is a serious issue and a disincentive to investment. The Chairperson made references to the difficulties that the industry was facing. It has lost 26 000 jobs over the last year and another 10 000 lost in first quarter. Mining production was five per cent in January, went down another eight per cent in February and went down almost 18 per cent more in March. The trend is downwards. Anything which further disincentives mining would have dire consequences for the industry and for job prospects of tens or even hundreds of thousands of people employed in mining.

The NHTL addressed the prohibition relating to an illegal act and the series of issues dealing with the kind of notice a mining company must give and permissions it must attain from the community before it gets the go-ahead. This is a big area. In terms of the budget debate, it is becoming increasingly clear that the social licence is becoming less credible and more and more communities feel that they are not being treated fairly by the current system. The original iteration of the MPRDA has taken mineral rights away from communities and put it in the hands of the state. The state has the power to affect communities by granting mineral rights on their land. The Committee may not be able to unscramble that particular egg but the Committee needs to find some way of ensuring that if mining does go ahead in a community, the community must get adequately compensated. There is a lot of talk about consultation in the Bill but there is nothing which addresses if the community says no.

This might also put South Africa in breach of another international treaty regarding the state’s ability to ride over the objections of communities to a mining right being granted which may be in violation of the African Charter on Human and Peoples Rights. South Africa agreed to this in 1996. It contains the people’s rights to freely dispose of natural resources, which has effectively been taken away by the nationalisation of mineral rights. This is another area which must be looked at. The Committee should not pass a Bill which is going to fail again because the President finds that the Committee has not met his objections and it does not pass constitutional muster or a Bill is passed which is taken to court. The whole Bill is thrown into doubt for one or two years while the court case goes on because possibilities have not all been considered.

The Committee needed to find a way to insert something that says (quoted from the traditional leaders’ document) ‘the view that no person can commence with any work on an area without consulting the land owner or lawful occupier first’. The Committee could add something about agreeing to compensation for material loss to be suffered by the landowner or lawful occupier. Although that happens sometimes in practice, too often it does not and people have their land disposed of without any compensation. It is the Committee’s duty to ensure that does not happen.

In terms of section 17 on the granting and duration of prospecting rights, traditional leaders were trying to get the Minister to exercise his rights under section 23 of the Act where he can set certain conditions for community participation in mining rights. An attempt was being made to deal this in the new Mining Charter by setting aside percentages of ownership for communities. This was not a bad idea in principle because it was believed that communities should share the benefits of the mine. The problem with ownership was that one does not necessarily make money from being a mine owner. Many lose money. If one does make money, one has to wait many years before one gets any kind of profit. In terms of communities benefitting financially, ownership is not necessarily the best way to go. There should be some other way of obtaining benefits earlier and more certainly. The royalty system should be considered. This would tax production at the mine instead of waiting for profit. That would be a far more fruitful way of ensuring that communities benefit. He was in support of the idea that the Minister must ensure that the community benefits when a mining licence is granted.

In terms of the establishment of the Mining and Mineral Development Council and the proposed new independent body suggested by the NHTL, there are a number of ideas concerning how that body could be composed. The principle should be that the local community or anyone affected by the mine should have a strong voice on that council when a mining right is granted. He offered more detail to members if requested.

Mr Z Mandela (ANC) said that in terms of NHTL submission, he agreed with their submission where they dealt with wording in terms of ‘may’ and ‘must.’ The Committee should not dwell too much on that contestation and the Committee should support the NHTL in that regard. On the definition of ‘community,’ their definition fell short by identifying a local municipality or traditional culture and he would like to support ‘community’ as defined by the Department. On the ‘labour sending area’ definition, he held a different view to Mr Lorimer because historically, in terms of his history and his province, areas have been reduced to labour sending areas. These areas contribute the majority of labourers into the mining industry. It would be interesting to see if Mr Lorimer could advocate his view in Pondoland from where the majority of people from labour sending areas come.

The Committee should ensure that as minerals in South Africa belong to South Africa, communities not in mining areas should not be prejudiced. As a result, he wanted to support the Department’s concept of benefitting people from labour sending areas. The definition of labour sending areas should be retained so that all South Africans could benefit from mining activities. A majority of men depart for mining areas and woman-headed households exist for ten months of the year. Where there are mining opportunities, South Africans should be able to benefit. Those were issues which were picked up from the submission.

