Localisation progress report; Sugar industry transformation report; Committee Annual Report

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Trade, Industry and Competition

05 December 2018
Chairperson: Ms J Fubbs (ANC)
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Meeting Summary

The Portfolio Committee on Trade and Industry has paid particular attention to transformation in the sugar industry following complaints from sugar cane farmers about the state of the industry, which was aggravated at the time by the importation of sugar at extremely low prices. It was against that backdrop that the Committee called for an update on the progress made towards transformation in the industry. Three sugar associations, accompanied by the Department of Trade and Industry, appeared before the Committee to give a briefing. The South African Sugar Millers Association attended the meeting but, owing to an oversight, had not been given a slot on the programme.

The South African Cane Growers Association declared that it had made some progress towards transformation with about 25% of the sugar cane now produced by black growers. In 1986, the canegrowers’ constitution had been amended to give representation to all grower organisations, including full voting rights. Currently grower representation at the association’s congress was 45% black, of whom 13% were women.
The association stated that it supported black growers, offering dedicated services from institutional support to business planning, support and budgets. Financial contributions came from the 64% contributed to the costs of the Sugar Association activities, including the R172 million for immediate interventions. The Association’s members were committed to sharing knowledge, technology and skills, and increasing the amount of cane delivered by black growers to more than 51% within the next 10 years. The intention was to increase the total number of black growers to 30 000 within the next 10 years.

Members were concerned about how much of the revenue actually went to black farmers. What were the transformation pillars? Why were the areas of focus not the same as the imperatives set down by the Committee? Why was the representivity of women so low when the women had always dominated cane farming in black areas?  Was there an organogram because it would reveal the elements of fronting evident to Members? Did the black canegrowers know the difference between fronting and transformation? There were reports that small growers had dropped from 50 000 to 20 000. Was that so? Why had the five-year plan been extended to a ten-year plan? Members also wanted specific details. How many independent cane farmers did the Canegrowers Association represent? How many of those were emerging black farmers? What resources, funds and opportunities were flowing to black farmers?

The umbrella body of the sugar industry, the South African Sugar Association, told the Committee that in order to secure the industry going into the future, the Sugar Association had done some work on diversification and renewable energy and was looking forward to biofuel being part of the renewal energy dispensation. By 2028, the target was 60% sugar production and 40% biofuel production as that change would unlock the industry’s ability to transform.

The Association had employed a transformation consultant to assist in developing a meaningful transformation plan.

The Association reported on the measurement bases and current baseline for the cane farming sector and for the sugar milling sector, the targets to be achieved by the end of the five-year plan, and the Agro-BEE initiatives to be implemented over the five-year period in each sector. The Committee was shown a copy of the annual report back transformation scorecard which had been completed for the year 2018/19 and which set the baseline against which to judge future reports.

The South African Farmers Development Association, which represented black farmers, was not impressed with the attitude of those in the industry and complained of a lack of commitment to transformation. The Farmers Development Association was particularly aggrieved because the Canegrowers Association had sent a letter querying the validity of aspects of the government gazette that had established parameters for transformation in the sugar industry and requesting legal advice. The Farmers Development Association wanted the Committee to issue an instruction to the Department of Trade and Industry to draft a proper gazette on transformation, one not based on old regulations. The Farmers Development Association also reported that there was a sugar mill in South Africa that was 100% owned by German farmers and it wanted the spotlight to shine on the ownership of sugar mills.

Committee Members were concerned that the timeframe for the transformation plan seemed to have changed from five years to ten years and wanted clarity on that number. Why were motions only carried with 80% support? Was that in line with the constitutional position on democracy?

The Sugar Association was asked how it had arrived at the number of members on their council and how the voting power worked. How was the leadership dealing with the deep-seated resistance to change? How was the R200 million per annum going to be spent on transformation? Members asked the Canegrowers Association why a letter, written outside of the meeting, questioned the integrity of the Committee and the Department. A Member asked why the Farmers Development Association did not challenge the industry’s constitution in court.

The Committee determined that it would recommend to the Sixth Parliament that a Committee Bill on transformation in the sugar industry be drafted as a matter of urgency if the pace and quality of transformation did not show immediate signs of improvement. Further, she expressed concern that the Department of Trade and Industry had lifted its eye on transformation in the sugar industry and wanted its full attention on the matter.

The Committee considered and approved three reports: the Committee Annual report; High Level Panel Report and the First Term Committee Programme.
 

