NEMLA Bill: Department response to submissions; Environmental Affairs budget: Committee Report

Environment, Forestry and Fisheries

09 May 2018
Chairperson: Mr P Mapulane (ANC)
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Meeting Summary

The National Environmental Management Laws Amendment (NEMLA) Bill had been subject to public hearings which had seen input from various entities and organisations which had made suggestions to the Department of Environmental Affairs (DEA) for amendments to be made to the Bill. This input had been primarily from the aquaculture sector through AgriSA; the Association of Cementitious Material Producers; the Centre for Environmental Rights; the Commission for Gender Equality; the Western Cape government; the Chamber of Mines; the Banking Association of South Africa; stakeholder groups such as Afriforum; and other interested and affected parties. The DEA had considered the various suggestions and comments, and briefed the Portfolio Committee on why it had  chosen to accept some of the proposals, while rejecting others.

The presentation on the implementation of the One Environmental System outlined the rationale behind the system, and the background to its implementation. It had been revised in 2014 to specifically ensure that mining activities were assessed in terms of their environmental impacts, in line with the National Environmental Management Act (NEMA). According to the DEA, removing the system would cause significant disruption to environmental management in the country. It emphasised that the new regulations would affect only legal projects. Projects that were illegal under the previous dispensation, would remain illegal under the new Bill.

The NEMLA Bill and the Water Act had been passed first while the Mineral and Petroleum Resources Development Amendment MRPDA Bill was still pending. This had created a problem, as there was no trigger that, once a mining application had been submitted, the other two departments could accept applications.  

The Association of Cementitious Material Producers requested to be exempted from parts of the Act on retrospective contamination, to which the Department responded it was currently considering the exclusion regulations for approval, and they may be published for implementation in 2018.

The Banking Association of South Africa asked for the financial sector, particularly banking institutions, to be exempted from the amendments, but the Department said it would not grant sector-wide exceptions or immunity from prosecution, or from receiving remediation orders. The financial institutions had been of the view that it would create significant economic challenges to hold them liable for foreclosure and “work out” scenarios for contaminated land.

Meeting report

NEMLA Bill: Response by Department of Environmental Affairs (DEA)

Dr Dee Fischer, Chief Policy Advisor: Integrated Environmental Management, DEA, told the Committee of a request in Clause 1/Section 1, to use the terms used in the Mineral and Petroleum Resources Development Act (MPRDA) of 2002, and therefore remove the term “primary processing”. The Department’s response was that the term had been introduced into the National Environmental Management Act (NEMA) and the Environmental Impact Assessment (EIA) regulations in preference to using MPRD terms, as the definition of “mining” in the MPRD amendment of 2012 referred to a mining area, which included “any non-adjacent surface of land if it was connected to such area by means of any installed infrastructure”.   This implied that if the Department of Mineral Resources (DMR) were the competent authority for the mine, they would be the competent authority for the structure linked to it as well. She informed the Committee that amendments to the MPRD were currently before Parliament.

In the same section of the Act on financial provision, a request by the Chamber of Mines to amend the reference to the term “bank guarantee” to “financial guarantee” was supported by the Department because it was not just a bank that could give a financial guarantee, and the phrasing should accommodate other financial institutions.

The Department supported a proposal by the Chamber of Mines and the Western Cape Government to retain “latent,” and have its dictionary definition in the Bill. The change had been made due to the incorrect consideration, which was not the dictionary definition but rather the MPRD regulation’s definition.

The Chairperson asked whether the word “latent” was contained in the draft amendments that had been published for comments and at what point in time it had been omitted. It was the Chairperson’s view that it would be unfair to reintroduce the word if it were not in the published document about which comments had been made.

The delegation, after consulting amongst themselves, responded that leaving out the word “latent” was likely to have unintended consequences. The Department was of the view that the word had not been removed in the amendment document, but would need more time to consult and clarify more definitively. The word had not been defined in the amendments document, and the suggestion to remove it came up only in the comments on the Bill. “Latent” in NEMA had the dictionary meaning, while in the amendments document, it had a broader meaning and the Western Cape Government was in favour of retaining it in the Bill.

The Chairperson remarked that the delegation had confused the Members on the issue, and therefore there would have to be further engagement on the issue to ensure the procedural matters were taken care of and sorted out.