The comment was made that the NHTL had not fully attended to the concerns of President Zuma when he referred the matter to the NHTL.

Mr I Pikinini (ANC) said that Mr Mandela covered many of his concerns. The issue of including the metros and local municipalities should be considered. The Committee should consider clauses 5, 6, 8, 10(a), 10(g) and 11 – the order of processing applications. The idea of a council which should be independent would be a problem as it conflicts with the idea that resources belong to the state and that the Minister should report periodically to government about the processing of those matters. The council that currently exists should remain and ensure that issues are attended to. The Constitution provides that mining is a national competency. In terms of section 3 of the MPRDA – that it is a constitutional prerogative for the Minister to act on behalf of the state to administer development of minerals and resources. It is clear that any company must declare who the owners are. The Committee should support the state on this and the Department should ensure that this role is always played by the Minister.

The Chairperson said he wanted to deal with the first issue. He told the Committee to engage. The point of the mixed bag was accepted. The most dangerous thing, in Mr Lorimer’s response to the submission of the NHTL as a mixed bag, was not to recognise that traditional leaders in general could not be homogenous due to ideology and their arguments.

The Chairperson stated that he did not want to distort Mr Lorimer’s argument but that one could not project the victims from historical hardship as causal. One could not project the crisis in the mining industry as a result of trying to transform and benefit people who were previously disadvantaged. On the issue of creating a Mining Charter, the people themselves could not address their economic needs but it was the government’s job to do this. Everyone in South Africa was striving for economic emancipation. The crisis was worldwide – the mining industry is on the decline internationally, even in Australia. Regarding BEE, if it is defined in the manner in which it is, the question is in the differing of policy perspectives domestically and one needs to consider what message is being sent. The political climate is a contributing to the mining industry. No one wants to associate with those in crisis - South Africans, especially those in the key centre of economic activity, needed to send a positive message. The argument runs the risk of saying that if black people, and Africans in particular, want to benefit from the economic spinoffs in this country, it will create a crisis. One would get different voices on this issue. A debate on different policy choices should be accommodated to hear different perspectives.

One of the central issues being raised was the decline of commodity prices and trade with China. It was risky to elevate one cause higher than another. All countries who primarily focus on trade with China cannot solely blame this trade. While he did not want to distort Mr Lorimer, the point of emphasis, if it was not consistent, was quite risky.

Some say that workers are demanding too much in the way of remuneration. That may be true – but was this the primary cause? Part of the issue in Mr Lorimer’s liberal economies was the huge salaries being paid to executives. Perhaps as a Committee, it should be determined what is accumulated to executives compared to workers, especially in the downturn. The Committee should have a discussion on this as it seems to be lopsided, even the ANC. Alternative policy choices should be considered.

The second issue was the definition of ‘labour sending area’ – one could not deny the reality of what was existing. One must define a phenomenon as it is and then try and find a solution. He had the privilege of staying in a coastal area and he would hate that if he went to the dock, people said that only people from Cape Town and the Western Cape could be employed in the harbour. National assets are being taken away. There is a ruling in the Constitutional Court involving AgriSA about rights being in the hands of the state. This discussion should be taken further – he agreed with the terminology but it had to be determined if the Department of Mineral Resources could take labour choices in the presence of the Labour Relations framework. Issues of labour relations and employment strategies should rest with the Department of Labour. The definition of a ‘labour sending area’ involves where a majority of labour is sent from. Traditional communities are where one’s roots are and if one claims their roots in a certain area but does not live there anymore, there will be unequal benefits among communities. In essence, the definition enquires what cultures and traditions are practiced. It did not define the geographic location of a person.

