Department of Mineral Resources on its 2 Quarter 2016/17 performance, with Minister

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Mineral Resources and Energy

02 November 2016
Chairperson: Mr S Luzipho (ANC)
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Meeting Summary

Though encouraged by its 88% achievement of its targets between July and September 2016, most important for DMR was to ensure there was positive impact in the work that it did.

DMR strived through its communication strategy to engage its stakeholders through workshops and career awareness programmes at Gauteng universities. DMR had managed to develop guidelines on prevention of fires in mines which was in line with tragedy at Lily mine where four mine workers had died. DMR had service level agreements (SLAs) with mining companies for the training of learner inspectors. DMR had absorbed 38 learners and was continuing with support of seven learners in their pursuing of qualifications

DMR had had a variance of R9.1 million in its overall expenditure which involved compensation of employees and the vacancy rate which DMR was working on decreasing by the end of the 2016/17 FY.

In discussion, the Committee asked:
- when the Director General position would be filled.
- whether the community engagement DMR had with the Xolobeni Community had been mining or taxi industry related.
- what the timeframes were for establishment of the Kuruman and Burgersfort one stop service centres.
- what DMR was doing to hold accountable former mine owners for the rehabilitation of derelict mines.
- what in the 12% non-achieved targets were concerning that the Committee should be aware of.
- where did one draw the line in the refusal to do dangerous work guideline; especially in terms of consciousness about what would constitute dangerous work conditions.
- what was the age group range, gender and race of the newly absorbed inspectors.
- when would the process of screening the 276 shortlisted candidates be finalised.


Meeting report

The Chairperson greeted everyone, including the Minister and said that the Committee had to acknowledge the work that had been done, especially the breakthrough that had been made at Committee level. Almost 10 months have passed since the disaster at Lily Mine.

Minister of Mineral Resources Overview
Minister Mosebenzi Zwane, said that when DMR tabled the budget vote for 2016/17, DMR had indicated that its main priorities would be enhancing regulatory and policy certainty, health and safety as well as meaningful transformation. Today, DMR would outline the progress made in the first two quarters. DMR had made progress in addressing the Auditor-General South Africa (AGSA) recommendations from the 2015/16 audit. DMR would continue to ensure that all the recommendations were implemented and would strengthen internal controls. DMR would continue creating an enabling environment for inclusive economic growth and decent work in line with the National Development Plan (NDP) and the Nine Point Plan. The Department was pleased that the Mineral and Petroleum Resources Development Act Amendment (MPRDA) Bill had been passed by the National Assembly and was looking forward to its successful processing by the National Council of Provinces. DMR believed that the speedy conclusion of the processing of the MPRDA Bill would contribute towards ease of doing business in SA and thus also promote economic growth and mineral and petroleum resources development. DMR appreciated the Committee’s commitment in dealing decisively with the processing of the MPRDA Bill.

Whilst addressing key concerns raised by the President, monitoring and enforcement of compliance by mining rights holders continued to be a key priority and where warranted actions were taken in terms of the legal provisions to ensure compliance. DMR had identified procurement in the mining industry as a key economic driver, which had the potential of creating sustainable jobs. The intention had been to promote the participation and competitiveness of black owned and managed businesses in the services and manufacturing sectors of the economy through the mining industry. Related to that was that one of the focus areas in DMR’s current cycle of deliverables was to substantially boost community development impact from mining through better implementation of Subsidence Management Plans (SMPs). The importance of healthy relations between mining companies as well as communities and local government was important as that contributed towards the social licence to operate. DMR was pleased that employers and employees had been able to amicably conclude a wage deal in the platinum sector as announced recently. DMR continued to engage various community structures where there was discontent about mining companies and some host communities in which this had become more pronounced.

To ease the administrative process, DMR would continue implementing a single window for processing mineral rights as well as associated and parliamentary authorisations and water licences. As a first step DMR had had a breakthrough around management of mining environmental management issues which would entail DMR handling all aspects in that regard so that the Department of Environmental Affairs (DEA) would act as an appeal authority. Furthermore, a quantum leap in commitment was needed to stem the tide of mining accidents and to make SA mines safer and healthier. DMR continued to engage with Chief Executive Officers (CEOs) in the sector to see how it could ensure sustainable improvements in health and safety in the remainder of the year. The last three months of the year were particularly challenging and DMR would continuing to ask for extra vigilance and in the following weeks DMR would be hosting the Mine Health and Safety Tripartite Summit to review the state of health and safety at mines and reflect on the progress made to date in the achievement of milestones from the previous summit.

DMR looked forward to the collaboration of the Committee and constructive engagement with the Committee in taking forward the mandate of the Department.

Department of Mineral Resources (DMR) 2016/17 Quarter 2 performance report: briefing
Mr David Msiza, Acting Director-General (ADG), said that though encouraged by its 88% achievement of its targets between July and September 2016, most important for DMR was to ensure there was positive impact in the work that it did.

