Evaluation of work of Committee: Committee Researcher briefing

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Mineral Resources and Energy

01 March 2017
Chairperson: Mr S Luzipho (ANC)
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Meeting Summary

The Chairperson referred to the unfortunate incident at Jerusalem in East Rand where a five-year-old child fell into a disused mine and at the time of the meeting had not been rescued. The Committee must act decisively in order to prevent any more similar incidents from occurring. He was informed that the mine shaft was sealed but went down because of incessant rainfall.

He also said that the Committee may be left in an awkward situation because of the pending Annual Performance Plan and budget and may not have sufficient time to cover all its responsibilities.

Dr Martin Nicol, Researcher; Portfolio Committee on Mineral Resources, identified the key issues that needed to be handled urgently by the Committee, and also advised the Committee on its level of performance.

Dr Nicol compared the successes of the 4th Parliament with the present 5th Parliament from the resources drawn up from the Parliamentary Monitoring Groupwebsite and noted that while the 4th Parliament had 142 meetings between 2009-2014, the 5th Parliament had 70 meetings between 2014-2016. Although the 5th Parliament had less legislation, and no public hearing so far, unlike the 4th Parliament, it was more active on oversight of provinces. Most of the time of the 5th Parliament had been devoted to budget cycle activities, whereas the Committee only oversees 0.2% of the national budget. This was at the expense of oversight over mining legislations and other issues critical to the mining sector.

Although the Department of Mineral Resources performed exceptionally well on the financial and performance measures set in the budget, it could not be determined if this performance was as a result of the portfolio Committee’s oversight. While the Department performed well on all budget indicators, the mining sector itself remained in a state of crisis with few mining jobs, increasing litigations and disagreement on the mining charter.

Although the Committee had covered all areas in the 2014 operational plan, there were still problems with follow-up and with the effectiveness of the Committee in holding the Department accountable.

He recommended that the Committee should develop an oversight model for the Department, in addition to the budget cycle oversight, and also involve public participation from stakeholders by holding public hearings on promoting junior miners and dealing with mine closure, liquidation and rehabilitation.

The Committee noted the issues raised, especially its shortcomings when compared to the 4th Parliament. It was also agreed that they would follow up on the Department on pending issues, which the Committee had already requested the Department’s clarifications.

On the oversight follow-up, it was noted by the Committee that it would be difficult to follow up considering the various activities which Members are involved in, but would look at the mining regulations to determine if the follow-up falls within the purview of the responsibilities of the Department.

It was also noted that while the Committee provides oversight reports after the visits and its recommendations sent to National Assembly, these issues were never adopted and therefore lacked the weight of Parliament.

Minutes of the meeting of 22 February, 2017 were adopted with all necessary amendments.

Meeting report

Presentation on issues for follow-up and future focus
Dr Martin Nicol, Committee Researcher, informed the Committee that the presentation on issues for the Committee follow-up and future focus was based on two written reports: the analysis of the content of the portfolio Committee meetings in the 5th Parliament (2014-2016) and the outstanding Parliamentary issues for the Department of Mineral Resources (DMR). The overview of the presentation borders on outstanding issues from the previous meetings of the Committee, which include unanswered questions posed to DMR, research on the Portfolio Committee on Mineral Resources (PMCR) activities 2014-2016 and recommendations.

The three-year operational plan was developed in 2014 at a breakaway workshop in Somerset West and covered the period 2014/15 to 2016/17. The Committee’s objectives in 2014 were mainly to increase oversight over DMR to ensure industry transformation; increase oversight over the DMR with relation to illegal mining activities and mine liquidation; to increase government support for Research and Development in the Mining and Petroleum sector, including support to the DMR and its entities and also ensure that the DMR accounts for progress made in meeting the challenges identified in its administrative processes.