If minerals are found on a farm, people who were previously displaced can be mobilised and claim benefits. This issue should still be dealt with but the quality of South African lives should be improved, even if this means a declaration of war with communities. If the mining industry says that benefitting the majority is a declaration of war, they would be at war. South Africans should not fear engagement. The issue of the Mining Charter should be forgotten – it may start from the extreme but it is an opportunity for engagement and they should be confident of their supreme ideas and engage. One cannot have a debate which is ahistorical. The most exploitative industry, amongst others, was the mining industry and this should be changed for the better. The mining industry should be happy that they are dealing with something that is so rough and extreme because they know what they are dealing with instead of someone who is a submarine.

In dealing with the other part, it is a fear that the Committee takes decisions which transcend the mandate of the Committee. The Committee must agree that the decision given extends the mandate of the Minister to powers that he or she would not have. Some are issues of trade. Everything beneath the soil is dealt with by the Committee but issues of trade and monitoring do not belong in the Committee. Some details being given may go beyond the mandate of the Department.

In terms of the last two issues, there is a need to consult with communities and he was in agreement with Mr Lorimer’s assertion about the consequences of mining on communities. Establishing policy should not be based on circumstances of the moment but rather on the issues which will always be present. Law should be balanced with regulations – it was odd that people would want the law to be overly prescriptive. In the process of trying to rectify the situation, one might create further conditions. People may be excluded from communities if they do not share the same culture or traditions. That definition of community would unfairly discriminate. Communities may exist where different cultures are practiced.

The Freedom Charter refers to the mineral wealth beneath the soil belongs to the people, in their hands, under the custodianship of the state. If that is the case, what form of a state is considered? The geographical definition, which the Department suggested would also include the district and local government, could be more suitable.

The last point is that one could not ignore reality. Social and labour plans inherently talk to mining areas in the proximity of the community. The issue has been the complaint about non-compliance with social and labour plans. The Committee should not pretend that there are no regulatory policies which protect the communities in the mining area. Whilst not agreeing with Mr Lorimer on why benefits in mining communities could not be seen in Pondoland but rather where mining occurred, the Department needs to make the determination. He said that he was poking Mr Lorimer and Mr Mandela. He believed there was the possibility of managing the issue of the labour sending areas and the question of preferential employment. Mr Pikinini raised the issue that there were two bases upon which the President referred the issue to the NHTL – the first was in relation to the definition of ‘community’. The second relates to issues of consent related to custom and culture. This would be dealt with in the second phase. The way that Mr Lorimer was sitting suggested that he wanted a second bite.

Mr Lorimer commenced with the definition on ‘community’ and that he agreed with the Chairperson that a fairer and better way would be on a geographical basis. He was unable to suggest how that definition should be structured for the time being. That would be a positive direction to go in.

Secondly, on labour sending areas, he did not particularly agree with NHTL on preferential employment. Government should not get involved in that. It becomes incredibly complex for a mining company to do part of its social plan in a labour sending area – it was not the job of a mining company but rather national government. National government needs resources to do this development and could be taken in tax. That should be happening but it is not. Mr Mandela spoke about advocating this in Pondoland and just as difficulty may be experienced in that point of view in Pondoland, Mr Mandela may have the same difficulty advocating it on the Platinum Belt.

In terms of transformation, he did not agree with the Chairperson that black people would only be able to benefit from mining if government forced their involvement. This was a depressive and wrong way of evaluating the potential of South Africans. Some people will be businessmen, some will be able to get involved in an industry by virtue of their skills and talents. Citizens should not be put in the position as helpless wards of the state where the state has to push them in order for them to succeed. Transformation should not benefit an entrepreneurial or tender-preneurial class. People who are on the doorsteps of the mines should be empowered – not someone who drives a Mercedes Benz and sits in a boardroom in Sandton. The Committee has a chance to do that by evaluating rights and compensation given to communities where the mining takes place.

In terms of the independent body who would allocate mining licences, the Department responded that the Constitution provides for mining as a national competence, the MPRDA annunciates the constitutional prerogative, enjoining the national minister to act on behalf of the state. The implication is that the minister should hand out mining licences – that is absurd. The Constitution does not say that the Minister should control every aspect of licensing. If that is thought of in terms of other industries, that it even more absurd.