Mr S Makhubele (ANC) asked that the Members be notified of the progress with solutions from questions raised during previous sessions with the Committee. He asked that the presenters illustrate which of the prior agreed upon measures had been implemented, and which were still problematic or where no agreements had been reached.

Mr Mark Gordon, Deputy-Director General: Chemicals and Waste Management, DEA, responded that there had been engagements between the relevant parties and some of the matters had been resolved, while others were still pending.

The Department was in agreement with the suggestion to change Clause 4(e)/Section 24C (12), which currently referred only to Environmental Authorisations (EAs) required for mineral or petroleum activities, but should also refer to an EA under the new NEMA regulations.

The Chamber of Mines had suggested retaining the detail of the content of an Environmental Management Programme Report (EMPR) in the Act in Clause 6/Section 24N. However, the Department did not think that was necessary because the Act should provide enabling provisions, while the detail of the content of the document should be in the regulation.

The Department was in agreement with a proposal from the Chamber of Mines that the financial provision in Clause 8/Section 24P to address the final closure measures of residual post closure impacts, to delete “progressive rehabilitation” as the funding for it was accounted for in the operational budget.

The Chairperson requested Dr Fisher to explain the term “progressive rehabilitation” in Clause 8/Section 24P of the Act, and the effect and financial implications of it remaining in the Act.

Dr Fisher replied that it had no financial implications, but removing the term “progressive rehabilitation” would equate “progressive” to “annual”.

Mr R Purdon (DA) noted an error in the presentation, which seemed to suggest that the Department was in favour of the idea of removing “progressive rehabilitation”.

The delegation noted the mistake, and promised to rectify the document.

Mr Makhubele asked for the specific timeframes in the terms “progressive” and “annual”.

Dr Fisher responded that there were no set timeframes for “progressive” – rather, it was on an on-going, continuous basis. As for “annual”, the timeframe was one calendar year.

The Department was open to considering the comment by the Chamber of Mines with regard to Clause 8/Section 24P (2), that the failure to rehabilitate or manage any impacts should more explicitly be linked to the environmental management programme contemplated in S24N and the annual rehabilitation plan. The Department agreed that there was duplication because “annually comply” seemed unnecessary, as the obligation was to comply at all times and do annual assessing for updating purposes. Therefore, the Department would delete the reference to “annual compliance”.

The Chamber of Mines submitted that the insertion of the word “mitigation” was superfluous, as mitigation was conceptually included with rehabilitation and remediation. The Department, however, wanted the two separated even though “mitigate” included both concepts.

The Department was aware of the misalignment in requiring a holder of an Environmental Authorisation to submit a three-year audit report to the Minister responsible for mineral resources on the adequacy of the financial provision from an independent auditor in Clause 8/Section 24(P)3. The Department agreed that the regulation would need to be amended once the change from one to three years had been published.

The Department disagreed with the proposal by the Chamber of Mines for the deletion of the words “in perpetuity” in Clause 8/Section 24P (5), because there should be no timeframes with latent effects, as they may not have manifested yet.

Mr T Hadebe (DA) asked for the exact final wording of the clause that the Department wished to make changes to.

The delegation expressed the view that the current session was meant to outline to the Committee the various comments received from the various stakeholders, while the exact clause by clause analysis would be tackled in the next session.

The Chamber of Mines wanted to retain the interest on ceded monies, but the Department wanted the money to be ceded to the DMR instead, because the Income Tax Act currently did not allow for ceding in the context of trusts or rehabilitation companies.

The Center for Environmental Rights (CER) contended that the definition of financial provision limited the requirement of financial provision to holders under the MPRDA and applicants for EAs. The Department supported that proposal, because it needed to include holders of EAs under NEMA and holders of EMPRs and Environmental Management Programmes (EMPs) under the MPRDA. Moreover, the Department submitted that it had to specifically include the requirement that the register was made public to allow for effective participation of interested and affected parties.