Meeting report

Opening remarks
The Chairperson announced that there had been a programme change due to unforeseen events. Professor Ben Turok had been rushed to hospital the previous night. She asked that everyone keep him in their prayers. Secondly, Bridgette Radebe from the South African Mining Development Association, who should have addressed the Committee that morning, had been involved an accident and was unable to travel. The Chairperson wished both well.

The adoption of the agenda was proposed and adopted by Mr S Mbuyane (ANC) and Mr A Williams (ANC) respectively.

The Chairperson welcomed the South African Canegrowers Association, the South African Sugar Association and the South African Farmers Development Association, as well as the Department of Trade and Industry under the Acting Deputy Director-General for the Industrial Development Division, Ms Thandi Phele.

Presentation by South African Canegrowers Association (SACGA)
Mr Higgins Mdluli, Congress Member, SACGA, thanked the Chairperson for the opportunity to address the Committee.

SACGA had made some progress towards transformation with about 25% of the sugar cane produced by black growers. In 1986, the SACGA constitution was amended to give representation to all grower organisations, including full voting rights. Currently grower representation at Congress was 45% black, and 13% being women.

SACGA supported black growers, offering dedicated services from institutional support to business planning support and budgets. Financial contributions came from the 64% contributed to the costs of the Sugar Association activities, including the R172 million for immediate interventions.  SACGA members were committed to increasing the amount of cane delivered by black growers to more than 51% within the next 10 years, and increasing the total number of black growers to 30 000 within the next 10 years.

Commercial farmers would be partnering with neighbouring communities to share knowledge, technology and skills. They would continue with skills training and business support, and subsidise fire and drought insurance facilities for small scale growers (SSGs), subsidise electricity and water costs, and utilise innovations like the biodigestor technology to reduce electricity.

Mr Mdluli invited the Committee to visit the SACGA’s office and to inspect their processes.

The Chairperson invited questions.

Discussion
Mr Williams noted that SACGA industry statistics showed that the growers’ share was 64% or R9 billion. What percentage of the R9 billion went to black growers and what percentage of the R3.7 billion in export earnings went to black growers?

Mr D Mahlobo (ANC) asked about the transformation imperatives. What were the transformation pillars that the Committee was looking for? The Committee’s areas of focus on the imperatives of transformation were not the same as the SACGA pillars of transformation. SACGA seemed to be more mechanical and would not bring about fundamental change. There were structural, economic and social pillars of transformation. The social pillar had to do with representivity and one could see that although SACGA had some representivity, it fell short. Black representivity was questionable and falling short of women’s participation. He had thought that most cane growers were women in the small growers industry. The women had kept the industry going. Having only one woman on the Board did not look okay. Maybe it was a public relations exercise but it was not the kind of transformation that he wanted to see. Structural transformation was critical as it had to inform the value chain and the most important pillar of transformation was the question of assets. The previous day the Land Expropriation Bill had been passed, a process had been started in 1912. In 1912, the ANC had sung a prayer and a song about the land. Land expropriation was going to go ahead and the canegrowers had to include that in the transformation imperatives. Apart from that, there were questions about whether the industry was growing, and what the premium was for growing the industry. However, he would stop his comments there as the presentation was too thin for him to engage with it.

Mr S Mbuyane (ANC) noted that an AGM had been held a few months previously. Was there an organogram because he could see elements of fronting in the organisation? Did the black canegrowers know the difference between fronting and transformation? There were reports that small growers had dropped from 50 000 to 20 000. Was that so? He expressed his astonishment at the ten-year transformation plan.

Ms E Ntlangwini (EFF) suggested that in future Mr Mahlobo should speak last as he covered everything. She agreed with her colleagues that the presentation was very flawed. It did not speak properly to a transformation agenda.

The Chairperson informed the Committee that the microphones in Parliament were not recording as a result of the electricity load shedding.

Ms Ntlangwini said that to have black people in a structure did not mean that they had power in the structure. What was Higgins’ position in SACGA? Why had the CEO not presented? It spoke to fronting. Fronting was used for white benefits. She was not personally insulting Mr Higgins but she did not want fronting in Parliament. It was not personal but a black face was not a transformation agenda.

Ms Ntlangwini noted that they spoke about a constitution amended in 1986 and that did not count as democracy was only achieved in 1994. The Committee was seeking to improve the lives of black people. If the SACGA wanted to work on that constitution, the Committee would need to examine the constitution.  She added that the pie charts meant nothing without figures. She wanted the numbers of people in the pie charts.