From the content of the 70 Committee meetings which took place from 2014 to December 2016, the percentage of the focus on the programmed activities were 46%, legislation Mineral and Petroleum Resources Development Amendment Bill (MPRDA bill) 9%, oversight follow-up 4%, and particular issue focus was 41%. When compared with the 4th Parliament, there was less legislation, and no public hearing but more active oversight of provinces. 

From the research findings, the Committee devoted more time to budget cycle activities whereas the portfolio Committee oversees only 0.2% of the national budget. This is at the expense of focus on oversight over mining legislation and other issues critical to the mining sector.

The Department performs exceptionally well on financial and performance measures set in the budget but there is no way to determine if this performance is influenced by the Committee’s oversight. While the DMR performs well on all budget indicators, the mining sector itself remains in a state of crisis. With fewer mining jobs, numerous litigations (as a result of double issue of licences, challenges to Milne Health and Safety Act (MHSA) section 54 notices etc.), mining Phakisa project not reported on and disagreement on the mining charter. 

The Committee has covered all areas in the 2014 Operational plan but there were still challenges with follow-up and effectiveness of the Committee in holding the Department to account. He advised that the operational plans need to be revised and the Committee also needs to identify particular priority issues and follow through with each issue in a planned programme.

On possible framework for the Committee, he suggested a framework that will combat the theft of mineral resource wealth (illegal mining and transfer mispricing), deals with the environmental impact of mining, deal with the social impacts of mining and move towards zero harm-occupational health and safety in the mining sector and secure a future for the mining and petroleum industries.

Dr Nicol highlighted the lifecycle of mines, which include exploration and prospecting, assessment, development, production and mining and closure of mines.

In conclusion, he recommended that the Committee should develop an oversight model for the Department in addition to the budget cycle oversight. This can be based on the lifecycle of a mine. It can also involve public participation of stakeholders by holding public hearings and use these to develop indicators for the DMR performance based on critical points in the life cycle of a mine. The Committee could start with the public hearings by promoting junior miners and exploration and dealing with mine closure, liquidation and rehabilitation.

The Chairperson thanked the Parliamentary Research Unit on the presentation and asked the Committee Members for any clarification they might seek from the presentation.

Mr N Mandela (ANC) commended the presentation and sought clarity on the methodology used in comparing the progress achieved by the 4th and the 5th Parliament on the issues raised in the presentation. He also asked if the comparison was based on the 1st or 2nd year of the parliamentary sitting or the whole tenure of Parliament, considering that the current Parliament is still sitting. Since the work of the Committee is informed by the budget and there were areas that the Committee needed to give adequate focus, what would be the recommendation on how the Committee will achieve this?

On the issue with litigations, especially as a result of issuance of double licences, he asked if the licences were issued by DMR and the number of cases involvedin double licenses. On Western Cape oversight, he asked if the environmental system is being implemented and if all other provinces have different environmental systems in place.

Mr I Pikinini (ANC) requested clarification on who would be responsible for the follow-up since Committee Members are engaged in various activities and other committees. He agreed on the importance of follow-up and noted that someone must be responsible for it. On the issue of illegal mining, the country has lost so much revenue from it, and asked the Researcher for proposals/recommendation on tackling the issue. He also said that the issue of the CSIR had been raised previously and agreed that there should be more focus on research. However, considering the notable success of Geoscience in Namibia and Botswana, would CSIR be able to offer the same services and information as Geoscience or was Geoscience only used because of lack of funds?

Mr M Matlala (ANC) asked if the oversight follow-up should be done by the DMR or the Committee. In his opinion, the Committee may not be able to handle second oversight for all the provinces already visited and the DMR should handle the follow-up.

Mr H Schmidt (DA) noted that there was a disconnection between the Committee and the DMR on the oversight. He suggested that the Committee should communicate the issues raised to the DMR and request feedback from them on progress. He also suggested that a review of the Mineral Resources regulations might be a guide on the responsibilities of the DMR. He highlighted the importance of tackling the issue on illegal mining, not just because of the loss of governmental revenue but also because of other social ills that emanate from it. It was noted that the communities now support the illegal miners against the police.

