The Minister of Mineral Resources said the Farlam Commission dealt with one of the most painful chapters in the history of mining in post democratic South Africa. Stakeholders must recommit to improving the well-being of mineworkers and communities affected and impacted by mining so that the narrative can change. There is need for continual improvement through strengthening the legislative framework and associated regulatory tools including capacity to do and enforce. The provision of accommodation for mineworkers as a way of restoring their dignity was emphasised and it remains the responsibility of the mining companies. Government is also aware of the collective agreements that have been signed and he reiterated that they must be honoured and not unilaterally adhered to. Mining companies must not be associated with less than humane treatment of workers. The integration and better coordination of socioeconomic intervention through social and labour plans responding to the needs of communities and workers, remain central to growth and sustainability within the mining industry. With reference to the improvement of housing and living conditions, the Minister stated there was a need for clear and legally enforceable guidelines standards. The Special Presidential Package for the Revitalisation of Distressed Mining Communities as well as the Framework Agreement for a Sustainable Mining Industry are key interventions being implemented to take South Africa forward. Stakeholders need to ensure that jobs are protected and socioeconomic development takes place. He emphasised the role of traditional leaders and other stakeholders in this process.
The Director General noted that the Farlam Commission, in finding Lonmin had failed to implement its undertakings under its 2006 Social and Labour Plan (SLP), the Commission recommended that the Department of Mineral Resources take steps to force Lonmin to comply with the housing obligations under the SLP. He discussed what had been achieved so far. He concluded that the implementation of the housing backlog of the SLP commitment of Lonmin is progressing, albeit not at the desired pace. Notwithstanding severely limited monitoring capacity, the DMR will continue with a monitoring and enforcement programme, especially in the Bojanala District, due to the higher concentration of mines and disputes in the area, and regulatory notices will be issued for noncompliance identified during these audits.
Members asked questions about the oversight of the Department over Lonmin, timelines for implementing the housing commitment, the role of traditional leaders, why the housing programme was going so slowly and what the Department was doing to curb financial outflows from Lonmin. Members were of the view that the Marikana incident happened because of the slow pace in improving the lives of mineworkers and four years down the line, nothing had changed. It was time the Department put its foot down and ensure things are done properly at these mines.
The Chairperson noted that a lot of work had been done in the economy and growth of almost 3.3% for the second quarter of 2016. South Africa emerged from a technical recession which saw the mining sector record an improvement of about 11.8%, while the manufacturing sector recorded a growth of 8.1%, emphasising the importance of the mining industry to the economy of the nation. He welcomed the Minister.
Mineral and Petroleum Resources Development Amendment (MPRDA) Bill [B15B – 2013]
Mr I Pikinini (ANC) and other members of the Committee asked the Chairperson to put the adoption on hold since they had not gone through the proposed amendments and needed some time to read through them properly and make proper inputs on them.
The Chairperson replied that the Bill had been deliberated on properly but he would allow MPs some more time to look at the proposed amendments again. He stressed the need for Members not to give the impression that they are deliberately delaying the process.
Adv H Schmidt (DA) asked the Chairperson about the consequences of accepting this proposal to postpone deliberations on the Bill since the Committee would not be available till sometime in October.
The Chairperson replied that Members would be given a notice of a week or two to reconvene so that the Bill can be dealt with even if it meant bringing them in from wherever they might be. Mr Mokoena was formally welcomed as a member of the Committee.
Minister of Mineral Resources comments on Farlam Commission recommendations
Minister Mosebenzi Joseph Zwane thanked the Committee for the opportunity to address it on the recommendations of the Farlam Commission and the steps taken by the Department to deal with the findings of the Commission. The Farlam Commission dealt with one of the most painful chapters in the history of mining in post democratic South Africa. He stated that stakeholders must be recommitted to improving the well-being of mineworkers and communities affected and impacted by mining so that the narrative can change. There is need for continual improvement through strengthening the legislative framework and associated regulatory tools including capacity to do and enforce. The provision of accommodation for mineworkers as a way of restoring their dignity was emphasised and it remains the responsibility of the mining companies. Government is also aware of the collective agreements that have been signed and he reiterated that they must be honoured and not unilaterally adhered to. The eradication of the hostile system of the past marked an important milestone in the programme of normalisation of relations with employees within the mining industry. While progress is being made in dealing with compliance issues which must be addressed, there are important lessons that have been identified by the Farlam Commission.