The Chairperson explained that Mr Mbululi was a Congress member.

Mr G Cachalia (DA) had heard that his colleagues say that they were having difficulties and that the presentation was flawed. He believed that the test as to whether it was flawed or not should be predicated on a number of questions and not statements. How many independent cane farmers did SACGA represent? How many of those were emerging black farmers? What resources, funds and opportunities were flowing to black farmers? That would tell the Committee what the association was doing and how it was doing and would assist Members. Just to say that the presentation was flawed was inadequate.

The Chairperson welcomed Mr J Esterhuizen (IFP) to the meeting. He explained that he had got lost trying to find the various staircases in the dark.

The Chairperson stated that the slide on demographics should have provided more information. She did not understand the roles of board members and congress members and sought clarification. Who was the CEO, CFO and other executive members?  Some Members of the Committee had understood that there was a transformation plan about what was going to happen and wanted to see that.

Mr Mdluli stated that the South African Sugar Industry presentation would give more clarity. He responded to Mr Mbuyane that what he saw was not fronting. Why was he, Mr Mdluli, presenting? He was first and foremost a sugar farmer and had 100 hectare of sugar cane. He had been a consulting engineer and he had resigned to become a permanent farmer. He represented a local association of 1 000 members. Cane Growers had not hired someone to present on their behalf and he resented being told he was fronting.

Ms Kiki Zanele, Congress Member, SACGA, responded to the comment about the presentation being flawed. It was not a flawed presentation. She was a black grower in the area when Albert Luthuli had farmed. Her family had been in sugar growing since the early 1900s. She had been a member of the Groutville Association for black farmers but now those farmers were now part of SACGA as there was support for growers there. The transformation had started long ago. She, as a black farmer, felt that she had experienced transformation and saw the value of SACGA. She recalled that there had been a sugar mill in Groutville and sugar farmers used to process sugar to sell and feed the people. She wanted the old model where the cane farmers had milled in the village. The hunger of the people would be satisfied. Other growers had had their land taken away but her family had kept its land. The black growers had insisted on being part of growers and had been there since Albert Luthuli’s time. She begged the parliamentarians to accept them as canegrowers and to support them. She apologised that she was new to Parliament but she was passionate about being a sugar farmer.

The Chairperson stated that she had made a special allowance for people new to Parliament but that was not how one would fire on. The time allotted for the canegrowers was over. All of the questions had to be responded to in a couple of minutes.

Mr Andrew Russell, board member, said that the South African Sugar Association (SASA) presentation would answer most questions raised. Essentially the SACGA’s presentation was in support of the SASA presentation. He stated that the R9 billion revenue - that accrued to growers - included R3 billion in exports and the income for black farmers was R2.75 billion. The Chairperson of the board had been unable to attend following the change in date for the presentation but the Deputy Chairpersons, Ms Nthuli and Mr Talmage, were in attendance.

The Chairperson asked for the organogram in writing. She asked Mr Mahlobo which of his questions had not been responded to.

Mr Mahlobo said that, on behalf of the Committee, he assured the canegrowers that Members were not being personal and they had no intention of casting aspersions on people. They wanted to find the truth. It was okay to say that the SASA presentation would help but the ANC knew what a transformation agenda was about. It was about economic transformation. The next presentation was also flawed. He had already read it. The consultant to SASA had been appointed because the sugar industry did not understand transformation. The matter of the pillars was outstanding. He warned that the Committee was unflinching and unrelenting about wanting proper transformation for the people of South Africa.

Mr Mbuyane wanted to see the organogram. The Portfolio Committee had invited the board to present, not the Congress so they could not come and say how many hectares they had. If the board members were invited, the board had to come and present. The Committee did not want fronting.

Ms Ntlangwini shared the sentiments of her colleagues. When the process had started, those were the same people who did not want transformation to happen. They had come with an army of lawyers. The Members knew that they had not transformed. There had been resistance from the get-go but the Committee was going to make them transform, whether they liked it or not. They were not going back to any system that benefitted one cane farmer but not other poor people. The Committee wanted a new system. Poor farmers had come in their numbers and complained to the Committee.