The Chairperson’s statement that the Freedom Charter states that the mineral wealth belongs in the hands of the people – aside from the fact that the Freedom Charter is ANC policy – the Freedom Charter is not the Constitution of the country and while the Chairperson may agree with it, South Africans are not necessarily bound by it. Despite this, he did not disagree with the notion – mineral wealth should be seen as something which can benefit people. If people are adversely affected by a mine on their doorstep, they should be compensated in some way. Benefits should not flow to someone in distant Sandton, they should flow into the community and this is the Committee’s chance to ensure this.

There are social labour plans in place – the problems with social labour plans are that they are unevenly drawn up (one mining company may have many more obligations that another mining company) and the obligations of a mining company are often seen as endless. A mining company may submit to a social labour plan which says it has to provide water for the community. The community then may ask why the mining company is not building a school. There is a never-ending list of demands for social services from the mining company which should be provided by government but which are not due to poor delivery from government. It may be that the mine is the one efficient service provider in the area. As long as people keep saying that mines should provide services which should be provided by government, there will be an endless field of contestation as mines should be providing everything as they are seen as a delivery agency. Government is hiding behind this and it should not. The third problem with social labour plans is a problem of interpretation – the extent to which mining companies should commit is unclear. It would be far better if a percentage of mining investment was assigned to determine the extent of a mine’s social obligations. At the moment it is a mess. This is a chance to try and clear up the mess by making clear and certain legislation.

The Chairperson stated that no one elevated the Freedom Charter at expense of the Constitution. This would be addressed later. He said that he wanted to provoke Mr Lorimer more, even though Mr Lorimer’s liberal perspective had an inherent contradiction, assuming that is the kind of custodian he is. There was something called free market, which says whoever wants to trade should have an opportunity to trade. If weaknesses are in the legislation, that should be addressed. In the North West, communities are doing trade and are trading royalties for shareholding. Free market teaches people that individuals trade, not the community as a collective. Opportunities for all would have been his argument if he was in Mr Lorimer’s position. This sounds like a contradiction as people trade according to their skills. If this issue was addressed and still includes those communities, this does not necessarily mean those communities were disadvantaged. It is an access matter. Just because people are manipulating the system, it does not mean that the policy is wrong. If royalties are exchanged for shareholding, when the mining company’s investments go down, the royalties go down.

The SLPs (social labour plans) are not something that the Department imposes. SLPs are what companies present for themselves. SLPs are meant to be advantageous in terms of tax returns. Some of these things have nothing to do with the legislation.

There was a long battle between Mr Lorimer and Mr Mandela, who was raising accommodation for employees as an issue for inclusion. There was a strong argument concerning overly prescriptive legislation. Islands that are not supposed to be subject to state regulation, will result if government does not regulate certain areas. No entity that is a subject of the state   should escape regulation. This is the reasoning behind the tripartite alliance concerning government, business and labour, and now communities. The question concerning the extent to which regulation is done was another argument. Issues of tax are meant to be done by the state – therefore the state has to increase taxes. There is wastage but for now, that is a reality.

The Chairperson said that Mr Pikinini, and to some extent Mr Lorimer, raised the issue whether it was for the Committee to make a determination on the constitutionality of the legislation or if it remained the prerogative of the judiciary. There was also the issue of whether a legal opinion should be obtained even though there was not a request for consultations from the legal side at Parliament. If the Committee goes the route that Mr Pikinini suggests, the Committee must argue only on the issues to which the President made references. In reading the President’s referral, it stated:

‘I am further of the view that this should have been referred to the National House of Traditional Leaders for its comments in terms of section 18 of the Traditional Leadership and Governance Framework Act in that the Bill impacts upon customary law or customs of traditional communities by:
i. allowing persons to enter upon land to conduct an investigation after notifying and consulting with the owner, occupier or person in control in terms of section 50 and in so doing ignores the consent principle in customary law.
ii. amending the definition of ‘community’ in section 1 of the Amendment Act.’