The Department agreed that there was an error in Clause 8/Section 24P (1) limiting the obligation to comply with financial provision requirements to prospecting and exploration. The Department also proposed the insertion of a provision in Clause 8/Section 24 P, authorising the Minister responsible for water  -- the Department of Water and Sanitation (DWS) -- to access financial provision in the event that the holder of a right or permit failed to rehabilitate or to manage any impact on water resources, or was unable to undertake such rehabilitation or to manage the impact.

It was the view of the Department that Clause 8/Section 24P (3) did not need to be amended because the previous version of the Bill included applicants for an Environmental Authorisation which was preferable, as it was in line with the phrasing in subsection 24(P)(4).

The Department submitted that the Act must make provision for interested and affected parties to initiate inquiries into the accuracy of the assessments or reviews. They had to be consulted in the EIA process as to the determination of the financial provision and the review in the EMPRs when they were updated after every five years.

The Western Cape Government was of the view that the competent authority for activities related to national priorities should be reconsidered. The Department saw no need for an amendment, as it was already enabled to delegate to a Member of the Executive Committee (MEC).

Stakeholder groups such as Afriforum were unhappy about expecting a detailed audit to be submitted to the Minister responsible for mining resources every year by holders of an Environmental Authorisation for listed or specified activities directly or indirectly related to prospecting, exploration or primary processing of a mineral or petroleum resource. The Department agreed, and proposed amending the regularity period to three years instead of one.

The Department believed it was an oversight to remove the word “extraction” from Section 1, as that was the trigger that had brought mining into the NEMA, and because extraction was defined as mining. Depending on the decision of the discussions between the DMR and Treasury, there may be a need to amend the definition of financial provision to include parent company for the oil and gas industry.

The Chairperson queried whether the contention in Clause 8 had been discussed with Treasury, and wanted to get answers as to how the DMR assessed the funds.

Dr Fischer responded that the Department had not yet discussed the matter with Treasury. The money was placed in a trust so that if the DMR wanted access to the funds, the request would be made to the trust, which would then grant access to the DMR within a reasonable timeframe.

A provision should be added to Section 49A on offences, to ensure it was a criminal offence to use funds meant for rehabilitation, for any other purposes. This was to protect the state and provide clarity to the industry on the sole purpose of the financial provision.

The Chairperson gave the example of a case whereby a mine was changing hands from Glencore to Tegeta. The process to acquire that mine, according to the Public Protector’s report, was through a rehabilitation fund. The money was then used for other purposes other than the intended purpose of rehabilitating the mine. Therefore, the Chairperson wanted to know what checks and balances were in place to ensure the funds were never used for any purposes other than rehabilitation.

Dr Fischer responded that the checks and balances were not currently in place in the financial provision regulations, but the Department was working on effecting them as soon as possible. The trusts were set up with a purpose in mind for the funds, the purpose being the rehabilitation of the mines, and the trusts would not have the authority to deviate from that goal. The delegation added that for the example the Chairperson had given, there had been nothing wrong with the laws and regulations in place at the time, but they had not been implemented and enforced to their full extent.

Mr Hadebe proposed that the Department get advice from the State Law Advisor on how to tailor the financial regulations provisions to ensure the funds could be used only for the rehabilitation of mines.

The Chairperson asked whether the register in subsection 5A was publicly available.

Dr Fischer responded in the affirmative.

Mr Makhubele asked whether the Department had discussed at an administrative level with the DWS and DMR on aspects of the Bill that may affect them.

Dr Fischer replied that the discussions had occurred at an official level and the Department would commit to discussing more with various other Departments going forward. 

The Chairperson requested the Department to further engage stakeholders on the additional proposed amendments, to accommodate the financial provisions regulations, and then get back to the Committee to finalise its report, because it was not clear whether the Committee should include the additional amendments without public participation having taken place. This was because public participation was a requirement in the Constitution.

The Chairperson announced that the clause-by-clause analysis deliberations would be done the following week. However, the rest of the presentations should proceed in the current session. He informed the Members of the suggestion by the Committee Secretary to adjourn the meeting to Tuesday of the following week instead of Wednesday and Thursday, to accommodate a budget vote on Wednesday and an MP’s caucus on Thursday.

One Environmental System: Written Responses

AgriSA was not in support of the One Environmental System, which came into operation in December 2014.

According to the Department, removing the One Environmental System would cause significant disruption.