The Chairperson said that board members had been invited and now the Committee found that some people were not board members. She asked people to indicate if they were board members or not: Dr Elizabeth Hurley – staff, CEO; Andrew Russel – board; Rex Talmage – board; Higgins Mdluli – Congress.

Mr Cachalia said that everyone was aware that the industry had to be transformed and the canegrowers were part of the process and so he had asked a number of questions. What was the gross total of independent cane growers? What portion of that number was from the Canegrowers Association and what proportion of that number was black farmers? That information would give meat to the presentation.  The function of the Committee was to evaluate the progress made towards transformation. He was listening with an open mind.

Ms P Mantashe (ANC) apologised for being late. She had been lost finding her way around the building and making her way up four levels in the dark. She had heard comrades ask questions on the presentation but the same canegrowers had written to SASA questioning the transformation agenda. The presentation did not talk about the letter that they had written questioning the Committee’s agenda.

The Chairperson said that certain cross-cutting issues would be addressed after hearing SASA.

Mr Esterhuizen said that when the engagement had first begun, he had begun emailing the cane growers. He was known as the White Zulu and he spoke to the cane farmers. There was a real problem in that cheaper imports had brought down production by 20% and that had affected mostly the smaller growers, but that had not been mentioned in the presentation.

The Chairperson explained that those issues would be dealt with by SASA.  She asked the canegrowers to respond in writing.

Mr Rex Talmage said that he was the Deputy Chairperson of the Canegrowers Association and asked if he could wrap up.

The Chairperson stated that, as the most senior person, he should have started the presentation.

Mr Talmage said that the association was very comfortable with the diversity in the association and it did not want to restrict anyone who wanted to present and who had the capacity to present very, very well. He had seen that there was a perception that the association did not want to transform and show transparency. He wanted, again, to invite the Committee to visit and to see the association first hand. There was nothing to hide and a visit would clarify any misperceptions. SACGA had been part of the industry transformation plan and had played a constructive and meaningful part in that process. As Higgins Mdluli had said, the association understood that transformation had to happen and would happen in a meaningful and sustainable way.

The Chairperson said that SASA was the umbrella that managed the sugar industry and Mr Hackmann needed to provide clarity on the issues.

SASA presentation on the Sugar Industry Five-year Transformation Plan
Mr Hans Hackmann, Chairperson, SASA, said that he was speaking on behalf of the entire sugar industry. The consultant, Mr Vuyo Jack, would be taking the Committee through the transformation plan that had been developed.

Mr Hackmann stated that a priority of SAGA was to remedy the inequalities experienced by black cane farmers, to introduce interventions that would accelerate transformation in the cane farming and sugar milling
sectors using the Agri-BEE sector codes, and to unlock industry growth through diversification into other products. He informed the Committee that SAGA had approved a transformation plan at a special meeting of the SASA Council on 29 November 2018. He stated that the industry had done some work since 2008 on diversification and renewable energy and SAGA had dusted off the previous work and was looking forward to biofuel being part of renewal energy dispensation. By 2028, the target was 60% sugar production and 40% biofuel production. That would unlock the ability to transform.

Mr Vuyo Jack, transformation consultant to SAGA, presented the measurement bases and current baseline for the cane farming sector and for the sugar milling sector. He also presented the targets to be attained by the end of the five-year plan and the Agro-BEE initiatives to be implemented over the five-year period in each sector. He showed the Committee a copy of the annual report back transformation scorecard which had been completed for the year 2018/19 and which set the baseline against which to judge future reports.

The overall BEE level of sector before discounting would be level 5 but discounted down on procurement to Level 6, which meant that procurement from black farmers was vital. SAGA was targeting BEE Level 3 over five years. The interim target was level 4. The plan was starting with 21 000 farmers in 2018/19.

The Chairperson introduced the SASA team.

Mr Mahlobo suggested that SAFDA present before the Committee engaged in discussion.

Mr Williams, briefly acting as Chairperson, invited SAFDA to make its presentation.

SAFDA
Siyabonga Madlala, Executive Chairperson, SAFDA, introduced the Deputy Chairperson of SAFDA, Ms Siphiwe Sithole, Mr Thandokwakhe Sibiya, Stakeholder Affairs and Mr Andile Buthelezi, SAFDA Head of Funding Enterprise Development. He also included Ms Lee Hlubi in his delegation as she represented SAFDA as Deputy Chairperson on SASA.