In responding to the issues raised by Members, Dr Nicol, said that the methodology used in his comparison of the 4th and 5th Parliament was based on a rough chart of the issues handled in the meeting and the agenda of both parliaments. He was able to gather this information from the Parliamentary Monitoring Group (PMG) website which provided an excellent window of the work of the Committee since 1998.

On the budget cycle,although it defined the work of the Committee, using it to determine the scope of work of a particular department may be misleading. In the case of DMR, the budget cycle offered an almost perfect picture of the Department while a look at the mining sector gave another picture of imperfection.

On the issue of litigation involving granting of double licences, he did not have the number of cases involved but there are so many cases. He gave an instance of the Akila case where the DMR issued two licences on the same mineral on the same piece of land to Chinese and Australian companies.

On oversight of the environmental system, the confusion expressed by Mr Mandela was general across all the provinces. Although there is a common environmental system, it is being implemented in different ways across the 9 DMR provincial offices giving rise to 9 different environmental systems.

On follow up and keeping track of issues raised at the Committee meetings, the secretary of the meeting takes records of the meeting and includes the issues that require follow-up. The DMR also appoints a Parliamentary Liaison Officer to record the meeting. He suggested that the Committee Secretary should remind the DMR of the resolutions reached at the meeting for follow-up on a weekly basis.

On the implementation of oversights, the Committee provides oversight reports after the visits which are normally sent to National Assembly, but noted that these minutes are not adopted by National Assembly but merely accepted for “noting” and therefore lack the weight of Parliament and not recognisable as the view of Parliament. He suggested that the Committee should ensure that these reports are adopted by Parliament. On the issue of follow-up on oversight visits, the Committee has in some instance followed up on the oversight as seen in the case of Ikwezi Quarry in Nthatha, where the Committee brokered several meetings between the management of the quarry and the community in order to proffer a solution to the issues raised during an oversight visit. This may not be the model but the Committee played a very useful role in that instance.

On the issue of role and capacity of the CSIR, the CSIR is involved in another part of the value chain in the lifecycle of mining. Whilst Geoscience is involved in exploration and prospecting, the CSIR handles research and development for mining.

On mining charter, the DMR had not responded to the Committee’s request for the list of companies that have not complied with the mining charter.

Mr N. Kweyama, Committee Content Advisor, added that the researchers would follow up on enquiries from the Committee to the DMR but they would not be able to do much as DMR is not forthcoming.

The Chairperson said the issue of tackling illegal mining would not be effectively handled by the DMR but would require contribution from many teams in order to ensure that it is curtailed. A better mechanism must be developed in handling illegal mining.

A system must be developed to determine the role of the Committee and any area of corroboration between the Committee and other departments.

On the issue of National Assembly adopting the recommendations proffered by the Committee, the Chairpersonstated that the Committee would endeavour to legitimise the recommendations through Parliament.

The Chairperson also said that the Research Team should develop a framework that can be used to measure the Committee’s commitment and also the key programmes that must be urgently handled by the Committee. On enforceability of the recommendations, the Committee Members must devise a way of ensuring that this is done irrespective of their political affiliations.

Mr J Lorimer (DA), agreed with the need for enforceability of the recommendations. The report on illegal mining has not been addressed should be addressed immediately. He suggested that the junior miners should also be invited for presentation as this would be useful for the Committee. There must be a monthly follow-up to the DMR on the questions posed to them.

The Chairpersonsaid that Committee’s oversight must be reviewed to include key programmes such as public hearings and presentations by the junior miners etc. He also emphasised that the Committee must follow up on the questions that were earlier sent to the DMR.

Adoption of minutes
Minutes of the meeting of 22 February, 2017 were adopted with all necessary amendments.

The meeting was adjourned.

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