He stated there is no mining without workers and these workers were important for the growth of the economy. Mining companies must not be associated with less than humane treatment of workers nor engage in practices that lead to value leakage. The integration and better coordination of socioeconomic interventions through social and labour plans responding to the needs of communities and workers remain central to growth and sustainability within the mining industry. With reference to the improvement of housing and living conditions, the Minister stated there was a need for clear and legally enforceable guidelines in terms of standards. Companies had to publish these plans and financial provisions have to be provided and ring fenced. A mechanism must be designed to make the social and labour plans publicly available to the affected communities. Transformation remains central in the drive for the normalisation of South Africa and must continue. The Special Presidential Package for the Revitalisation of Distressed Mining Communities as well as the Framework Agreement for a Sustainable Mining Industry are key interventions being implemented to take South Africa forward. Stakeholders needed to ensure that jobs are protected and socioeconomic development takes place. He emphasised the role of traditional leaders and other stakeholders in this process. Marikana must not be allowed to repeat itself and must serve as a constant reminder of the need to double efforts in transforming the lives of the communities where mining is taking place. In conclusion, he remarked on the safety of mineworkers saying it remains a priority and will not be compromised. Mining executives must place a premium on workers returning home safe and if this cannot be achieved then mining cannot be morally justified. Mining must shed the image of a sector that kills people and mineworkers also have a responsibility to ensure safety where they work. According to the Minister, a happy worker is indeed a productive worker.
Farlam Commission findings: actions taken by Department of Mineral Resources (DMR)
DMR Acting Director General, Mr David Msiza, said that on 26 August 2012 the President appointed a Commission of Inquiry to investigate the tragic incidents at Lonmin during 11 to 16 August 2012. The President appointed retired Judge Farlam to head the Commission. On 25 June 2015, the President released the Commission Report that articulated both the findings and the recommendations to various affected parties.Only one recommendation was directed to the DMR. In finding Lonmin had failed to implement its undertakings under its Social and Labour Plan (SLP), the Farlam Commission recommended that the Department of Mineral Resources be asked to take steps to force Lonmin to comply with the housing obligations under the SLP.
In terms of its 2006 Social and Labour Plan (SLP), Lonmin had committed to phasing out all existing single sex hostel accommodation, converting most existing hostels into bachelor or family units and building an additional 5 500 houses for their migrant employees by September 2011. DMR approved the proposed SLP and Lonmin became legally obliged to comply with its terms, which could only be amended with the written consent of the Department, which was neither given nor sought. The Commission recommended that Lonmin’s failure to comply with the housing obligations should be drawn to the attention of the Department of Mineral Resources, which should take steps to enforce performance of these obligations by Lonmin. Following the recommendations made by the Farlam Commission, the DMR conducted an inspection focusing on housing in the social and labour plan commitments. The outcome of the inspection revealed that all hostel dwellings had been converted into bachelor and family units by the end of 2014 as per the Mining Charter targets. This constituted 776 family units and 1 908 single units. The company is in the process of build infill apartments in between the current existing hostels, to address rental needs of the 85% of employees who indicated no interest in home ownership. An Inter-Ministerial Committee (IMC) for the Revitalisation of Distressed Mining Communities was established during 2012 to address Part 3 of the Social Accord (SPP): Addressing socio-economic challenges in mining districts and their labour sending areas. The IMC is also focusing on ensuring decent living conditions for mineworkers including throughout the North West province. 50 hectares of serviced land was donated for the development of 2 658 (rental and ownership) accommodation units at Marikana Ext II (2013) in partnership with the Department of Human Settlements. This land became part of the Special Presidential Package. The construction of Phase 1 comprising 292 BNG (Breaking New Ground) houses and 252 CRU (Community Residential units) rental units were completed in March 2016. 70% of the CRU rental units will be allocated to employees in category 4 to 9. With respect to the Social and Labour Plan Amendment (SLP), DMR directed Lonmin to revise their SLP, including the housing aspect in line with the national integrated sustainable housing strategy. The provision of accommodation, including construction of houses, rests fully with the mining right holder and should not be transferred to the responsibility of government and or employees.
Mr Msiza concluded that the implementation of the housing backlog pertaining to the SLP commitment of Lonmin, as contained in the Farlam Commission Report, is progressing, albeit not at the desired pace. The SLP is being amended to align the housing component to the National Housing Strategy, with clear plan and cost of implementation. Notwithstanding severely limited monitoring capacity, the DMR will continue with a monitoring and enforcement programme especially in the Bojanala District, due to the higher concentration of mines and disputes in the area and regulatory notices will be issued for any noncompliance identified during these audits.
Mr F Mokoena (EFF) stated that it is key for government to play a proper oversight role to ensure that responsibilities by these mining houses are executed. He asked if there were timelines for these mining companies to finish the housing commitments because people continue to live in squalor. He also referred to the finding of the Commission about the R250 million in the financial outflows of Lonmin. He is aware there was a recommendation to investigate this financial outflow because this criminal act affects the mining industry the most. He asked the Department if it was doing anything to curb these outflows which are costing the country billions of rands.