The Chairperson said Mr Pikinini stated that in those two reasons provided for, some NHTL proposals are not necessarily relevant to the bases of the referral. Some of the issues have been considered. There are areas where there was consensus. If Mr Pikinini’s argument is used, if the comments are not in conformity with the bases of the President’s referral, does the Committee need to accommodate areas, even where there is consensus, and apply for a suspension of Rule 203(2)(a) to get an opportunity to contribute and accommodate comments from the NHTL? Committee members do not need to agree with the suggestion but members are confined to issues raised by the NHTL and if issue is taken with regards to the reservations of the President, namely customary law or customs of traditional communities or the issue of the definition of community, there was no reason to apply for the suspension of the rule. This meant that the other two aspects on substantive issues need to be discussed and included in the report prepared by the Committee.

The Chairperson said that there was another independent process, the NCOP process. According to the NCOP process, it would be wide open and not limited to the President’s reservations. The NCOP are essentially starting afresh. The potential was that when the NCOP Report came back to the Committee, new considerations may be raised. The Committee could not predict what would happen. It was possible that the Committee might deal with the issue again. Comments from members were requested.

Mr Lorimer stated that he was unclear on process. As a result of discussions in the meeting, what would happen? Did the Committee write a report? Would it be useful to submit further written suggestions concerning what should be in that report, on the basis of the committee’s discussions in the meeting? Such as that members should improve the definition of ‘community’ to include a geographic location. Would this go into the report?

The Chairperson said that he would try to assist Mr Lorimer. The first issue was that Mr Pikinini said that there was only one matter which was in relation to the referral of the President. This is why two possibilities were provided in terms of the reservations. What other issues are consistent with the reservation? Mr Pikinini said that comments consistent with the referral included the definition of ‘community’. The silence on the issue of the consent principle does not arise in the report and could the Committee introduce an issue which does not arise on the submission made. Committee members may be able to show that customary issues relate to labour sending areas.

Mr Lorimer replied that everything in the NHTL submission relates to customary law and practice – everything from the definition of community to consent to mine land. Were some of the NHTL objections outside the scope of what they were allowed to object to?

The Chairperson said that was what Mr Pikinini was saying. For example, beneficiation talks to consent of customary law or customs of traditional communities. On the wording of the President’s referral, the Committee must be able to show that there are customary implications on land. In terms of the point that Mr Lorimer raised about communities living around mines, environmental issues were not addressed only one issue in relation to the referral of the President. That was what Mr Pikinini was suggesting. If the Committee dealt with each point raised by traditional leaders, the Committee needed to determine whether the points were consistent with the referral. The issue, quoted from the President’s reservation, ‘‘I am further of the view that the Bill should have been referred to the National House of Traditional Leaders for its comments in terms of section 18 of the Traditional Leadership and Governance Framework Act in that the Bill impacts upon customary law or customs of traditional communities’. Another example was compensation. If there was movement of people’s graves for a mine, that would impact on customs of traditional communities. That was an example, not an actual submission. The Committee needed to determine how this impacted on customary law and the customs of traditional communities. ‘By allowing persons to enter upon land to conduct an investigation after notifying and consulting with the owner, occupier or person in control in terms of section 50 and in so doing ignores the consent principle in customary law’. The second part of how it impacts is by ‘amending the definition of community’. Those are grounds upon which the matter is referred.

Mr Lorimer stated that most objections related to land usage in traditional and customary law. Therefore it was well within the province of traditional leaders to comment on them. Consent to use land is a function of traditional communities. All of it related to traditional communities.

The Chairperson said that he did not want to argue with Mr Lorimer but that his argument was not correct. The ruling of the Constitutional Court proved otherwise. If one knows the ruling, one would know that it was not automatic. ‘Impact on customary law’ was what was referred. This was why the Court ruled on customs. The ownership of land is not automatic. Communities may belong to a traditional council but people in charge of developmental processes belong to the Communal Property Association (CPA). Therefore consent of use of land may not involve traditional leaders but the CPA. If each definition was dealt with, the Committee would need to show how each definition related to customary law. There are about fourteen proposals in the submission, starting with community. This is a customary issue. Some will argue beneficiation impacts on customary law. The motivation behind some of the proposals was the problem – the Committee could not invent motivations on the NHTL’s behalf. 1.2 states ‘allowing persons to enter upon land to conduct an investigation after notifying and consulting with the owner.’ This was referred to the NHTL. Could a traditional leader be the ‘owner’ on behalf of many? ‘Occupier’ could be someone who occupies a space who is not traditional. The CPA would say the persons in control. To do justice, motivations should not be invented on matters which do not necessarily fit. Relevant issues should be dealt with. The Bill would still come back to the Committee after the NCOP process. Could the Committee look at other areas which should be attended to? The Committee should determine whether there was an unconventional way that matters could be dealt with and where the Committee could find common ground. He was not convinced that certain issues should be motivated for on the NHTL’s behalf.