Dr Madlala stated that there was a serious attitude problem in a sector of SASA. Transformation was a total commitment and SASA and SA Millers were playing a positive role but the canegrowers reneged on agreements. He was upset that SACGA was dragging SAFDA to court about the government gazette that gave recognition to SAFDA. The Growers Association wanted a legal opinion as to whether SAFDA was entitled to get a subsidy. SAFDA wanted the Committee to issue an instruction to the Department of Trade and Industry to draft a proper gazette. The current gazette was based on old regulations. Transformation had to be gazetted. He also reported that there was a sugar mill in South Africa that was 100% owned by German farmers. That was where trade happened and he wanted the spotlight to shine on the ownership of sugar mills.

The Chairperson thanked Dr Madlala.

Discussion
Mr Williams said to SASA that the government did not want to shut down the sugar industry in SA or make it difficult for the industry to do work. The Committee did not want government to make it impossible for the industry to employ people but the government was going to move very swiftly in respect of transformation. The complaints of the last speaker were very worrying.  He was concerned about the change in the timeframe for the transformation plan from five years to ten years. He wanted clarity on that number. He was concerned about the different reports and the vetoing of agreements. If matter did not improve, the Committee would be forced to develop a Transformation of the Sugar Industry Bill and force transformation via legislation.

Mr Mbuyane needed clarity in respect of the voting process in SASA. Why were motions only carried with 80% support? 80% of what? In a democracy, a majority was 50+1. He asked what SASMA referred to. He noted that decisions taken by SASA had been taken on the advice of SASMA and SACGA. Why was SASA working on the advice of other organisations? Could it not manage the process on its own? How was the R200 million per annum going to be spent on transformation?

Ms Ntlangwini asked how the 80% majority worked? She asked SASA to explain the composition of the members of the SASA Council. How had they arrived at that number of members and how did voting power work? On the issue of the letter that SAFDA had raised: It proved what she had said: the presentation by SACGA was flawed. The association could not bring a presentation on transformation and go back and seek legal opinions on technicalities. If the association would not talk to SAFDA but sent lawyers, it proved that the association did not want to transform.

Ms Ntlangwini stated that DTI was not doing what it had promised. The Department had not delivered according to what the Committee had wanted. If it was deliberate that someone in DTI was not carrying out the instructions of the Committee, that person had to be fired. The Committee needed to speak to the Minister. SACGA could not change goalposts from five years to 10 years.

Ms Mantashe said that the Committee should ensure that the transformation agenda was embedded in a gazette. On one level people sat in the Committee but on the other hand there were legal letters.
There was an undemocratic distribution of power in SACGA. One could not negotiate from a position of a lack of power. She recommended that the Committee spoke to the DG of DTI about introducing legislation.
She asked about the letter that SAFDA had complained about. Why had a letter been written outside of the meeting questioning the integrity of the Committee and the DTI?

Mr Mahlobo thanked the teams for the presentations but they had to be honest about what they were presenting. The three presentations showed elements of those who were resisting change. The pillars of transformation were there. But they were not sufficient. The scorecard did not refer to the asset base and that had to be there. The structure was problematic. There had to be structural change. The transformation pillar on social impact had to be there, plus a pillar on the environment that had to look at the challenges of drought and flooding and so on. The plan should also look at technology which would revolutionise the industry within the next five years. The transformation advisor and DTI had to assist in concluding the transformation framework. The Department had to be involved.

Mr Mahlobo added that the fact that people wanted to undermine change because of a deep-seated resistance to change. They had to free the mind. How was the leadership dealing with that? In the House the previous day, he had noted, for the first time, the deep-seated resistance to change and non-transformation. It had been exposed in the land expropriation debate.

The transformation plan was window shopping. There was no equality. There had to be equality in the structure. The voting rule of 80% made him sick.

Mr Radebe reminded everyone that that day was the fifth anniversary of Nelson Mandela’s passing on. He had wanted reconciliation and he had given the country a transformative constitution that gave everyone equality. The voting rule of 80% was against the Constitution that said a majority was 50 + 1. He advised Dr Madlala to challenge the SAGA constitution in court because it would be thrown out as unconstitutional and undemocratic. However, he would prefer that transformation be resolved in the boardroom. Those guys who had been empowered in the past had to share with those who had not been empowered

The Chairperson asked the presenters to respond. She was surprised that the South African Sugar Millers Association was in attendance as she had not been aware of its attendance. She promised that the association would make a presentation the next time.