The One Environmental System was first conceived in the year 2008, and it equated an Environmental Management Plan (EMP) to an Environmental Authorisation, based on a ministerial agreement. Prior to 8 December 2014, environmental aspects of mining activities were regulated in terms of the Mineral and Petroleum Resources Development Act (MPRDA). However, some construction activities related to mining triggered listed activities under the environmental impact assessment (EIA) regulations, and this had led to an undesirable situation in which both laws had their own process and information requirements. 

The Chamber of Mines had argued that the definition of Environmental Authorisation in the proposed text, which was currently before the Committee, was different from the definition contained in the NEMA and the Air Quality Act.

The Chamber of Mines proposed collapsing Clauses 75, 76, 77 and 78 into one Clause in the transitional provisions. The Department had no problem with that proposal, and would have no problem implementing it.

The Department emphasised that the new regulations would affect only legal projects. Projects that were illegal under the previous dispensation, would remain illegal under the new Bill.

The Western Cape Government was of the view that Environmental Management Programmes (EMPRs) was not an Environmental Authorisation, and that the two were not equal. The Department agreed with that opinion.

Discussion

Mr Makhubela commented that there was not much to comment on that particular presentation because the particulars and details had been very well summarised in the presentation. To save time, he suggested that the third presentation proceed, which was agreed to by the Members.

Waste Act-related amendments: Comments and responses

The Department noted the comments by the Association of Cementitious Material Producers (ACMP) that the intention of providing clarity on interpretation and implementation had not been achieved.

The ACMP also requested to be exempted from parts of the Act on retrospective contamination, to which the Department was currently considering the exclusion regulations for approval, which may be published for implementation in 2018.

On the request by the Banking Association of South Africa (BASA) asking for financial sectors, particularly banking institutions, to be exempted from the amendments, the Department would not grant sector-wide exceptions or immunity from prosecution or from receiving remediation orders. The financial institutions were of the view that it would create significant economic challenges to hold them liable for foreclosure and “work out” scenarios for contaminated land.

AgriSA raised an issue with the definitions of domestic, commercial and building waste, and was opposed to the granting of any decision-making powers in terms of the National Environmental Management Waste Act (NEM:WA), to the Minister of Mineral Resources. The Department, however, was of the view that the Bill provided clarity that the Minister of Mineral Resources was responsible for activities related to prospecting, exploration, and primary processing of mineral resources and that the Minister of Environmental Affairs would be the appeal authority. There was, therefore, no need to make those changes to the Bill.

BASA wanted the Bill not to dilute the deeds registry produced by the Department of Rural Development and Land Reform, which was currently converting the registry into an e-cadastre system.  The Department’s response was that the register was currently available at the South African Waste Information Centre, and would be linked to the deeds registry.

The Centre for Environmental Rights (CER) requested that the provision be amended to specify the timeframes and periods within which the site assessment report and remediation must be submitted, and they recommend a timeframe of not more than 90 days.  The Department, however, was of the view that studies usually took longer than the proposed 90 days and often ran up to 24 months, so the proposal could not be accepted.

The CER proposed that the threshold be whether or not the levels of contamination that existed posed a risk to the environment and human health. It requested that a provision be made for the sampling of groundwater as a means to indicate contamination in the surrounding soil. The Department’s response was that the mining of contaminated sites was contained in the DMR’s database of derelict and ownerless mine sites, as it was their mandate to rehabilitate them.

The Chamber of Mines wanted a provision made in Section 34U (6) of the Act, for delegations to be published in the Government Gazette. The Department, however, was of the opinion that delegation was an administrative function that would not require Gazetting.  

The Commission for Gender Equality (CGE) recommended an amendment to Clause 52 by way of an insertion of “hazardous waste,” and a change to Clause 56 to specify that appointments had to be made so that the Board was at all times composed of a broad range of appropriate expertise in the field of waste management, and had an equitable gender representation. The Department did not see the need for inserting the words “hazardous waste,” since biological species formed part of the environment. The Department, however, supported the comment on the incorporation of gender requirements and agreed that equitable gender representation should be considered as part of the nomination process.

Mr Hadebe requested clarity and separation of gender equity and gender equality in the next session because of time constraints in the current session.

The meeting was adjourned.

 

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