Corporate Services
Ms Patricia Gamede, Deputy-Director General (DDG): Corporate Services, said the focus of her division was both internal and external. DMR strived through its communication strategy to engage its stakeholders through workshops and she listed the initiatives in the presentation. There had been career awareness programmes at Gauteng universities including Witwatersrand and Johannesburg on mining careers over and above the listed institutions.

Mineral Policy & Promotion
Mr Joel Raphela, DDG: Mineral Policy, noted in his overview that DMR had implemented rehabilitation of 17 derelict and ownerless mines.

Mine Health and Safety
Mr Xolile Mbonambi, Acting Chief Inspector of Mines, DMR, said that DMR had managed to develop guidelines on prevention of fires in mines which was in line with the tragedy at Lily Mine where four mine workers had died.

DMR had had service level agreements (SLAs) with mining companies for the training of learner inspectors. Those SLAs had been completed where DMR had absorbed 38 learners and was continuing with support of seven learners in their pursuit of BTech qualifications at University of Johannesburg.

Financial Administration
Ms Irene Singo, DMR CFO, said that DMR had had a variance of R9.1 million in its overall expenditure projections which involved compensation of employees and the vacancy rate which DMR was working on decreasing by the end of the 2016/17 FY.

On progress on implementation of the Auditor-General’s recommendations, she said DMR had already implemented most of the recommendations that the Auditor-General had made. DMR was working hard on the small things that could hinder it from getting a clean audit report.

Mr M Matlala (ANC) wanted to know when the Director General position would be filled.

Nkosi M Mandela (ANC) wanted clarity whether the community engagement which the DMR had had with the Xolobeni Community had been mining or taxi industry related. He also sought clarity on the ex-mineworkers imbizos held at oPhongolo and Kuruman on the reasons behind the decision to host the imbizos in those regions as he believed that they had contributed the least in terms of percentage mineworkers in the mining industry.

What were the timeframes for the establishment of the one stop service centre in Kuruman and Burgersfort?

What was the strategy in rolling-out career awareness campaigns in rural areas?

What was DMR doing to hold accountable former mine owners and mine bosses for the rehabilitation of derelict mines?

Why had DMR specifically chosen the term ‘black’ in describing the group of individuals assisted to become industrialists? Why had it not used ‘previously disadvantaged’ as the term used could be perceived as non-inclusive as ‘previously disadvantaged’?

What strategies were in place to curb the rise in fatalities in mines?

Mr J Lorimer (DA) asked what in the 12% non-achieved targets were concerning that the Committee had to be aware in DMR’s second quarter performance.

Mr Msiza said a key non-achievable goal for DMR was fatalities as the other non-achieved targets were administrative and could be improved upon.

The DMR though it understood that there was the dynamic that the taxi association in Xolobeni were involved the DMR had gone to the community as it had been worried about the social unrest there. The Minister had since issued a mining moratorium in the community to allow for consultations to occur.

Regarding the Imbizos, DMR, the Departments of Labour (DoL) and Health (DoH) together with unions and the mines were all working together, mainly in dealing with legacy issues in terms of payments of compensation and sustainability. DMR had established the one stop service centres in that regard in Mthatha, Carletonville and, in Kuruman and the Sekhukhune area the DMR had initiated a similar process.

There were ex-mineworkers in oPhongolo who had similar challenges in accessing their compensation which the DMR had prioritised. On the sustainability pillar of the DMR work in terms of the one stop service centres it had a Macadamia nuts project it was running to sustain the livelihoods of some of the ex-mineworkers.

Ms Gamede said that DMR was in the last lap in the filling of the Director General position before the sign-off which would given by Cabinet. The process was with Cabinet and the Department of Public Service and Administration (DPSA).

The DMR had two career awareness campaigns for learners in high school and varsity students. In Mthatha the campaign had been directed at varsity students. However the special projects unit identified communities to go and do awareness at and that was on a provincial rotational basis. The career awareness focus for 2016 had been on Gauteng, Mpumalanga and the Free State.

Mr Raphela replied that the DMR had no intention to racialise the mining industry with the use of the term ‘black’. DMR noted the concern and that the intention simply had been to drive the transformation objectives of the NDP by targeting a particular profile of entities that had to be assisted in deepening transformation. Certainly in the refinement of the DMR Annual Performance Plan (APP) going forward the consideration would be made of the potential adverse interpretation of terminology.

He said that authorised operations had the environmental management programmes and plans and the obligations flowing from those documents were quite clear; that until such time that closure certificates were issued for the process to be concluded. Continuous monitoring and enforcement were undertaken to ensure that rights holders and mine bosses would continue to be held accountable for rehabilitation of mines and that work was done as part of one environmental system in collaboration with the Departments of Environmental Affairs (DEA) as well Water and Sanitation (DWS). Even in the categorisation of mines as ownerless and derelict there was a process to ascertain that Government did not assume responsibility of liabilities when owners could be traced and held accountable.