Mr H Schmidt (DA) asked for the timelines attached to the Farlam findings. He asked the Department when both the hostel conversion and the house construction processes were to be completed. He complained about the absence of timelines on the recommendations of the Farlam Commission and he asked for specific dates. On the land donated for the development of 2 658 (rental and ownership) accommodation units at Marikana Ext II in partnership with the Department of Human Settlements, he asked who the donor was.
Mr J Lorimer (DA) asked why the housing programme was going so slowly. He asked for an explanation on the limited monitoring capacity. What percentage of Lonmin employees are not living in mine-provided accommodation?
Mr N Mandela (ANC) thanked the Department for the presentation and the input made by the Minister. He referred to the 85% of employees who indicated no interest in home ownership and wanted to know what the Department was doing to address this since most of the mining workers are migrant workers who would rather go back to their villages and place of origin to retire and would prefer to have houses there instead. He referred to the slides which showed “before” and “after” pictures of hostel conversions and stated the buildings in the photos do not correspond with each other and wanted an explanation for that. He also spoke about the Marikana Ext II units being constructed and asked if they had been completed and, if not, when they would be completed and how many units in total for single units and the other apartments.
The Minister excused himself and left for a cabinet meeting and stated the DG was capable of dealing with all the questions raised.
The Director General replied to the financial outflow question, stating that work had been done on this by the Department of Trade and Industry and Treasury. Investigations were done by Treasury and actions taken where necessary. On the question of when inspections were done on the progress of Lonmin, these were carried out in June 2015 and just recently he had a meeting with the CEO to discuss their plans on housing. With respect to the rental needs of the 85% of employees who indicated no interest in home ownership, the companies have to align to the National Housing Strategy specifically to ensure there is a balance in the houses being built and the integration of the workers within their respective communities. Workers will have an option of staying on the mines in hostels being built or wherever they wanted to live. On the question of land donation, he replied the land was donated by Lonmin. With the Special Presidential Package, the presidential intervention was being implemented. On the question of the photo, he stated that both buildings were a part of the same block.
Mr Joel Raphela, Deputy Director General: Mineral Regulation, responded to the question of the timeline for providing housing for mineworkers, based on the submitted revised social labour plan of Lonmin which is still under consideration. The company is expected to submit a comprehensive costing by November 2016 which will detail the clear implementation timelines and why the implementation has been slow. He stated the slow pace was as a result of the challenges being faced from the mines and the demands put forward by the employees who have indicated interest in owning homes. He also spoke about the unfortunate tragedy at the mine.
Mr Mosa Mabuza, Deputy Director General: Mineral Policy and Investment Promotion, also dealt with the financial outflow. He stated it was a criminal act and that in cooperation with National Treasury certain policy instruments have been employed to tackle it. On the issue of whether government should provide accommodation for the mineworkers, he stated there was no reason why the government and the mining industry could no work together to develop these communities and leave lasting legacies for the people.
Mr S Jafta (ANC) commented on traditional leaders mentioned by the Minister and asked for clarification on the role being played by traditional leaders.
Mr Schmidt asked DMR what it had done to ensure compliance by the mines on safety.
Mr Mokoena stated that lessons had not been learned from Marikana. He was of the view that the Marikana incident happened because of the slow pace in improving the lives of mineworkers and four years down the line, nothing had changed. He stated it was time the Department put its foot down and ensure things are done properly at these mines. He asked what was being done to revitalise the ghost mining towns and communities with the aim of reviving their economies.
The Director General noted the comments made by Mr Mokoena and agreed on the urgency of improving conditions. Engagement will continue to take place and there would be more urgency in the implementation of policies to improve the conditions of the mineworkers. With respect to the ghost mining towns, the socioeconomic conditions and decent living conditions of the workers are being looked into in collaboration with the necessary departments to deal with compensation for the workers. With the reviewed Mining Charter, the mining ghost towns were being looked into.
The Chairperson in his closing remarks stated that there was need for the Department to ensure that the recommendations of the Farlam Commission be implemented because from what he read in the presentation, it seemed as if there was a deliberate act by Lonmin not to comply with the recommendations and this was an indictment on the Department.
The Director General responded to this by apologising and stated that the Committee engaging with them was to ensure compliance and he agreed the Department was supposed to have been more firm with Lonmin.
The Chairperson replied that he was not asking the Department to be stricter but he wanted them to apply the law and do it properly especially with matters that reflected on workers’ safety and welfare.
The minutes of the previous meetings were adopted and the meeting adjourned.
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