Mr Hackmann replied to the questions about the transformation timeframe. In SASA’s mind it was a five-year plan with a minimum of R200 million per annum to fund the transformation. He had absolutely no doubt that it was a five-year plan. He explained that there was a difference of opinion between SASA and SACGA as to whether 51% of the cane could come from black growers within five years. No agreement had been reached on that point at SASA.

Mr Hackmann explained that SASA operated on the basis that 50% of the industry was sugar milling and 50% of the industry was cane farming. Previously cane growers appointed 50% of SASA councillors and sugar millers appointed 50%. But now the cane farming sector had been split into two. Farmers and millers were equal partners, dependent on each other. The gazette had said that two organisations, SACGA and SAFDA, represented the growers sector equally.

The 80% majority had been gazetted to take care of the transitional arrangements for the following two years and to enable each party in the industry to be involved in the transformation. Previously, a majority had been 50% plus one, with a minimum of one councillor from each of the growers and millers sectors being part of the majority vote. The interim arrangement came to an end in 2020 and then the constitution would be looked at again.

Dr Madlala said that the 80% for voting in SASA was a problem because one sector could veto decisions. He noted that Albert Luthuli had called for a farmers’ organisation for black farmers. SAFDA could not be subsumed into an organisation that was embedded in an apartheid imbalance between rich and poor. He always said that he who pays the piper calls the tune. That was the ethos in the industry. He proposed that the SASA constitution be changed to 50% plus 1, but he also wanted the one man, one vote because then black farmers would be in the majority. He would not accept SASA’s attitude of one ton of sugar, one vote.

Mr Radebe proposed that the Committee start a Committee Bill. The Committee could not have millers having 50% of the vote in SASA when it had changed. The legacy report had to include that as an urgent matter for the new Committee.

Ms Ntlangwini supported the idea of a Committee Bill. The Committee had started the process and it had to be seen through to the end.

The Chairperson noted that a Committee Bill on transformation in the sugar industry had been proposed by Mr Radebe and seconded by Ms Ntlangwini.

Mr Talmage explained that the letter referred to was an internal matter and had been sent to SASA and, as such, should not have been raised with the Committee prematurely. The industry had scheduled a meeting for the following day to deal with that matter. It requested clarity on the legal validity of the legislation and should not be misconstrued as a resistance to transformation. That was categorically not true. The directors of the company had a fiduciary duty, especially in the light of the various commissions of enquiry, to be sure that they had acted with the members’ interests at heart. Should there be a class action; the directors would have to prove that they had acted in the interests of their fiduciary duty. The Government Gazette of 9 October 2018 had published transitional provisions in respect of (a) the Constitution of the South African Sugar Association and (b) the Sugar Industry Agreement.  The gazette stated that all three associations had to submit budgets and there would be cross subsidisation. If that cross-subsidisation was applied to the budgets and the current budget was extrapolated and suddenly a budget of R300 million was put forward, there were fiduciary consequences to that for the directors of SACGA. The directors had sought clarity in that respect.

The Chairperson said that SAFDA had raised the letter but the Committee did not have time to dig into that matter.

The Chairperson addressed the Department of Trade and Industry. She was concerned that DTI had lifted its eye from the matter of the sugar industry and she wanted its full attention on the matter. The DG needed to be involved in the matter. What was happening regarding the milestones? The Commission wanted the Department to resolve the issue of the milestones. Transformation was not following what the Chairperson had thought was an agreement. She wanted that addressed.

The Chairperson referred to the matter of the letter written by SACGA. If SAFDA had wanted advice on the letter, a copy should have been sent to the Committee. Mr Talmage had indicated that there was a pending meeting and the directors were seeking clarity. The Committee would not want to prevent that. However, the Committee was concerned about the confusion about a ten-year milestone versus a five-year milestone.

The Chairperson reminded everyone that Nelson Mandela had said that something might seem impossible until it was achieved. No one would have expected South Africa to have a bloodless change of government. SA had a Constitution, a non-racial country and had one person one vote. She asked that everyone apply their minds more seriously, otherwise there was a proposal to do what had been done with the National Credit Amendment Committee Bill. The Committee would propose that the Trade and Industry Committee in the Sixth Parliament draft a Committee Bill, although she would prefer that change came in an organic manner. Progress had been made but greater progress was needed. She asked all players to resolve that issue. She thanked everyone in the sugar industry and assured them that the intention was not to insult anyone, but the Committee was shocked at the slow progress.