Mr Mbonambi said though the DMR reaffirmed its commitment of zero harm at South African mines, it had noticed that as the numbers come down, further improvement became a challenge as attested to in the presentation. The numbers had become less that 100 in each mineral sector. DMR had also realised that with the improvement in commodity prices at the end of 2015 there had been an appetite from mining stakeholders to re-open old shafts and workings that had been historically non-profitable because of the contraction of commodity prices. The challenge there was that the workers were rushed into those without proper risk assessments. The causes of accidents experienced since had confirmed that realisation. The majority of fatalities indeed had come from the gold and platinum sectors which had been caused by falls of ground, winch related accidents, and rail bound equipment as well as trackless mobile machines. DMR had since issued instructions that all re-opened old workings had to have proper risk assessments with rock engineering reports presented to DMR before any old shaft could be accessed.

Secondly DMR had appointed the 38 students to be part of its establishment in increasing its visibility in terms of mine inspections and audits and since July 2016 the DMR had seen improvements in the number of fatalities reported by mines. The DMR also used the imbizos and tripartite summits to address the fatalities issues with stakeholders.

In the number of investigated cases of injuries, where there had been negligence, DMR had taken actions. Such as the withdrawal or suspension of legal appointments. DMR had also introduced the suspension of Government certificates of competencies which was a measure targeted at supervisors. Since workers could make a contribution to decrease fatalities, DMR had introduced a guideline early in 2016 where miners could refuse to do dangerous work. DMR had been raising awareness in all mines about that code of practice and had ensured that all miners were aware of that guideline.

The Chairperson said that there currently was a court judgement where the definition of ‘black’ included more than the three categories of black, coloured and Indian. It also included the Chinese which was a community of about 10 000 inhabitants in SA.

The Chairperson asked where did one draw the line regarding the refusal to do dangerous work guideline, especially in terms of consciousness about what would constitute dangerous work conditions. Sometimes it was not the concept that was problematic but the presence and absence of authority in determining the danger of working conditions. The Chairperson believed that particularly challenging was the fact that in the work situation, Human Resources (HR) almost always chose the employer’s side in a dispute.

Indeed some conflicts in mining communities presented as disputes about mining when indeed the conflicts were about chieftaincy. The point the Committee was trying to get across was for DMR to say what it had discovered when it engaged the Xolobeni community.

He commended the DMR for reducing its vacancy rate from 14 to five. The term ‘black’ in the deepening of transformation in line with the NDP was not problematic as long as it had an affirmative action component so that those with disabilities and women who may not fall under the ‘black’ category were included. Therefore there had to be from the beginning, a demonstration that going further there would not be an increase on one side of the industrialist divide with a stagnation on the other side.

He added that it was very risky to keep someone in an acting position if there was no intention, because generally at management level acting managers were rotated if a vacancy had occurred. Legitimate expectations developed over time if someone acted for too long in one position.

Mr Matlala asked whether DMR had considered disabled youth in the 38 newly appointed learner mine inspectors. What age group range were the newly absorbed inspectors; what race were they and what had been the gender split?

Mr I Pikinini (ANC) asked when the process of screening the 276 shortlisted candidates would be finalised. At the beginning of the processing of the review of the Mining Charter, the Committee had been told that only the mines would be consulted but he was seeing that communities would also be consulted. How reliable was that information considering that communities were no longer homogenous?

If indeed the DMR did robust inspections then the number of fatalities would not be so high in the different mineral sectors. He would have preferred instead of percentages that numbers could have been supplied as percentages had the potential to mislead.

Mr Mandela reiterated that the term ‘black’ still bothered him and asked if the identified industrialists were of African descent or was the term generic. It was particularly problematic if the reference was to black African South Africans as that spoke to racialised categories.

Mr Msiza reiterated that indeed as the DMR they accepted the comment and would certainly consider Nkosi Mandela’s sentiments.

The vacancy rate had been a great concern to the DMR as it limited DMR’s ability to achieve its APP and strategic plan. The Minister had prioritised the matter such that the 38 inspector learners had then been absorbed into the DMR. The biggest challenge of the Inspectorate had been the attraction and retention of inspectors. The 38 learner inspectors were graduates that had been placed at mining companies for 24 months and had contributed in the improvement of DMR vacancy rate. Forty percent of the learner inspectors were women because historically, inspectors had been men in general.

The DMR had identified the priority vacancies needing to be filled including enforcement officials on the environmental side.