Mr Lorimer stated that if a very narrow definition of what the NHTL should have addressed is adopted, most of their concerns listed would not need to be addressed? Secondly, in the President’s reservations about the Bill, the possible contravention of international trade agreements was mentioned. Should this not be discussed separately from the discussion concerning the NHTL submission?

The Chairperson said that the Committee should first discuss the NHTL submission and the trade issue would be discussed afterwards. There were areas where even the Department agrees with the NHTL but whether or not this was consistent with the reservations of the President needed to be determined. In trying to create the law, the Committee should not create a process which was inconsistent. For example, on the issue of owning land, someone may claim this and the Committee should not go to these lengths. Even where there was agreement, it was inconsistent with the President’s reservations and it should not be said that traditional leaders are not being accommodated. It was a process matter. The issue of the consent principle does not arise in the submission of the NHTL. The definition of community was raised. The NHTL defined communities on the basis of roots of origin, not the current geographical space. Not to be racist but most communities - whites, coloureds and Indians (not all coloureds) do not practice traditions and have different traditions. What would happen to these people? These people would be excluded from these communities. This would be unfair discrimination. Geographical location would be a better definition as it was consistent with the Constitution.

Mr Pikinini said that he wanted to move from step one. The Committee agreed on issues concerning conformity. The Committee should be able to accommodate both the Department and the NHTL. As a Committee, they needed to wait for their report tabling the argument they dealt with and in the meeting, they should deal with the report. This would be step one. When the Committee receives the NCOP argument, the Committee could begin step two. On the basis of one’s own history, one would always go back to the history, the history of deprivation. When trying to balance imbalances of the past, one would always move there. The state takes resources to benefit everyone and the report must be dealt with.

The Chairperson stated that he wanted to move forward. There were two possibilities. The first one was that reservations must be dealt with. The second one states that if the Committee wants to now accommodate issues where there is commonality between the Department and the NHTL, the Committee must request a suspension of Rule 203(a). That means, if this was agreed upon, this might only take place next week. The Committee would then discuss this and engage after the 3rd of August upon return. The first option states that a report is prepared before the House rises to be tabled in Parliament. This means it will be referred to the NCOP. Certainty must be created. The Committee could then wait and see what arises out of the NCOP meeting. In the NCOP, there are no limitations on submissions. Either that or the longer route of applying for the suspension of Rule 203(2)(a) is taken, which would sit the issue. It would be better for the Committee to settle the issue. While some people would say that the Committee is postponing the matter, some of the issues were in agreement and this was a technical problem. Even if the suspension is granted, it would mean a longer period to attend to the issues.

Mr Lorimer stated that the Committee should not be rushed into getting this wrong due to the timing of parliament. This Bill sat for a long time in Parliament where nothing happened due to a lack of political will. One cannot say that things have to happen and then get it wrong.

The Chairperson interrupted Mr Lorimer, stating that he wanted to raise a point of order. The first time the President referred the Bill was in January 2015. It came to the Committee, who disposed of their discussion on the 6 March. Mr Lorimer was accusing the Committee of a lack of political will. It was not a question of delaying or doing the process incorrectly, it was trying to master the rules of Parliament. Fast-tracking the Bill was not based on trying to do things incorrectly. This is why the Committee had an opportunity to discuss the contents of the submission and then discuss the best procedure to follow. He was explaining a procedure, not substantive issues. He did not take kindly that he had tried his best to do the right thing procedurally and was trying to master procedure. One might be shorter, one might be longer but they still accommodated what the Committee wanted to contribute.

Mr Lorimer said that as far as the procedure went, he believed it would be better to accommodate points of agreement and matters raised by the traditional leaders. How many points raised by traditional leaders did the Chairperson consider invalid because they did not conform to the President’ referral? And which ones were valid?