The Chairperson gave each association 30 seconds to conclude.

Mr Talmage stated that SACGA would continue to feed into the process constructively and wanted sustainable and meaningful transformation attained in a sustained way as they would not want to see the entire industry, which was already under economic pressure, undermined by the pace. He said that Dr Madlala had accused SACGA of reneging on agreements but SACGA was looking at the pace at which transformation had to take place, not at undermining transformation.

Dr Madlala thanked the Portfolio Committee for helping to shine the spotlight on the industry. He drew from the Committee’s wisdom. He asked for continued oversight of the poorest of the poor who could not sit around the table and negotiate for themselves.

Mr Hackmann committed SASA to transformation as quickly and effectively as possible. He thanked the Committee for its support and guidance. He wished Members a pleasant festive season.

Minutes
The minutes of 14 November 2018 were adopted by Mr Mahlobo and seconded by Mr Williams.
The minutes of 20 November 2018 were adopted by Mr Williams and seconded by Mr Mbuyane.
The minutes of 27 November 2018 were adopted by Mr Radebe and seconded by Mr Mahlobo with the amendment that Mr Mbuyane was not present but had sent an apology as he had been in the Energy Committee.

Formal Consideration of the Committee Annual Report
The Chairperson invited input or amendments, although there was no need to belabour the matter.
Localisation had been included. Key challenges during the year had been poorly drafted legislation, Members serving on more than one Committee, and the continuous changes to the parliamentary programme. The Committee made a proposal to expedite the transformation of the sugar industry, including the drafting of a Committee Bill. Members should serve on only one Committee, given the substantive mandate of DTI.

Mr Mahlobo proposed the adoption of the Annual Report, with amendments. Mr Williams seconded the proposal.

Report of the High Level Panel
Mr Williams referred to paragraph 5.1 of the Committee response which dealt with reducing red tape in businesses and the administrative burden of labour relations. He said that nothing should be done to upset the rights of workers and that should not even be implied. 5.3 also spoke to a compliance burden. Those two implied that the labour laws were burdensome. Labour laws had to be protected.

The Chairperson stated that the item referred to red tape, which had been significantly reduced. Some issues applied to small business, and not to trade and industry. There was a point about BEE legislation and that start-up businesses should be exempted from various obligations and fees. She believed that enterprises had to be exempted as such companies were exempted from paying Company and Intellectual Property Commission costs.

Mr Mahlobo suggested that 5.1 read: “…continue to monitor the DTI … conducive environment and ease of business… regulatory environment.”

The Chairperson agreed with the proposed wording because a lot of the points applied to small business and his suggestion conveyed what the Committee did.

Mr Williams referred to 5.3 and the compliance burden. The Committee should not imply that the DTI should reduce rights of workers.

Mr Radebe suggested that the word “burden” be removed from 5.3.

Mr Mahlobo suggested that the sentence starting, “Furthermore” be deleted so that the point ended after “…economic growth”.

In paragraph 5.4, Mr Mahlobo suggested that the name of the NCAB be written out in full as National Credit Amendment Bill. 5.5 should be deleted as it had been subsumed by 5.4

Mr Williams suggested that the future review would check whether reckless lending had been reduced. For that reason 5.5 should remain in the report.

Mr Mahlobo suggested that 5.6 be placed after 5.3 to improve the flow.

Mr Mahlobo proposed the adoption of the report. Mr Williams seconded the proposal.

Committee programme for the first term 2019
The Committee Secretary presented the first term programme for 2019. It was necessary to adopt the programme so that the staff could book venues.

Mr Williams proposed the adoption of the draft programme. Mr Radebe seconded the proposal.

Closing remarks
The Chairperson said that the entire Committee resolved to thank the staff for their efficient and effective support. It was a formal resolution and the Committee wished them well during the festive season and a safe return in the new year.

The Chairperson thanked all of the honourable Members. She had differed with some but the Committee had made robust legislation. She was sure that it was the hardest working Committee. She wished all well.

Mr Radebe said ANC had to have last word. The ANC supported the vote of thanks to the staff and he thanked the Parliamentary Monitoring Group (PMG) that was always there and for the very supportive website. He thanked the Chairperson for being the best the Chairperson

The Chairperson agreed with Mr Radebe’s comments about PMG and also thanked DTI for their cooperation.

The meeting was adjourned.

 

 

 

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