Indeed when there were genuine community challenges, DMR had to strive to intervene not only reactively but proactively where the Senior Management Staff (SMS) had started oversight visits to mines to see whether there was implementation of Social Labour Plans (SLPs).

Mr Mbonambi said that the programme for learner inspectors had targeted previously disadvantaged South Africans with mining related qualifications, with a focus on younger graduates as the work of inspectors was physically intense. Due to the job requirements where inspectors had to go underground, DMR could only avail the programme to able bodied individuals. Certainly the disabled could be trained as technical advisors for demographic representativity.

He said that since the promulgation of the Mine Safety Act, there had been a provision in the Act that every miner had a right to refuse dangerous work. There remained challenges for miners to exercise that right as determination of ‘dangerous’ depended on the interpretation of those in a position of authority. That was the reason behind the DMR introducing the code of practice and consultations with all stakeholders had been undertaken in the evolution of the guideline. To date it was quite early to say whether the miners had sufficiently exercised that right and what outcomes that had borne. Certainly DMR would monitor that exercise and would report to the Committee on compliance to that code of practice.

Mr Raphela said that though matters arising from community engagements varied from one community to another they involved amongst others; skills development and basic services challenges. Other cases had to do with employment or unresolved disputes pertaining to traditional leadership as well as small enterprise support. Certainly DMR took the advice that when returning to Committee in future, it would be helpful for the Department to present case by case community engagements and what had been discovered.

In Xolobeni the DMR had discovered that the community was divided on whether to mine or not. Hence the 18 month proposed moratorium alluded to earlier where DMR was consulting with the community and the various stakeholders with a view to arriving at a balanced approach going forward so that at the end of that process the Minister could make a firmer determination on how to proceed. Indeed the undertones in engagements to date did include taxi industry matters.

On acting positions, Ms Gamede said there were measures in place such as the clause in the acting position appointment letter, where the incumbent signed a disclaimer that DMR would not be expected to fill the position with the acting incumbent when the position was permanently filled.

The process of screening was outside of DMR control and although the DMR had engaged the State Security Agency (SSA) to assist in expediting the screening process, SSA had had a backlog for some time. However, the screening period had improved and become shorter.

The Chairperson said he would wait for Mr Mbonambi’s report on the exercise of the right to refuse dangerous work but he assured him that on the Committee oversight visits the tripartite arrangement sometimes was adverse to the exercise of that right due to where the authority lay. His point was that the manner of the exercise of the guideline could have unintended consequences because reasonableness could be subjective. Someone could see risk where there was none and the opposite could happen where there was risk but the authority refused to be reasonable. The Chairperson’s hope was the arrangement of the guideline addressed the question of authority as it could be abused by both parties.

On the community engagements, the Chairperson wanted clarity that the DMR was not duplicating work that was already being undertaken by other departments. For example, he noticed that DMR had hosted an International Geological Congress. Was that a programme of DMR or one of its entities.?

He was not entirely clear on ex-mineworker activities because the Minister of Trade and Industry, Mr Rob Davies had reported to the National Assembly that the Department of Trade and Industry (DTI) had produced aboutfour4 black industrialists. If there was such a programme at DTI, was the DMR black industrialists programme completely different from that of DTI?

He said that in the Eastern Cape, the one stop service centre could not be only located in Port Elizabeth to service the entire province as ex-mineworkers lived in deep rural areas of that province. Even the satellite one stop service centre at Mthatha was not enough because the decision-making still had to be done in PE and that was the reason for ex-mineworkers in that region becoming victims of individuals claiming to be able to assist in tracing how much compensation an ex-mineworker was owed. The Chairperson’s request was that DMR consider increasing the number of one stop service centres and to devolve the decision making to the satellite offices as well.

Secondly though the ex-mineworkers programmes were lead by the Deputy Minister could DMR arrange a meeting with traditional leaders to be able to trace ex-mineworkers because they knew all the ex-mineworkers from their villages? The DMR could also approach the National House of Traditional Leaders (NHTL) with such a programme without necessarily having to approach individual traditional leaders.

Mr Msiza said that the DMR strived to align its black industrialist programme and all its other strategic programmes to Government’s national imperatives which included the NDP, the Nine Point Plan and the Industrial Policy Action Plan (IPAP) which was being led by the DTI. DMR was aligned to the Broad Based Black Economic Empowerment (BBBEE). As DMR was in the mining and petroleum space, it developed programmes in the minerals sector apart from those of the DTI and other departments. For instance, there was a drive by Government on infrastructure build and the departments involved therein had to develop programmes in line with national imperatives. DMR participated in the Economic Cluster where departments shared how they would implement programmes in line with government imperatives including the Medium Term Strategic Framework (MTSF). Therefore the DMR in its sector would look at procurement that had to do mining where the DTI would be dealing with procurement in the automotive industry, for example.

The Chairperson thanked the DMR. The meeting was then adjourned.


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