The Chairperson said that there were two areas on which members had views. The one was the issue of what the President had raised about ignoring consent in terms of customary law. The comments by the NHTL did not make reference of this. The definition of ‘community’ was addressed. The demarcation via geographic location should be included – metros and local municipalities should be included as only districts are referred to. Other points must be explained in terms of the referral, which has not been done by traditional leaders. Unfortunately, there was no motivation how these issues impacted upon customs and traditions of communities. If these issues return after the NCOP, the Committee should deal with them. The reservations must be read. The Committee must be able to stand up and say that there may have been disagreement on the definition of ‘community’ and the popular view on this must be tested. The NHTL defined this and took it further, which problematised the matter. There was no submission on consent regarding customary law. The Committee should deal with what is consistent and put the other issues aside. The Committee wants to accommodate them and this must be applied for in Parliament to make request for a motion which waivers the relevant section. The Committee must determine if that was what they wanted. As a Committee of Parliament, there are sticking points but due to parliamentary rules they could not be dealt with. It was important to provide certainty. Once the Bill comes back from the NCOP, the Committee could deal and engage with issues.

Unless this is fundamentally incorrect, this was a matter which should be dealt with. There are not areas of difference. The issues should be accommodated while the NCOP process is ongoing. The NCOP should be able to make motivations. By the time the Bill comes back, the Committee may be sure of the definition of ‘community’.

Mr Lorimer said that he was happy that there was an opportunity to allow traditional leaders to motivate their submission.

The Chairperson said that he was raising two options for processing the matter. The first was the one whereby the Committee prepared its report and ensured that it contained the issues which they believed were consistent with the reservations of the President. The first deals with the principle of consent, which did not really arise, and the second was community. The Committee agreed that this should include metropolitan and local municipalities. The Committee was then supposed to deal with two other aspects, including the international rules of trade. The Committee should find a way to engage with the NHTL in order for them to raise motivations. This would assist with future processes such as the NCOP. The second approach states that the Committee should request the suspension of Rule 203(2)(a) in order for the Committee to accommodate proposals raised by the NHTL which may not be consistent with the President’s reservations. If this is done in terms of the motion, the Committee would not be able to finalise their report. These were two options.

The Chairperson expressed concern as the other two matters had not been dealt with. Mr Lorimer said that the Committee should consider exploring the option of consulting senior counsel - should this be included in the report? The Committee recognised and respected the fact that matters of legality remained with the judiciary and they were required to deal with these. The Committee would appeal to Parliament that before the final determination on the Bill would be made, it should solicit opinion of senior counsel who specialises on international trade agreements.

Mr Lorimer stated that he was not particularly partial as to which way this was done but that it was important to do.

Mr Mandela said that he believed it was necessary to obtain legal advice. In terms of the options put forward, the Committee should compile a report on the findings of the Committee and accommodate what has been raised by the NHTL, particularly where there are synergies with the Department. The Committee was tasked to engage with the NHTL who had the time and opportunity to engage on all matters and they did. That is their submission. The Committee has also heard the Department’s response.

The Chairperson confirmed that was option one. He asked Ms Desiree Swartz, Parliamentary Legal Advisor, for her opinion.

Ms Swartz stated if the Committee wanted to request the legal opinion of counsel, she needed to make the request to the Parliamentary Legal Office. The Committee must make that decision. The Committee was not bound by the parliamentary legal opinion and could request an external opinion and the Committee could take a decision based on that.

The Chairperson said that the Committee Report would suggest that Parliament should consider soliciting the expertise of senior counsel who specialises in international trade – would this be against the law of Parliament?

Ms Swartz said that a Committee Report to the National Assembly should present the view of the Committee.

Mr Lorimer asked if the Committee should get the opinion.

The Chairperson said that they would obtain the legal opinion but legal processes would be underway. The Committee would compile its report on the basis of the discussions. The Committee could deal with issues as they arose. The report may require another meeting in order to adopt it.

Adoption of Minutes
The minutes of 13 April 2016 and 4 May 2016 were adopted.

Meeting adjourned.


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